Mainfreight: 'This is not a time for nice to have projects'
- 26 June, 2020 06:43
Logistics giant Mainfreight is scaling back capital investment in ICT for the foreseeable future to reflect the economic environment and the needs of the business.
"This is not a time for 'nice to have' projects," the NZX-listed company said in its annual report, released this morning.
"Cyber security, however, remains a critical resource and is receiving ongoing investment."
Mainfreight's major competitor in both Australia and New Zealand, Toll Group, was hit by a debilitating ransomware attack earlier this year.
Mainfreight company spent $60.4 million on ICT in the year ended 31 March 2020, up from $57 million on 2019. Just under 28 per cent of that was capitalised.
It said investment in technology continued to strengthen the company's efficiency and productivity. It also provided data and statistics that allowed it to deliver an extra layer of intelligence to customers as well as greater quality and transparency.
"Over many years we have invested strongly in our own proprietary technology to complement our business operations," the company told shareholders.
"This has served our customers and ourselves well over time. In particular, we have always wanted our customers to see what we could see; a 'warts and all' approach.
With time and significant investment, this technology has become increasingly sophisticated, Mainfreight said.
"Our platforms around the world are mostly common in origin, and integrated to provide global visibility to ourselves and our customers for their complete supply chain requirements."
Those platforms provided simple track-and-trace, but were also able to manage stock flows and optimisation of trade to ensure efficiency and accuracy. This was of significant strategic value and one of Mainfreight's selling propositions to new customers.
Mainfreight said it expected that with changing supply chain requirements emerging after the COVID-19 pandemic, the usefulness of its technology to deliver efficiencies, will be valued by existing and new customers searching for trading advantages.
"The ever-present risk to system resilience and business continuance posed by cyber threat, has seen us invest heavily in strengthening our protocols, monitoring and training," Mainfreight said.
"Cyber security training internally and the implementation of significant firewall security systems have been features of this investment."
Disaster recovery sites had been upgraded and added to in New Zealand and the USA and Mainfreight's European datacentre was next for further investment.
"Updating and improving internal operating systems are a regular feature of IT activity. Key customer 'connecting' systems, like MainChain, MainTel and Freman, have been updated and improved.
"Further development of our systems is being scrutinised carefully to ensure investment protocols during a slowing global economy are prudent and acceptable."
That scrutiny included the costs of external providers.
"During the height of the pandemic lockdown, we had in excess of 1500 team members working from home," Mainfreight said.
"Our infrastructure proved robust, with the capability to support our remote team to continue working smoothly and without issues.
"We remain confident that our proprietary systems will continue to provide competitive advantage for ourselves and our customers alike."