DHL CEO Frank Appel: “More globalisation means more prosperity”

After a record year in 2016, Deutsche Post DHL Group is facing the future with confidence.
“2016 was an excellent year for us and we have a clear idea of what the future of logistics will look like,” said Frank Appel, CEO, DHL, at the Annual General Meeting in Bochum in late April. “We are investing in expanding our network and in technology. We are working in a focused and connected way – and we will continue to grow.”
Appel also confirmed the Group’s ambitious targets – operating profit is to rise from 3.5 billion ($5.1 billion) to around 3.75 billion ($5.5 billion) in 2017, and EBIT is to be increased by an annual average of more than 8 per cent between 2013 and 2020.
Speaking to shareholders, Frank Appel voiced his optimism that global trade would continue to grow despite mounting protectionist tendencies. “World trade drives prosperity, and prosperity promotes peace,” he said. “We therefore don’t need less globalisation, but more – and we need it now and sustainably.”
He stated that countries should invest more in education and infrastructure in the interests of long-term growth.
“Logistics is the backbone of global trade,” he said, adding that global teamwork was impossible without it. “Of all logistics service providers, we have the strongest global presence. We have the widest range of offerings and most extensive experience. We know how logistics works and, as the market leader, we have a clear idea of how our industry can continue to contribute to global prosperity,” he added.

DHL CEO Appel on Amazon, Uber as competition, underestimating complexity

Speaking in a TV interview with news channel CNBC at the World Economic Forum in Davos, Switzerland, Deutsche Post DHL Group (DHL) CEO Frank Appel affirmed his confidence in the world’s largest courier company’s continuing relevance at a time when commerce and transport companies such as Amazon and Uber are reportedly gearing up to take a share of the global logistics task.
“If you are a quality leader, the edge of what is possible, you always have a right of existence,” Appel stated. “If you get lazy and think, ‘no one can hurt us’, then you get a problem.
When asked for his thoughts on what disruptors such as Amazon are underestimating as they try to enter the market, Appel noted that little is often thought of the effort that goes into ensuring quality of service. “To get [a parcel] to the consumer and bring it back is tremendously difficult, it’s undervalued because logistics are not visible,” he said. “I think what we do every night with millions of parcels is completely underestimated.” He added that he does not believe Amazon, which he describes as an important customer and partner of DHL, underestimates the task, and that is why they go to DHL to receive quality service. “But many people think that it is easy, that anyone can do it,” he added.
Appel expressed doubts about the viability of an Uber-style parcel delivery service. “Think about that we have an Uber solution, we have 100,000 parcels and everyone delivers five,” he said. The number of cars that would end up waiting in front of their depots would result in chaos, “That will never work,” he added. He conceded that the delivery model may well work for select, often rural, destinations, but not for the masses.
Appel further noted that he believes that delivery by Uber, or any other method, needs a human element, at least for the time being. “If…you call an Uber,” he said. “If it doesn’t show up, you call another one. If the parcel got stuck, what should the parcel do? It doesn’t speak, it doesn’t communicate, so some human intervention is necessary. I think that complexity is underestimated by many people.
When asked about his feelings on the likelihood of drone delivery becoming a reality, Appel stated that he thinks the technology has the potential to be use in the medium term, though not in the short term. “You never know,” he said. “You should prepare for the uncertainty. That’s also interesting about the current situation we’re in – complexity and uncertainty is good for companies who are willing to deal with that. That creates business opportunities.
“We make life for our customers easier, things are getting more complex. That’s a moment of truth for us. I tell our people, don’t worry, see it as a huge opportunity we can then gain, we can then grow.”
Image: Kandschwar at the German language Wikipedia.

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