This Week in Logistics News (June 25-29, 2012)

The big news this week, of course, is yesterday’s decision by the Supreme Court to uphold the Affordable Care Act (more commonly referred to as ObamaCare). While the link between healthcare and logistics doesn’t get much press, there is an important link between them, as I discussed in a September 2009 posting, “Healthcare and the Trucking Industry: Interview with JB Hunt.” Simply stated, it’s another cost factor that 3PLs and trucking companies must manage, and an important factor in employee hiring and retention.

In other news this week…

Rather than punting the transportation funding issue yet again, it appears that the House and Senate have agreed on a two-year, $120 billion transportation bill. While the term of the bill is shorter than the usual six years, and it doesn’t really resolve the core funding problem (i.e., the fuel tax), it’s certainly better than issuing yet another short-term extension.

An article published this morning in Truckinginfo provides a good overview of what’s included in the bill. According to the article, “the American Trucking Associations got a provision that requires the Federal Motor Carrier Safety Administration to conduct a field study of the 34-hour restart rule, and it got a provision mandating electronic logs [which the Owner-Operator Independent Drivers Association opposes]. But it did not get the increase in truck weight limits that it wanted, and had to settle for a study instead.”

On the technology front, the convergence of social media with enterprise software took another step forward with Microsoft’s announcement that it is acquiring Yammer for $1.2 billion in cash. According to the press release:

Yammer will join the Microsoft Office Division, led by division President Kurt DelBene, and the team will continue to report to current CEO David Sacks.

Yammer will continue to develop its standalone service and maintain its commitment to simplicity, innovation and cross-platform experiences. Moving forward, Microsoft plans to accelerate Yammer’s adoption alongside complementary offerings from Microsoft SharePoint, Office 365, Microsoft Dynamics and Skype.

This acquisition is great news for Moxie Software, Jive Software, Socialcast, Volerro (a Logistics Viewpoints sponsor) and other technology providers leveraging “enterprise social media” capabilities to transform the way people work and how business processes are executed. But as I noted in “Why Companies Aren’t Using Social Media for Supply Chain Management,” just because you make a new technology available and tell people to use it doesn’t mean that they will. Getting people to actually change the way they work is arguably the biggest hurdle companies must overcome.

Retail remains a hot focus area for software vendors these days, with RedPrairie and Oracle both announcing enhanced solutions for retailers this week. RedPrairie announced the availability of RedPrairie Commerce Suite 2012.1, “a scalable suite of solutions that help retailers deliver on the vision of ‘Buy Anywhere Fulfill Anywhere’ across the growing number of customer touch points.” According to the press release, major functional additions include:

  • Store Center which puts e-commerce order capabilities into the hands of in-store associates, helping them “save-the-sale” for out-of-stock items and opens up visibility to an “endless aisle” for items not normally stocked at their location. Store Center provides all-channel order visibility, 360-degree customer management, fulfillment from store, and more.
  • Customer Engagement Management which helps retail brands measure and build customer loyalty by tracking customer gestures, promotion and transaction patterns. It provides actionable insights on capture points, drives and manages marketing and merchandising programs, and builds loyalty reward programs.
  • RedPrairie fulfillment solutions integration which enables real-time, enterprise-wide inventory visibility, order sourcing and direct-to-consumer fulfillment.

Meanwhile, Oracle announced the release of Oracle Retail Customer Analytics, “a business intelligence solution that helps retailers better understand their customers and what drives their buying decisions. Oracle Retail Customer Analytics helps retailers increase sales and margins by providing category managers, merchandise managers, buyers and pricing analysts with the segmentation, demographic, product affinity and promotion information they need to make more informed decision.”

There’s a saying in New England that if you don’t like the weather, just wait a minute. The same can be said of oil prices and forecasts these days. In its 2012 Annual Energy Outlook, the Energy Information Administration projects that “U.S. output from eight tight oil prospects covered by the report will more than double to 1.23 million barrels per day by 2035 from 2011 levels,” as reported by Reuters. “The estimates — based on a ‘reference’ case, which assumes current technological and demographic trends will continue — show that total U.S. oil output will reach a peak of 6.7 million bpd in 2020, the highest since 1994. About 18 percent of this will come from tight oil.”

In related news, Leonardo Maugeri, a Harvard research fellow who was formerly a senior manager at oil and gas giant Eni SpA, wrote the following in a policy brief published by Harvard’s Belfer Center for Science and International Affairs: “Contrary to what most people believe, oil supply capacity is growing worldwide at such an unprecedented level that it might outpace consumption. This could lead to a glut of overproduction and a steep dip in prices.” You can watch an interview with Mr. Maugeri below.

That’s all the time I have for today. Have a great weekend!

(Note: Oracle and RedPrairie are ARC clients)