Mitch Mac Donald has more than 30 years of experience in both the newspaper and magazine businesses. He has covered the logistics and supply chain fields since 1988. Twice named one of the Top 10 Business Journalists in the U.S., he has served in a multitude of editorial and publishing roles. The leading force behind the launch of Supply Chain Management Review, he was that brand's founding publisher and editorial director from 1997 to 2000. Additionally, he has served as news editor, chief editor, publisher and editorial director of Logistics Management, as well as publisher of Modern Materials Handling. Mitch is also the president and CEO of Agile Business Media, LLC, the parent company of DC VELOCITY and CSCMP's Supply Chain Quarterly.
Over the years, Mark E. Richards has done a lot of thinking about the right way to choose a third-party logistics service provider—thinking he has now distilled into a simple six-step process.
In formulating those steps, Richards has drawn on his vast experience in logistics, having worked in the field for more than 30 years. His first job was with a multicity public warehouse company, Distribution Centers Inc. He went on to work for such companies as Nabisco, Gillette, and Oral-B. He is currently the vice president of Associated Warehouses, a consortium of more than 50 third-party logistics service providers (3PLs) operating over 110 million square feet of space in North America and Europe.
Throughout his career, Richards has been actively involved with industry groups like the Warehousing Education and Research Council (WERC), Council of Supply Chain Management Professionals (CSCMP), and International Warehouse Logistics Association (ILWA). He was appointed to the CSCMP executive committee at the 1999 Annual Conference and served as chairman of the board of directors during 2005 and 2006.
Richards met recently with DC Velocity Group Editorial Director Mitch Mac Donald to talk about how he fell into the profession and the six keys to win-win shipper/third-party relationships.
Q: What led you to seek a career in logistics and supply chain management?
A few weeks later, his company contacted me and asked if I would be interested in interviewing. Again, I said, "Thank you, but no thank you." They said, "Well, how about if you consider it a practice interview?" The next thing I knew I was working for Distribution Centers Inc. and Ken Ackerman.
Q: What changes have you seen over the past 30 years in the way businesses approach logistics and supply chain management? A: More and more organizations are recognizing the critical role that logistics plays. One manifestation of that is Tom Friedman's assertion in one of his books that those companies that have the most effective and efficient supply chains are the ones that will "win." So here you have a general publication that is recognizing the importance of supply chain. Another popular expression of it is the advertisements that we see on TV now. Thirty years ago, you wouldn't have seen "I love logistics" and UPS and others promoting logistics.
Q: Do you think the failure to stay on top of emerging technologies could put a company at a competitive disadvantage? A: Definitely. There are so many things that will revolutionize what we do and how we do it. Take robotics, for instance—the idea of a $20,000 investment in a robot that could handle picking and packing in a distribution center. I can also see a day where you have a third-party distribution center become a farm of sorts that would contain many, many 3D printers and all the ingredients that go into that printer. Someone places an order and that third party prints it, packs it, and ships it.
Q: What's the value of being active in industry associations like WERC, CSCMP, and IWLA? A: You have to not only take from the profession but also give back to that profession and be willing to invest yourself in hopefully making the profession better than when you entered it. My father and mother raised me with the whole idea of giving back. Even beyond that, I just believe that none of us has all the answers. I have been involved because I knew that it would expose me to different perspectives, different thinking, and different experiences and that could only be good for my personal development.
Q: You have come up with a six-step process for selecting a third-party provider that allows everybody to win. Could you summarize those six steps for us? A: One of the first steps is to understand yourself. Someone will contact us saying they need help looking for a third party and what's the price. I'll say, "Well, we can get to that, but can you tell me what you are trying to do with this and what your objectives are? Why are you even thinking about outsourcing?" Really, the first step is understanding who you are as a company and what your objectives are.
Another key is getting as many people as possible within the organization involved in the process. There again, I see people that want to outsource, and they start down that path but with minimal or no involvement from people in human resources or IT or finance or sales and marketing. To me, that is a mistake. You get those people involved from day one and your solution can be so much better.
Q: What are the next steps? A: Another key part is communications. Remember, you cannot overcommunicate. I'm a believer in communicating in a variety of ways: via phone, via text, via e-mail, via printed material. As you do that, you will be amazed. You have to kind of chuckle, "My goodness, I've said that to you, shared that with you six times and you are just now hearing it?" Because that is how we all are.
When you go to select a third party, another key consideration is the culture and cultural fit. That's probably the most important factor. You can teach anybody a technical process, but if there isn't a cultural fit, the result is not going to be as good as it could be. Part of that is asking questions that you might not typically think of. You need to be asking more of the "soft stuff" to understand the organization from a cultural standpoint and again, getting people involved in that process. It shouldn't be a one-person process. You should have other people visit the facility.
Q: And the next step? A: The next step concerns the implementation process. It's an area that I think a lot of people take pretty lightly. They need to have a plan that everybody can rally around and agree upon.
The final step is maximizing the results. Now that you have this partner, you really need to consider it an extension of your company and treat it just as you would someone within your organization. You need to share your expectations. You need to train. You need to have ongoing contact and communication with them, and you need to celebrate successes. I am a big believer in that.
Q: What advice would you offer a young person considering a career in logistics and supply chain management? A: Be actively involved and always give. When you give of yourself, you will be amazed at what comes back.
The U.S., U.K., and Australia will strengthen supply chain resiliency by sharing data and taking joint actions under the terms of a pact signed last week, the three nations said.
The agreement creates a “Supply Chain Resilience Cooperation Group” designed to build resilience in priority supply chains and to enhance the members’ mutual ability to identify and address risks, threats, and disruptions, according to the U.K.’s Department for Business and Trade.
One of the top priorities for the new group is developing an early warning pilot focused on the telecommunications supply chain, which is essential for the three countries’ global, digitized economies, they said. By identifying and monitoring disruption risks to the telecommunications supply chain, this pilot will enhance all three countries’ knowledge of relevant vulnerabilities, criticality, and residual risks. It will also develop procedures for sharing this information and responding cooperatively to disruptions.
According to the U.S. Department of Homeland Security (DHS), the group chose that sector because telecommunications infrastructure is vital to the distribution of public safety information, emergency services, and the day to day lives of many citizens. For example, undersea fiberoptic cables carry over 95% of transoceanic data traffic without which smartphones, financial networks, and communications systems would cease to function reliably.
“The resilience of our critical supply chains is a homeland security and economic security imperative,” Secretary of Homeland Security Alejandro N. Mayorkas said in a release. “Collaboration with international partners allows us to anticipate and mitigate disruptions before they occur. Our new U.S.-U.K.-Australia Supply Chain Resilience Cooperation Group will help ensure that our communities continue to have the essential goods and services they need, when they need them.”
A new survey finds a disconnect in organizations’ approach to maintenance, repair, and operations (MRO), as specialists call for greater focus than executives are providing, according to a report from Verusen, a provider of inventory optimization software.
Nearly three-quarters (71%) of the 250 procurement and operations leaders surveyed think MRO procurement/operations should be treated as a strategic initiative for continuous improvement and a potential innovation source. However, just over half (58%) of respondents note that MRO procurement/operations are treated as strategic organizational initiatives.
That result comes from “Future Strategies for MRO Inventory Optimization,” a survey produced by Atlanta-based Verusen along with WBR Insights and ProcureCon MRO.
Balancing MRO working capital and risk has become increasingly important as large asset-intensive industries such as oil and gas, mining, energy and utilities, resources, and heavy manufacturing seek solutions to optimize their MRO inventories, spend, and risk with deeper intelligence. Roughly half of organizations need to take a risk-based approach, as the survey found that 46% of organizations do not include asset criticality (spare parts deemed the most critical to continuous operations) in their materials planning process.
“Rather than merely seeing the MRO function as a necessary project or cost, businesses now see it as a mission-critical deliverable, and companies are more apt to explore new methods and technologies, including AI, to enhance this capability and drive innovation,” Scott Matthews, CEO of Verusen, said in a release. “This is because improving MRO, while addressing asset criticality, delivers tangible results by removing risk and expense from procurement initiatives.”
Survey respondents expressed specific challenges with product data inconsistencies and inaccuracies from different systems and sources. A lack of standardized data formats and incomplete information hampers efficient inventory management. The problem is further compounded by the complexity of integrating legacy systems with modern data management, leading to fragmented/siloed data. Centralizing inventory management and optimizing procurement without standardized product data is especially challenging.
In fact, only 39% of survey respondents report full data uniformity across all materials, and many respondents do not regularly review asset criticality, which adds to the challenges.
Artificial intelligence (AI) tools can help users build “smart and responsive supply chains” by increasing workforce productivity, expanding visibility, accelerating processes, and prioritizing the next best action to drive results, according to business software vendor Oracle.
To help reach that goal, the Texas company last week released software upgrades including user experience (UX) enhancements to its Oracle Fusion Cloud Supply Chain & Manufacturing (SCM) suite.
“Organizations are under pressure to create efficient and resilient supply chains that can quickly adapt to economic conditions, control costs, and protect margins,” Chris Leone, executive vice president, Applications Development, Oracle, said in a release. “The latest enhancements to Oracle Cloud SCM help customers create a smarter, more responsive supply chain by enabling them to optimize planning and execution and improve the speed and accuracy of processes.”
According to Oracle, specific upgrades feature changes to its:
Production Supervisor Workbench, which helps organizations improve manufacturing performance by providing real-time insight into work orders and generative AI-powered shift reporting.
Maintenance Supervisor Workbench, which helps organizations increase productivity and reduce asset downtime by resolving maintenance issues faster.
Order Management Enhancements, which help organizations increase operational performance by enabling users to quickly create and find orders, take actions, and engage customers.
Product Lifecycle Management (PLM) Enhancements, which help organizations accelerate product development and go-to-market by enabling users to quickly find items and configure critical objects and navigation paths to meet business-critical priorities.
Nearly one-third of American consumers have increased their secondhand purchases in the past year, revealing a jump in “recommerce” according to a buyer survey from ShipStation, a provider of web-based shipping and order fulfillment solutions.
The number comes from a survey of 500 U.S. consumers showing that nearly one in four (23%) Americans lack confidence in making purchases over $200 in the next six months. Due to economic uncertainty, savvy shoppers are looking for ways to save money without sacrificing quality or style, the research found.
Younger shoppers are leading the charge in that trend, with 59% of Gen Z and 48% of Millennials buying pre-owned items weekly or monthly. That rate makes Gen Z nearly twice as likely to buy second hand compared to older generations.
The primary reason that shoppers say they have increased their recommerce habits is lower prices (74%), followed by the thrill of finding unique or rare items (38%) and getting higher quality for a lower price (28%). Only 14% of Americans cite environmental concerns as a primary reason they shop second-hand.
Despite the challenge of adjusting to the new pattern, recommerce represents a strategic opportunity for businesses to capture today’s budget-minded shoppers and foster long-term loyalty, Austin, Texas-based ShipStation said.
For example, retailers don’t have to sell used goods to capitalize on the secondhand boom. Instead, they can offer trade-in programs swapping discounts or store credit for shoppers’ old items. And they can improve product discoverability to help customers—particularly older generations—find what they’re looking for.
Other ways for retailers to connect with recommerce shoppers are to improve shipping practices. According to ShipStation:
70% of shoppers won’t return to a brand if shipping is too expensive.
51% of consumers are turned off by late deliveries
40% of shoppers won’t return to a retailer again if the packaging is bad.
The “CMA CGM Startup Awards”—created in collaboration with BFM Business and La Tribune—will identify the best innovations to accelerate its transformation, the French company said.
Specifically, the company will select the best startup among the applicants, with clear industry transformation objectives focused on environmental performance, competitiveness, and quality of life at work in each of the three areas:
Shipping: Enabling safer, more efficient, and sustainable navigation through innovative technological solutions.
Logistics: Reinventing the global supply chain with smart and sustainable logistics solutions.
Media: Transform content creation, and customer engagement with innovative media technologies and strategies.
Three winners will be selected during a final event organized on November 15 at the Orange Vélodrome Stadium in Marseille, during the 2nd Artificial Intelligence Marseille (AIM) forum organized by La Tribune and BFM Business. The selection will be made by a jury chaired by Rodolphe Saadé, Chairman and CEO of the Group, and including members of the executive committee representing the various sectors of CMA CGM.