ALC Compliance Summit: Metcash reveals COR struggles

By: Rob McKay


Uncertainty and ignorance around extent of responsibility tackled in search for compliance

ALC Compliance Summit: Metcash reveals COR struggles
Distribution centres are at the centre of a web of business and COR exposure.

 

While elements of the trucking industry might continue to struggle with the chain of responsibility (COR), they may gain some solace in knowing retailers are battling too.

In a "warts and all" presentation to the Australian Logistics Council’s Supply Chain Safety & Compliance Summit that caught Woolworths and Coles safety executives between shock and admiration, Metcash chief logistics officer Linda Venables offered an insight into the difficulties faced by the whole supply chain.  

Casting herself as a "passionate supporter rather than a deeply experienced individual" in COR sphere, Venables confirmed that while the extent of COR’s reach is increasingly being understood by retailers, how to deal with it and how to engender understanding, cooperation and collaboration through the supply chain was a challenge. 

"All parties in the COR having responsibilities is something that I still don't think many companies get because they don't understand who all the parties are," she says.

"The fact that to be proactive when we take responsibility for prevention is something that paralyses companies because they're not entirely sure what steps they need to take." 

The complexities are apparent, particularly when up to 17 parties are involved in getting an item through the supply chain and when the originating vendor can be based overseas.

So is dealing with the authorities and Venables admitted the a spur to Metcash’s progress, along with an audit committee directive to tighten up on COR, was a New South Wales Roads and Maritime Services improvement notice.

She is grateful to senior RMS compliance staff Peter Wells and Paul Endycott, in attendance at the conference, for helping the company stay on the right track.

"One thing that struck me is the burden of proof," she says.  

"So although we are checking, [we are] also having someone checking the checkers so that we've got proof that we checked."

Once the course of COR improvement action had been agreed, the firm chose it’s most efficient facility, gauged its efficiencies and built benchmarks for other facilities.

Through the feedback "we picked up gaps and we picked up even better processes".

This was workshopped at a meeting of operations managers and IT representatives to form best practices.  

Noting that retailers such as Metcash are exposed on two legs – from producers to the distribution centres and from DCs to stores – much cooperation and collaboration was needed on all sides and the accuracy of data has to be of the highest order to ensure planning assumptions are valid.

This was part of an ongoing learning process, as while Venables had been aware of the company’s responsibilities regarding the likes of minimising truck dwell times, driver notification of delays, providing proper facilities for drivers and ensuring against overloading, other implied responsibilities were less obvious.

This included alerting other parts of the supply chain to safety shortfalls.

This effort had garnered a "fantastic response".

Also uncovered were risks involved with Metcash’s business with its independent retailer customers, who have access to its DCs but may not be across their own COR imperatives.

It was not all bad news.

One of several goals in Metcash’s effort was that it be revenue neutral but the outcome has actually been an increase in efficiency and a saving so far of $392,000.

 

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