Clearing the Road Ahead: How to Reduce the Cost, Complexity, and Uncertainty of Global Logistics

Between the trucker shortage, rising transportation costs, and the explosion of U.S. import and export traffic, every company is looking for ways to streamline shipping processes and optimize their supply chains. While it won’t be easy, there are a few key steps every business can take to help reduce the inefficiencies and improve the performance of their logistical operations.

Let’s take a look at a few of these key steps, what they enable, and how they help save time and money.

Friction is the enemy. Minimize it through digitization.

For Paul Keel, Senior Vice President of Supply Chain Management at 3M, optimizing the modern supply chain is largely about minimizing friction. “Friction occurs at the connection points,” he says in a recent Forbes.com article. By using digital technology to sync all the elements in 3M’s supply chain, enable more centralized, open communication, and connect supplier and shipper systems, Keel isn’t just increasing efficiency, but increasing trust. According to him, the hard data generated by these efforts offers tangible proof that “our suppliers will perform as they promise us they will, and 3M in turn will perform as we promise our customers that we will.”

Not only can digital workflows reduce friction in the actual delivery of goods, but they can streamline time-consuming in-house tasks too. From automating processes like geocoding and VX lookups, to running real-time reports with ease, there are a whole host of costly, inefficient bottlenecks that modern logistics platforms can help companies eliminate.

Expect chaos. And use technology to navigate it.

Jose Lopez, who served as Nestle’s Chief Operations Officer until 2015, summed up the heightened stakes of 21st century logistics with a smile. When asked what it means to suddenly be responsible for 440 factories in 86 countries and 1,300 global warehouses and shipment points, he responded: “It means I’ll be blamed for whatever goes wrong.”

And things will go wrong. But rather than the “plan and pray” attitude that characterized logistics in the past, modern tools and technologies enable businesses to diagnose and resolve problems more proactively, through greater real-time supply chain visibility.

For example, Corning International, a multinational company that produces specialty glass, is using impact sensors to cut down on damage claims. “I know at any given point of time that my glass incurred an impact on mile marker 57 and [at] 1 a.m., so I know who had the glass at that moment,” Vice President of Global Supply Chain Cheryl Capps said in an article published on JOC.com. “We have one indisputable record and our partners are excited because they have data to find the root cause of the problems and claims will go down.”

Don’t go it alone. Logistics is increasingly a team effort.

Hunting down carriers, dealing with damaged freight claims, properly forecasting costs, monitoring product security in transport, better aligning supply with demand—these are all table stakes in maintaining an efficient logistics operation. But trying to do it all yourself means burning loads of resources that may be better spent elsewhere. This may be why companies are spending more on outsourced logistics providers every year.

It’s a sound strategy. Not only do you free up time for things like innovation, business development, and better customer service, but you also get the benefit of tapping into a partner’s connections, expertise, and pre-vetted carrier relationships. Throughout the entire disruption of the logistics industry, the theme of horizontal connectedness is a constant. Teaming up with a logistics partner is one way to break down the silos that slow you down and chip away at your bottom line.

Join forces with an experienced global logistics partner.

Having been in the supply chain industry for the last 60 years, we’re excited about all possibilities the future of logistics holds. Our focus has always been about finding new ways to leverage technology, relationships, and local expertise to give our clients a logistical competitive edge. If you’d like to talk with us about how you can modernize your supply chain, reach out today.

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