January 2002 | Commentary | Checking In

How Logistics Shaped Our Nation: Making Waves

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New York, it turns out, achieved its "Empire State" status, at least in part, because of the canals that linked New York City to the Midwest and the west. That point was made in a recent PBS special on New York State and the integral role transportation played. Products, people and ambition flowed west. Raw materials flowed east. Except for a few notable exceptions, cargo moving by canal is a thing of the past.

Curious about how our discipline shaped our nation, I wondered how what we are doing now will shape the future face of our nation. The people back then were smart, visionary and tough. Are we? By and large they created much of what we have today by pressing their vision of America transformed by a network of canals, rails and roads despite obstacles that would deter lesser men. Inspired by classical studies and tempered by privation, these transportation visionaries set an example of behavior for us to follow today. Can we do that?

Their contributions were not just limited to transportation, commerce and trade. In 1834 a canal builder, John Scott Russell, was riding along side a canal and discovered a phenomena that drives many of the advances in supply chain being adopted today. When the mules hauling a barge were brought to a stop quickly, Russell noticed that the mass of the stopped barge creates a solitary wave - a soliton - that moved along the canal - seemingly undiminished - for a great distance.

How does that 1834 discovery drive today's logistics efficiencies? Linn Mollenauer, a Bell Labs researcher, showed us one way. In 1988 he demonstrated how an optical solitary wave with information traveled down a fiber optic network for more than 2,400 miles. In 1994 he demonstrated another soliton of information traveling 24,000 miles - about the circumference of the Earth - without much diminution. Much of the productivity created by logistics is due to the fiber optic networks that carry our inventory and transportation transactions, logistics information and supply chain decisions over the Internet. As bandwidth increases and "I-tone" become ubiquitous, supply chain innovations will create even more productivity.

Global supply chain information at light speed traced back to some mules and a barge in 1834? There is the practical application of Russell's solitary wave theory but can we use it theoretically as well? I think we can.

The events of 2001, economic and otherwise, have some companies in "hunker down" mode. Capital expenditures are not being made. Technology is not being invested in. The "disruption" of rebuilding our supply chains by executing new logistics ideas is being postponed as we deal with very real disruptions of another kind. Actions and ideas that generate the new waves of efficiency we need to drive future logistics successes are in a holding pattern.

But a look at this day's business headlines show how important it is that we not let this happen. Kmart is on the ropes. Many observe that they were hobbled by legacy transportation ideas and practice, not able to see the inventory in their own stores or manage the inbound flow to efficiently compete. There were surely other problems, but competitors like Target, that built a logistics network unfettered by legacy, or Wal-Mart, that constantly examines, innovates and improves its SCM practices, gave Kmart 2 logistically tough competitors. Add to that Kmart's own supply chain failures and you can see a powerful example for the need to continually innovate and improve logistics excellence. The barge has stopped but examples in the news teach us that we must continue to drive supply chain efficiencies, ideas and innovation forward.

2002 may not be expected to be a big year for supply chain investment and innovation but we still can ride the wave of what we've done in 2001 to drive our discipline forward. Let our metaphorical "barge" be all our past transportation expertise the solitary wave be the outrider of innovation and change that we must have to continue to succeed. Maybe soon those mules will start up again and that barge will move forward once more.

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