Trade and Investment

This logistics company says a strong business purpose is the best defence in a crisis

The distribution of vaccines depends crucially on global logistics. Image: Photo by Mat Napo on Unsplash

John Pearson
Chief Executive Officer, DHL Express, DHL Group
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  • The pandemic posed a formidable challenge to logistics companies - as border controls sprung up around the world and lockdowns confined people to their homes.
  • This required an immediate response characterized by speed, clarity, agility and a willingness to embrace tech.
  • The workforce's ability to manage crises such as this comes from a company's strength of purpose and clarity of vision. But what does that mean in practice?

For many years, DHL has invested in defining and communicating its ‘purpose’ as a company. Some 10 years ago we coined the mantra: 'Connecting people, improving lives'. It underscores a collective belief that logistics and global trade improve the prosperity of nations and improve the lives of blue-collar workers in those countries.

But our plan and our purpose met a formidable challenge with the arrival of the pandemic. On paper, we faced a serious threat to our business and our ability to serve our customers. Global supply chains were interrupted, in many countries air traffic came to standstill; border controls sprung up around the world; lockdowns confined people to their homes. The future became very unpredictable.

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This required a multi-tiered response to the immediate challenges:

Decision-making speed

I have often gone by the principle that a quick decision is often a bad decision and not to be pressured by fictional deadlines. This situation was different and from talking and thinking as a team it quickly became clear that it was necessary to change work routines and processes almost overnight.

Clear communication

Communication became critical and we had to tailor and translate messages to our employees in 220 countries. We had to ensure protection from the virus and deal with the prospect of downsizing. We resolved to introduce a radically changed environment.

Accelerating technological advancement

Somehow we squeezed four years of technological advancement into four months. Previously departments such as HR and IT had often been known as ‘support’ functions. We had to move 9000 laptops into homes as employees made the transition to their new place of work. Under these circumstances, it confirmed my suspicion that there is no such thing as support functions: we’re all on the frontline and we never missed a moment when we weren’t fully connected to our customers. In fact more connected than ever before.

Agility

At one moment we were delivering PPE to China from the world and then within a matter of weeks the direction shifted, and it was to move PPE from China to the world. We helped to safeguard the existence of brands that had to suddenly close their physical stores and move their business online. How tough would life have been if people had stopped receiving packages? There would have been no DIY, no gardening, no books, no sports gear, not to mention vaccines, medical supplies or spare parts for vehicles.

Within weeks, it became apparent that our business remained very strong and our customers needed us more than ever. Connecting people, improving lives - never before had this been more relevant than during the pandemic.

What matters most is how you “connect” locally and set the best example so that your employees can proudly carry the torch.

John Pearson, CEO DHL Express

But what about the longer term? How does resilience embed itself into company culture?

Strong company culture to align decision-making

Our strategy was able to evolve with the changing circumstances. We’d come up with a company culture and a modus operandi that enabled teams to make the right decisions. During the darkest days, our investment in communicating and clarifying our purpose over many years, paid off. Thankfully, we were not an executive board of ten advocating what to do, we had 110,000 advocates for what we needed to do. Our purpose gave us the momentum we needed to adapt. The concept of “influence a thousand” came to mind.

For global organizations, natural or political disruption of some kind will be happening somewhere every week. We’ve got to deal with it. But we are optimistic about a swift recovery from the pandemic. It will pass in the same way as the Icelandic ash cloud of 2010 and the Great Recession of 2008.

Pride and motivation

Like so many other front line and essential services, it wasn’t difficult for our employees to see the impact they were having – enabling growth and keeping supply chains running. This pride was reflected in our annual Employee Opinion Survey, conducted among all employees. It shows that employee engagement jumped from 77% in 2019 to 82% in 2020.

The benefits of maintaining global connections have become even more tangible than before. Vaccine development itself is a great example of globalization at its best. It wouldn’t have been possible without the global division of labour and the global exchange of knowledge.

Now that vaccine production is ramping up, the distribution of vaccines depends crucially on global logistics. To date we have distributed more than 200 million Covid-19 vaccine doses to 120 countries. This is an excellent example of our purpose (and globalization) in action.

Global vaccine flows, millions of doses Image: McKinsey & Company

The distribution of vaccines is not just essential for our customers and the world. It’s also motivating for our employees: they feel part of something, their families show their pride in the, and they are thrilled when they see our planes arrive and the distribution process start.

Employees as ‘active citizens’

But our purpose is not just a feature of work life. We want our employees to be active citizens in helping the towns, villages and communities where they live. Our ‘Go’ programmes support the efforts of our employees to make a contribution to wider society.

Whether it’s to make it easier to trade across borders, (GoTrade), giving young people the opportunity learn new skills (GoTeach), preparing for the logistical challenges of natural disasters (GoHelp) or to ensure business success is compatible with environmental protection (GoGreen), we have initiatives to get employees involved in causes that drive them. Also: we’ve launched DHL’s Got Heart – a way that colleagues can draw attention to the charities they support or set up ways to back good causes through their own initiative.

International collaboration can counter the forces of nationalism and protectionism which threaten the flow of trade. Corporate work cultures can offer a model for societies, showing how commerce can transcend religious and cultural differences and be inclusive of many nationalities and languages.

We know that trade can soothe the tensions between nations and create bonds of fellowship. If companies like ours succeed in engaging and empowering our employees, that will provide a template for Governments and wider society.

The purpose of any company and organization should be aligned with what it is they do, where they operate, what industry they are in, what assets they have and where their employees live. What matters most is how you “connect” locally and set the best example so that your employees can proudly carry the torch.

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