July 2016 | Sponsored | Knowledge Base

Is It Time to Think About Logistics Outsourcing?

Tags: Partnership, Logistics, Technology , Supply Chain

John Burke is CEO, ARMADA, 412-406-5700

Changing consumer behaviors, increasing consumer expectations and rapid advancements in technology are converging to create the need for supply chains to be more global, transparent, agile and responsive. We are at a unique point in time with all of these dynamics in place simultaneously that the supply chain function is evolving in its breadth of competency and increasing in its level of complexity. Supply chain management and execution is now viewed as a highly specialized core business function capable of driving favorable results to the bottom line.

To ensure that companies are leveraging the latest strategies for their supply chain operations, many are turning to logistics outsourcing. Companies that outsource their logistics functions are often able to align their supply chain activities more effectively with their overall business strategy, which is a key to success. A logistics outsourcing partner leverages its expertise to help a company advance its supply chain strategy by defining and delivering the network capabilities required to support overall business objectives. The alignment of incentives between a company and its logistics partner is a core element of outsourcing ensuring objectives are clear and collaborative behaviors are fostered.

With this alignment in place, strategic elements in the supply chain can then be executed.

Leading-Edge Solutions Oriented Thinking and Execution—As the demands on supply chains have increased, logistics management practices and technologies have evolved significantly. A logistics outsourcing partner ensures that a company is leveraging leading-edge thinking to define supply chain needs, prioritize challenges and develop and execute customized solutions that are targeted to support specific business objectives.

State-of-the-Art Technology Platforms—End-to-end supply chain visibility provides the foundation to migrate from a reactive supply chain management approach to a proactive model. A logistics outsourcing partner provides a state-of-the-art technology platform that enables transparency of supply chain activities across all trading partners and provides real-time access to vital data. An updated technology platform also provides proactive alerts to network stakeholders on issues affecting supply chain performance and automates responses to disturbances in the supply chain. The result is a much more agile, dynamic and efficient network.

Engineering-Based Network Design, Modeling and Optimization—Proactive supply chain management requires a comprehensive, engineering-based approach to supply chain planning. A logistics outsourcing partner combines engineering and operations expertise with state-of-the-art optimization and simulation software to remove complexity and cost from supply chain infrastructure. Continuous monitoring and assessment of the supply chain helps to ensure that high service levels are maintained while providing the flexibility to meet changing business needs. It also helps minimize the cost and impact of short-term disruptions, such as unexpected changes in consumer demand related to promotional activities.

Driving Value Throughout the Supply Chain—With a holistic approach to the supply chain, a logistics outsourcing partner serves to reduce fragmentation and centralize supply chain activities. This provides a foundation for developing and implementing solutions that drive value and decrease costs throughout the supply chain. A logistics outsourcing partner also fosters collaboration by orchestrating the activities of all trading partners, diminishing the burdens placed on network stakeholders and positioning a company as a "customer of choice" for key network partners.

The need to move more goods to more locations more quickly and accurately than ever is applying unprecedented operational and financial pressure on supply chains. A company's ability to efficiently execute a supply chain strategy in today's environment can be enhanced by logistics outsourcing with a strategic partner.






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