What are the top challenges logistics CEOs face in the current supply chain arena?
Authored by SMC³ on June 25, 2019
It’s impossible to avoid politics at any substantive gathering of supply chain and transportation industry leaders, and during the first day of the Connections 2019 logistics conference at the Broadmoor in Colorado Springs, the government was front of mind, both implicitly and explicitly, during most panel conversations.
Jim Burnley, a former secretary of the Department of Transportation, laid things out quite bluntly during an afternoon panel on regulations, telling the audience that the common refrain of “Washington is broken” has an element of truth.
“It’s about as dysfunctional today as it has ever been,” he said. “On a sustained basis we are not getting much done, especially on the legislative side.” Deregulation is one area of significant activity, he noted. “But legislatively, we are pretty much, as you read and hear, at gridlock.”
Burnley added: “We’re all interested in what’s going to happen on surface transportation infrastructure. The answer, sadly, is little or nothing good in the foreseeable future.”
Supply chain CEOs take stock of the transportation world
In a morning panel populated by CEOs of some of the largest supply chain and transportation companies operating today, talk of supply chain challenges quickly turned to regulations. Darren Hawkins, CEO of YRC Worldwide, said one of the biggest challenges is the “whipsaw we’re seeing from a tariff perspective.” Uncertainty is not a good thing in this market, he added.
Bob Biesterfeld of C.H. Robinson looked at the biggest challenges from a different perspective, saying they are all rooted in talent. Attracting drivers is, of course, a perennial concern for carriers, but he also noted that finding the right people to address data-driven analytics and a shipper’s engineering needs is becoming difficult.
3PL transformation
Mike Grayson, executive vice president of Worldwide Express, said he thinks this is a fantastic time for 3PLs in the supply chain, telling the Connections 2019 audience that this is “probably the most transformative period in transportation since the early 1980s and deregulation. There are a lot of things happening.” But choosing how to take advantage of this activity is up to each individual company. There’s no “silver bullet” to becoming a next-generation 3PL, he said, but there’s also nothing stopping any company, however small, from taking advantage of upward trends currently existing in the marketplace.
To back up his thoughts, Grayson turned to numbers. More than 60 percent of shippers surveyed recently said they expect to increase their use of 3PLs this year, a small uptick from 2018. As a reflection of that trend, over the next five years, 3PL revenue is expected to grow at an average of 7.7 percent annually.
In the current industry, Grayson said the carrier and 3PL relationship has transitioned from tactical to strategic. Technology is also no longer a “nice to have,” as the barrier to entry has significantly lowered to allow even the smallest companies access to a vast technology toolbox. Another big driver of 3PL growth is private equity money.
Women leadership in logistics
During a special lunch event focused on women in the industry moderated by Women in Trucking president and CEO Ellen Voie, Kendra Miller, SMC³’s director of alliance partner development, talked about being intentional with hiring practices and promotions, identifying qualified female candidates and integrating them into supply chain companies. Networking events and conferences that promote women in supply chain leadership roles are also an important part of creating stronger visibility for women in the field.
Voie added: “Being intentional means doing things like this. People ask, why do you need a Women in Trucking Association, and I will tell them, well if you’re okay with the fact that women make up less than 25 percent of management in the trucking and logistics industry, then don’t join. But I think we have a long way to go.”
Lindsey Graves, COO of Sunset Transportation, said she has been successful in her career by listening first and never assuming she has all the answers. As a woman in a family business, Graves told the lunch crowd she had to battle with the perception of being the boss’s daughter and had to work extra hard for everything she has achieved. While rising through the ranks at Sunset, Graves kept an emphasis on company culture and finding the absolute best person for a given position.
“I just love the ability to hire whatever talent fits our culture,” she said. That to me is more important than the book smarts. I love being able to give a person an opportunity…that’s the best part of my day.”
Voie closed with a parcel of good advice for women looking to move up in supply chain companies. She told the crowd to stop saying “I’m sorry,” learn to take a compliment – “just say thank you” – and raise your hand.
“You have to speak up,” she said. “Point out when you’ve done something well; a lot of times, people might not be aware.”
To learn more about SMC³ supply chain conferences, visit http://www.smc3.com/supply-chain-education.htm.