May 2008 | Commentary | Checking In

Less Pie in the Sky And More Meat and Potatoes

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When asked about the economy, Harry S Truman said he wished for a one-handed economic advisor so he could never say, "on the other hand."

In certain sectors, the economy is bad and likely to get worse.

Why? Could it be that the decades without a national energy policy are coming home to roost as energy costs increase exponentially at every touch in the value chain?

Add tax and other policies that disrupt business, and therefore job growth, and throw in the cupidity and stupidity creating credit crises in the mortgage and finance sectors.

And let's not forget globalization pressures increasing competition and inflation, as emerging and booming economies buy copious amounts of almost every commodity, leading to higher prices and temporary shortages in oil, copper, steel, chemicals, paper and, yes, food.

On the other hand...I believe that the U.S. economy ought to be considered the aggregate of work that each and every one of us does. And many of us are working as hard as ever to compete and grow. There are some rocky times ahead, but the U.S. economy ain't yet dead.

Whether it is perception or reality, times like these remind us to be more conservative. Recent discussions with readers, solutions providers, carriers, and others in the industry revealed a trend toward postponing pie-in-the sky solutions - applications, technology, equipment - and sticking to the meat-and- potatoes solutions that drive immediate optimization and deliver quick ROI.

Some solutions are simple, such as placing speed governors on fleets and adjusting truck idling policies. Others are more strategic, focusing on logistics IT solutions that deliver quick, demonstrable ROI, such as the new generation TMS solutions.

Companies are also renewing their emphasis on avoiding costly disruptions, giving greater value to investing in visibility tools.

More and more companies are willing to listen to the social responsibility case for being green - but they are acting on the business case.

One reader, for example, says that changing to more efficient lighting in his distribution centers will save almost $100,000 in energy costs over one year.

At NA 2008, the Material Handling Industry conference held last month in Cleveland, I checked out a new generation of equipment - scanners that update and repair themselves, strategic forklifts that enable and empower the labor force with measurable efficiency gains, asset meters on materials handling systems that sip power on an as-needed basis instead of an always-on basis.

Many of these advances send strategic alerts that predict failure instead of sending a notice after the breakdown. When coupled with extra durability, they really deliver disruption avoidance savings.

What meat-and-potatoes steps are you taking in your operation while the economy recovers? Email us at editor@inboundlogistics.com so we can share your back-to-basics menu with other readers hungry for savings.


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