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.
Parcel giant FedEx Corp. is automating its fulfillment flows by investing in the AI robotics and autonomous e-commerce fulfillment technology firm Nimble, and announcing plans to use the San Francisco-based startup’s tech in its own returns network.
The move is significant because FedEx Supply Chain operates at a large scale, running more than 130 warehouse and fulfillment operations in North America and processing 475 million returns annually. According to FedEx, the “strategic alliance” will help to scale up FedEx Fulfillment with Nimble’s “fully autonomous 3PL model.”
“Our strategic alliance and financial investment with Nimble expands our footprint in the e-commerce space, helping to further scale our FedEx Fulfillment offering across North America,” Scott Temple, president, FedEx Supply Chain, said in a release. “Nimble’s cutting-edge AI robotics and autonomous fulfillment systems will help FedEx streamline operations and unlock new opportunities for our customers.”
According to Nimble founder and CEO Simon Kalouche, the collaboration will help enable FedEx to leverage Nimble’s “fast and cost-effective” fulfillment centers, powered by its intelligent general purpose warehouse robots and AI technology.
Nimble says that more than 90% of warehouses today still operate manually with minimal or no robotics, and even those automated warehouses use robots with limited intelligence that are restricted to just a few warehouse functions—primarily storage and retrieval. In contrast, Nimble says its “intelligent general-purpose warehouse robot” is capable of performing all core fulfillment functions including storage and retrieval, picking, packing, and sorting.
For the past seven years, third-party service provider ODW Logistics has provided logistics support for the Pelotonia Ride Weekend, a campaign to raise funds for cancer research at The Ohio State University’s Comprehensive Cancer Center–Arthur G. James Cancer Hospital and Richard J. Solove Research Institute. As in the past, ODW provided inventory management services and transportation for the riders’ bicycles at this year’s event. In all, some 7,000 riders and 3,000 volunteers participated in the ride weekend.
Photo courtesy of Dematic
For the past four years, automated solutions provider Dematic has helped support students pursuing careers in the STEM (science, technology, engineering, and mathematics) fields with its FIRST Scholarship program, conducted in partnership with the corporate nonprofit FIRST (For Inspiration and Recognition of Science and Technology). This year’s scholarship recipients include Aman Amjad of Brookfield, Wisconsin, and Lily Hoopes of Bonney Lake, Washington, who were each awarded $5,000 to support their post-secondary education. Dematic also awarded $1,000 scholarships to another 10 students.
Motive, an artificial intelligence (AI)-powered integrated operations platform, has launched an initiative with PGA Tour pro Jason Day to support the Navy SEAL Foundation (NSF). For every birdie Day makes on tour, Motive will make a contribution to the NSF, which provides support for warriors, veterans, and their families. Fans can contribute to the mission by purchasing a Jason Day Tour Edition hat at https://malbongolf.com/products/m-9189-blk-wht-black-motive-rope-hat.
MTS Logistics Inc., a New York-based freight forwarding and logistics company, raised more than $120,000 for autism awareness and acceptance at its 14th annual Bike Tour with MTS for Autism. All proceeds from the June event were donated to New Jersey-based nonprofit Spectrum Works, which provides job training and opportunities for young adults with autism.
The logistics process automation provider Vanderlande has agreed to acquire Siemens Logistics for $325 million, saying its specialty in providing value-added baggage and cargo handling and digital solutions for airport operations will complement Netherlands-based Vanderlande’s business in the warehousing, airports, and parcel sectors.
According to Vanderlande, the global logistics landscape is undergoing significant change, with increasing demand for efficient, automated systems. Vanderlande, which has a strong presence in airport logistics, said it recognizes the evolving trends in the sector and sees tremendous potential for sustained growth. With passenger travel on the rise and airports investing heavily in modernization, the long-term market outlook for airport automation is highly positive.
To meet that growing demand, the proposed transaction will significantly enhance customer value by providing accelerated access to advanced technologies, improving global presence for better local service, and creating further customer value through synergies in technology development, Vanderlande said.
In a statement, Nuremberg, Germany-based Siemens Logistics said that merging with Vanderlande would “have no operational impact on ongoing or new projects,” but that it would offer its current customers and employees significant development and value-add potential.
"As a distinguished provider of solutions for airport logistics, Siemens Logistics enjoys a first-class reputation in the baggage and air-cargo handling areas. Together with Vanderlande and our committed global teams, we look forward to bringing fresh impetus to the airport industry and to supporting our customers' business with future-oriented technologies," Michael Schneider, CEO of Siemens Logistics, said in a release.
I recently came across a report showing that 86% of CEOs around the world see resiliency problems in their supply chains, and that business leaders are spending more time than ever tackling supply chain-related challenges. Initially I was surprised, thinking that the lessons learned from the Covid-19 pandemic surely prepared industry leaders for just about anything, helping to bake risk and resiliency planning into corporate strategies for companies of all sizes.
But then I thought about the growing number of issues that can affect supply chains today—more frequent severe weather events, accelerating cybersecurity threats, and the tangle of emerging demands and regulations around decarbonization, to name just a few. The level of potential problems seems to be increasing at lightning speed, making it difficult, if not impossible, to plan for every imaginable scenario.
What is it Mike Tyson said? Everyone has a plan until they get punched in the mouth.
It has never been more important to be able to pivot and adjust to challenges that can throw you off your game. The report I referenced—the “2024 Supply Chain Barometer” from procurement, supply chain, and sustainability consulting firm Proxima—makes the case for just that. The company surveyed 3,000 CEOs from the United Kingdom, Europe, and the United States and found that the growing complexities in global supply chains necessitate a laser-sharp focus on this area of the business. One example: Rightshoring, which is the process of moving business operations to the best location, means companies are redesigning and reconfiguring their supply chains like never before. The study found that large numbers of CEOs are grappling with the various subsets of rightshoring: 44% said they are planning to or have already undertaken onshoring, for instance; 41% said they are planning to or have undertaken nearshoring; 41% said they are planning to or have undertaken friendshoring; and 35% said they are planning to or have undertaken offshoring.
But that’s not all. CEOs are also struggling to deal with the rise of artificial intelligence (AI) and its application to business processes, the potential for abuse and labor rights issues in their supply chains, and a growing number of barriers to their companies’ decarbonization efforts. For instance:
Nearly all of those surveyed (99%) said they are either using or considering the use of AI in their supply chains, with 82% saying they are planning new initiatives this year;
More than 60% said they are concerned about the potential for human or labor rights issues in their supply chains;
And virtually all (99%) said they face barriers to decarbonization, with 30% pointing to the complexity of the work required as the biggest barrier.
Those are big issues to contend with, so it’s no surprise that 96% of the CEOs Proxima surveyed said they are dedicating equal (41%) or more time (55%) to supply chain issues this year than last year. And changing economic conditions are adding to the complexity, according to the report.
“As inflation fell throughout last year, there were glimmers of markets stabilizing,” the authors wrote. “The reality, though, has been that global market dynamics are shifting. With no clear-set position for them to land in, CEOs must continue to navigate their organizations through an ever-changing landscape. Just 4% of CEOs foresee the amount of time spent on supply chain-related topics decreasing in the year ahead.”
Simon Geale, executive vice president and chief procurement officer at Proxima, added some perspective.
“It’s fair to say that the complexities of global supply chains continue to have CEOs around the world scratching their heads,” he wrote. “The results of this year’s Barometer show that business leaders are spending more and more time tackling supply chain challenges, reflecting the multiple challenges to address.”
Perhaps the extra focus on supply chain issues will help organizations improve their ability to roll with the punches and overcome resiliency challenges in the year ahead. Only time will tell.
Investing in artificial intelligence (AI) is a top priority for supply chain leaders as they develop their organization’s technology roadmap, according to data from research and consulting firm Gartner.
AI—including machine learning—and Generative AI (GenAI) ranked as the top two priorities for digital supply chain investments globally among more than 400 supply chain leaders surveyed earlier this year. But key differences apply regionally and by job responsibility, according to the research.
Twenty percent of the survey’s respondents said they are prioritizing investments in traditional AI—which analyzes data, identifies patterns, and makes predictions. Virtual assistants like Siri and Alexa are common examples. Slightly less (17%) said they are prioritizing investments in GenAI, which takes the process a step further by learning patterns and using them to generate text, images, and so forth. OpenAI’s ChatGPT is the most common example.
Despite that overall focus, AI lagged as a priority in Western Europe, where connected industry objectives remain paramount, according to Gartner. The survey also found that business-led roles are much less enthusiastic than their IT counterparts when it comes to prioritizing the technology.
“While enthusiasm for both traditional AI and GenAI remain high on an absolute level within supply chain, the prioritization varies greatly between different roles, geographies, and industries,” Michael Dominy, VP analyst in Gartner’s Supply Chain practice, said in a statement announcing the survey results. “European respondents were more likely to prioritize technologies that align with Industry 4.0 objectives, such as smart manufacturing. In addition to region differences, certain industries prioritize specific use cases, such as robotics or machine learning, which are currently viewed as more pragmatic investments than GenAI.”
The survey also found that:
Twenty-six percent of North American respondents identified AI, including machine learning, as their top priority, compared to 14% of Western Europeans.
Fourteen percent of Western European respondents identified robots in manufacturing as their top choice compared to just 1% of North American respondents.
Geographical variances generally correlated with industry-specific priorities; regions with a higher proportion of manufacturing respondents were less likely to select AI or GenAI as a top digital priority.
Digging deeper into job responsibilities, just 12% of respondents with business-focused roles indicated GenAI as a top priority, compared to 28% of IT roles. The data may indicate that GenAI use cases are perceived as less tangible and directly tied to core supply chain processes, according to Gartner.
“Business-led roles are traditionally more comfortable with prioritizing established technologies, and the survey data suggests that these business-led roles still question whether GenAI can deliver an adequate return on investment,” said Dominy. “However, multiple industries including retail, industrial manufacturers and high-tech manufacturers have already made GenAI their top investment priority.”