Powerpoint seminar 1_ The Hague by pengxiang

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									International Business Orientation

Seminar 1     24 September 2007      The Hague
South Africa 2007   2

         Welcome by Harry Koorstra
         Presentation Big Five
         Road Networks Ben Klaassen
         North Star Foundation Ludo Oelrich
         Next steps

South Africa 2007                              3

       Harry Koorstra
       Group Managing Director Mail

South Africa 2007                      4
                        Presentation Big Five

                    4                           3


South Africa 2007   1                           25
IBO Seminar 1

TNT‟s Intra Regional African Road Network

Botswana - Swaziland - Zambia - Malawi - Zimbabwe

Paolo, Monique, Niels-Peter, Maaike, Joost and Lotte
                  Research Set Up

               Sep 6           Sep 24               Oct 18                                   Dec 17

           Kickoff             Sem1                  Sem2             South Africa

                                                                                                  African Road Network??
                          Defining Research    Defining Research
                            Method Sem 1        Method Sem 2

                           Assignment 1:       Assignment 2: ?       Defining Research
                           Desk Research                                   Method

                          Preparing Sem 1      Preparing Sem 2

          Meet & Greet   Present the          Present the           Field Research –
          the Leo‟s      Research Progress    Research Progress –   Feedback Local Experts
                                              Feedback Experts

           South Africa 2007                                                                                           7
           Progress of the Research
        Sep 6            Sep 24     Oct 18                                  Dec 17

    Kickoff              Sem1        Sem2           South Africa

                                             1. Identified a COUNTRY OF FOCUS per Leo
                                             2. Identified TOPICS OF FOCUS: macro
                                               economic data, trade profiles, business
                                               climate, infrastructure, competitive

3. Used same REFERENCES
4. Filled in the WORKING DOCUMENT

     South Africa 2007                                                                   8
      Used References

         www.worldbank.org
         www.imf.org
         www.oecd.org
         www.intracen.org
         www.sadc.int
         www.cia.gov
         www.postnet.co.bw
         www.dhl.com
         www.fedex.com
         www.ups.com

South Africa 2007             9
      Interesting Observations – Quotes (1)
      Botswana - activities of competitors: ‘In Botswana, PostNet is the only
       brand that offers a true one-stop-shop-providing a full range of business
       and communication services including…, courier services, … Two
       stores are located in the capital city of Gabarone while another is
       situated in the tourist hub of Maun.’ (www.postnet.co.bw)

      Swaziland: ‘Swazilands economic performance remains weak. Poverty
       has escalated in the face of high and rising unemployment, food
       shortages, and the world’s highest HIV/AIDS infection rate.’

      Zambia: ‘Zambia’s international trade prospects look bright given
       increasing copper exports from (i) sustained demand for copper in the
       international markets, particularly China, and (ii) increased copper
       output from new and existing mines across the country. (www.cia.gov).
       At the same time copper is the economic engine for macro economic
       stability which brings with it lots of risks.

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      Interesting Observations – Quotes (2)

      Malawi: ‘Malawi is one of the poorest countries in the world. It was
       ranked 165th out of 177 countries according to the 2005 UN Human
       Development Index and had the second lowest GDP per capita in 2003’

      Zimbabwe: ‘Zimbabwe suffers the highest rate of inflation in the World!’

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Team Lion: Democratic Republic Congo & Nigeria

M Beumer, F Baars, M Jongens, R Laman Trip, M van Doorn
                        Democratic Republic of Congo
                              ‘Justice, Paix, Travail’

Macro Economic data DRC

   GDP $44.44 billion, rank 89
   GDP per capita $700, rank 225
   GDP real growth rate 6,4%
   The economic centers are: Kinshasa and Kananga (‘Copperbelt’)
   The international trade forecast for the DRC is uncertain

    South Africa 2007                                               13
Trade Profiles DRC

 Agriculture is the leading industry, which accounts for 55% of GDP
 The second industry is mining which accounts for 25% of GDP
 Export:
     1.108 billion dollars
     Export partners: Belgium, China, Chile, Finland, US
 Import:
     1.319 billion dollars
     Import partners: South Africa, Belgium, France, Kenya, Zambia, Ivory

   South Africa 2007                                                     14
Business Climate DRC

 The business climate is slowly beginning to improve
 The government offers a number of investment incentives to attract
  foreign capital
 Risks
    Political risks: revision of law, tax benefits and license
    War or political change
    Bureaucratic procedures

  South Africa 2007                                                    15
Infrastructure DRC

 Road: 145.000 km of neglected road, most roads outside urban areas are
 Train: Some railways still provide transportation into and out of the
 The Congo River continues to provide affordable transportation.
 The only deep water port is Matadi and there are 10 smaller ports.
 Air Traffic:
    The poor state of the infrastructure caused an increasing use of air
      traffic for both goods and people.
    There are 25 airports with paved runways and 209 with unpaved

  South Africa 2007                                                    16
Competitive landscape DRC

 SABOT International Transport does transport copper and cobalt to South
 In the Express Industry there is some activity
     DHL has around 10 depots
 Action Express is the subcontractor for UPS en FeDex


  South Africa 2007                                                    17
                        ‘Unity and Faith, Peace and Progress’

Macro Economic data Nigeria

 GDP $ 191,4 billion, rank 49
 GDP per capita $1.500,- rank 198
 GDP real growth rate: 3,5 %
 Economic centers: Lagos (economical), Abuja (capital), Benin, Calabar,
  Caduna (central), Kano (former Sahara trade center), Port Harcourt,
 The international trade forecast for Nigeria seems hopeful. Regarding
  the oil industry and the maritime freight sector, the country has a lot of
  potential. However, security- and infrastructure problems tighten growth

    South Africa 2007                                                      18
Trade Profiles Nigeria

 The leading industries are oil (75% of the government income),
  agriculture (45% of GDP) and coal. The telecom sector is upcoming.

 Trade dynamics: Privatization of dysfunctional governmental monopolies
  such as telecom, railroads and electricity companies. Global companies
  such as Seltel (Hoofddorp) bought the GSM rights for Nigeria. This
  indicates the future business potential of Nigeria.

  South Africa 2007                                                    19
Business Climate Nigeria

 The business climate is relatively good. Major foreign multinationals do
  business in Nigeria. Shell, Heineken, Unilever, Philips, Peugeot and
  others belong to this large group.
 The spoken language is English, which encourages foreign business
 The government has developed a National Economic Empowerment and
  Development Strategy (NEEDS) to improve the business climate.
 Privatization of dysfunctional governmental monopolies offer perspective.
 Possible risks: two different legal systems in north and south (shari’a and
  national legal system), corruption, bureaucracy.

   South Africa 2007                                                       20
Infrastructure Nigeria

 Road: 60.068 km paved road, which is in need of urgent repair, due to
  poor maintenance. The accident rate is amongst the highest in the world.
 Train: 3.557 km railroads, that are in parlous condition.
 Nigerian port activities have fallen behind international standards. A
  partial port privatization strategy is ongoing.
 Air Traffic: Nigeria has 37 airports with paved runways and 34 with
  unpaved runways, which have poor reputation for operational efficiency
  and safety.

   South Africa 2007                                                     21
Competitive landscape Nigeria

 There is a Courier Regulatory Department (CRD), which was created in
  1992 by the Nigerian Postal Service (NIPOST).
 There are 84 licensed couriers and many more unlicensed competitors.
 DHL has nine Hubs in Nigeria.

  South Africa 2007                                                      22
      Preliminary conclusion

       Both the Democratic Republic of Congo and Nigeria seem
        to have sufficient potential for further investigation.
       Current sources an possible new sources will provide
        necessary information.
       Team Lion would like to continue their investigation using
        Michael Porter’s ‘Diamond’, as displayed in the next slide.

South Africa 2007                                                     23
               Firm Strategy, structure and
                Corruption
                Raping and looting rebels
                A low morale
                Bigger companies are often
                  owned by foreigners.
                Working conditions are bad .

                                                  Demand Conditions
                                                   Many goods are imported,
                      Factor Conditions            Underdeveloped industry.
                       Poor infrastructure        There is a demand for
                       Landlines for phones        machinery and transport
                        an internet are scarce.     equipment
                       65% of the                 And there is a demand for
                        population is literate.     many products that are not
                       Low cost labour.            produced in the DRC
                       Median age is 16.1.         (foodstuffs, fuels )
                       A vast natural wealth
                       Corruption
                       Political unrest
                       Legal uncertainty
South Africa 2007                                                                24
 Websites:
       COMESA
       Worldbank
       CIA World Factbook
       SABOT Int. Transport
       Boss Mining Ltd.
       Gecamines
       Wikipedia
       Ministy of Foreign Affairs
       Congonline
       Africabusinessnet
       Indigologistics
       The courierlink
       Businessmonitor
       University of Groningen (electronic resources page)

 Interviews:
       D. Kam; a former employee of the UN in DRC.
       H. van Manen; a former employee of Nedloyd-logistics in Nigeria.

   South Africa 2007                                                       25
IBO South Africa 2007
The Rhino Team Assignment

Natalie Abels, Mathijs Benink, Willem Bonenkamp, Rachel Dowling, Jeroen Siegerink   24-9-07
      The Rhino Team
Mathijs – Business
                                   Willem – Regulations
Development & Express – Creative &
                   Jeroen                         Rachel – Customer - Logistic
                                   & Economy Expert
                                                  Service 5 Processes
            Team of Specialists / The Big & Training & HR

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      Mission Assignment and Output

   Mission:
    Creating Value for TNT SA and GAM by investigating needs &
    undiscovered demands for specific GAM customers in South

   Output:
    In-depth interviews with GAM customers that contain valuable
    information about the needs, opportunities and undiscovered
    demands of specific current GAM customers in South Africa

   Interviews set up with:
       Automotive Industry Development Centre (AIDC)
       South African Post vwb Postal markt

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      Our Approach
                      1. Define Areas of

                       2. Background

                     3. Design Interview

                       4. Test Interview

                         5. Conduct

                     6. Analyse Results &
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   Research East Africa:
   Uganda, Tanzania, Kenya and Rwanda

Team:              Marieke, Jikkie, Jeroen, Sebastien, Raffy
Master Elephant:   Michiel
      Research Set up

        1           Data Gathering and Analyses

        2           SWOT – analysis per country

        3           TNT Express Opportunities per country

        4           Opportunities for East-African interregional network

        5           Customized recommendations for
                    TNT Express in East Africa

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         Progress of research                                  1   Data Gathering and Analyses

                                                               2   SWOT – analysis per country

                                                               3   TNT Express Opportunities per country

                                                               4   Opportunities for East -African interregional network

                                                               5    Customized recommendations for
                                                                    TNT Express in East Africa

Step 1                              Step 2a      Step 2b      Step 2c

         Individ         Team         Team          Individ        Team
           ual                                        ual
                          Data       SWOT                           Revie
          Data           classifi    format          Data           wing
         collect          cation                   collect         SWOT
         ion per                                     ion +         analys
         countr                                     SWOT               es
            y                                         per
            Done: 24/9              Done: 24/9         1/10
                                                 Done: y      Done: 8/10

 South Africa 2007                                                                                               32
      Format SWOT-analysis

      Strength                                     Weaknesses
       Infrastructure                              Social figures (# labour force, av. Age,
       Economy (macro, WTO, growth etc.)          crime rates, population < poverty line)
       Industry                                    Seasonal influence
       Gov‟t regulations (bureaucracy)             Communication systems
       # export products                           no resources
       Globalization                               Fuel price
                                                    Political Climate
                                                    security situation
      Opportunities                                Threats
       Foreign investments (incl. intern‟l org)    HIV / Aids
       Future plans (incl. by gov‟t)               Social instability (refugees, ex-
       trade figures (export / import)            militians)
       African economy organization                environmental changes (drought)
                                                    (drugs industry)

South Africa 2007                                                                               33

         www.wikipedia.org, www.minbuza.nl, www.evd.nl, www.cia.org,
                      www.uneca.org, www.stategov.com

Uganda                Rwanda                    Kenya                 Tanzania

www.myuganda.co.ug    http://www.minbuza.nl/    earthtrends.wri.org   www.tptanzania.co.tz
                      nl/reizenlanden/landen,   www.krb.go.ke
                      rwanda.html               strategis.ic.gc.ca

  South Africa 2007                                                                      34
      Interesting observations

      Poverty in East-Africa
       Ranking in global GDP list of IMF in 2006 (total 179 countries):
        154 Uganda >> 161 Rwanda >> 164 Kenya >> 175 Tanzania
       All highly donor dependent

      East Africa Community
       Kenya, Tanzania, Uganda and Rwanda all in the EAC (since 1/7/07)
       Customs union for Kenya, Tanzania and Uganda since 2005;
        Rwanda might join in the near future
       EAC Market covers 120 million people

      International investments
       High World Bank investments in this region
       Rwanda as ICT hub of East-Africa
         (investment projects from Nokia, Microsoft and World Bank)

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                         Team Buffalo
                      Angola & Mozambique

Mariëlle Sitskoorn Sandra Antons
Niels Toeset         Marjolijn Klooster
Joris Balkema        Berend Gras
 South Africa 2007                          37
             Angola   Mozambique

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Macro Economic Data

               Angola                                   Mozambique
GDP                                       GDP
 GDP           : $53 Billion PPP           GDP           : $29 Billion PPP
 GDP           : Per capita $ 4400         GDP           : Per capita $ 1500
 Ranking       : 82 & 146                  Ranking:      : 103 & 199

Population distribution (by income)       Population distribution (by income)
 Highest 10%: N/A                          Highest 10%: 31.7%
 Lowest 10%: N/A                           Lowest 10%: 2.5%

Economic centers                          Economic centers
 Luanda: 2.7 Mln citizens                  Maputo: 1.2 Mln citizens
 Huambo, Lobito, Benguela                  Matola, Beira, Nampula

International trade forecast and growth   International trade forecast and growth
 Import $ 10 Bln / Export $ 35 Bln         Import $ 2.8 Bln / Export $ 2.4 Bln
 Positive outlook for trade                Moderate positive outlook
 US, China, 2007
     South Africa
                  Portugal, SK, SA          Import: SA, AU; Export: BE, IT, ES 39
Trade profile

                  Angola                             Mozambique
   Leading industries                  Leading industries
     Agriculture                        Agriculture
     Oil                                Trade
     Diamond mining                     Transport communications
   Express/Non express services        Express/Non express services
     Telecommunications                 Automotive
     High tec
     Medicine
   Target industries (top 3) Import    Target industries (top 3) Import
     Machinery, Vehicles, Medicine      Machinery, Vehicles, Fuel
   Target trade flows (top 3) Import   Target trade flows (top 3) Import
     South Korea : 17,3 %,              Import         : S-A 35 %
     Portugal : 14,1 %                  Australia      : 9,4%
     S-A           : 6,3%               China          : 5%
   Trade flows per continent Export    Trade flows per continent Export
     US            : 39, 4%             Belgium        : 29,3%
     China         : 35, 4%             Italy          : 22%
     France        : 5%                 Spain          : 12,7 %
     South Africa 2007                                                       40
Business Climate

                 Angola                                 Mozambique
Stability                                Stability
 Macro-economic performance = Good        Macro-economic performance = Good
 Economic prospects = Good                Economic prospects = Good
 Business climate = Instable              Exch. rate/Cons. price index = Stable
Plans                                     Int. financial credibility = Increasing
 Economic program to address the         Plans
consequences of the long civil war.        Several projects to improve:
 Focus on infrastructure development
                                                     Business environment
 A volatile market for its main export              Infrastructure
crude oil.                                           Agricultural sector
 Bureaucracy/Corruption is high
 Roadnetwork is generally poor                      Tourism
 Landmines…                              Risks
Legal issues                              Legal system is antiquated and
 Labour law is serious impediment for
business                                   Bureaucracy/Corruption is high
 Corruption frustrates attainment of      Roadnetwork is generally poor
licences and permits                      Legal issues
    South Africa 2007                      N/A                                 41

                 Angola                                  Mozambique
Footprint of roads:                          Footprint of roads:
 Highways : 76,626 km                          Highways : 30,400 km
                                                Paved        : 5,685 km
 Paved          : 19,156 km                    Unpaved : 24,715 km (1996 est.)
 Unpaved        : 57,470 km (1997 est.)      Ports:
Ports:                                         Beira, railhead for Zimbabwe
 Ambriz, Cabinda                               Inhambane
 Luanda - railhead for Malanje                 Maputo, railhead for South Africa
                                                Nacala, railhead for Malawi with
 Lobito - railhead for Congo                      deep water port
 Malongo                                       Pemba, Quelimane
 Namibe - railhead for Menongue              Airports: 158 (22 paved, 2006)
                                                over 3,047 mtr        :1
                                                2,438 to 3,047 mtr: 3
Airports:                                      1,524 to 2,437 mtr: 10
   Further research necesarry                  914 to 1,523 mtr : 3
                                                under 914 m           :5
Customs restrictions                         Customs restrictions
    South research
    FurtherAfrica 2007necesarry                   Further research necesarry   42
Competitive landscape & Next steps
        Competitive landscape

  Background research countries
     Bundesagentur für Außenwirtschaft
     OECD
     US Commercial Services
     Chartered Institute of Logistics and Transport South Africa
     In-depth interviews

  Getting to know the competition
     Personal contacts of colleagues in Express- telephone interviews etc.
     Competitor bulletin (CMI)

  Evaluate the competition
     Further personal research by telephone / E-Mail
     Newspapers

  Competitive landscape seems to be a difficult topic to investigate; the establishment
  of personal contact to get an insight into the Express/ logistics market will still take
  some time but is absolutely necessary as the undertaken internet research has not
  provided the required results

    South Africa 2007                                                                        43

      www.cia.com
      www.wikipedia.nl
      http://go.worldbank.org
      http://www.dhl.com
      http://www.sa-acc.co.za (Angola only)
      http://www.state.gov/
      http://aaitpc.unido.org (Custom regulations)

      South Africa 2007                               44

       Pizza in the foyer
       15 minutes

South Africa 2007            45
      Road Networks

       Ben Klaassen
       Managing Director TNT Express Road Network

South Africa 2007                                    46

         Introduction
         Express networks
         Designing and optimizing networks
         Network check list
         Q&A

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      Introduction : Network and connectivity

                    Monkey see, monkey do

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         TNT Express - Network Operation

   International Road Hub
                                                  Road Network

TNT Express Air Hub

 Air Network

                                      Commercial Network
   South Africa 2007                                         49
                  European Air Network Quarter 2 - 2007

                                                                                                                                 Global Networks & Operations

                                                                                                 TKU                               B757
                                                                  OSL                                   HEL                        TU204
                                                                                    ARN                 TLL
                                                          SVG                                                                      B737
                                                                                                        RIX                        F27
                          EDI                                   BLL
                                                                        MMX                            KUN
                  BFS             MME                                                    GDN                        MSQ
      SNN     DUB                                                 HAJ
                                  EMA                                       TXL                WAW
        ORK               CWL
                                                        LGG                                                               KBP
                                                                             PRG           KTW
                                                  CDG                               BRQ
                                                                      MUC          VIE
                                  NTE                       BSL                            BUD          CLJ
                                                         GVA            TSF LJU
                                                                  LIN               ZAG          TSR
                                  BOD              LYS
                                                                      BLQ                      BEG            OTP
                                            TLS                                          SJJ
                            VIT                          MRS                PSR
             VGO                                                                                        SOF
                                 ZAZ          BCN                                                SKP
            OPO                                                                                                     IST
                          MAD                                                                        SKG
            LIS                       VLC
                    SVQ                                                           CTA                  ATH
South Africa 2007                                                                                                                                         50
                 TNT Express Road Network
                 Total Network
34 countries
85 international depots
connecting 415 depots
16 road hubs
      Main hub-hub
      Main hub-depot cq. direct linehauls

    Simplified                                                                 HL3

                                                  NXH                   HNJ
                                                        GNQ                          VIE


                                       BN3                                                             SOF


      South Africa 2007                                                                                      51
         TNT Express Road Network
         NextDay-by-Road connections


                                           QAR                       WA1

                               GNQ                             VIE



 South Africa 2007                                                         52
          TNT Express Road Network
          Business cases 2006
  Main hub-hub
  Main hub-depot cq. direct linehauls
  Business case 2006 (implemented)                                                        TKU

  Business case (pending)



                                              NXH                       HNJ
                                                          RH3           DNG
                                                    GNQ                             VIE


                                   BN3                                                                SOF


 South Africa 2007                                                                                          53
      Designing and optimising TNT networks

      TNT Methodology
       To ensure that our networks are planned and
        optimised to ensure smooth capital
        investment supporting the planned business
       To adopt a scientific and fact based approach
        supported by world class operations research
        and planning tools
       Data warehouse directly feeds strategic
        planning tools
       Optimised air and road networks
       Global approach and consistent deployment
South Africa 2007                                       54
                Our methodology ensures TNT is able to make sound
                strategic network decisions

Project Aims

Objectives &                                          Model Current
Deliverables         Develop         Determine
                     Baseline                          Performance       Validate
                                    Demand and
                                                        and Cost         Baseline
Project Scope
                                   Service Profile

                       Model           Develop
                    Alternatives                        Model the        Compare
 Timetable                            Alternative
                                                       Alternatives     Alternatives
Resources &

   Tools                                                                  Final
                     Strategy                          Prepare and       Strateg
                     Selection                         Present the          y
    Fees                                               Final Report      Selectio

     South Africa 2007                                                                 55
                                                                                                 PUD Cost

                                                                                           Collection & Delivery

                                                                                          Mobile Worker In-cab

South Africa 2007
                    Common Codes
                                                                                         Office & Warehouse Cost

                                                                                         Ops Piece Label
                                                                                                                   Ops Data

                                                                                        EDI Load / Batching

                    Business Partner
                                                                                           Check Weigh & Cube

                                                             Shipping Documentation
                                                                                         Mobile Worker Warehouse
                                                                                                                                Office & Warehouse

                                                                                      Warehouse Management System
                                                                                                                                                     Enterprise Data Warehouse

                    Customer Database
                                         Customs Clearance

                                                                                        Hub Management System

                                                                                      ROCS           ROCS
                                                                                      Manage        Operate
                                                                                                                                                                                 Network Operations – Systems Landscape


                                                                                       Propel        Propel
                                                                                        Cost         Flight


                    Service Capability


      Global Optimisation - Tools &Technology
                   Global Optimisation Toolbox
           Logic Tools Strategic Network Modelling Tool
 OPERATIONS                                                     OPTIMISATION

                             RANGE OF USAGE

 Immediate support                  DANTE                    Quick wins / short
    & analysis                    Data analysis             term improvements

Tactical optimisation             SHORTREC                    Best schedule &
                         Schedule & Resource optimisation   resource allocation

Strategic optimisation               BOSS                   Best infrastructure
                            Infrastructure optimisation     & growth scenarios

South Africa 2007                                                                 57
       Network design strategy
                             Hub             Country / Depot
   Networks                                                               PUD
                        infrastructure        infrastructure

               Integrated Network & Infrastructure Approach

                                                               Linehaul & hub
 It‟s all about                                                infrastructure
   balancing                                                   Depot


                                                                         No. of Depots
„Internal Network Intelligence & Capabilities‟
 South Africa 2007                                                                 58
        Depot infrastructure planning

    Determining the optimum
     number of depots and
     their optimal territory to
     ensure the highest levels
     of delivery service.
    Business Objective
    Identify optimal number
     of depots & their position
    Which postal codes to
    Different assignment for
     various products/services
                                  Country based   Nearest Depot based
    Optimal service

  South Africa 2007                                                59
      Networks strategic planning

     By selecting operations data from TNT-systems of the (recent) past,
      look at various angles to the network & identify improvement possibilities

     Business Objective

     Quick wins & bottleneck identification
     Monitor process & improve data quality
     Basis further optimisation

South Africa 2007                                                                  60
      Determining the strategic infrastructure for TNT
      Spain example of network planning
                                           In the strategic review,
                                           9 hubs were analysed:

                                           VIT (Vitoria)
                                           BEN (Benavente)
                                           ZAZ (Zaragoza)
                                           BAR (Barcelona)
                                           VAL (Valencia)
                                           ALI (Alicante)
                                           MAD (Madrid)
                                           SER (Sevilla)
                                           BAI (Bailen)

South Africa 2007                                                     61
                 TNT Express Road Network
                 Total Network
34 countries
85 international depots
connecting 415 depots
16 road hubs
      Main hub-hub
      Main hub-depot cq. direct linehauls

    Simplified                                                                 HL3

                                                  NXH                   HNJ
                                                        GNQ                          VIE


                                       BN3                                                             SOF


      South Africa 2007                                                                                      62
                        European road network in one common database and
                        network model
Current European cross-border                   Common Database on Hubs‟ Locations
Network Structure                               and Flows
                                                             Parcels (daily volume)
!   Type:            Road

                                                                                                                                                                                                                                                    Location 10
                                                                             Location 1

                                                                                               Location 2

                                                                                                                  Location 3

                                                                                                                                    Location 4

                                                                                                                                                         Location 5

                                                                                                                                                                           Location 6

                                                                                                                                                                                             Location 7

                                                                                                                                                                                                               Location 8

                                                                                                                                                                                                                                  Location 9
    hub                                                        From/To

    Utilization:     76%
                                                             Location 1      1 188                          39    1 336             2 520               1 763              1 953             1 779             2 304             2 282                  396
    Volume processed:                                        Location 2      1 213
                                                                      Basic infrastructure
                                                                                               2 051              3 168             2 422               2 376
                                                                                                                                                      Sorting process
                                                                                                                                                                           1 755
                                                                                                                                                                 Sorting machines
                                                                                                                                                                                                 479           3 160             2 014                  349
                     7% of                        Hub
                                                             Location 3
                                                                   # ramps
                                                              Location 4
                                                                             1 373
                                                                                               1 706
                                                                                                                      983               316 1 234        770 1 570 Parcel
                                                                                                                                        Daily mail Daily parcel
                                                                                                                                                                        1 553 1 752
                                                                                                                                                                                                                                                    2 164
                                                           area               887               354
                                                                             buildings1 356potential                                     volume104 volume
                                                                                                                                        432              725     657 1 048 1 405                                                                    1 184
    total                                                    Location 5
                                                                 1 (on 2         216               331                303               867                  405
                                                                                                                                                                machines utilization
                                                                                                                                                                               665               441               141                641           1 046
                                                L1         22 000                         36                     none                            2 337 974                   32 467                            2                 45%
                                                             Location 6          221               209                143                        13          159               135               170               274                280                         5
    Cost structure                                           Location 7          807
                                                                                                   yes (c.a. double
                                                                                                   890       530                        647             1 295              2 397             2 493             1 287             2 478                  365
                                                L2         25 900     2                   42         the space in                                 913 550                    31 975                            1                 55%
           Fixed: 23%                                        Location 8          194               373        44
                                                                                                   modular mode)                        477                  465               544               508               361                754               162
                                                            7 Location19         315                      610
                                                                                                   423 none                             587928 483 3                         614                 355           1 138 30%508                             438
           Variable:                            L3            259
                                                             Location 10
                                                                                 186                 6    117                           149                           58
                                                                                                                                                                             23 568
                                                                                                                                                                                        43       229               120                         42       171
                     77%                        L4         17 073     1
                                                             Location 11         164
                                                                                                                               68       218
                                                                                                                                                 1 163 472
                                                                                                                                                                             16 979
                                                                                                                                                                                        9                 39
                                                                                                                                                                                                                                      280               173
                                                L5          7 Location1
                                                              300      12        404
                                                                                  15             548        center) 359
                                                                                                 none (city360              378
                                                                                                                       907 655                                               112
                                                                                                                                                                             11 690              458               443                270               531
    Service level: 95%                                       Location 13         306               173                361                        78          337               195                        39       141                367                         24
                                                L6           600      1                   8                      none                             249 139                          2 821
    Very limited                                             Location 14         293               479                445               194                  284               261               265               159                         12       509
                                                L7            700
                                                            1 Location115                 14
                                                                                          23       353 none38                           371580 804
                                                                                                                                                368                          26 175
                                                                                                                                                                              95                 179               341                316               210
    expansion                                                Location 16                  8                 50        223                        69                   97       199                        84       328                114               135
                                                L8          2 000     1                   6                      none                             588 460                          7 180
    possibilities                                            Location 17         236               206                339                        77          399               167               337               292                320               254
                                                L9           600
                                                             Location118                  8
                                                                                          2                 74 none
                                                                                                                  103                   210460 228
                                                                                                                                                 45                                7 906
                                                                                                                                                                                   20                     61       212                         46                 26
                                                L 10        1 Location1
                                                              850      19        474
                                                                                   8                      925
                                                                                                    71 none                         1 006     174
                                                                                                                                         462 372                               461 1 278
                                                                                                                                                                                2 811                              118                         33   1 134
                                                             Location 20         316               198    153                           362                  363               263               217                        40        150               234
                                                L 11         650      1                   8                      none                             144 707                          3 252

     International network hubs                 L 12        1 146     1                   8                      none                             239 631                          6 896

     Air hub in Liege                           L 13        1 042     1                   6                      none                             335 275                          4 037

     International network spokes               L 14         950      1                   8                      none                             345 898                          6 472

     International road linehauls

        South Africa 2007                                                                                                                                                                                                                           63
       The TNT European road network has been planned
       for growth through to 2017
Difference between the current network and the optimal 2017

+6      Selected new hubs
Bratislava,        Prague, Czech
Slovakia           Republic
Lyon, France
     Maintained existing hubs
                  Vitoria, Spain
                  Milan, Italy
Netherlands                                                                   Prague
                   Helsingborg,                               Stuttgart
Madrid, Spain                                                        Munich
                   Sweden                              Lyon                      Bratislava

Warsaw, Poland     Sofia, Bulgaria
Garonor, France
Brussels,          Hannover,                                            Legend:
Belgium            Germany                                                  Maintained existing hub
                                                                            Selected new hub candidate
Benavente,         Northampton,                                             Closed existing hub
Spain              UK
                  4% fewer km and 6% fewer hub costs per touch due to
Wiesbaden,                       increased use of low-cost hubs
                   Turku, Finland
South Africa 2007                                                                                        64
      TNT Hoau China network
      56 Hubs & 1,100 Depots


                                                           Jingzhou                               Xuzhou
                                                Huhehaote              Dalian
                                                        Beijing Tangshan                        Yangzhou               Nantong
                                                                                                 Nanjing       Wuxi Kunshan
                                                             Tianjin    Yantai
                                                     Shijiazhuang                                      Changzhou     Shanghai
                                                 Taiyuan              Qingdao
                                    Yinchuan                    ’
                                                               Ji nan                                           Suzhou
                          Xi ning                                                                          HangzhouNingbo
                                          Xi an
                                                              Hefei                                           Jinhua

                                                   Wuhan                                                        Wenzhou
                                           Changsha   Nanchang
                                                                       Xiamen                  Guangzhou Shantou
                          Kunming          Liuzhou                                               Dongguan
                                                                                      Foshan          Huizhou
     56 Hubs                             Nanning                                  Jiangmen           Shenzhen

     1100 depots                                                                           Zhongshan


South Africa 2007                                                                                                                65
      Network TNT China re-design
      in support of the Time Definite Service

South Africa 2007                               66
         Hub Capacity
     Identify relevant hub capacity
      by resource type, optimise in
      order to achieve improved
      maximum output of the hub in a
      specific period or sort window

Business Objective
     Find through-put & productivity
      bottlenecks (doors, sorter,
      people/ labour, space, etc.)
     Streamline processes

   South Africa 2007                    67
      Network and connectivity

       Lesson learned

      1. What do you believe you need to know when
        building a network or “judging”” existing

      2. How do you think network performance
        should be measured?

South Africa 2007                                    68
      Network and connectivity

      Following parameters are relevant for road networks:
      - Service connectivity (which service you wanna offer;
        cut off times)
      - Products carried (pallets, parcels, docs, DG)
      - Volumes/capacity/utilisation (eg truck type, hubs)
      - Driving restrictions (weekend, holidays)
      - Legal restrictions (speed, border crossings, resting and
        driving times)
      - Distance (avg speed, infrastructure)
      - Schedule (1-2 drivers, # arr/dep times)
      - Modes of transport (tunnel, ferries, bridges)
      - Own or subcontracted (own trailers, vehicles)

South Africa 2007                                                  69
      Network and connectivity

      Lesson learned

      You can not compare every
      country/region with Europe.
      Differences in road condition,
      legislation, type and quality of
      vehicles or drivers (incl health like
      in S A), licenses,
      borders/customs, paperwork, type
      of freight, size and quality of hubs

      You can of course use the same
      tools and lessons learned in
      Europe. Lot of principles will

      Hence “Monkey see monkey do”

South Africa 2007                             70
      Moving the World – North Star

       Ludo Oelrich
       Director Moving the World

South Africa 2007                     71
Moving the World: Evaluation and Current Status
 The partnership blossomed into 4 categories
                                                                      Moving the World

               Awareness &
                                                             Hands-on Support        Knowledge Transfer                  Interagency/Other

Fundraising & Awareness       Engagement & Awareness                                               Fleet management                       Customs Control

                 Corporate                        School Feeding
                                                                        Emergency Operations        Aviation Training                 Logistics Industry Init.
              Fundraising/Davos                    Volunteering

                Cause Related
                                                  Colour the World                                        Warehouse                          Fleet Forum

                                            Kids Moving the World                                     Supply Chain                   North Star Foundation

                                                                                                                   Best Practice Ops
                Twinning Model              Management Retreats
                                                                                                                  Management Systems

                              Global: Walk The World                                                                     Tracking

                                   Local events                                                                  Transport Optimization

                                                           Objectives Addressed:                   Transparency/Accountability

                      1       Awareness & Fundraising
                                                                                                          2 Logistics Efficiency

                                                      3 Saving & Improving Lives

                                                        4 TNT Internal/External Reputation

 TNT Management supports to continue MtW

                                        “Post: Exit is not a
                                                                             “Express Europe: We
                                     scenario ─ but find ways
                                                                              shouldn’t reduce our                  “Express East. Europe:
                                      to bind people into the
                                                                               people’s focus on                   Don’t move away from it,
                                                                                     CSR”                          but put less emphasis on
                 “Post: people want to                                                                                       MtW”
                make their own choices                                                    “Post: Personally,
                  about philanthropy”                                                continue, it keeps our feet                   “Express China: It’s good
                                                                                       on the ground, but as a                    but everything has a shelf-
                                                                                      Director, I’m not so sure,                   life: its’ important that we
                                         “EMN: I would like them to                 it’s hard to explain why we                      get their buy-in again. I
                                           express their demands                      invest in Africa and CO2                       would vote for finding a
                                                more clearly”                         when we’re cutting jobs”                    couple of complementary
       “Express Americas: Re-
       package, but if we focus                                                                                                       areas like ER, WtW,
       on other CSR activities,                                                                  “Express India: It’s great         Transport Optimization”
        WFP should not be a                        “Spring Global Mail: Just
                                                                                                but how do I bring it closer
              casualty”                           keep doing it, there’s value
                                                                                                   to home, on nutrition
                                                  in this being long-term, it’s
                                                                                                    issues for example”
                                                    a serious commitment”
                                                                                                                      “Express SEA: focus
                                                                                                                   efforts on a limited number
                                                 “IBU: It’s a good thing but                                                 of areas”
                                                 we’d like to see it closer to
                                                  our core values ─ move
                                                  away from hunger to be
                                                 more focused on what the
                                                   partners can do…AIDS                                                         “Express Aus/NZ: When
                                                   has a closer relevance”                                                     we handed Walk the World
                                                                                                                               to WFP, it felt like the end;
                                                                                                                               let’s carry on, but we need
                                                                                                                               to balance fundraising with
                                                                                                                                 involvement, bodies can
                                                                                                                                    be far more helpful”

     Managers are calling for a re-vitalized MtW with stronger local connections,
                         And within a larger CSR framework
Beyond Moving the World: There are a wide
number of other issues of concern to managers
                                                                                 Express Europe
                                                  Post                      • Planet Me: anticipate
                                       • Discounts to SME for using           regulatory pressure
                                         recycled packaging                 • Establishing a European
                                                                              Rail Network                         Express East. Europe
                          Post                                              • Sharing network capacity           • Local charities and
               • Planet Me: close to                                                                               emergencies
               • Flexible work for                                                              Post                                     Express China
                 mothers, students                                                                                              • Improving labor
                                                                                    • Helping employees
                                                     EMN                                                                          conditions: overtime pay
                                                                                      transition out of Post
                                           • Opportunities for youth                                                              to better salaries, health
                                                                                    • Planet Me: a green
                                             and elderly employment                                                               and safety
          Express Americas                                                            stamp?
        • Using transportation
          for economic
          development                                         Spring                             Express India
        • Improving capacity                        • Planet Me                           • Local charities and
                                                                                            emergencies                           Express SEA
                                                                                          • Nutrition rather than          • Economic development
        • North Star Foundation-
                                                                                            hunger                           to integrate rural areas
          Wellness Centers
                                                                                          • Planet Me                        into economic hubs
        • Security of transport
                                                                                          • Working conditions             • Labor conditions: e.g.
        • Road safety
                                                               IBU                        • Using network to                 overtime
        • Environment
                                                    • Targets for CO2                       distribute social goods:
                                                    • Labor conditions in                   eye-glasses
                                                      emerging markets                    • Airport congestion                   Express Aus./NZ
                                                    • Coalition with customers                                               • Employee wellness
                                                      to distribute drugs, etc                                               • Integrating
                                                    • North Star Foundation                                                    physically/mentally
                                                      with a clear commitment                                                  disadvantaged workers
                                                    • Local initiatives like                                                   into the workforce
                                                      helmets for kids in Asia                                               • Work with the Cancer

European businesses focus on CO2 and employment
Emerging countries highlight the role of transportation for economic development
and delivery of social goods, labor conditions, local charity and disaster response
     Future expectations of TNT/WFP
WFP Managers

        Continue the partnership
        Pursue the funding of school feeding programmes (as most tangible contribution to WFP‟s mission)
        Help WFP become the logistics provider of choice for the humanitarian community and focus support on 1/
         training (leadership and technical) 2/ hands-on support in emergencies 3/ targeted efficiency projects with
         high replication potential
        Open to explore new areas: local procurement, internal and external communications, etc.
        Institutionalize the management of the partnership across divisions
        Ensure sufficient funds and resources to allow sufficient absorption of TNT‟s competencies

TNT Managers

        Continue a certain level of global philanthropic engagements: WFP as preferred option but tackle the
         tiredness syndrome effectively
        Release employees from fundraising pressure, but local linkages wherever possible (e.g. BRIC countries)
        Focus the work on fewer, more visible, more tangible projects in terms of results
        Emphasize the application of expertise to communicate that notion to customers
        Use the partnership more for TNT leadership development

                    Partnership portfolios, BoM sponsorship
  Fine tuning +                                                                                         Relate to WFP‟s
  Local context                                                                                         Strategic Charter
                  “Funds for Children / A.O.”                                  “A Movement against Hunger”

          • Tools for employee engagement
          • School feeding: Twinning &                                   •   Walk the World
            Volunteers                                                   •   Davos
          • Cause related marketing                                      •   Kids MtW
                                                                         •   New?
          • Local Context Issues TNT (t.b.d.)         Ask of new
                                                    Executive Director

Continue ER + rigid                                 Measurement”                                         Shared Interest
framework projects
                      “Expertise for Impact”                                  “Responsible Transportation”
                                                                               & “Transportation for Good”

          • Emergency response: local
            relationship-building + global stand-                        • Mitigating WFP’s and the sector’s
            by teams                                                       impacts: CO2, HIV/AIDS, Road safety
          • Building WFP as the service provider                         • Biomass / Poverty alleviation / Offset
            for the humanitarian field                                     with WFP and others
          • Logistics efficiency projects +                              • Transport infrastructure diagnostics
            training                                                       to mobilize others

                                       “Expertise for Impact ”

     Tackling hunger using TNT’s capabilities offers opportunities for both Focused Philanthropy and
       Strategic CSR (Transform value chain activities and improve salient areas of competitive context)
        in counties where TNT Express has interest

     • Objectives:          -   Improve efficiency and adding capacity (emergency response) to WFP
                            -   Supporting TNT Express strategy in IBU countries (t.b.d.)
                            -   Make WFP LSP of choice
                            -   Employee engagement and enhancing TNT‟s internal and external

     • Measurement          - Sustainable cost gains WFP, response times
       of success:          - Number of assignments blue & white collar
                            - Strategic objectives?

     • Options we explore: - Expand 48-hours stand-by team (adding capacity)
                           - Direct WFP-country support (focus implementation rigor)
                           - Limited amount of strategic projects to support WFP LSP-role
                           - Different volunteer models with blue collar staff & talent development

     • Questions:          - How can we champion this in TNT Express?
                           - Do we want to align with some of our strategic interests in this portfolio?

• North Star Foundation was established in November 2006.

• We are funded by private and public organizations including TNT, a
  global mail and express delivery company, and the United Nations
  World Food Programme, the logistics arm of the United Nations.

• The Foundation is officially supported by UNAIDS, the International
  Transport Workers‟ Federation, Global Business Coalition and

• We invite private and public sector companies, humanitarian
  agencies, advocacy groups, health service providers, donor agencies
  and governments to join us in our efforts.
The harsh reality

• In Sub-Saharan Africa the transport industry has an HIV infection rate
  reported to be at least twice that of the general population.

• One of the more reliable studies was undertaken in 2001 - it found
  that 56% of long-distance truck drivers tested in South Africa were
  HIV positive and 95% of those tested at one truck stop were infected.

• A report by the International Organisation for Migration highlights
  prevalence rates among truckers in West Africa of up to 32%.

• UNAIDS estimates that approximately 300,000 people infected with
  HIV travel along the Abidjan – Lagos corridor (Ivory Coast – Nigeria)
  each year.
Impacts on the transport sector

• HIV/AIDS affects transport workers, their families and communities,
  the enterprises they work for and the economy as a whole.

• Transport enterprises are at risk because of the impact on their
  workforce - the costs of absences and sickness, and the loss of
  skilled and experienced employees, threaten profits as they are
  hidden and apportioned in others areas such as
  security…absence…additional recruitment.

• Life expectancy in some African countries has fallen to below 35 –
  18-35 is the optimum age for lorry driver recruitment and impacts on
  a sustainable future.

• A study of a transport company in Zimbabwe found the total costs
  related to AIDS were equal to 20% of profits.
Costs to business

               Timeline                       Progression of HIV/AIDS in
                                                                                        Cost to employer
            (illustrative)                          the workforce

                                             Employee becomes infected with
                 Year 0                                HIV virus
                                                                                 No cost to the employer at this stage

                                              Employee remains well and fully
                Year 0-8                               productive
                                                                                 No cost to the employer at this stage

                                                                                  Illness-related costs are incurred
                                               Sickness begins (some early
                Year 7-9                     deaths, some long-term survivors)
                                                                                      (absenteeism, productivity,
                                                                                   management time, medical care)

                                                                                   Termination-related costs are
                                            Employee leaves workforce due to
               Year 9-10                                                         incurred (payouts from retirement
                                           death or retirement (some long-term
                                                                                   fund, funeral expenses, loss of
                                                                                 morale, experience , and cohesion)

                                               Company hires replacement           Replacement-related costs are
              Year 10-11                      employee (some employees not          incurred (vacancy, recruiting,
                                                        replaced)                   training, reduced productivity)

    * Source: Barnett & Whiteside, AIDS in the Twenty-First Century
What is the challenge?

• Supply chain managers not fully aware of business risk due to

• Outsourced supply chains mean outsourced problems.

• Resource constraints prevent small transport companies from
What is the challenge? (2)

• Top down views limit the response of big transport companies.

• A lack of practical, low-barrier interventions suited to sector needs.

• Interventions are presented in humanitarian and not business terms.

• Interventions do not fit into business processes.
The effectiveness of intervention

• Initiatives that provide healthcare and education services at
  'Wellness Centres' at strategic locations have been shown to be

• In Tamil Nadu, India, research found that an HIV prevention for truck
  drivers reduced the number of truckers having unprotected sex from
  14% to 2% between 1996 and 2003.

• A survey carried out at a WFP at locations in Ethiopia where the
  organisation had carried out HIV/AIDS training showed that 90% of
  truck drivers had gained a basic knowledge of HIV transmission and
  prevention behaviour.

• A number of other initiatives demonstrate that this approach can be
  effective, but there is a need for a coordinated, targeted and
  replicable response.
Why should companies get involved?

Critical to sustainable growth
• For transport companies and other parts of commercial supply
  chains effective HIV/AIDS interventions are critical to sustainable
  business growth. Mobile transport workers are at great risk of
  infection – in sub-Saharan Africa prevalence rates are believed to be
  at least twice as high as that of the general population.

• In four NSF focus countries more than 27% of the drivers in the
  region are driving sick and 21% are driving with a STI or HIV/AIDS.
  These drivers are responsible for carrying $5-30 million worth of
  cargo and operate equipment with a high capital cost investment by
  the company they represent. The risk for losses to either the
  company or the client is high.

• Direct impact on the bottom line. Rising costs for insurance, health
  benefits, recruitment, retraining, loss of goods, pipeline breaks,
  damaged reputation. (See Slide 16.)
Why should companies get involved? (2)

Current interventions ineffective

• Prevention is better/less expensive than treatment. But many
  workplace interventions do not exist or reach highly mobile transport
  workers who spend most of their time traveling.

Employee right to health

• Companies are responsible for protecting employees‟ rights to life
  and rights to health, and are expected to contribute to the
  achievement of the Millennium Development Goals through
  combating HIV/AIDS and other diseases, and by working with
  governments, international agencies and NGOs to promote
Checklist for companies

• Do you understand your company‟s risk exposure to HIV/AIDS?

• What is your current forecast on the impact of HIV/AIDS in your
  organisation from both a moral and financial viewpoint ?

• Do you have clear contingency plans in place for the next 10 years ?

• Do you have a comprehensive work place policy for your employees ?

• How extensive is it ? (drivers, warehouse, stevedores, office staff?)

• Do you regularly measure the effectiveness of your policy and/or

• Do you know what external interventions would benefit yours and other
  organisations (for example do you rely on sub contractors and other
  downstream supply chain partners)?
‘There can be no pause or let-up in the battle against HIV/AIDS. Every truck
driver, taxi driver, bus operator, commuter, passenger, pilot, air steward and
seafarer can either be part of the problem or become part of the solution... Our
transport network offers us a potent weapon in this battle. It moves millions of
people every day, both within and across our borders. These movements can
either continue to widen the spread of HIV/AIDS or become a powerful channel
for disseminating the information, knowledge and understanding upon which
effective prevention depends.’
Abdulah M. Omar, South African Minister of Transport, November 2001
           Programme SA

Sunday      Monday        Tuesday     Wednesday     Thursday    Friday      Saturday
Oct 28th    Oct 29th      Oct 30th    Nov 31st      Nov 1st     Nov 2nd     Nov 3rd

Arrival     Welcome at    Company     Company       Social      Return to   Free time
08:55       TNT express   visits      visits        School      Joburg      & lunch
Joburg      SA                                      programme

Cultural   Presentation   Entertain   Travel to     Football    Final       flight
highlights /Discussion    ment/       Pilanesberg               Output      back to
           Forum          nightlife                             TNT         Adam

     Subcommittee during week
 Photo group;      Berend Gras
                    Marjolijn Klooster
                    Niels-Peter Bronsvoort

 Video group;      Maaike Schuil
                    Joris Balkema
                    Jeroen Siegerink

 Wellness visit;   Marielle Sitskoorn

Next steps

   Sent Wishou examples to team representitive IBO
   ERN visit 3rd October
   Make appointments working assignment
   Deepening gathered information
   Implement feedback & information Seminar 1
   Make presentation for entering SA
   Be prepared for Seminar 2 (18th October)


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