The following interview is part of the Omixon interview series that we are conducting with Key Opinion Leaders, Experts and Business Managers at Omixon. Today, Mr. Daniel Horvath, Head of Manufacturing and Logistics answers various questions related to logistics and inventory management.
Tell us about the start of your career. Why did you choose to be a logistics expert? What made you work in this area?
To be honest, in the environment I grew up the only person that can be linked to logistics is my father who works as a custom broker. I would say that it was the primary influence and an invisible pressure on my shoulders to choose to work as a logistics expert. I used to work in other fields, but I was always aware that I love organizing parties, social events, outings, holidays, everything!
Then, an opportunity knocked at my door in 2015 so I decided to knuckle down. A factory, producing refrigerators, was searching for a new supply chain manager who arranges deliveries and coordinates material supply for the factory. As the previous manager left the factory hurriedly, I had almost no time to take over tasks personally from him so I was thrown in at the deep end. However, I accepted the challenge and I could cope with it. Later, I moved abroad to expand my experience, however, I realised after a couple of months that I would like to live in my homeland. I came home after a year and joined the Omixon team right away. I took on the role as a logistics administrator, but the whole department was new, so I built and developed the logistics department at Omixon more or less from scratch. It felt like I was in deep water again, but much more experienced, so I started to establish relationships with delivery companies with the most extensive coverage in the world. Based in part on my past business relationships, I managed to build up our current global delivery networks.
What is logistics all about? Could you describe it in your own words?
In general business sense, logistics is detailed and complex organizing, coordinating and moving resources from one location to another. Since you’ve asked, I would say logistics is the art of fine tuning the manufacturing and delivery processes in order to meet our customers’ needs at a high level. In my opinion, this area needs ‘action-reaction’ type employees, swift decision-making ability with so called ‘can-do’ attitude as each shipment differs from the other. There are several possible sources of error – nearly anything can alter the shipping process after it’s in the hands of the freighting companies. Though with careful planning, we can reduce the chance of errors and more easily handle those that do arise.
What does logistics and manufacturing department do at OMIXON? What do you think of your team’s role at you company?
My team is in continuous contact with importers, warehouses, delivery companies and our customers. Omixon receives multiple orders per day and ships worldwide to fulfill our customers’ needs at short notice. As previously mentioned, our field of business demands competent, experienced and determined individuals who are able to work in a team to march together towards the established goals. Fortunately, our team is formed by well-trained professionals who are able to move heaven and earth if it is needed. Shipping temperature sensitive products (-20C°) worldwide is as complex and diverse as it can be. When our team receives a purchase order, we first check our inventory and initiate the delivery. In the meantime, we contact our salesperson and customer to finalize the shipment details. If all the details are clear, my team plans the route of the goods, calculates the weight of the parcels, estimates delivery time and reviews several influencing factors of the delivery to ensure the right product will arrive at the right place, at the right time, in the right condition to the right customer. Our logistics experts track the routes of all the parcels that have been sent out until they are received by our customers. I think our department is an essential link between our sales department, manufacturer and research department and financial team. Although, it is difficult to highlight certain departments as the company could not function well without any of its departments.
You have mentioned that delivering your product is very complex. What is the difference between a simple commercial product and your product?
Firstly, our customers use our products for patients facing organ transplants in hospitals. Some of our customers use it for research purposes, so I can calmly say that it is not a simple commodity, but it indirectly helps to treat or cure patients with serious illnesses.
Secondly, Omixon produces kits that contain certain amount of reagents that are very sensitive to temperature fluctuations, and need to be stored on dry ice or in a freezer – much lower than the temperature outside. Shipping on dry ice is a hazardous shipment, requires special permits and must be handled as fragile cargo. Documentation of the products must be clear and straightforward without any confusion relating to its origin, date of production, best before date or content. In several countries, we have to meet very strict customs regulations and have to be aligned with international treaties as well as national regulations. Admittedly, Omixon has a very well-grounded and extensive network of transit points all over the World, so we get help in repackaging and tracking our parcels.
Why you think your product is special in terms of delivery? What is the biggest challenge you are facing regarding the delivery of your products?
The biggest challenge is the endless race against time. In the clinical world, it is very important to always be in the fast lane of business-logistics. If you are up-to-date and informed you will be prepared for any case to solve.
Our product is rapidly perishable without appropriate temperature-control. Notwithstanding, that it needs special delivery conditions, it has to be frozen far below zero, so we use dry ice to secure the acceptable circumstances. We have only 4-5 days to successfully deliver our kits to the buyers. If something interrupts the route of a parcel we have to replan its route and request a repacking at a transit point not to let the kit melt. Though, we have widely built our networks, our sales team continues to find new territories in which to business, so one of my personal targets is to continually extend this network – a quite challenging project!
Additionally, there are country specific facts and issues which have to be taken into consideration such as national holidays, weekdays and weekends, time zones, weather, legal and social issues which can cause delays or difficulties.
What can you do to overcome the challenges posed by the delivery of your products?
If a shipment melts, that is a waste. Our team has to carefully plan delivery route well in advance and filter possible failure points. The inventory, sales and logistics team are to work as a unit to be able to anticipate issues and solve them before they occur. Precision, optimal level of stocks and communication are the cornerstone of a well coordinated delivery process. Also, teamwork helps us overcome puzzles and problems and it is always a cure for several issues.
Could you tell us about some interesting facts, impressive moments, remarkable situations?
Yes, sure. There are plenty of them. Once we delivered a parcel to Turkey, our delivery arrived right at the time of the night of the military coup. Everyone in Turkey was buzzing, armament had started, tanks and armed soldiers and people were everywhere. It was one of my most difficult and complicated cases during my career here at Omixon. I didn’t really sleep that night, but the order was successfully delivered by the end of the story.
Speaking about the fulfilled deliveries, last year we processed more than 500 parcels. Our indicators are increasing exponentially, namely by 50-70% in a year, which is a huge number. We could anticipate that we are going to reach 800-900 this year if we perform well in the market. As previously mentioned, our kits are temperature sensitive, so we regularly consume a lot of dry ice. We use somewhere approximately 9-11 tonnes of dry ice – that’s as much as 4 African elephants in a year!
Freight forwarders processed more than 1000 boxes from Omixon last year – if you add up the distance of all of the delivers, our parcels have travel from the Earth to the Moon. That’s a long journey! We also counted the heights of the boxes we sent last year and it would be equal with the highest ever LEGO tower.
Our department is also a big fan of bubble wrap. Using this wrapping is not just for fun of course, but another fun fact is the area it made up. The size of the used bubble wrap is not less than 1,5 tennis pitch per year, it is about 240 sm.
Oh, wow, that is impressive! After “having a bit of fun”, back to a more serious question – can you tell me what makes you feel most proud when you think of your workplace? What do you feel when you see your company growing?
I could mention 2 remarkable situations: once I was watching TV as usual and I noticed one of our partners who treats children diagnosed with leukaemia. I felt a bit proud as it confirms that I work every day as part of a team that’s delivering meaning to peoples’ lives.
The second highlight, when I felt super proud of my company was this year in April. Omixon was nominated and won the Hungarian Innovation Grand Prize – we were selected as the most innovative company of 2018 in the whole country. It was an outstanding moment in my life. What is more, I could join the team which represented the company in the Hungarian Parliament. This added tremendously to my motivation and verified again why I am committed to Omixon.
Thank you, Daniel!