Oct 01, 2018, 09:05 ET
NASHVILLE, Tenn., Oct. 1, 2018 /PRNewswire/ -- In an era where technology is continuing to migrate consumer spending habits online and away from brick-and-mortar stores, the newly released 2019 Third-Party Logistics Study (#3PLStudy) highlights how supply chains are also going digital and using science to keep pace.
The publication, available at www.3PLStudy.com, is created and supported by Infosys Consulting, Penn State University, Penske Logistics and Korn Ferry.
Here are a few notable findings from the report, released today at the Council of Supply Chain Management Professionals (CSCMP) EDGE conference:
- What are the top concerns and challenges in regards to supply chain decisions? This can be answered from two different perspectives: the companies that manufacture and distribute goods and services (referred to as shippers in the study) and third-party logistics providers (3PLs). In order, the top nine concerns for shippers: infrastructure; workforce readiness; economic stability; freight/supply chain transparency; lack of strategic partners/suppliers in the region; regulations/tax structure; security/crime/corruption; executive-level talent; border-crossing delays. The list for 3PLs: workforce readiness; infrastructure; economic stability; freight/supply chain transparency; lack of strategic partners/suppliers in region; executive-level talent; security/crime/corruption; regulation/tax structure; border-crossing delays.
- Shifting consumer buying habits, which include a blend of in-person and online purchases of goods and services, requires quicker responses than the retail model of yesteryear. Shippers recognize the need for agility, but 42 percent of survey respondents said they have not made the required changes to improve their agility over the past five years. Fifty-one percent of participants did say, however, that they are open to new ideas, creating more opportunities for 3PLs to introduce and implement innovations.
- A key complaint among consumers who choose home or office delivery is that packages become lost more frequently. Within the last mile of the supply chain, defined as the final steps of package delivery to a person's home or business, exists an undervalued concept known as the last yard. The majority of shippers (71 percent) and third-party firms (72 percent) recognize its influence on key retailer metrics such as consumer satisfaction and brand loyalty. Yet, only roughly a third of all survey takers agreed that companies do enough to effectively manage last yard issues.
- In any given week, consumers buy products online for home delivery or in-store pickup and also still visit physical stores to make a purchase or return. This shopping blend is known as the omni-channel. Retailers have been working hard to emphasize an always-on, always-open shopping experience that provides seamless interaction across all retail sales channels, and that is creating different demands on all supply chains. In the survey, 38 percent of shippers said they are inconsistent across the omni-channel and 36 percent noted they have no capability in this area. Supply chains are investing in integrated technologies to reverse this trend, which include: enterprise resource planning software (72 percent); warehouse management systems (56 percent); transportation management networks (38 percent); and supply chain visibility tools (34 percent).
- Disruptions break even the strongest links across supply chains. When disruptions occur due to natural disasters, extreme weather or pandemics, supermarket shelves are missing key household items and products are out-of-stock online. The most common impacts, according to shipper respondents, are increased transportation and logistics costs (75 percent), transportation and logistics network disruptions (73 percent), and higher supplier costs (66 percent). The level of importance that companies and 3PLs place on mitigating these disruptions is greater than five years ago, with 23 percent of shippers and 22 percent of 3PLs scoring it significantly greater. The study notes that two major tools that companies and third-party logistics organizations can utilize to minimize disruptions are visibility tools (61 percent of shippers and 67 percent of 3PLs) and partnerships (72 percent and 64 percent, respectively). In the area of predictive analytics, 33 percent of 3PLs and 17 percent of companies are making use of these cutting-edge tools.
- Data sharing between shippers and 3PLs become increasingly important. The key to a successful 3PL-shipper relationship is the foundation-building accomplished during the request for proposal (RFP) process. It ensures that both the short-term and long-term goals of both parties are clearly understood and reasonable expectations are set in the relationship. In the study, 36 percent of shippers and 35 percent of 3PLs agreed that there are opportunities to improve the sharing of insight and data collected by the sales team with account management.
Ken Toombs, global head of Infosys Consulting stated, "The last mile in the world of logistics has quickly become one of the most mission-critical areas for shippers to address, as issues that occur here have major impact on brand perception, reputation and customer satisfaction. A mix of enhanced data along with emerging technologies, such as artificial intelligence, can play a key role in meeting the ever-increasing demands of today's enterprise customers."
Joe Carlier, senior vice president of global sales for Penske Logistics, stated the following in reference to supply chain shifts that come in a market of tightening capacity: "When there is no capacity, those conversations change. Today the focus is on maximizing utilization and resources as they are becoming more limited and moving products to the end user in the most economical way."
Meredith Moot, principal at Korn Ferry, suggested that change is the only constant in the supply chain today. "The continuous transformation of the supply chain due to technology, regulations or other factors only exacerbates the talent challenges in an already tight labor market. Whether you're looking for an innovation leader or a frontline employee, you have to think about attracting, retaining and training talent to build your workforce in a new, dynamic way."
Since 1996, this study has documented the transformation of the third-party logistics industry. Dr. C. John Langley, clinical professor, supply chain information systems and director of development, Center for Supply Chain Research at Smeal College of Business at The Pennsylvania State University, initiated this study to capture and measure this evolving industry. As part of this year's survey process, the study recorded over 650 respondents. The 2019 study, as well as an archive of previous publications, is available at www.3PLStudy.com.
Infosys Consulting is a global advisor enabling organizations to reimagine their future and create sustainable value leveraging disruptive technologies. And as part of technology leader Infosys, the firm has access to a global network and delivery capability of 200,000 professionals that help its consultants implement at scale. Visit InfosysConsultingInsights.com or reach out to [email protected] for more information.
Penske Logistics is a wholly owned subsidiary of Penske Truck Leasing. With operations in North America, South America, Europe and Asia, Penske Logistics provides supply chain management and logistics services to leading companies around the world. Penske Logistics delivers value through its design, planning and execution in transportation, warehousing and freight management. To learn more visit www.PenskeLogistics.com.
Korn Ferry is a global organizational consulting firm. We help clients synchronize strategy and talent to drive superior performance. We work with organizations to design their structures, roles, and responsibilities. We help them hire the right people to bring their strategy to life. And we advise them on how to reward, develop, and motivate their people. To learn more, visit www.kornferry.com
SOURCE Penske Logistics
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