INCORPORATING COLD CHAIN
CONTRIBUTORS
Business process outsourcing meeting demand in growing sectors By Gean Botha , managing director of PPO
Many of the South African business models have changed dramatically in the past 18 months , partially driven by the pandemic and lockdowns , which vastly accelerated adoption of digital solutions , e-commerce and altered buying patterns .
Hannes Egler | Unsplash
This has put pressure on the manufacturing and storage element of the supply chain , which has had to adapt to these shifts in demand . Optimising processes lies at the heart of the ability to store , manage , and deliver stock at the pace required today , which is where business process outsourcing ( BPO ) can play a pivotal role .
A BOOMING INDUSTRY As traditional retailers have developed more robust online sales strategies and people have become more accepting of e-commerce in South Africa , we have seen significant growth in this space . This growth will only continue in the years to come , and the warehousing element of the logistics chain in particular needs to support the shift . There has already been a significant expansion of industrial areas to offer greater warehousing facilities , especially close to airports and major transport routes .
However , the physical storage space of the warehouse is only one element . Managing the people element , especially given limitations on the number of staff permitted due to social distancing requirements , has become a real challenge .
Furthermore , businesses face the challenge of sourcing trained and qualified staff due to occurrences of illness and isolation , brought on by Covid-19 . Ensuring levels of output are met while balancing costs , requires an intelligent approach . This growth does , however , come with certain challenges , such as effectively managing space and human capital .
South Africa is already experiencing the growing demand in storage as buying trends have changed .
Džoko Stach | Pixabay
Reviving the manufacturing sector in a sustainable way is a critical step toward securing South Africa ’ s economic recovery .
The management of human resources is further exacerbated by making necessary considerations for Covid-19 regulations , such as social distancing . Ensuring adequately trained and qualified personnel further ensures business continuity should employees fall ill or be forced into isolation due to the pandemic . It is of utmost importance to maintain a delicate balance between input and output costs during this growth period , considering the unforeseen challenges that could arise due to the pandemic .
OPTIMISATION IS KEY There is a physical limitation on the amount of work people can do , and increasing headcount is typically the first step in increasing output . However , in the current situation , this is not always possible and is often not the most effective solution in any case . For an increase or decrease in headcount to be effective , productivity and performance needs to be at a level of at least 95 %. Therefore , improving productivity is the first step that any provider should take – and this includes training , process optimisation and capacity utilisation .
If storage areas for example are too small , and there is too much stock on hand , work areas will be congested . On the other hand , if there is not enough stock , then stores will not be able to fulfil orders . Both scenarios result in lost revenue . The key is to maximise volume over minimal time . Having a BPO partner not only ensures that processes are streamlined , but also that staff are trained to the level required to be highly productive . On top of this , should additional resources be required , the BPO provider will assist by scaling their workforce up or down as demand necessitates .
COLLABORATIVE PARTNERSHIPS To meet the drastic increase in volumes required today and , in the future , expansion needs to happen rapidly . There are many elements to consider outside of human resources , and the infrastructure needs to support efforts to maximise capacity .
In addition , as volumes increase and resources are under pressure , it can become challenging to meet service level agreements .
Transparency and effective planning are critical – this is not a short-term fix , but a long-term view of where the industry is going and how it can be adapted . The more organised and well-run the provider , the greater their likelihood of survival , because agility to rapid market changes has become a hallmark of success . When BPO providers collaborate with warehousing and logistics suppliers and communicate effectively , the entire process can be strategically planned and executed for maximum mutual benefit .
ALLEVIATING LOCAL MANUFACTURING INDUSTRY LABOUR RELATIONS HEADACHES In the aftermath of the 2020 ’ s national lockdown , businesses were eager for economic recovery . However , South Africa ’ s fourth largest industry – manufacturing – continues to struggle to get back on its feet . While industry stats over the past year indicate an improvement since May 2020 , month-on-month growth in the last six months has shown only two positive upticks ( 0,7 % in December 2020 and 3,2 % in March 2021 ).
The manufacturing sector has suffered many setbacks during this time such as the recent looting in KwaZulu-Natal and Gauteng . Rebuilding this industry will be challenging . This is another area where BPO can make a difference , providing the
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