With our Supply Chain Leadership Forum quickly approaching, I’ve invited the Consortium’s Executive Director and my brother, Bruce Tompkins, to tell us a little more about how folks can benefit through networking at the August 29-31 event in Florida. – Jim

In today’s fast-paced world, how often do any of us slow down enough to stop and talk face-to-face with colleagues about developments in the supply chain field?

When do we take the time to find out what others are doing and seek answers to puzzling questions?

For me, the answer to these questions is: "Not very often."

Is there not enough value in taking this time to learn from others, or do I already know everything there is to know, so why bother? Or is it just a matter of opportunity?

I would argue that it is all about opportunity. There are few opportunities to really network these days, even when you consider the conferences you may attend or the people you may interact with online during the course of working hours. But even conferences today tend to be too fast paced – with packed agendas and speaking whirlwinds designed to educate by lecture instead of through discussion and interaction.

Face-to-face networking offers tremendous opportunities to learn what successes and failures your peers have experienced. You get the chance to ask questions that help you gain a deeper understanding of a topic, as opposed to the cursory view presented at most conferences.

I think there is great value in true face-to-face networking with smart, knowledgeable, interesting people, and so I suggest an oasis in the conference jungle: The Supply Chain Consortium’s Leadership Forum.

The forum is based on a format of breakout sessions in which participants share ideas and insights on a variety of supply chain topics. And there is plenty of time in between sessions for getting to know one another and learning how others in your industry are dealing with today’s toughest challenges.

Check out how to join the Consortium at http://www.supplychainconsortium.com/, and then come network with us this year at the Walt Disney WorldÒ Resort in Lake Buena Vista, Florida.

-- Bruce

In this recovering economy, third-party logistics providers (a.k.a. 3PLs, logistics service providers, or LSPs) are jockeying for position to claim their share of new and increased business. Why? Because shippers across a wide variety of industries are once again focused on growth.

Whether it’s concern about freight capacity and rates, requirements for additional distribution points, entry into new markets, or a strategic direction to outsource logistics functions, shippers are increasingly turning to LSPs. As such, the outlook for growth in the 3PL industry, short and long term, is good.

But this evolution in the 3PL industry certainly hasn’t made it easier for shippers to navigate through the myriad of service options that exist.  Many LSPs have difficulty presenting their portfolios in a way that promotes their services, and even those who offer “integrated services” struggle with how to organize – and sell – for maximum effectiveness and client satisfaction.

Basic terms such as contract logistics, transportation management and global freight forwarding seem easy to understand on the surface; however, each of these terms covers a host of potential services.  Then there’s the positioning of asset, non-asset, asset light, asset right …. and the list goes on. These claims can be very confusing, especially as LSPs add to their capabilities in an array of different scenarios through organic expansion, strategic relationships, internal reorganizations, and M&A activities.

So, a very important question for you LSPs out there: How do you ensure that your customers a) know who you are? and; b) know how to find you?

Five Basic Questions that 3PLs Often Miss

 When you read my tips below, you may dismiss them as stating the obvious. But trust me, based on the 3PL marketing materials and presentations we have reviewed, as well as LSP site visits and marketing assessments we’ve completed, a large number of LSPs – big and small – still don’t have this right.  Consider these five simple questions:

1. Do you have an elevator speech that even your parents could understand?
2. Does your website clearly identify who you are, what you do, and who you serve?
3. Have your clearly identified your target market?
4. Have you clearly differentiated your market position?
5. Have you clearly communicated your Value Proposition and market differentiators?

Never assume that if it’s clear to you, it’s clear to the marketplace. Gaining external perspectives to test and fine tune messaging, researching specific needs by market segment, and thoroughly analyzing your findings for correct positioning are all really important. 

Once these basics are in place, it will be much easier to ensure that your marketing and sales tactics align. Then you will be executing on all cylinders – reaping the benefits through improvements in renewal, expansion and new contracts.  And of course we know your work does not stop there.  You must be sure to continuously deliver on promises through excellent service, year-over-year innovation, and continuous improvement in value delivered. 

And let’s not forget the power of implementing best practices and of networking with shippers and others in your industry. You may have already heard about the successful Tompkins Supply Chain Consortium. What you may now have heard is that now 3PLs also have the opportunity to actively participate in this vibrant community through a special LSP Supply Chain Consortium.

As an LSP, do you have the five basic questions down pat? Do you want to expand your knowledge base via supply chain benchmarking and best practices?

Feel free to respond in this post, or contact me directly at vbonebrake@tompkinsinc.com. As Jim says, Go!Go!Go!

Valerie

More Resources

LSP Top 11: Market Forces Drive Freight Costs Up

Tompkins Supply Chain Consortium for Logistics Service Providers (LSPs)

Logistics and Manufacturing Outsourcing: Harness Your Core Competencies

Putting out fires. Mending fences. Treading water.

We have a lot of ways to refer to “those types” of days at work. You know the ones –when we are so focused on a rapid-fire series of tasks that the day is over before we knew it had begun.

I often read articles about leadership that recommend you take a step back from your work and management activities to see the bigger picture. By doing this, you are able to look at the tasks you do each day and decide if you are still doing them in the right way, if some are still important to even do, and if you are still leading your team to do the best possible work they can do.

No doubt, it can be difficult to find the time to re-examine the context of your work.

There are many techniques that have been documented on how to accomplish this, especially because it is difficult to take time to do it consistently. I read about one technique recently in the Harvard Business Review that I thought was a particularly appropriate metaphor for this re-examination of context and smart leadership.

The author compares finding this time to creating “white space” in your schedule to contemplate and get perspective on management and overall strategy.  Click here to read the post, which also explains the benefits of scheduling white space.

What was especially interesting to me about this concept is that in order to capture white space, a leader needs to take some time to be alone instead of with his or her team.

Do you think you could consistently schedule and keep white space time? And if you are already following this practice, how do you make it unique to your situation or work?

Go!Go!Go!

More Resources

Bold Leadership for Organizational Acceleration

Photo Credit: meddygarnet

I hope you enjoyed my previous post about proposed changes in U.S. transportation laws.

Today, I want to relay some thoughts on the Federal Motor Carrier Safety Administration’s Compliance, Safety and Accountability (CSA) proposal, as mentioned in the Supply Chain Consortium’s recent report, Domestic Transportation: Finding the Right Balance of Volume, Capacity and Pricing.

CSA is a well-intentioned proposal with the goal of getting dangerous commercial drivers off U.S. roads. Now you may be wondering, “How could this be controversial?” Well, if these dangerous drivers were the only ones being eliminated from the pool, there wouldn’t be any pushback.

The only problem is that good drivers are getting caught up in the same net. This primarily happens two different ways:

1. As proposed by CSA, the new system views all accidents the same. There is no distinction between a driver who is involved in a fatal accident because he gets rear-ended while stopped in rush-hour traffic and one who falls asleep at the wheel and causes a fatality.
   
2. The system depends on accurate data entry and record keeping by state and local law enforcement officials. In parts of the country where CSA is being piloted, data has been found to be inaccurate a substantial 5% of the time. The idea of one out of every 20 drivers being sidelined – even temporarily – by something as simple as a key-punch error is pretty scary.

Scarier still is the responsibility that CSA puts on shippers. As the rules are currently written, shippers must know that a carrier is in good standing before any loads are tendered – a status that can change from day to day for each carrier.

Furthermore, the shipper’s CSA responsibility extends beyond the carrier of record, to the actual transporter of goods. This substantially complicates the process of brokering loads (allowing carriers to use other service providers) and the entire spot-market process.

All of this means increased administrative burden for shippers, lower capacity for carriers and, ultimately, higher prices for consumers.

Let’s hope this well-intentioned policy gets put on the back burner until a few more of the kinks get worked out.

What do you think about the proposed transportation regulations?

Jim

More Resources:

Domestic Transportation Report

Warren Buffett's Ride on the Rails Is Paying Off, Businessweek article

Transportation Management and Reducing Costs in the Supply Chain

Photo Credit:  lrargerich

A few days ago, I got a chance to read the Supply Chain Consortium’s latest report, Domestic Transportation: Finding the Right Balance of Volume, Capacity and Pricing. Of course I am biased, but I thought it was a must-read for any supply chain leader who is concerned about transportation trends and costs. 

The sidebar piece on the Hours of Service (HOS) and Compliance, Safety Accountability (CSA) proposals makes some great points about a couple of changes that could soon be happening within the industry. I’ll talk about CSA in more detail in an upcoming blog, but today, I wanted to focus on HOS.

Basically, the Federal Motor Carrier Safety Administration (FMCSA) is proposing to increase safety by decreasing the number of hours drivers are on the road. But, at the same time, these new proposals have some potentially devastating negative effects on the industry. 

The two main proposals being touted are:

1. Reducing the length of driving time each day by one hour, allowing drivers to be on the road 10 hours a day, instead of 11. 
2. Adding a component to how “restarts” (essentially weekends) are figured.  Currently, a driver’s “weekend” is calculated as 34 consecutive hours off. In the proposed change, the 34 hours would need to include two periods of downtime between midnight and 6 a.m.  This means a driver finishing his week just after midnight would need to wait up to 57 hours before being eligible to drive again. 

While the industry is not happy about either HOS proposal, the second one is most perplexing, considering that this rule would, effectively, mandate that a large percentage of drivers begin their day during the peak morning rush hours. This idea hardly seems conducive to increasing safety, since there aren’t as many cars on the road at night.

Not to be overlooked is the first issue, reducing the length of time an individual may drive by one hour represents an effective 9% reduction in work force. I know unemployment is still high but, the last time I checked, people weren’t lining up to become over-the-road truck drivers.

Still, if these changes were being proposed to solve a chronic problem and make our roads safer, it would be hard to argue with them (regardless of the cost or imposition). I don’t think anyone, including me, would argue that safety on the roads is not of great concern.

However, the number of fatalities caused by accidents involving large trucks has declined every single year since 2004, including last year – the lowest number on record since the stats started being kept. With all the challenges the economy continues to face, enacting new laws that will constrict supply and increase costs in order to solve a problem that is already under control doesn’t seem like time well-spent.

Or is it a policy that should be accommodated in order to ensure even safer roads? Like the title of the report says, it may come down to “finding the right balance.” What do you think?

Go!Go!Go!

Jim

More Resources:

Domestic Transportation Report

Warren Buffett's Ride on the Rails Is Paying Off, Businessweek article

Transportation Management and Reducing Costs in the Supply Chain

The Tompkins Supply Chain Consortium

Photo Credit: sheqafrica

Ketchup, french fries, soft drinks, cereal, milk, coffee, and sugar. No, this is not my grocery list; it’s just a sampling of food and beverage (F&B) items that have become more expensive in the past six months.

But this is not surprising, given unsteady commodity prices and economic uncertainty. In fact, when we published the Top 11 Priorities in 2011 for Profitable Growth in the F&B industry, mitigating commodity price increases and controlling operating costs were two of the top items.

Now, Tompkins Associates’ experts have taken a mid-year look at these priorities to see if our predictions are coming true and to catch what we may have missed earlier. It is true that commodity price surges and higher transportation costs are affecting F&B supply chains; however, we did not predict that it would happen so quickly or exactly how companies would respond.

Integrating commodity purchasing and logistics strategies has become a top priority for F&B companies in the cost-cutting arena. How are they accomplishing this? One way is through Direct Store Delivery (DSD) of products, using strategic network designs and supply chain solutions to both sell and distribute directly to the point of sale.

DSD has been used extensively in the fresh food supply chain for products such as milk and bread in which the number of days until sold is an issue. But in today’s economic climate, I am seeing wider use of DSD among some of the larger companies that want better control over costs.

And retailers are pleased with DSD vendors, according to a study conducted earlier this year via the Food Marketing Institute and Grocery Manufacturers Association.

So is DSD a trend for the future or a temporary response to price increases? Regardless, scrutinizing the supply chain and distribution channels to improve operations is always a smart choice when it comes to beverage and food distribution.

More Resources

Transform Your Fresh Food Supply Chain

Tame the Global Food Supply Chain

More on Trends and Challenges in the Food and Beverage Industry

Photo Credit: Steve Snodgrass