GOOD QUESTION: What’s Your Controversial Take on a Supply Chain Issue?
Industry insiders share their controversial opinions on supply chain topics.
The current global supply chain is unsustainable. A sustainable model embeds environmental, social, and governance best practices into how raw materials are sourced, turned into products, and delivered to market. Global supply chains have been focused on achieving financial efficiency. The result is messy and fragile supply chain systems.
Vice President, Business Development
Forced standards, even if imperfect, make more sense. While historically standards have been determined by the free market (VHS vs. Betamax, etc.), the pandemic demonstrated alarming gaps in all supply chains. We need to act quickly and we do not have enough time for the free market to crown a winner.
Manufacturers and logistics providers face a crucial choice: They must either (1) engage in candid discussions with their economic development and governmental leaders to invest in the supply chain workforce or (2) embrace an accelerated adoption of automation. The challenges in the supply chain workforce cannot be left unattended.
World Trade Center Buffalo Niagara
Nearshoring will not be around for the long term. It’s a short-term reaction to turmoil in overseas sourcing points. In the long term, raw materials will always be sourced from wherever demand can be met at the lowest cost.
Information and Technology Services
Things would run smoother if more governing organizations intervened when major bottlenecks occurred. I don’t believe any single company or union should have the power to control a process when it hinders the entire supply chain.
Veterans Logistics Group
The Russian invasion of Ukraine and subsequent war have been tipping points in weakening global supply chains—but climate change has been undermining their resilience since long before that. War might get resolved, but climate change is still the biggest long-term threat to supply chains and is excluded from decision-making.
CEO and Co-Founder
In the next 10 years we will see a heavy unionization of roles due to automation and artificial intelligence standards becoming the norm. Based on the impact of these technologies, I see governments enacting laws to ensure the future of work is sustainable, equitable, and beneficial for all mankind.
–Ann Marie Jonkman
PMP, Senior Director, Global Industry Strategies
The billions of dollars spent by startups on technology with the intent to completely automate the brokerage industry won’t prove to yield a high return on investment. The billions of dollars spent by large incumbent brokerages on technology to create efficiencies and better serve their clients and carriers is where real value will be created in the industry.
Chief Information Officer
Echo Global Logistics
Nearshoring or ally-shoring will prove difficult if not impossible. As much as companies would like to decouple from certain countries, there are powerful reasons (manufacturing expertise and scale) why they will simply have to deal with sourcing from higher-risk countries.
Practice Director, Security and Resilience
We need to take a hard look at port disruptions and labor shortages. These issues won’t go away by conducting business as usual. What’s at the heart of work slow-downs? Why aren’t the jobs we have to offer attractive? Finding answers to tough questions will keep global supply chains moving.
International & Alaska
California’s AB5 and CARB decisions are having a significant and deleterious effect on the American economy. They are causing driver shortages, owner-operators to exit, and will massively increase costs by forcing electric truck utilization and slowing the supply chain due to long charging times versus fuel pumping.
The ripple effects of the pandemic have ultimately left logistics and procurement in a better place. Yes, they have made for the toughest operating conditions in a generation—but have also shaken up the industry, forced us to embrace innovation and agility, and provided the infrastructure to tackle future challenges.
CEO and Founder
The recent rise in fraud in the domestic truckload market will lead to more consolidation of power by large 3PLs and trucking companies that also have large brokerages.
- Smaller companies have a higher likelihood of going out of business if they are hit by these schemes.
- The costs to ensure compliance will continue to rise, which will more negatively impact providers with smaller shipment counts.
- Customers will look to lower the number of carriers they work with to have less exposure to potential fraud schemes that negatively impact their business.
AI-powered supply chain solutions should never strive for 100% automation. In the event they do, organizations will fail to uncover new opportunities that are exposed via human interactions, and progress will stagnate. People fuel growth and expansion, AI powers efficiency.
Blaming the supply chain for what ails us is no longer in vogue. It’s a worn-out cliché customers no longer find acceptable. Some would even say it’s insulting. Establishing and maintaining an impactful comeback means better forecasting, demand planning, and multi-sourcing products.
President & CEO
Most companies don’t look at inventory in the right way. I recall reading an article back in the late 1980s entitled J.I.T.–Just in Time or Just Inviting Trouble? I worked for a Japanese consumer giant at the time. That article stuck with me right up to the present day, and the dilemma should resonate with all of us.
The answer is not simple, and it can be vastly different depending on the complexity of the supply chain. It’s also important we recognize the following:
- The companies hit worst by recent events were the leanest (e.g. automakers; were they “just inviting trouble?”)
- These shortages will come again. Demand and supply will forever be at odds. Understanding where the risks are in advance is everything.
- OEMs will again panic buy and jam orders for way more than they need. This will cause supply chains all around the world to swell and potentially burst, wreaking havoc on the ecosystem around them.
VP, Global Supply Chain, Diversified Manufacturing Services (DMS)
The question is not whether or not companies will incorporate artificial intelligence. It’s a matter of when, in what capacity, what platform, and how much to invest. AI also will create new cybersecurity issues that will need to be addressed and combated.
Chief Technology Officer
Companies should prioritize sustainability over cost efficiency. While cost reduction is important, environmental concerns and social responsibility should also be given equal weight in decision-making to ensure a more sustainable and ethical supply chain.
Chief Executive Officer
U.S. logistics companies who ignore, delay, decry or deride the importance of having an ESG roadmap or program will find themselves without invitations to RFPs for large domestic and international cargo owners. They see logistics companies as mandatory partners in helping them reduce carbon emissions and meet their sustainability goals.
Position : Global
Exchanges should not be the highest priority for customer returns. Amazon has proven that providing convenient drop-off options with quick refunds is what drives long-term trust, loyalty, and profit.
Inmar Post Purchase Solutions
Sustainable delivery is not more expensive. Many retailers fail to understand that sustainable home delivery costs less. Consumers are interested in sustainable delivery options and ones that combine or slow deliveries down or increase delivery density are lower cost alternatives. It’s up to retailers to present sustainable delivery options and let consumers pick them.
EVP of Industry and Services
Now is the time to automate supply chains. Pressure to automate has subsided with slack demand. Yet automation is best done during down cycles as slack demand reduces implementation risk and prepares firms for the next cycle.
Co-founder and Partner
To combat the labor shortage in the logistics industry, many leaders rush to automate. However, this can be a mistake if companies do not first involve all necessary company departments, establish clear objectives, and know their warehouse processes inside and out. Preparation is key to successful automation.
Vice President of Supply Chain Solutions
Reaching out to receive quotes from all of your vendors at least quarterly could lead to much cheaper rates and big savings in the long run. Rates change for existing partners regularly, and it’s important to compare and contrast a variety of freight companies. At the end of the day, simply taking the time to do your due diligence and ask questions on a regular basis can go a long way, even making or breaking an entire operation.
Founder & CEO
There is some confusion in the marketplace on the various supply chain forecasts for the remainder of 2023 and into 2024. Some organizations are saying the issues are resolving for them and others are saying challenges will continue to be a burden and may increase through 2024. So, what is the right answer? Is it dependent on the industry? Is it preparing for the worst and hoping for the best? Answering this question is critical to success and planning for businesses that rely on the supply chain for operational success.
Brother Mobile Solutions
Most warehouse management systems can’t get the job done in today’s high-volume direct-to-consumer environment. These legacy systems were built for yesterday—when purchases were made in stores. A better architected, flexible DTC fulfillment solution is required to connect today’s complex ecosystem to fill and deliver orders fast and meet consumer expectations.
Communication with supply chain partners is shifting away from EDI and towards B2B-via-APIs. EDI will remain, but APIs offer simplicity, quicker onboarding, and data modularity that will motivate logistics organizations to adopt and promote APIs whenever possible. Real-time data connectivity helps businesses efficiently capitalize on these API-based benefits.
Senior Technology Evangelist
The future is about a transition to serialized, real-time visible demand chains, with carbon and even better biodiversity as an important quality. Every item will be tracked with a digital twin or passport. Drivers to this transition will be food safety compliance in the United States, and the EU’s Carbon Border adjustment tax (CBAM), which will transform the flow of materials around the world. Through the standardization by wireless carriers of ambient IoT technology, which will decrease the cost of tracking 100x, borders and compliance will be automated and frictionless.
VP Climate & Circularity
Rising freight prices and extended lead times have posed challenges, and exploring alternative transportation modes, fostering local production, and embracing digital solutions may not fully address the underlying issues. Relying on suppliers and optimizing stock inventory will contribute to more sustainable and resilient long-term solutions.
Head of Procurement
Several trucking and logistics companies made decisions around maximizing profits for the past few years and are now paying the price for that. Shippers tend to remember companies that only took spot freight and didn’t protect their contracts. How this plays out in the coming years is going to be very interesting. Who will be standing?
In our interconnected global economy, the traditional notion of “supply chain” falls short in capturing the complexity and interdependence of modern business networks. Companies, regardless of size or geographic location, now operate within expansive supply networks that include contract manufacturers, contract packaging, and outsourced warehousing. While you may agree, I would argue it’s time to replace “supply chain” with “supply network” in our day-to-day.
SVP & Chief Marketing & Solutions Officer
SAP Business Network
Retailers must embrace the circular economy by reframing returns and overstock items as valuable resources. Leveraging reverse logistics and partnerships in the secondary market enables sustainable solutions, unlocking hidden value and creating a resilient supply chain ecosystem.
Vice President of New Business Development
Most supply chain software on the market is far too narrow in the problems it addresses. Brands and retailers need to start thinking far more comprehensively about digitalization. That means adopting software that considers all supply chain workflows and integrates them into one platform for maximum accuracy and efficiency.
Poor supply chain integration can be a deal breaker, literally. Costly delays, disruptions, and frustrated employees can quickly turn a promising deal on its head. To secure long-term value from a merger or acquisition, companies must prioritize a plan for effective supply chain integration prior to closing to gain a competitive edge.
Vice President, Client Engagement