On Feb 17, 2016 Supply and Demand Chain Executive Magazine named 28 supply chain leaders as the 2016 practitioner “Pro to know” featuring executives from companies as diverse as food and commodities giant – Cargill, industrial manufacturer Dow Corning, and online electronics retailer Newegg. Included in this list was Orhan Daglioglugil, the supply chain leader at A101 Stores, Turkey’s fastest growing hard discount retail chain.
Since its founding just over eight years ago, Orhan and his team have helped A101 scale its supply chain operations to over 5,000 stores serving customers in all 81 of Turkey's provinces. Recently, we sat down for a conversation with Orhan to congratulate him on his recognition as well as to discuss the supply chain landscape at A101.
Q: What is your philosophy and approach for aligning A101’s supply chain with the company's broader strategy?
As a discount store chain, our business objective is simple: provide customers with high quality products at the lowest prices possible all the time. This means bringing the discount culture into our day-to-day operations and always pursuing opportunities to improve the quality and efficiency of our supply chain processes. At the end of the day our job is to make both our shareholders and customers happy by keeping the right amount of stock at the right time in the right place.
At A101, we are very conscious in our efforts to try and bring this mentality of continuous improvement down to an individual store level. This means building a common culture that thinks and acts in principles of lean management and continuous improvement. My team benefits from the continuous feedback from our customers, stores and distribution centers.
In addition, we are proactive about developing stronger partner relationships with our suppliers. Any efficiencies or value we collectively create will result in increased satisfaction for our customers which ultimately translates into measurable benefits for our suppliers too.
Q: What do you see as the key challenges facing A101 and its supply chain in the year ahead? How is your team preparing to meet those challenges?
As a high growth business in a competitive retail environment, our biggest challenge is managing growth profitably. Competitive pressures mean we have to build agility into our planning and logistics operations to enable quick reaction to changing business conditions.
|"Retail is detail. To that end we keep our team very close to the field."|
We are always looking for ways to automate as much of our supply chain planning operations as possible to increase day-to-day productivity and give us room to focus on executing our vision. As you know, retail is detail, and the devil is often hidden in the details. To that end we keep our team very close to the field. We also pay great attention to managing every SKU at every store, dynamically setting stock targets, closely tracking newly introduced products, and adapting rapidly to changing supplier performance.
Furthermore, we are proactive about investing in the necessary physical and digital infrastructure to help support our long-term business objectives. We work closely with our partners to learn and implement best practices, follow industry trends, and use innovative planning solutions.
Q: How do you see supply chain as a business function changing as we move to a more digital economy?
Supply chain capabilities are a prerequisite for a sustainable business in the digital economy. I strongly believe that the supply chain in the digital economy plays the role of the physical infrastructure – much like roads, electricity or water supply in a city. Yes, you can build beautiful parks, great buildings and other attractions but, without the appropriate infrastructure, the city will always be fighting itself. In absence of an efficient supply chain, even the most attractive and fashionable business models are doomed to fail.
In many cases, a well-managed supply chain can in-fact be a competitive advantage. With advanced supply chain planning capabilities, it is possible to gain competitive advantage by keeping your costs to a minimum, managing your product margins better, keeping the right assortment in your stores and responding to market changes faster than your competition.
Q: What attracted you to the field of supply chain?
As an industrial engineer – supply chain management was a natural fit for me. I get great pleasure in creating efficiencies and making things work slightly better every time you do something. At the end of the day, this world has limited resources. When you efficiently create value from these finite resources, you are making a real difference. This way of thinking really motivates me.
Supply chain today is increasingly becoming a blend of big-data analytics, fast changing technology, and business strategy making it a really challenging yet fun area to work in.
Q: Any tips, lessons learnt from your career that you would like to share?
Let me share two points. First, always try to look at issues from a big-picture
|"At the end of the day, this world has limited resources. When you efficiently create value from these finite resources, you are making a real difference."|
and multidisciplinary point of view. My advice to companies is to avoid restricting employees within their functional silos like sales, finance, supply chain or IT, and to give them cross-functional responsibilities. At A101, in addition to supply chain responsibilities, I hold IT and regional sales/EBITDA responsibilities which helped me gain a more holistic point of view and make better business as well as professional career decisions.
Secondly – Less is more! I think too often we over complicate our business processes or our lives. Try and bring simplicity to both your business and personal life, take the time to continuously learn new things and improve yourself.
YoY Revenue Growth Reduction in Inventory Levels Drop in Stock-Outs