What supply chain logistics can learn from the sharing economy
From waiting on home deliveries to managing business supply chains, we're all affected by shipping snags. And the logistics industry still faces disruptive driver shortages, climate issues and outdated infrastructure. Andy Moses, senior vice president, solutions and sales strategy at Penske Logistics, sees tech innovations like AI and sharing-economy-inspired networks as potential game-changers. For businesses, this could mean fewer half-filled trucks, more cost-effective shipping and better package tracking.
Kate MacArthur: What changes do brands need to understand about building a resilient, agile supply chain while still meeting speed expectations?
Andy Moses: They need to understand how critical data is. When you talk about data, you're really talking about process management, not systems. If you have reliable execution data from millions of transactions that occur in supply chains, that's a foundational piece. Then you've got to have great systems to leverage the data, and integration of systems so stakeholders across the supply chain can be enabled to make well-informed decisions. You've got to put all that together.
MacArthur: How so?
Moses: Do you have the process management so that you've got good information to work from? Do you have an architecture with your systems so that you've got the right systems and the typical systems? What about enterprise resource planning systems, transportation management systems, warehouse management systems, order management systems and all the foundational systems and supply chains? Have your teams mastered the use of these systems, or are you relying on third parties that have mastered those? And then how’s all this stuff integrated and getting information back to your various stakeholders where they like to consume it? That's the trick in my mind.
MacArthur: What is the biggest challenge in getting speed, efficiency and cost in a reasonable place?
Moses: You have to start with network design. Depending on your network, you’re either going to have to be really good at long-haul transportation, regional transportation, local transportation or all three.
MacArthur: What’s the biggest question you get about how companies can future-proof their logistics organization?
Moses: It’s this whole issue of managing capacity, having access to the capacity, and not being exposed to the extremes in cost in freight markets, which come about cyclically.
MacArthur: Is the driver shortage as bad as everyone makes it out to be?
Moses: It's very real. We have a lot of driver retirements in the immediate years ahead. And in some economies, we don't attract enough qualified applicants.
MacArthur: American drivers have negative attitudes about automated driving. How do you manage trust on the roads for average drivers alongside autonomous trucks?
Moses: Clearly, public perception’s a big issue, and it has to be navigated thoughtfully. My hope is that the insurance industry, political forces and business community can come together and make progress down this path. I don’t see it in the final mile soon. But from rest stop to rest stop on a long distance on an interstate highway, that’s the sort of thing I could really see happening more.
Few businesses are able to deliver a great digital experience to their customers today. … Not that many businesses, especially in the B2B space, have a grip on that yet.”
MacArthur: Is there one technology that will most impact how companies prepare their future logistics?
Moses: There are several, but in our industry, freight status visibility is probably No. 1 still. Few businesses are able to deliver a great digital experience to their customers today. And by that, I mean, can I go on digitally? Can I place an order? Can I change an order? Can I track an order? Not that many businesses, especially in the B2B space, have a grip on that yet.
MacArthur: What’s it going to take to do that?
Moses: Technology’s part of the solution. There are weaknesses in certain transportation modes, and investment capital will be drawn to exploit those and turn those into strengths. With process management over time, we’ll get there, and we’re way farther ahead than we were five or 10 years ago. As a supply chain community, we're not at the percentage we need to be to give a great digital experience to that end-user customer yet.
MacArthur: In five years, what will be the biggest difference in how goods are transported versus now?
Moses: We are going to see the sharing economy continue to advance and mature. Just like we have Airbnb and Uber, we'll see the elimination of wasted capacity in the transportation sector through more sharing, which is going to be good for the environment and for the economy. All those trucks you see going down the road aren’t all full. We have a lot of upside in transportation and in supply chains to leverage that capacity better. The best thing we can do for the environment is to move the material with fewer miles. It takes carbon emissions right out of the equation.
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