Mark Solomon joined DC VELOCITY as senior editor in August 2008, and was promoted to his current position on January 1, 2015. He has spent more than 30 years in the transportation, logistics and supply chain management fields as a journalist and public relations professional. From 1989 to 1994, he worked in Washington as a reporter for the Journal of Commerce, covering the aviation and trucking industries, the Department of Transportation, Congress and the U.S. Supreme Court. Prior to that, he worked for Traffic World for seven years in a similar role. From 1994 to 2008, Mr. Solomon ran Media-Based Solutions, a public relations firm based in Atlanta. He graduated in 1978 with a B.A. in journalism from The American University in Washington, D.C.
The stars seem aligned for Terry L. Esper. Only 40, he has already completed the career trifecta of industry, government, and academia. As such, he understands the value each brings to the profession as unique entities, and as one powerful force.
Esper holds the prestigious Oren Harris Chair in Logistics at the University of Arkansas' Sam M. Walton College of Business. Commanding, articulate, and extremely passionate about the field, Esper is poised to become one of the most visible members of an increasingly visible profession.
Senior Editor Mark B. Solomon interviewed Esper about his career, the interplay of the three disciplines, his outlook for the business and the people who will help it succeed, and his drive to empower more African-Americans to join the industry.
Q: You have a background in all three major fields of endeavor. How do the attitudes toward logistics differ amongst academia, industry, and government?
A: I would say they're alike in many ways. All three sectors converge on a desire to support logistics activity in the global economy. In doing so, however, each maintains a commitment to its respective performance outcomes. Government has a strong focus on infrastructure, safety, and policy. Industry operates through a lens of logistics cost efficiency. Academia emphasizes research and knowledge dissemination.
These areas are often viewed as competing perspectives. Safety regulations and associated costs are often interpreted by industry as inefficient. Government and industry accuse academia of being too "theoretical" and "ivory tower." Industry is viewed as being so focused on cost reduction that such savings are achieved at the expense of others in the logistics community.
In the end, each sector has the same goal - more and better logistics activity. It's good we have different interpretations of what that means. It keeps each sector accountable. For example, I can't get too theoretical ... industry will ensure that. Industry can't get too cost focused ... government will ensure that. The different perspectives are good and can benefit us all.
Q: What has been the biggest change you've seen in the way all three areas perceive the field and its value? A: We have entered an era where we are all aware of the value that the business creates. This is particularly true within the academic and industry sectors. Deans and CEOs are paying attention. I worked in industry during the years when logisticians had to lobby for attention from CEOs. That's not the case anymore. When I entered academia, many logistics professors had to "lobby" for support and respect from academic colleagues. That's not the case anymore. I've watched C-level logistics and supply chain executives emerge in most large corporations. I've taught logistics concepts to budding entrepreneurs who are becoming more sensitive to the importance of logistics. I've seen academic programs grow tremendously.
At Arkansas, our student enrollment has more than doubled in the last four years. Most business schools are now getting into the game of teaching logistics concepts in their core curriculum. Overall, this maturity has been the biggest change that I've seen. We are a much more respected and valued field, and each sector has contributed to it.
Q: What has been the biggest challenge in attracting and retaining qualified talent to the industry overall? A: Most of us stumbled into logistics. When I entered academia, I would ask my students how many of them came to school to major in logistics. I would get virtually no hands. Most of them had to be roped in. Top students are not as apt to gravitate toward logistics as they are toward finance, accounting, or marketing. We are rolling out an "Intro to SCM" course at Arkansas that all business students must take. This will give us earlier access to the general student population, where we can make students aware of logistics at the front end of their experience.
I think the retention issue is a byproduct of this. Top talent has so many opportunities because of the "maturation" of the field. The growth over the last decade has exceeded the output of top talent. It's a supply and demand issue. Retention becomes much more difficult because there are so many wonderful opportunities available without adequate supply.
Q: Do you see yourself returning to either industry or government, or is academia the last stop? A: Academia is the last stop. I stay connected to industry and government, but have no desire to return. Being in academia is very rewarding, which is great. But for me, it's deeper. I not only work in academia, but I am an academic. This sector is much more about who I am versus what I do. I do research and I teach. But I am a researcher and educator. I feel my prior industry and government experiences were training ground for my true career.
Q: African-Americans are not well represented in the industry. How can the industry be more effective in attracting more African-Americans to the field? A: The relative obscurity of logistics has made diversity issues more difficult to address. Beyond this, I think it's a "face" issue. Studies have shown that one of the more effective ways to diversify a field is by diversifying those who train and mentor within the field. They will attract others.
This has proven to be true for me. One of my first mentors in the field was Rodney Slater, a former secretary of transportation and an African-American. When I worked for Hallmark, I was mentored by someone who is now their head supply chain guy, Pete Burney, an African-American. My Ph.D. adviser was Dr. Lisa Williams, an African-American. I've just advised my first African-American doctoral student, Dr. LaDonna Thornton. I consider it my duty to contribute to the diversity of the field by both mentoring and advising those who can also mentor. In the end, one of the most powerful ways of attracting and maintaining a diverse logistics community, be it ethnic, gender, etc., is through mentorship and the support of mentorship.
Q: What attracted you to the logistics industry? Was this what you always wanted to do? A: I, too, stumbled into the field. I always wanted to be an academic. I majored in mathematics in college, primarily because it seemed to be the most abstract and academic major. I wasn't sure what I would do with a degree in mathematical science. It's not like a degree in education, or social work, or business. But I fell into an opportunity to apply my math skills to transportation research. That's where I learned about logistics. I entered the field and eventually stumbled into logistics research and academics. I've always wanted to be an academic and researcher. But I had no clue going in that it would be in logistics.
Logistics was the most fascinating thing I'd heard of. When I was first introduced to the planned and precise movement of so many parts in order to support the needs and demands of the general consumer, I couldn't believe it. I was in awe of how there was so much planning and strategy behind the basic "product on shelf" concept. It was as if I had slipped into another reality and been exposed to a secret world. I still get excited when I think about it. It's a world that the average consumer has no clue about, and that's the joy in it for me.
Q: Looking at those currently matriculating into the field, what do you see as their primary strengths and weaknesses? A: It's a Catch-22. The strength is the sophistication of those new to the field. They are much more equipped with technological savvy and quantitative analysis techniques. They are much more strategic in mindset and understand the big picture when it comes to the role logistics plays in society. But this sophistication comes at the expense of many new entrants not being able to identify with the operational level of logistics.
I started my career on rural highways surveying truck drivers and studying the logistics infrastructure. Many of my contemporaries started on third-shift operations in warehouses. These experiences gave us an awareness of the great things going on in the trenches. New entrants are not too excited about these types of entry-level opportunities. In an attempt to attract top talent, many companies are no longer requiring such foundational experience. So, many new entrants cannot identify with the true operations of logistics and the effort that goes into making it all work, which is a major weakness.
Congestion on U.S. highways is costing the trucking industry big, according to research from the American Transportation Research Institute (ATRI), released today.
The group found that traffic congestion on U.S. highways added $108.8 billion in costs to the trucking industry in 2022, a record high. The information comes from ATRI’s Cost of Congestion study, which is part of the organization’s ongoing highway performance measurement research.
Total hours of congestion fell slightly compared to 2021 due to softening freight market conditions, but the cost of operating a truck increased at a much higher rate, according to the research. As a result, the overall cost of congestion increased by 15% year-over-year—a level equivalent to more than 430,000 commercial truck drivers sitting idle for one work year and an average cost of $7,588 for every registered combination truck.
The analysis also identified metropolitan delays and related impacts, showing that the top 10 most-congested states each experienced added costs of more than $8 billion. That list was led by Texas, at $9.17 billion in added costs; California, at $8.77 billion; and Florida, $8.44 billion. Rounding out the top 10 list were New York, Georgia, New Jersey, Illinois, Pennsylvania, Louisiana, and Tennessee. Combined, the top 10 states account for more than half of the trucking industry’s congestion costs nationwide—52%, according to the research.
The metro areas with the highest congestion costs include New York City, $6.68 billion; Miami, $3.2 billion; and Chicago, $3.14 billion.
ATRI’s analysis also found that the trucking industry wasted more than 6.4 billion gallons of diesel fuel in 2022 due to congestion, resulting in additional fuel costs of $32.1 billion.
ATRI used a combination of data sources, including its truck GPS database and Operational Costs study benchmarks, to calculate the impacts of trucking delays on major U.S. roadways.
There’s a photo from 1971 that John Kent, professor of supply chain management at the University of Arkansas, likes to show. It’s of a shaggy-haired 18-year-old named Glenn Cowan grinning at three-time world table tennis champion Zhuang Zedong, while holding a silk tapestry Zhuang had just given him. Cowan was a member of the U.S. table tennis team who participated in the 1971 World Table Tennis Championships in Nagoya, Japan. Story has it that one morning, he overslept and missed his bus to the tournament and had to hitch a ride with the Chinese national team and met and connected with Zhuang.
Cowan and Zhuang’s interaction led to an invitation for the U.S. team to visit China. At the time, the two countries were just beginning to emerge from a 20-year period of decidedly frosty relations, strict travel bans, and trade restrictions. The highly publicized trip signaled a willingness on both sides to renew relations and launched the term “pingpong diplomacy.”
Kent, who is a senior fellow at the George H. W. Bush Foundation for U.S.-China Relations, believes the photograph is a good reminder that some 50-odd years ago, the economies of the United States and China were not as tightly interwoven as they are today. At the time, the Nixon administration was looking to form closer political and economic ties between the two countries in hopes of reducing chances of future conflict (and to weaken alliances among Communist countries).
The signals coming out of Washington and Beijing are now, of course, much different than they were in the early 1970s. Instead of advocating for better relations, political rhetoric focuses on the need for the U.S. to “decouple” from China. Both Republicans and Democrats have warned that the U.S. economy is too dependent on goods manufactured in China. They see this dependency as a threat to economic strength, American jobs, supply chain resiliency, and national security.
Supply chain professionals, however, know that extricating ourselves from our reliance on Chinese manufacturing is easier said than done. Many pundits push for a “China + 1” strategy, where companies diversify their manufacturing and sourcing options beyond China. But in reality, that “plus one” is often a Chinese company operating in a different country or a non-Chinese manufacturer that is still heavily dependent on material or subcomponents made in China.
This is the problem when supply chain decisions are made on a global scale without input from supply chain professionals. In an article in the Arkansas Democrat-Gazette, Kent argues that, “The discussions on supply chains mainly take place between government officials who typically bring many other competing issues and agendas to the table. Corporate entities—the individuals and companies directly impacted by supply chains—tend to be under-represented in the conversation.”
Kent is a proponent of what he calls “supply chain diplomacy,” where experts from academia and industry from the U.S. and China work collaboratively to create better, more efficient global supply chains. Take, for example, the “Peace Beans” project that Kent is involved with. This project, jointly formed by Zhejiang University and the Bush China Foundation, proposes balancing supply chains by exporting soybeans from Arkansas to tofu producers in China’s Yunnan province, and, in return, importing coffee beans grown in Yunnan to coffee roasters in Arkansas. Kent believes the operation could even use the same transportation equipment.
The benefits of working collaboratively—instead of continuing to build friction in the supply chain through tariffs and adversarial relationships—are numerous, according to Kent and his colleagues. They believe it would be much better if the two major world economies worked together on issues like global inflation, climate change, and artificial intelligence.
And such relations could play a significant role in strengthening world peace, particularly in light of ongoing tensions over Taiwan. Because, as Kent writes, “The 19th-century idea that ‘When goods don’t cross borders, soldiers will’ is as true today as ever. Perhaps more so.”
Hyster-Yale Materials Handling today announced its plans to fulfill the domestic manufacturing requirements of the Build America, Buy America (BABA) Act for certain portions of its lineup of forklift trucks and container handling equipment.
That means the Greenville, North Carolina-based company now plans to expand its existing American manufacturing with a targeted set of high-capacity models, including electric options, that align with the needs of infrastructure projects subject to BABA requirements. The company’s plans include determining the optimal production location in the United States, strategically expanding sourcing agreements to meet local material requirements, and further developing electric power options for high-capacity equipment.
As a part of the 2021 Infrastructure Investment and Jobs Act, the BABA Act aims to increase the use of American-made materials in federally funded infrastructure projects across the U.S., Hyster-Yale says. It was enacted as part of a broader effort to boost domestic manufacturing and economic growth, and mandates that federal dollars allocated to infrastructure – such as roads, bridges, ports and public transit systems – must prioritize materials produced in the USA, including critical items like steel, iron and various construction materials.
Hyster-Yale’s footprint in the U.S. is spread across 10 locations, including three manufacturing facilities.
“Our leadership is fully invested in meeting the needs of businesses that require BABA-compliant material handling solutions,” Tony Salgado, Hyster-Yale’s chief operating officer, said in a release. “We are working to partner with our key domestic suppliers, as well as identifying how best to leverage our own American manufacturing footprint to deliver a competitive solution for our customers and stakeholders. But beyond mere compliance, and in line with the many areas of our business where we are evolving to better support our customers, our commitment remains steadfast. We are dedicated to delivering industry-leading standards in design, durability and performance — qualities that have become synonymous with our brands worldwide and that our customers have come to rely on and expect.”
In a separate move, the U.S. Environmental Protection Agency (EPA) also gave its approval for the state to advance its Heavy-Duty Omnibus Rule, which is crafted to significantly reduce smog-forming nitrogen oxide (NOx) emissions from new heavy-duty, diesel-powered trucks.
Both rules are intended to deliver health benefits to California citizens affected by vehicle pollution, according to the environmental group Earthjustice. If the state gets federal approval for the final steps to become law, the rules mean that cars on the road in California will largely be zero-emissions a generation from now in the 2050s, accounting for the average vehicle lifespan of vehicles with internal combustion engine (ICE) power sold before that 2035 date.
“This might read like checking a bureaucratic box, but EPA’s approval is a critical step forward in protecting our lungs from pollution and our wallets from the expenses of combustion fuels,” Paul Cort, director of Earthjustice’s Right To Zero campaign, said in a release. “The gradual shift in car sales to zero-emissions models will cut smog and household costs while growing California’s clean energy workforce. Cutting truck pollution will help clear our skies of smog. EPA should now approve the remaining authorization requests from California to allow the state to clean its air and protect its residents.”
However, the truck drivers' industry group Owner-Operator Independent Drivers Association (OOIDA) pushed back against the federal decision allowing the Omnibus Low-NOx rule to advance. "The Omnibus Low-NOx waiver for California calls into question the policymaking process under the Biden administration's EPA. Purposefully injecting uncertainty into a $588 billion American industry is bad for our economy and makes no meaningful progress towards purported environmental goals," (OOIDA) President Todd Spencer said in a release. "EPA's credibility outside of radical environmental circles would have been better served by working with regulated industries rather than ramming through last-minute special interest favors. We look forward to working with the Trump administration's EPA in good faith towards achievable environmental outcomes.”
Editor's note:This article was revised on December 18 to add reaction from OOIDA.
A Canadian startup that provides AI-powered logistics solutions has gained $5.5 million in seed funding to support its concept of creating a digital platform for global trade, according to Toronto-based Starboard.
The round was led by Eclipse, with participation from previous backers Garuda Ventures and Everywhere Ventures. The firm says it will use its new backing to expand its engineering team in Toronto and accelerate its AI-driven product development to simplify supply chain complexities.
According to Starboard, the logistics industry is under immense pressure to adapt to the growing complexity of global trade, which has hit recent hurdles such as the strike at U.S. east and gulf coast ports. That situation calls for innovative solutions to streamline operations and reduce costs for operators.
As a potential solution, Starboard offers its flagship product, which it defines as an AI-based transportation management system (TMS) and rate management system that helps mid-sized freight forwarders operate more efficiently and win more business. More broadly, Starboard says it is building the virtual infrastructure for global trade, allowing freight companies to leverage AI and machine learning to optimize operations such as processing shipments in real time, reconciling invoices, and following up on payments.
"This investment is a pivotal step in our mission to unlock the power of AI for our customers," said Sumeet Trehan, Co-Founder and CEO of Starboard. "Global trade has long been plagued by inefficiencies that drive up costs and reduce competitiveness. Our platform is designed to empower SMB freight forwarders—the backbone of more than $20 trillion in global trade and $1 trillion in logistics spend—with the tools they need to thrive in this complex ecosystem."