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Mr. Keshav R. Murugesh - Group CEO, WNS
Hello, and Happy New year to everyone. 2020, what a year it has been! I’m sure that each one of us has great stories of resilience, hope and courage to share as we navigated the challenges due to COVID-19. Here’s an interesting observation about the year 2020. In the past, it was frequently used as the reference point for making predictions and defining long term visions. In fact, by the 1990s, it seemed that everyone had to have a vision for 2020 – corporates, governments, universities, everybody had one. The year became a metaphor for peering fearlessly into the future and the endless promises it held. Let’s fast forward a couple of decades to when 2020 actually happened.
As we all know by now, literally, everything was turned on its head. The COVID-19 crisis pushed the businesses of our clients to the deep end of the pool, leaving them with little or really no time to prepare. Amidst the global disruption, ensuing challenges and fight for survival, digital really emerged as the catalyst for accelerating their recovery and the rebound. In fact, client businesses that had invested in digital ahead of the curve, were able to blunt the impact to the crisis compared to anyone of their peer set.
I have with me today Chief Executive Officer of one of our key clients, a leader who has steered his company through the COVID-19 turbulence with remarkable fortitude - Jeremy Nixon of Ocean Network Express or ONE. Thank you Jeremy for taking the time to discuss the digital imperative for ONE’s vision for deeply embedding digital in its business.
So Jeremy, before COVID-19, digitization was seen as an important aspect of modernising the sector. Today, there is a palpable sense of urgency for the need to digitise and automate. I understand that ONE has embarked on an organisation wide digital transformation journey. What is ONE’s digital vision, and how have you changed the way you conduct business with your customers?
Mr. Jeremy Nixon - CEO, ONE
Thank you Keshav and it’s an honour and a pleasure to be, once again, talking to you, and to talk about what a dynamic year 2020-21 is. And to touch base, as you say, on digitalization and what we’re trying to do about that as ONE. But I think your first point is absolutely key, which is the pandemic, and for us 2020 an incredible roller coaster. I mean, container shipping is really kind of a leading edge economy business. I always think, we’re the servant of global trade and we really went through this incredible roller coaster with the supply shock firstly in China, which is like about 20% of our global business, shutting down. And then the demand shock coming through to the Americas and the rest of Asia and Europe. So we really rode out a very difficult last 9 months. But, what it kind of underlined for us, is two things. Our business… one thing our business is about, is moving physical things. So, we move a lot… we have a lot of steel, whether ships or containers, and we physically move things. But the other part of our business, which is really dominant and getting more and more, is the data. And ultimately, we have to be a data driven company which happens to have a logistics capability. And for us, the whole digital transformation… we started off the company 3 years ago, which you might recall, we were 3 legacy companies. We took those businesses, those assets, and completely reorganised them and rebranded them and turned them into one new big company. And fortunately when we did that 3 years ago, we saw it as a good opportunity to invest in IT and from the very beginning we went cloud based as much as possible and our staff had laptops. Thank goodness! Because when the pandemic hit, for us it was painful, but within 2-3 weeks I think we were pretty much okay, and that’s gone well. But now during the last 5-6 months, we’ve also been having another look at our enterprise architecture as a company, looking at digital transformation from a people’s standpoint, process standpoint and system standpoint. And ultimately for us, digital transformation, they key part of that is to deliver superior customer service. That’s ultimately what we need to do. That’s our ultimate differentiator. And so, we’ve embarked on this journey to improve our data driven enterprise capabilities, operational excellence in terms of our IT platform, and really critically looking at our sales and customer service operating model from an end to end ecommerce platform standpoint. So, we’ve been working on all three of those pillars over the last 6-9 months. And, we’re making good progress and we’ll be bringing quite a lot of these changes to market over the next 6-9 months. And, thank you so much for your very strong contribution as well, in supporting and helping us with a lot of that digitalisation journey.
Mr. Keshav R. Murugesh - Group CEO, WNS
Well, Jeremy, we are really excited to be a part of ONE’s digital transformation initiatives. In fact, WNS has been enabling clients’ digitalisation agendas by leveraging our digital ecosystem that is supported by strategic partnerships, future ready talent pool and unique digital accelerators. We’d like to hear your thoughts around digital ONE, which is one of your key route/root projects.
Mr. Jeremy Nixon - CEO, ONE
Indeed Keshav. We’ve had a long association with WNS, both during our legacy times and as ONE. And you know, WNS provides a lot of very key support to us in our shared service centers in providing us with the data processing management, strictly around the export production side of our business and also the container tracking side of our business. And we moved that journey initially you know some time back into the back office or shared office centers with that data and moved that away from a lot of our frontline activity and we worked together on that collaboration. And now particularly we want to speed up the processing of the data and improve further the accuracy of that data. So the area where we have been trying to do that is through robotics. Robotic process applications, RPA, and really we turned to WNS as a leading company to support us and assist us on that journey. We have been working together now over the last 18 months and the team has done a great job in terms of showing us the best practice of working alongside us and looking at the innovation that we could get out of RPA. And looking at some of the processes that we could flip onto RPA. So we are doing that together. We have about a 140 bots up and running at the moment. We hope to have about 200 by quarter one. And for us this is really good because it is actually the data is so critical to our business and yet you know we can’t add a lot of value add on the data in terms of the input into the system. And by being able to do this with WNS and with our bots, we can hand over a lot of that kind of very important but mundane type processes. And concentrate really more on the exception management side. And when you take our business, we’re moving about 12 million containers a year. We are covering 200 different ports in the world. And you know operationally generally we are running at about 85-90% schedule integrity as a company. But because of the COVID issues and the pandemic, the land side operations globally have really been challenged and ports have slowed down, terminals have slowed down, land side infrastructure’s slowed down. And we don’t just move the container port to port, we actually move it from inland point to inland point. So actually the whole schedule integrity or robustness of the container shipping industry we’ve noticed in the last 4-5 months, we have all as an industry down at about 20% schedule integrity at that moment because of so much disruption. I will give you a good example. We have 35 ships at anchor right now in LA Long Beach because the terminals there can’t keep up because of the COVID situation.
So the point I am coming back to is that actually the exception management side of our business grows significantly because when we take a booking we give a predictive ETA and estimated time of arrival on the other side of the world. But great maturity in the times now, those ETAs are not possible because of the operational land side operation. So it is all about managing exceptions and getting that data updated as fast as possible when a delay happens or something changes. So for us to have a superior customer driven experience, we really need very good quality data and faster updating of that data. And the RPA journey has been really positive and helpful in that regard.
Mr. Keshav R. Murugesh - Group CEO, WNS
Really fascinating journey. You know it is always humbling to hear first-hand experiences from our engagements form clients like you. And I just want to understand how do you envisage WNS’ role evolving as we fast forward into this digital era?
Mr. Jeremy Nixon - CEO, ONE
Well I think it is a journey Keshav, and we’re on that journey together. And we go back 5, 6, 7 years ago when we were looking at just moving processes from the frontline offices or frontline offices to the offshore offices, the shared service centers we ourselves. That was for us quite an interesting process and it was about moving something directly out of our control and across into a shared team approach and once we saw that one really well went smoothly and also had the ability to flex up and flex down in line with the volumes of the business. And our business is actually very seasonal. And our booking production or flexes up and down hour by hour or day by day and certain times of the year. So we went on that journey together and we looked at also making sure that we had the redundancy built in, the backups built in, to ensure that if we have any operational difficulties, any location, we can back each other up and help each other through that. And that is also very critical. As we have learnt you know with the issues in and around weather related problems in certain parts of the world, or whether its cyber security etc. So we worked on that partnership together.
And then we then said look can we process this data faster, and can we automate the data prison in the process of inputting? And that’s really where we then worked together on the RPA journey to input a lot of this data in many different ways. And that journey continues. And we’ve put this box into this particular process and now we say hey, why can’t we look at doing it here. So we are still I think widening the scope and the range of how RPA can be implemented. And I am sure that journey will continue together.
And then the third area now is more around AI and looking at big data, and how we can be more predictive in the future. And so if we can try to predict changes in booking demands and weather systems or whatever, that’s really very useful for us. We still spend an enormous amount of money moving empty containers around the world as well as full containers. And so if we can improve our AI and our machine learning, we can shave off tens of millions of dollars in terms of costs by being more efficient. And then is the sort of knowledge based processes which are more value add, which again maybe an area where you know we can work together and say look you know it is not all just about the data but it is actually about some of the value added processes that we are handling today also in our on-shore teams, and looking at whether some of those could also be moved into the shared service environment together. So there is a lot going on and you know the level of technology is accelerating and the digitalization is accelerating. And we are transitioning really from a kind of logistics company that happens to have some digital capability, more and more towards becoming a digital driven company which has a logistics ability. And it’s a big journey together.
Mr. Keshav R. Murugesh - Group CEO, WNS
Jeremy just one final question from me since I have you here. Is there any change that you had to make as a leader yourself during this pandemic personally? Could you share some details?
Mr. Jeremy Nixon - CEO, ONE
Well Keshav I think we’ve all had to adapt haven’t we? Very, very fast. And I think one of the challenges that you and I have is that we haven’t been able to jump on airplanes and go around and see our organizations as much as we had in the past. And I think it is really important to get in and see our staff and be able to do those town hall meetings, and basically walk the floor with that kind of Gemba type approach that we talk about a lot here with our Kaizen and stuff. And so one just has to communicate more through videos like this and actually what I have learned is that in some ways you can – your productivity goes up because when you and I are traveling, there is a lot of downtime in and around that travel experience. And not to mention some of the tiredness we get or whatever. But now we can actually communicate with more of our staff, quicker, faster. Maybe not better, because we still miss that direct human interaction which I think is so important. But I think it’s proven that we can actually still do so much even though we are not physically traveling. But I do like yourself look forward very much to going back and meeting again our top customers and our staff, face to face, because I think at the end of the day, humans, we need that contact. And we’ve relied very much on our existing relationships, existing way of working, to tie us through. But we need to reinvest again in those relationships and that behavior management face to face. And I look forward to that day, hopefully sometime in 2021 or if the worst comes, 2022. But we just have to be patient.
Mr. Keshav R. Murugesh - Group CEO, WNS
Lots of great advice there Jeremy. You have to help everyone prepare for the next bout of uncertainty whenever it happens. But you know thank you very much Jeremy. Really wonderful conversation and some amazing perspectives. You know COVID-19’s trail of unprecedented disruption has truly lit the fire of digital urgency. In the new world order, digital first has turned into digital only. It is no longer an alternative but a time bound imperative. It is heartening to witness the digital transformation journeys undertaken by clients, such as ONE, in partnership with us. Together we remain focused on co-creating business transformation led by digitization, automation, analytics and cognitive intelligence.