Lion’s Share

Asked the key element to the company’s success, Lion Nathan’s Logistics director George Bearzot is quick to point to the company’s focus on its people.

“A lot of companies say they’ve got good people but I believe our approach, from recruitment, to development and company culture surpasses anything I’ve seen before,” he tells Logistics Magazine.

“It’s our major point differentiation.”

“We identify and measure the level of engagement employees have with the company, with the intention of understanding what will make a person put in that little bit of extra effort rather than just coming to work,” Bearzot explains.

“If you have engaged, competent people you’re 90 per cent of the way there.”

In addition, Bearzot asserts that an organisation’s supply chain strategy must be exactly aligned with the business, or it will fail to deliver what’s required.

“We create what we call ‘the vision’, which keeps supply chain supportive of the business by enabling us to be very clear where the priorities are and where we should be focusing our energies,” he says.

“Everybody working in supply chain really knows where we want to take it.”

“While cost is an important objective, our primary focus at Lion Nathan is customer satisfaction and that’s a people issue as well,” Bearzot says.

“We measure ourselves and have external people survey our customers on a six monthly basis to determine how we’re performing.”

“We know from feedback that we’re performing well but that’s not to say we can’t improve.”

“We encourage our people to find opportunities to service to our customers better and add value to them,” Bearzot adds.

“Our supply chain team consistently measure our DIFOT and know how we’re tracking to date. Regardless of their role they’re expected to understand customer issues.”

George Bearzot sees Lion Nathan at the leading edge of strategic procurement strategy.

“We’ve had a very sophisticated supply model for a number of years now,” he says.

“All suppliers are important but we recognise some are more strategically important than others, by virtue of the very considerable spend we have with them, and their ability to enact innovation in the business.”

“We segment our suppliers accordingly and try to secure long term, close working relationships with key suppliers at multiple levels starting with their CEOs and working right through the organisaton.”

Bearzot says Lion Nathan’s ‘Best in Breed’ systems support demand planning but communication, coordination and a solid process are more important than fancy software.

“We work very hard to measure our inventory in days,” he explains.

“If you don’t get the forecasting right you can stock out very quickly. It’s about collecting sales information across the country, aggregating it and managing the various parts of your business accordingly.”

“Business intelligence must be fed into the demand plans in a timely way so that we have stock in our Dubbo DC in time for that local event, for example.”

Over his career, George Bearzot has witnessed many changes in the alcoholic beverage industry, particularly in advanced supply chain planning technology.

“In the last ten years, the ability to optimise decision making has improved a thousand times,” he enthuses. “People don’t appreciate that.”

“With a view across the entire supply chain, complex decisions can be made more easily and in some cases are doable where they weren’t before.”

“As the systems become more powerful, it’ll drive great benefit for the industry moving forward,” Bearzot says.

The ability to connect with consumers through technology is another big change.

“Consumers are more fragmented and diverse, and the internet offers an easier way to connect with them,” he says.

“On the other hand, consumers are far more aware and knowledgeable.”

“Discussion about how society should deal alcohol consumption has increased,” Bearzot says by way of example.

“While we’ve always had to respond to the issue, the availability of information and ease of communication on the internet has facilitated our ability to engage better with consumers on this subject.”

“We see it as good news and believe we’re adding value to society by promoting responsible drinking.”

“The way we connect with consumers can also be applied to suppliers,” Bearzot says.

“Integrating efficiently with suppliers, right down to advanced notification, transactions and sharing forecasts and inventory management is where our company is going next.”

Taking an innovative step in the marketplace, Lion Nathan last year formed an independent company, Bevchain, which is 50 per cent co-owned by Linfox.

Bevchain is contracted to provide all Lion Nathan’s deliveries and warehousing, but free to build synergies with the volumes of its competitors.

“What we wanted to do is change our 3PL model in a way that works better,” Bearzot says.

“We’ve got a large scale distribution network, servicing tens of thousands of customers across the country for next day delivery.”

“We see it as a huge opportunity for industry to recognise that we can compete on brand while sharing resources and integrating our volumes to reduce supply chain costs.”

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