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We work in a volatile, rapidly changing marketplace nearing this final quarter of 2009, which necessitates that we should be engaged in a highly iterative process for peak performance of our 3PL businesses. It requires the repetitive and efficient ability to (1) benchmark results against best-in-class companies; (2) gauge effectiveness; (3) adapt promptly to change; and (4) maneuver rapidly through automation, technology, and implementation processes.
Thus, the primary prerequisite to adaptation is studied and deliberate advance planning. Achievement of painstaking planning may be realized by the implementation of practices such as adumbrative projection and innovative re-structuring.
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Rosalyn Wilson—an independent consultant and author of the 20th Annual State of Logistics, which was published in mid-2009, and sponsored by the Council of Supply Chain Management Professionals—predicted “We have not hit bottom yet.” Over the course of 2008, Wilson reports that total logistics costs continued to drop, with many fewer (1) asset-based carriers and (2) 3PL providers willing to invest in long-term strategies for growth. Unfortunately, they did so at their own peril, Wilson asserts.
Warehousing costs rose 9.5 percent during the first half of 2009, with warehouse managers reporting that inventory turns were down substantially from earlier years as stock spent more time in warehouses.
“While the numbers look pretty bad for carriers and 3PLs, I’m telling everyone to consider what we taught when I was a Girl Scout leader,” reminisces Wilson: “Every great challenge offers the opportunity to excel.” In this industry’s context, that means that shippers must take a more proactive role in nurturing supply chain relationships, while 3PL’s need to invest in more efficient technology in order to create a symbiosis between the two which will behoove both when this current state of the economy corrects itself.
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During the current economic downturn, the glass may appear half-empty to many—perhaps most—while others perceive the same glass as half-full. In which category do you find yourself, based upon the following criteria?:
- Have you laid off workers OR have you upgraded and trained your labor force, offered cross-training and certification programs?
- Have you frozen IT spending OR have you taken advantage of the current slow period to upgrade and to train?
- Have you ceased all Travel OR have you proactively visited customers and providers?
- Have you idled Distribution Centers OR have you rearranged racking more efficiently and “performed Kaizen events in the warehouse”?
[Source of final bullet: Dr. Bruce Amtzen, MIT Center for Transportation and Logistics.]
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