Guest lecture at Fontys University of Applied Sciences
Alleen de uitgesproken tekst geldt.
Good morning everyone,
It is a pleasure to be here today. It does not seem so very long ago that I myself was sitting in a lecture hall. I studied Business Engineering in Eindhoven. [details?]
During my studies, I undertook an internship at Canon in Japan. I performed research into the stock management at this company. [details?]
During this internship, I became enthusiastic about logistics. And I believe that all of us here today share that enthusiasm. It is, after all, extraordinary that every day we can buy whatever we need in the shops.
Let us think of our breakfast this morning. What did you eat? Perhaps a few slices of bread with eggs or a bowl of muesli? Whatever it was, it had to travel over a long or short distance. According to Agrologistiek Magazine, six hundred different lorries are involved in an average Dutch breakfast! Six hundred lorries!
For example, every day there is a demand for some 4 million loaves of bread in the Netherlands. The ingredients have to arrive on time at the bakeries and the fresh loaves have to be on supermarket shelves in the morning.
It is a tremendous logistical performance that allowed you and me to have breakfast this morning. Especially since we ate and drank fresh products. Cheese, milk, bread: all these are perishable – and thus become worthless if they do not reach their destination on time. Or if they are inadequately packaged or insufficiently cooled.
And it is precisely the specialised field of the transport of fresh products in which Venlo has a strong reputation. Here, we are in the most complete agro and food region of the Netherlands. With the arrival of the Greenport, Venlo will be able to develop this position even further. Companies in the agriculture sector, trade and processing as well as suppliers, knowledge and research institutions will soon be located together on the same site. In this way we can ensure that products do not have to be transported unnecessarily for trade, processing and packaging.
The way in which companies come together in Venlo is truly unique. As a Limburger myself, it makes me feel good to see just how much of a dedicated effort is being made to strengthen the economy of Limburg.
And the Fontys University of Applied Sciences is making a unique contribution. Which of you are studying Food and Flower Management?
I believe that you have made a good choice. This programme combines economic and technical subjects and applies them to the agribusiness sector. You rarely see tertiary education programmes that are so well in line with the job opportunities of a region.
Logistics is thus very important. It has been and it still is the driving force behind our economy. This is true today and will remain so in the future. And yet something is changing fundamentally. Logistics is becoming increasingly complex and modern consumers more demanding. In supermarkets we can choose from dozens of desserts and if we do not find our preferred choice, we go to the competition.
This makes the management of logistics increasingly important. And it is becoming increasingly decisive for the success of companies in a rapidly changing global economy. Management of logistics is becoming so important that it can take the place within companies of the primary process – of the production of goods.
For instance, Nike can no longer compete in the production of shoes. Labour is cheaper elsewhere. Nike therefore no longer produces a single pair of sports shoes itself. It does, however, manage the chain from design to product marketing. It is other companies that make and market shoes under the Nike brand.
If, after graduation, you go to work in the flower sector, you will probably see very few flowers. Many floricultural products that are managed from the Netherlands, no longer physically come from the Netherlands. Thanks to the Netherlands, roses cultivated in Kenya end up in a vase in the United States without ever having seen a polder.
The Netherlands is competing as a floriculture nation because we excel both at cultivating flowers and in logistics. Our strength is that we not only ship flowers of good quality but primarily that we ship combinations of flowers in a way that is in line with the needs of the customer. If, somewhere in the United States there is a flower parade that needs 40 percent white roses, 40 percent red roses and 20 percent amaryllises, we can make the delivery. Everything revolves around logistics management.
Logistics does not have to be managed by the company that delivers the goods. Nor is it necessary that it is managed in the country of origin of the products or their destination country. Logistics management is becoming more and more footloose. The Netherlands wishes to attract this type of unconstrained management activity. Our desire is to develop into an international manager of flows of services and goods.
Chain management is the logical next step in the development of the Netherlands as a logistics nation. We have excellent mainports and a good multimodal network. We are good at transportation. We are good at distribution. We are at the frontline of ICT. To build on this strong starting point, we need to grab our chance to develop into an international manager of services and goods flows.
We want the Netherlands to remain an attractive country for people like yourselves to work in. Even for those of you who come from Germany where there is also a flourishing logistics sector. We want this not just because you seem like a nice group of young people, but especially because this is important for the future of the Netherlands.
We need young, motivated people like yourselves. People who can take logistics to a higher level. Because chain management requires specific expertise and innovation. It needs intelligent, specialised professionals and smart systems.
Currently, the added value of specific chain-management related activities is some 3 billion euros a year. We want this to grow to 10 billion euros over the next twelve years.
· This is the ambition of the business community
· It is the ambition of knowledge institutions (like this university of applied sciences).
· And it is the ambition of this cabinet.
Companies, knowledge institutions and authorities have together set up a programme to make the Netherlands the market leader in chain management. We are setting up a top institute in Breda at which we will conduct research projects to strengthen our knowledge position. Five research universities are going to draw up the programmes. And some 30 companies and knowledge institutions will be working on this.
We are investing in chain management because standing still actually means moving backwards. Other countries are developing at a rapid pace and are competing very strongly in terms of labour costs. Polish lorry drivers are less expensive than Dutch drivers. But that is not what we should be afraid of – we badly need lorry drivers, even in these times. The Port of Rotterdam cannot grow to the optimum if the lorries are standing still.
The Netherlands has a strong competitive position. We do not compete in terms of salary costs, but rather in terms of expertise and technology. This means that we have to put our shoulders to the grindstone to remain at the vanguard in these fields.
Myths
It is abundantly clear that we have to keep innovating an keep investing into our logistical sector. And yet myths still circulate that are keeping us from pressing ahead at full steam. You can see these myths within companies but also in The Hague.
Within companies, the myth exists that the person who manages logistics does not need to be part of the company management team. All too frequently, logistics staff members are only involved in decisions once they have already been made. Once it has already been decided, for instance, to buy goods from a large company in China because purchasing from South-East Asia is very popular.
If logistics consequences are not taken into account in such decisions, a company may be severely disappointed by the results:
· It may be that delivery times become too long.
· It may also be that the supplier is unreliable because you are a relatively small client and have a low priority.
To avoid such mistakes, it is high time that companies began to take logistics more seriously. The performances of companies stand or fall by logistics. Decisions concerning logistics have enormous financial consequences.
Soon it will be up to you to make your mark within a company. I am not saying that you will be able to demand a seat on the Board in your first job. But you can do your level best to convince others of the logistics consequences of decisions.
Some people believe the myth that traffic and transport continue to pollute our environment. That our air is becoming ever dirtier and that the norms are being exceeded on a large scale.
People who believe this are forgetting that air quality in the Netherlands has improved significantly over the past decades. They are forgetting that our stringent standards for air quality are only exceeded in certain specific locations, such as along busy urban streets and highways.
The amount of nitrogen oxide [stikstof oxiden] - which is bad for the air passages and for the ozone layer - that is emitted in the traffic and transport sector has dropped by 40 percent in twenty years. If we look at road traffic alone, these emissions have been halved. And this while the amount of traffic increased considerably during the same period.
The amount of particulate matter [fijn stof] - bad for one’s health - emitted is also falling.
CO2 emissions - responsible for the greenhouse effect - have been falling since 2007, due in part to the increasing popularity of biofuels. This fall could do with some acceleration; that is why we are pushing for the introduction of electric cars.
A myth that also exists is that the Netherlands is too small to play a key role internationally. That we cannot compete with large countries. That we would be better off to set up trade barriers so that we would not have to try and compete. But I say: the Netherlands is not small.
The Netherlands occupies the fifth place on the world list of exporters (behind Germany, the US, China and Japan). This is thanks in part to our strong position as a transhipment country with the mainports of Rotterdam and Schiphol.
Through the port of Rotterdam, the world has access to 150 million consumers living within a radius of 500 kilometres from Rotterdam. These consumers can be reached within 24 hours by road, rail, inland waterways and pipe lines.
The Netherlands is thus a big player where transport and logistics are concerned.
Open economy
I believe it is important to shatter the myths I just mentioned. I would like to convince everyone that we should sail the course dictated by the prevailing international wind.
Our centuries of experience as a trading nation have provided us with a solid ship. We can withstand a knock, we can allow ourselves a slight miscalculation. But we cannot sail against the wind, ultimately we will have to follow it. And every detour that we take will cause us to lag behind.
The Netherlands owes its prosperity to its transport links. We owe it to our capacity to respond to the changes around us. The Netherlands lives from international trade, from its role as a hub in an international network of transport links.
Therefore, it is not an option for us to hide behind our dikes and hide from the rest of the world. This is neither possible nor desirable. What we want is to use our strength to capture a position on the world market.
As minister I regularly travel across the world with trade missions. Time and again I see the significance of the Dutch business community abroad. We should not consider low-wage countries as a threat. Rather, they are extremely interesting business partners for the Netherlands.
Early this year, I was in Brazil with a trade mission. An emerging economy that is playing an ever increasing role in the global economy. Currently, Brazil is investing heavily in logistics and infrastructure. This offers opportunities for Dutch companies. For example, Dutch companies are collaborating in a maritime project in the province of Rio Grande do Sul.
Next weekend I will be travelling to China and Japan with a trade mission. Some of the companies I am taking with me are logistics providers. They have in-house knowledge and expertise that China itself cannot provide in full. They can supply something that is very important for China.
Chinese companies are producing for the global market. It is important for these companies that their goods are shipped to their customers as efficiently and inexpensively as possible. This offers Dutch logistics providers wonderful opportunities for assisting Chinese companies.
In China, the business community and the state are closely intertwined. A situation that is fundamentally different to ours. When a minister introduces companies in China, these companies are taken more seriously. As minister I help companies to get a foot in the door.
I hope that all of you will soon have many opportunities to spread your wings in other countries. The German students among you have already made a good start at this. I hope that you will open up new markets, that you will continue to prove and expand the added value of Dutch chain management. And that you will remain open to new ideas, new cultures and new technology.