Almost anyone who has ever travelled on a British motorway will be at least dimly aware of Eddie Stobart, and most would be capable of identifying it as a road haulage concern with a reassuringly northern does-what-it-says-on-the-tin, down-to-earth brand. It’s something of a surprise then to hear IT director Vince Sparks describe the modern company as a “multimodal logistics” concern that is attempting to “differentiate from the standard palette shifter” by transforming supply chains across manufacturing, retail, public sector and other organisations.
If that’s not enough, I discover that the Warrington-based company is now called Stobart Group, but there is more than just a fashionable change of image going on here. The fast-growing company has moved into rail, sea, waterways and air in a radical step to creating a modern international logistics all-rounder capable of offering customers multiple ways of moving materials from A to B, and boasting six million square feet of warehousing.
Facilities include London Southend Airport in Essex, Carlisle Airport in Cumbria and a Merseyside hub on a brownfield redevelopment site at Widnes. Incorporating Stobart Rail, Stobart Ports and Stobart Air, the company also wants to be known as highly energy-efficient, providing not just fast routes and lean, mean supply chains but also a reduced carbon footprint.
The jarring yet iconic red, yellow, white and green livery of the haulier is a strangely comforting sight for Brits and as much part of the furniture of our major artery roads as signs for the A1, 70mph speed limit, hard shoulders, AA men, cats’ eyes and orange cones. It’s a very British company in some ways, with its quirky naming of vehicles, its own fan club and spotters’ societies, namechecks in the Gavin & Stacey sitcom and inspiration for a song by dreadful gimmick group The Wurzels. Yet the company which started as an agricultural delivery business in Cumbria by ‘Steady’ Eddie Stobart back in the 1950s has come a long way, having floated in 2007 through some complex acquisitions and arbitrage.
Stobart recently won a big deal to haul Tesco’s chilled food around the country and initiated a joint venture to transport renewable biomass fuel from wood with AW Jenkinson but the company said in a June 2010 trading statement that business was “challenging”. However, performance is in line with expectations and the company remains on an ambitious growth trajectory backed by a £100m loan and heavy marketing including sponsorships at motorsport events, Widnes Rugby league club and mighty Carlisle United in football as well as polo tournaments.
Compared to a turnover of £170m in 2007/08, the group now has revenue of about £450m and headcount of over 5300 – and it has designs on becoming a great deal larger. The rising cost of fuel, the congested state of the road networks and concerns over ecology make this a good time to be looking at alternative travel arrangements. Sparks says this perfect storm has prompted Stobart to “make use of different ways of moving goods into the UK and taking road journeys off the main network when it makes sense”. This in turn has led to what until recently might have sounded unlikely scenarios, such as Stobart using rail to transport goods within the UK and to import goods from France and Spain, for example.
As with any major strategic shift, the company also had to realign and institute fundamental change processes to underpin its broader strategy. In IT terms, the first move was fundamental: appointing Sparks to manage what were discrete divisions with separate networks, email systems and other infrastructure.
“It was a collection of companies each with their own vision of IT, hence the role of IT director across the businesses,” he explains. “It was about elevating the standards around IT and putting in place a strategy rather than letting them do their own thing.”
The challenge and opportunity was classic: cut down on the number of datacentres to streamline operations and concentrate on business. Sparks achieved this by outsourcing support for the company’s Wintel estate, email and file storage to SCC. Long-term partner Enterprise Software was consulted and recommended Onyx Group, a specialist provider of data hosting, security and business continuity. Onyx took control of Stobart’s main IBM servers, including the core IBM iSeries servers, in its Glasgow and Newcastle datacentres.
Sparks is a veteran of the iSeries, a box formerly known as the AS/400.
“Finance and banking didn’t really appeal to me; in this sector you can’t be too many steps removed so it’s very much hands-on. I’ve always worked in manufacturing, warehousing and distribution where the iSeries has been popular as a highly integrated system that can reliably handle big workloads. It’s a very robust transaction processor and very scalable. It’s 24x7x365 and never stops, which is exactly what you need. You’re looking for a platform that works and scales with the business.”
Using an offsite datacentre provider with highly scalable facilities meant that he could rest easy in the knowledge that spikes in demand, for example driven by potential mergers and acquisitions, could be handled. It also allowed him to operate a small in-house team of about 20 to help support 60 locations and 1500 users.
“Onyx was very capable, very agile and had a range of experts covering datacentre operations, LAN, WAN and TCP/IP. You can’t emulate in-house what they can do in terms of availability and scalability and connectivity. We want to get away from the frailty of operating smaller computer rooms and the limitations around power and cooling. They’re specialists and that means our people can be more business-focused. Monitoring servers and mail systems is not something I want my team doing as their main focus.”
Stobart Group has made major investments in vehicle tracking and linking the cab back to the back-office systems. All 1800 vehicles have in-cab technology and in-vehicle communications systems that enable them to receive new instructions and report on location at any time. However, they also have the freedom to select their own routes as automation has not advanced so far that satnav can always provide the smartest route. “The human being is still the best,” he concludes.
Sparks is a relative newcomer to Stobart, having only joined in 2008 after a career in manufacturing and supply chain management. He says he enjoys his work but has sometimes been frustrated by the failure of his peers in the industry to innovate through the supply chain. RFID tagging remains in its infancy, for example, thus slowing down the goods delivery process. Also, he says that the proof-of-delivery process for deliveries should be digitised but there is insufficient will within the industry to move away from a time-consuming, manual, paper-based way of working.
“It’s something I’ve thought about a lot and it’s odd that we’re still physically signing bits of paper when there are so many technological advances in the marketplace. A lot of work still needs to be done throughout the supply chain and we all have to consider if we really want another 20 years scanning paper,” he says.
The inside knowledge that Sparks has picked up over the years leads him to think that a future in consultancy as some sort of technical guru is attractive but for now, even if he is unable to pull off a one-man crusade to change the sector, his role at Stobart brings its own challenges. Recently, for example, the firm has not been helped by the recent blocking of development at Carlisle Airport by a judge.
Today, Eddie Stobart is not just a road haulage operation but a sophisticated logistics company and even something of a cult brand with ‘Stobart Spotters’ comparing notes on which vehicles (all of which traditionally bear women’s names) they have identified. Today you can buy Stobart vehicle models, clothing and even teddy bears and Scalextric kits. That branding smartness is line with Stobart’s vaulting ambitions. Rather than being merely familiar sight on Britain’s motorways, Stobart wants to be so much more – underestimate it if you dare.