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Wincanton is the largest British logistics firm, providing supply chain expertise to some of the world’s most admired brands, including high-street retailers.
Richard Gifford, Wincanton’s CIO, recognises both the scale of the current business, which employs 17,700 people across 200 sites, and the firm’s long history of successful fulfilment. Yet he also understands change is in the air, due to the potential for digital disruption.
“Our approach is still great today, but there’s going to much more focus around omni-channel and internet retailing in the future,” he says.
“We need to think about how we service that demand and how we create propositions for our customers. In 18 to 24 months, I think our digital propositions for our clients will be significantly enhanced to what they are today.”
In a wide-ranging interview, Gifford explains how he is drawing on his IT experience to help Wincanton develop a digital supply chain. This development includes both in-house programmes and external partnerships with innovative startups.
Using leadership experience
Prior to joining Wincanton, Gifford spent time in senior IT roles in the NHS and at construction giant Carillion, who he left in May 2017, long before the firm’s financial challenges became headline news in early 2018. “There were some excellent things going on there – and some financial aspects that were not my concern and were clearly not acceptable,” he says.
“My role at the firm was to help transform the business. We were using digital technology to change construction operations. We were taking plans all the way from design and costing through to building techniques using digital platforms. It provided excellent experience for the work I’m doing now.”
In his role at Wincanton, Gifford reports to the chief financial officer (CFO). He is using his 20-plus years’ experience of IT transformation to lead change across the business. Gifford says his focus is twofold: developing fresh opportunities and dealing with legacy concerns.
“There’s a huge opportunity to digitise the supply chain and develop new business models,” he says. “I’ve also got to address the legacy systems and ensure we can move from where we are today to a position whereby all our digital ambitions are met.”
Gifford looks back on his year at Wincanton and says a strong business strategy is emerging. “We now have a three-year and that’s about moving from legacy into a digital space,” he says.
Dealing with legacy systems
Like many other businesses, Gifford says Wincanton owns a large amount of older kit. “Legacy is really the enemy as far as digital transformation is concerned,” he says. “We have a lot of older technology, but we also have a to deal with those systems.”
The centres on two areas. , by transforming a range of foundational systems, so that these older applications can run on digital platforms. The key application here, says Gifford, is the firm’s transport management system (TMS). The modernisation strategy involves consolidation and the implementation of a cloud-based TMS across the business.
The initiative involves a multimillion-pound project that has been signed off by the board. Gifford says the next stage involves commissioning suppliers. “We’re taking four legacy TMS applications that do a good job for our customers today but which are not well positioned for the future,” he says. “We’re moving to the cloud because we have a cloud- strategy.”
The second focus of his strategy for legacy systems is centred on the firm’s existing IT infrastructure. That technology is largely Wintel-based. Once again, the aim is to make use of the cloud and plans for this transition are being formalised, says Gifford. “The aim is to make that shift at pace – and we’ll be doing that via the private cloud,” he says.
“It’s just not economic to use the public cloud on a 24/7 operation. We’ll be starting simply – we’ll use evergreen hardware, run by a third party. The scalability of that provision will be very important. As we win contracts, we need to be able to flex upwards. Equally, there is churn in the contract base as well, and we need to breathe in when that happens.”
Developing the digital supply chain
Gifford says there are several key themes that characterise digital transformation at Wincanton. There are immediate priorities around e-commerce and bringing in partners to help with developments in that . The firm manages deliveries for a range of retail customers. Gifford says his business must be able to respond to their demands effectively.
“It’s about creating an ‘internet of transport’,” he says, referring to his aims to digitise logistics arrangements for the firm’s retail clients. “That’s all about ensuring goods arrive at our customers’ premises in the condition they should do. We want to use sensors to automatically and proactively alert us to any potential deterioration during transportation.”
“We’ve got quite a neat strategy around transportation and a clear modernisation process. It’s not complete, but we’ve kicked it off, and I’m quite proud of the developments we’ve made so far”
Richard Gifford, Wincanton
The firm started working on telematics as part of its transport strategy recently. “That’s giving us feeds out from the vehicles in terms of driving performance,” he says. “We’re also going paperless in the cabs. We’ve got an app on a tablet which is in the cab, so all the driver information and the proof-of-delivery takes place through a single pane of glass.”
Gifford says these technical elements come together to create a holistic approach to transportation. The firm’s TMS will form the basis for the strategy, telematics will help hone operational performance, and the proof-of-delivery application will help ensure business efficiency and effectiveness.
“We’ve got quite a neat strategy around transportation and a clear modernisation process,” he says. “It’s not complete, but we’ve kicked it off, and I’m quite proud of the developments we’ve made so far.”
Partnering with startups
Wincanton’s digital strategy for its clients extends in other directions, too. The firm launched an innovation programme – W2 Labs – last March. The programme is aimed at challenging startups from around the world to develop innovative solutions to industry challenges defined by the Wincanton Group.
Run in partnership with corporate innovation specialist and early-stage investor L Marks, startups were invited to apply to work with Wincanton across five categories: improving asset utilisation; accessing and brokering excess space; connected cab and driver technology; data challenges; and wildcard, which is an open category for creative ideas.
The programme received 92 submissions from 12 countries, which was then reduced to 24 ahead of the pitch day in May, and finally to six, which were given the opportunity to present at a demo day: CinChapi, Routeique, Storekat, Street Stream, Synaptiv and ZigZag.
These selected startups developed their business proposition with Wincanton and received intensive business mentoring from the company’s senior executives during summer 2017. They were given the opportunity to prove their concepts in the context of the company’s day-to-day operations. The startups have also engaged in trials with some of Wincanton’s key customers, using real business data to refine and streamline their propositions.
“The organisation had gone out to find a few startups that could help us across a range of key business areas, such as data and returns,” says Gifford. “We’ve been onboarding those original startups and we’ll run another one of those events in the summer. We firmly believe in this sort of partnering and building up an ecosystem.”
Creating a network effect
Work around developments in e-commerce and e-fulfilment for the firm’s retail customers continues. To meet their demands, Wincanton has developed partnerships with key external providers. Gifford points to the W2 Partner Network, which consists of selected partners developing innovative technologies that will affect the evolution of the supply chain.
This network is an extension of the W2 Labs programme and allows partners to work with Wincanton in a wide range of capability areas. One of these partners is Sorted. This specialist organisation provides a carrier management system, known as SortedPRO, that enables retailers working with Wincanton to dispatch and trace goods. Retail firms can use the platform to manage deliveries across a range of carriers.
Gifford also refers to his firm’s link-up with ZigZag, one of the six startups that presented at the W2 Labs demo day last summer. ZigZag helps online retailers manage international returns and provides a link between warehouses and couriers. This creates an end-to-end approach for returns, which is often a problematic area for online retailers.
Finally, Gifford points to a partnership with Virtualstock. This software-as-service specialist provides a system that allows retailers to expand their online product ranges, without the need to carry additional stock. Gifford says this relationship, and the partnerships above, allow his business to broaden and improve its e-fulfilment strategy.
“Rather than fronting this process as Wincanton, we’re telling our retail customers that we have a partner and that system then becomes part of our ecosystem,” he says. “As this approach takes off, we’ll integrate the system back into Wincanton. But what we didn’t want to do is slow things up to start with.”
Benefiting from digitisation
Gifford says this combination of internal programmes and external partnerships means Wincanton is making significant headway in its attempts to create a digital supply chain.
“We recognised a big opportunity in terms of data and trying to advance the whole agenda in that space,” he says. “I think that’s exactly what we’ve been doing in a relatively short period of time. I think we’ve made quite significant progress.”
The pace of development is unlikely to slow. Gifford expects the digital programmes he talks about to be fully deployed during the next 18 to 24 months. “We’ll have all kinds of efficiencies through that approach. I think we will have an educated workforce when it comes to the advantages of digitisation,” he says.
“We will be running many more proof-of-concepts and exploiting the results. We’ll be exploiting many of the startup ideas and we’ll be plugging those in to the business. We’ll be working with many other partners in that system, too.”
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