Innovation: Novozymes develops global standard for logistics

For the first time industry may now reach agreement on an electronic logistics standard. For industrial companies this could mean lower administration, production and transport costs, smaller inventories and better service.

This marks the end of competing for standards in the supply chain. A group of the heavyweights in the global market, headed by Procter & Gamble, Nestlé, Unilever and Henkel, has adopted an integrated IT system for automatic inventory control – which Novozymes helped to develop – and refined it to create a global standard.

The result for Novozymes and the 5,000+ companies worldwide which use electronic processing of data between suppliers and distributors is a common language which significantly simplifies buying, selling and delivery.

"The system we have helped to develop is rather like finding a plug which fits any socket, wherever you are in the world, rather than each country having its own unique system," says Peter Brønd from Novozymes’ supply chain development, who has been involved in the pilot project with Procter & Gamble which shaped the standard.

Benefits for the supply chain

Companies will reap a number of benefits from having an electronic standard. They will be able to save on administration costs, obtain more precise estimates and experience improved logistics. And they will avoid the start-up costs, which are often high, when a supplier and distributor enter into a new collaboration.

Novozymes has been a front-runner in the standardisation project. The initiative as a whole is known as GUSI (Global Upstream Supply Initiative), a project conducted by a group of companies under the name GS1. GS1 is a global organisation working to design and implement standards to make the supply chain more efficient globally and across different sectors.

The GS1 standard will be the most widespread in the world. In the last 12 months alone, the number of companies which have chosen to use the system Novozymes has developed, which is now the standard, has risen from 200 to 5,000.