Logistics Viewpoints

A complete analysis of logistics trends, technologies, and services

Pharma at the Forefront: How Vaccine Distribution Challenges Are Accelerating ‘The Cognitive Supply Chain’

Guest Commentary | By •

cognitive supply chainAs researchers around the world race to develop a safe and effective COVID-19 vaccine, pharma
companies also face another daunting challenge: how to distribute hundreds of millions of
highly sensitive vaccine doses, quickly and accurately, across the country and the world.

Normal vaccine distribution was already inherently complex with a myriad of issues – including
security, temperature control, political/trade challenges, multiple geographies and
transportation modes, transit times, and carrier capacity – that have to be precisely managed
and tightly coordinated across a vast network of stakeholders. COVID-19 distribution efforts will
be infinitely bigger and more complex. Can our pharma supply chains meet the moment?

I think they can. But to do so, data and advanced technologies – visibility, artificial intelligence,
machine learning – need to play a key role, particularly during that critical “last mile” to final
destinations. The good news is that many pharma distributors appear to have their eyes (and
their checkbooks) wide open as they invest in various ‘cognitive supply chain’ capabilities that
will provide critical visibility into vaccines in transport, enabling various predictive and
corrective actions to help expedite deliveries and prevent damage, spoilage or theft.

Here are some of the unique aspects of the challenge, together with several of the
“must-haves” when it comes to safe and efficient vaccine distribution.

There are lots of unknowns. Having never faced anything approaching a distribution effort of
this scale, there’s a lot we don’t know. We don’t know when there will be a vaccine. We don’t
know whether one dose will suffice or two might be required to confer immunity. We don’t yet
know which segments of the population or which geographies might need to be prioritized as
the vaccine becomes available. With so much uncertainty on so many key questions, the
cognitive supply chain will have to be highly flexible and agile.

Pharma supply chains are uniquely complex. Pharma supply chains have a unique structure. In
addition to the drug manufacturers at the top of the chain, there are several healthcare
services and distribution companies that manage the complexities of logistics (amongst other
tasks), across a group of stakeholders that includes customers, suppliers, and local, state and
federal government partners. Distributors need to consider how product is supplied and
re-supplied to major metro areas versus rural regions, which are more complex in terms of
distribution and personnel.

Monitoring is mission critical. Many industries require close monitoring of essential and /or
perishable products. Vaccines take this to the extreme, because they are highly perishable and
must be maintained at very cold, specific temperatures. (Several of the Covid-19 vaccines in
development are expected to require temperatures ranging from minus four to minus 94
degrees Fahrenheit, which can be very difficult to maintain in transit). This necessitates
something the industry calls ‘the vaccine cold chain,’ which is a supply chain that can keep
vaccines in tightly controlled temperatures from the moment they are made to the moment
they are administered to a patient. A 2019 study estimates 25% of vaccines are degraded due
to being exposed to out-of-range temperatures, resulting in more than $34B in losses (these
vaccines are always throw away), not to mention the cost of illnesses that could have been
prevented by timely deliveries of high-quality vaccines.

The cognitive supply chain that many healthcare companies are working to create aims to
tackle issues such as these head on. Critical components include real-time supply chain visibility
together with machine learning and artificial intelligence capabilities so that companies not
only have better visibility into vaccines when in transit, but also the ability to mitigate issues as
they arise or even predict and prevent them entirely.

For example, real-time temperature monitoring and alerts can help distributors, shippers and
carriers maintain constant watch on temperature thresholds. If any vaccines are in danger of
compromise, shippers and carriers can collaborate based on real-time data to expedite the
shipment of replacement vaccines, locate additional trucks and scarce refrigerated trailers
(several major logistics companies, including UPS and DHL, are reported to be investing in new
storage facilities for cold chain management) or optimize lanes to speed up delivery times.
Real-time monitoring can also serve as a strong deterrent against theft.

Bigger picture, the cognitive supply chain promises to play a huge role in more efficient, leaner
pharma supply chains, especially in the last mile arena, which has been underserved historically
by technology. Today, because of the difficulty in predicting demand for vaccines and other
critical medical supplies, the industry tends to hold a great deal of inventory in stock all over the
world, so when demand spikes, product is relatively close to those in need. But carrying all of
that inventory comes at a high cost. A cognitive supply chain will help the industry predict
demand, better manage and protect product in transit, and track and account for products as
they are delivered. That should lead eventually to a leaner, more optimized pharma supply
chain and better outcomes for consumers.

I recently spoke with Joshua Dolan, Vice President of Global Logistics at Cardinal Health, one of
the world’s leading healthcare services and products companies. He summed up the promise of
the cognitive supply chain succinctly: “We are working toward a cognitive network that will
allow us to flow inventory unencumbered across the entire supply chain, so customers can be
served wherever they are with a frictionless experience.”

Yes, there are many unknowns and hurdles ahead and distributing the COVID-19 vaccine
presents many challenges. But armed with our most advanced technologies and collaboration
across the pharma supply chain, we have the tools to rise to the occasion.

Matt Elenjickal is the Founder and Chief Executive Officer of FourKites. He founded FourKites in 2014 after recognizing pain points in the logistics industry and designing elegant and effective systems to address them. Prior to founding FourKites, Matt spent 7 years in the enterprise software space working for market leaders such as Oracle Corp and i2 Technologies/JDA Software Group. Matt has led high-impact teams that implemented logistics strategies and systems at P&G, Nestle, Kraft, Anheuser-Busch Inbev, Tyco, Argos and Nokia across North America, Western Europe and Latin America. Matt is passionate about logistics and supply chain management and has a keen sense for how technology can disrupt traditional silo-based planning and execution. Matt holds a BS in Mechanical Engineering from College of Engineering, Guindy, an MS in Industrial Engineering and Management Science from Northwestern University, and an MBA from Northwestern’s Kellogg School of Management. He lives in Chicago.

Retail 2020 – A Year of High Season

Guest Commentary | By •

high seasonOne thing is certain – there is no normal in 2020.  What we have experienced so far this year is either a blip that we will look back at and wonder on, or our lives have fundamentally shifted, and 2020 is really just Year One.

Either way, what we understand about this year is that Covid-19 has upended everything about the status quo. The pandemic has exposed all of our weaknesses and all of the cracks in our frameworks. What it is, is a compelling reason to change, and luckily there are solutions and strategies to meet the uncertainty, and so more than anything, 2020 is a year of transformation.

A couple of weeks ago a CEO asked me if I expected or believed that the potential second wave would bring empty shelves.  I shook my head. I don’t believe that we will see the same disruptions that we saw at the beginning of the pandemic – especially not for essential items.

When the pandemic began there were a lot of uncertainties and unknowns about the virus, and so consumer buying patterns were chaotic. We are only human, after all.  We reacted to the situation emotionally and that was why we saw paper towels, toilet paper, hand sanitizer and other essentials being emptied out of store shelves. But over the last six months the demand and supply have adjusted in terms of price and quantity and the segment of essential goods has mostly normalized.

However, the pandemic has accelerated the altering of buying patterns, and I believe it’s done that for good. The eCommerce market size is expected to grow at a compound annual growth rate (CAGR) of 14.7% from 2020 to 2027, and it is expected to account for more than 95% of all sales by 2040. This year alone, eCommerce sales will surpass $4 trillion dollars.

I don’t have any reason to believe that online shopping will suddenly slow down over the coming months. In fact, what I have seen and helped implement with many customers this year is the combination of the digital and the physical. Companies don’t want to lose their physical space completely. They may want to reduce footprints, but they know it’s good to have a physical presence in markets where they expect to have growth. To meet this challenge they have to execute on physi-digital strategies that provide the quickest and safest services to customers. The important thing here is that companies are giving customers the option to decide if they want to go to stores or stay in the safety of their homes to complete their shopping.  This is the critical requirement in meeting the challenges of Year One of the new world.

Implementing these processes is definitely not easy because businesses have to rethink and reengineer all of their processes under pressure. With IT landscapes exposed, I have seen many operational issues needing to be addressed. A lot of the businesses I worked with were not fully migrated to the cloud, and really in order to support these kind of activities in the physical world, a digital transformation is the key to surviving.

And to make matters more complex, now, in the northern hemisphere, we are starting our fall and winter seasons. High season is upon us. But based on the volumes of certain segments the past 6 months, one could say High Season started back in March. High season is already here. So what to make of the holidays? How are businesses planning to deal with holiday sales? What will Cyber Monday look like? What will Black Friday look like? Do they even matter anymore?

Well, of course, I think they do, but something to keep in mind is that Amazon Prime Day was moved this year from July to mid-October. Amazon Prime Day is now a kickoff event for what may be an intense season of holiday shopping. And maybe this is the beginning of a shift. Maybe this pandemic has moved the start of holiday shopping from the day after Thanksgiving to two weeks before Halloween!

Either a Blip or The Start of Something New

As we get closer to the holidays and six months after the beginning of the pandemic in the United States, I believe shopping patterns for the holiday season will be determined by the new world we live in and the new lifestyles we are experiencing.  I believe it may even be determined by pent up demand! This year, I predict there will be huge demands for goods and products that are going to increase quality of life rather than wish lists of items that do not add value to people immediately. That said, I think sales might be down overall, but eCommerce will boom, especially in essentials and electronics.

And the largest beneficiaries of this eCommerce boom will be the big three. Amazon, Target, and Walmart will dominate the market – reflecting what we have seen now in the last few years, but also proving the adage that bigger is better in times of crisis.

But that’s not to say that other companies or smaller companies can’t partake in the eCommerce tsunami that is about to wash over us. I have been pushing my customers really to move fast on their cloudification efforts, to work hard with manufacturing, retailers, consumer good products companies to respond and accelerate their cloud migrations.

And while I’ve been preaching this for the last decade, 2020 is the year when everybody just gets it. As a cloud vendor, my main goal has been to remove all the stresses on system performance and to allow my customers to focus on their core business by using us as an extension of their organizations to achieve their goals and bring in shareholder value.

My hope is that this fall will not lead to another lockdown, but if that does happen, I think we can rest assured that businesses have pivoted quickly to understand better the mix of physi-digital shopping. Click and collect is the way to maximize and grow retail, and the businesses that have embraced eCommerce and invested over the last six months in digital technology will certainly have their share of the consumer pie in this very challenging year.

In short, this virus is the trigger to modernize technology that arguably should have been modernized 5 years ago. So even though it was 5 years ago when I was making the recommendation to change, retailers can still catch up and catch this wave. eCommerce is the new normal in shopping, and you owe it to yourself to get in on the business here at year one.

high seasonDiego Pantoja-Navajas is vice president of WMS development at Oracle and former founder and CEO of LogFire. He is an industry thought leader in SCM who enjoys exploring the impact of advanced and emerging tech on supply chains.

Descartes Evolution 2020: Emerging Stronger

Logistics Trends | By •

Descartes EvolutionThe COVID-19 pandemic has changed the nature of my job quite a bit. The pandemic hit just as we were heading into our busy conference season. So instead of traveling across the country attending conferences, networking with peers, and in most cases, enjoying a bit of sunshine either by the pool or on the beach, I was attending these events from the friendly confines of my home office. The good news is that the virtual nature of these shows removed one of the biggest challenges of attending a conference: deciding which sessions to attend. Instead, I have been able to watch and, in some cases, re-watch a presentation to glean more insights than I may have been able to do at an in-person event. And this year’s Descartes Evolution was no exception. The conference was last month, and I was actually on vacation during part of it. But I have since been able to go back and re-watch some of the key sessions. The theme of the event was spot-on as we all try to adjust to the new normal: Emerging Stronger.

During his keynote speech, Descartes CEO Ed Ryan discussed the foundation that is Descartes: the Global Logistics Network. The network connects carriers (ocean, air, ground, and rail transportation companies), shippers (retailers, manufacturers & distributors, and service providers), governments (customs agencies, regulatory bodies, and other agencies & associations), and intermediaries (customs brokers, freight brokers, forwarders/3PLs/NVOCCs, and payment agencies). Currently, Descartes has 20,000+ customers worldwide on the network, which processes 18.6+ billion transactions per year, and has grown 21 percent. On top of the network are Descartes’ value-added services: Routing, Mobile, & Telematics, Transportation Management, Customs and Regulatory Compliance, Broker & Forwarder Enterprise Systems, and Global Trade Content. These solutions all tie into the larger network.

2020 Trends

In his keynote, Mr. Ryan touched upon the impact of COVID-19 and what we have learned as an industry in 2020. The coronavirus pandemic has sped up the digital transformation of supply chains around the world. Of the solution areas highlighted above, Mr. Ryan said that Descartes’ E-Commerce, Shipping, & Fulfillment is the fastest growing. This solution enables e-commerce providers to manage their TMS and WMS while interconnecting back office systems. Given the e-commerce boom, it is not surprising that this is the fastest growing product segment.

Mr. Ryan highlighted five things that 2020 has taught us so far. First is the importance of managing a distributed organization. This was never more evident than when the country went into a lockdown and the majority of workers were suddenly working remote full-time. Second, we have seen the death of paper-based processing. For companies that were still relying on paper-based processes because it was cheaper than implementing a new solution, the pandemic has made the decision for them and it is no longer an option. Third, there is a need to address the variability in demand. Capacity and demand fluctuation have upended global supply chains; companies need to be able to react quickly to these changing demands. Fourth, there has been a pivot in business models. These pivots can be seen everywhere, in the way companies collaborate to the way in which they get their products to consumers. These pivots have changed how companies operate. And fifth, there is an increased importance of visibility. Consumers and businesses alike need more transparency on where an order is and need to know when and how they will receive it.

Major E-commerce Trends

There were two sessions that really stuck out to me regarding the growing importance of e-commerce and how companies are emerging stronger. The first was Descartes End-to-End Vision for E-Commerce which featured Johannes Panzer, Head of Industry Solutions for Ecommerce at Descartes. In this session Mr. Panzer highlighted a number of key trends across three categories that are impacting e-commerce operations and fulfillment.

The second session was Home Delivery Best Practices presented by Chris Jones, Executive Vice President at Descartes. I will give a further recap of that see that will be part of my next article.

Macroeconomic Trends

It is no secret that COVID-19 has spurred e-commerce growth. In his session, Mr. Panzer made the point that COVID-19 is causing volume uplift as more people are buying online. And as e-commerce has continued to grow, these changing shopping behaviors are likely to remain in place once brick and mortar stores are back to business as usual. There are whole customer segments that have traditionally avoided e-commerce but are now seeing the convenience of it.

Mr. Panzer highlighted several category trends that the pandemic has affected. For example, travel, events, and hotel stays are all down as a result of COVID-19. This has direct ties to a 77 percent decline in luggage sales, 63 percent decline in bridal clothing, and a 39 percent decline in camping equipment. Although, camping equipment is probably back on the rise as more and more campsites have opened up. On the other end of the spectrum, disposable glove sales have increased 670 percent, cough and cold products have increased 535 percent, and fitness equipment has increased 170 percent. From what I have seen there has also been a rush on bicycles and inflatable pools. The results of these fluctuations has been a 50+ percent increase in shipment volume after the lockdowns were lifted.

Industry Trends

Mr. Panzer highlighted two main industry trends as part of the global shift in e-commerce. The first is the fast-scaling of operations. Fast-scaling means that companies are able to handle a growing amount of work or a change in operations in a fast and efficient manner. The example that Mr. Panzer used in his presentation is the use of flash sales. The proliferation of social influencers and content can create a flash sale on any given item on any given day. A flash sale can effectively mean that retailers need to be able to treat any day like a peak season day, knowing that demand for a product is likely to soar. This means the retailer needs to be able to fulfill orders more quickly and efficiently while meeting the surge.

The second industry trend highlighted in this session is alternative sourcing and fulfillment strategies. As supply chains became disrupted due to COVID-19, the risk increased for those companies that relied on single-country sourcing. Now, these companies are diversifying how they source and fulfill orders. When factories in China shut down just after Chinese New Year, many companies were left in a difficult position of trying to figure out the best way to get the products they needed. Diversified sourcing strategies were the answer and have led to a change in the way these companies currently and will operate in the future.

Technology Trends

The third category of trends that Mr. Panzer highlighted are the technology trends. The first trend that was discussed is APIs, and the automation of data exchange. Most e-commerce platforms already have APIs in place and now more carriers are moving in that direction. There has also been better data exchange through automation.

The second trend is shipment tracking. Visibility tools have become one of the most sought-after solutions in the market. Customers have an expectation of accurate ETAs and improved visibility into where shipments are. Many companies are integrating external data streams to improve ETAs. Bust visibility goes beyond just the live tracking of a package. Now, more and more companies are looking for more transparency in their supply chains, especially visibility into sourcing. This visibility can help brands make better decisions as well as more accurate forecasts.

The final technology trend that Mr. Panzer highlighted is data analytics. There is so much data being collected during every customer interaction and transaction. That data can be leveraged to create greater insights. The use of data analytics is more about connecting different sources and identifying the right insights to drive better decisions.

Customer Experience

The final piece of Mr. Palzer’s presentation was on the customer experience, and how retailers need to provide a remarkable customer experience through fulfillment. There are five stages of the customer experience that retailers can impact:

  1. Check-out Process: retailers need to make sure that customers have access to accurate real-time inventory so they can get the item that they want.
  2. Order Confirmation: retailers need to ensure that all customer information is correct and that an accurate and acceptable shipment and delivery date is available.
  3. Shipment Tracking: real-time notifications must be given to enable the customer to track the order; retailers can also give customers access to next-level processes, such as letting the customer know when a delivery is a few stops away and ask where they want the item to be delivered.
  4. Point of Delivery: the retailer needs to make sure the order arrives when it is scheduled and it must not be damaged.
  5. Returns: there needs to be seamless and fast processing for returns; retailers can provide a return label in the initial shipment and must process returns and refunds quickly.

Final Thought

While this year’s Descartes Evolution conference was certainly a change of pace from attending in person, the message was clear: Descartes’ customers are emerging stronger as we move towards the new normal of a COVID-19 world. Ed Ryan highlighted the impact COVID-19 has had on the industry and what we have learned in 2020. The coronavirus pandemic has pushed e-commerce to the forefront of the global economy, and fulfillment is a driving force for a positive customer experience. Johannes Panzer showcased the end-to-end e-commerce vision for Descartes. This vision is centered around a retailer’s ability to provide a remarkable customer experience through fulfillment. Sourcing and fulfillment are at the heart of e-commerce, and Descartes is positioning itself to ensure that its customers have all the tools they need to succeed and truly emerge stronger.

This Week in Logistics News (July 4 – 10)

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logistics newsA little over a year and a half ago I saw Hamilton in Boston. The show was incredible, but I always wondered if I missed out by not seeing the original cast on Broadway. When I initially heard that Hamilton was set to hit the big screen in 2021 with a filmed performance by the original cast, I was pretty excited. With coronavirus shutting down theatres, Disney spent $75 million for the rights and released it a year early on its streaming service. Needless to say, that when it dropped on July 3, we had a family movie night. The production was brilliant and watching Daveed Diggs rattle off rhymes at warp speed was beyond enjoyable. It did make me happy that the performance I saw was not lacking for talent either. Both performances were incredible all around. And now on to this week’s logistics news.

According to recent reports, Walmart is launching a subscription service similar to Amazon Prime this month. While Walmart has declined to share specifics about the program, it appears that it will be named Walmart Plus, and will cost consumers $98 per year. Membership perks include same-day grocery delivery, gas station discounts, and early access to deals. The service was originally expected to launch by April, but its rollout has been delayed by the coronavirus pandemic, which is not surprising. The move makes sense as Walmart has seen a significant uptick in e-commerce business, most notably in online grocery sales. Overall, the company in May reported a 74 percent jump in e-commerce sales for its latest quarter.

logistics newsThe whispers have been growing and the speculation non-stop, and now, the news is official: Uber has agreed to acquire the food delivery start-up Postmates for $2.65 billion. This comes as the company aims to expand its presence in on-demand food delivery while its core ride-hailing business struggles. Uber will combine Postmates with its own food delivery subsidiary, Uber Eats, and Postmates will continue to operate under its own name. Together, Postmates and Uber Eats would have a 37 percent share of food delivery sales in the United States, according to Edison Trends, which tracks credit card spending. DoorDash would remain the largest player with 45 percent, while Grubhub would have 17 percent.

And Uber is not done – the company has announced that it is launching a grocery delivery service in the United States, along with parts of Canada and Latin America. The company is partnering with Cornershop, a Chilean grocery delivery startup. According to Uber, “with this service launch, grocery orders placed on Uber and Uber Eats will be facilitated and delivered by Cornershop team members. Just like ordering a ride or a meal with Uber, customers can follow their grocery delivery at each step of the process.”

My colleague Steve Banker has written about decontamination robots, and how they can impact worker safety in a warehouse and/or factory. And we have seen multiple companies develop robots that can help to clean these spaces. As coronavirus concerns linger, and new information about the spread of the disease are constantly changing, MIT has designed a robot that is capable of disinfecting the floor of a 4,000-square foot warehouse in only half an hour. The university’s Computer Science and Artificial Intelligence Laboratory (CSAIL) worked with Ava Robotics, a company that focuses on creating telepresence robots, and the Greater Boston Food Bank (GBFB) to develop a robot that uses a custom UV-C light to disinfect surfaces and neutralize aerosolized forms of the coronavirus. The results have been encouraging enough that the researchers say that autonomous UV disinfection could be done in other environments such as supermarkets, factories and restaurants.

logistics newsMexico has had a shortage of safety equipment for frontline workers with protests being held across the country demanding better working conditions. Sincronia Logistica has said it has been using drones to deliver facemasks to Mexican hospitals to remove the risk of human-to-human transmission of COVID-19. The drones have been delivering the medical safety equipment to hospitals in the central state of Queretaro. The Mexico City-based pharmaceutical and logistics company, Sincronia Logistica has turned to drone technology to deliver antibacterial gel, facemasks, gloves, 3D-printed face shields, and other supplies to healthcare workers on the frontline. The majority of what the drones are delivering has been donated to Sincronia Logistica to deliver to the healthcare workers.

The personal protective gear that was in dangerously short supply during the early weeks of the coronavirus crisis in the US is running low again as the virus resumes its rapid spread and the number of hospitalized patients climbs. A national nursing union is concerned that gear has to be reused. A doctor’s association warns that physicians’ offices are closed because they cannot get masks and other supplies. And Democratic members of Congress are pushing the Trump administration to devise a national strategy to acquire and distribute gear in anticipation of the crisis worsening into the fall.

As online grocery sales continue to soar, Stop & Shop is expanding its e-commerce operations. Stop & Shop will add three new warerooms and bring pickup service to at least 50 more locations in 2020. The retailer currently operates 21 warerooms, which are e-commerce fulfillment spaces that are typically attached to brick-and-mortar stores and feature manual order picking and packing, according to a Stop & Shop spokesperson. Grocery pickup, which Stop & Shop launched last summer, is currently available at 212 stores, and orders are available for customers to collect in as little as four hours. The grocer also recently expanded its partnership with Instacart, which now offers same-day delivery service from 321 Stop & Shop stores.

While the global pandemic has taken a toll on many industries, home delivery has been soaring. Since the start of the pandemic, FedEx has hired tens of thousands of package handlers and service providers. The company continues to hire, with thousands of openings seeming to pop up on a weekly basis. According to FedEx:

“The surge in e-commerce during the pandemic has resulted in peak-like levels of package volume for FedEx Ground. Similar to our peak season efforts, we are proactively taking steps to help ensure we continue to deliver for our customers, including hiring, collaborating with customers regarding capacity levels, and leveraging our Sunday residential delivery offering. Since March, FedEx Ground has hired tens of thousands of package handlers and service providers have onboarded thousands of drivers in targeted markets. The pace of hiring continues as we manage ongoing demand for our services and prepare for the coming peak season.”

And finally, Amazon is postponing its marquee shopping event Prime Day until at least early October. The company had previously targeted September as the potential timing for Prime Day, but on Wednesday, Amazon informed third-party sellers that the date could be pushed back another month. Prime Day, which started in 2015, is typically held in July. The discount celebration is partially designed to secure new Prime members, as well as to promote Amazon’s own products and services and provide a sales boost in the middle of the year.

That’s all for this week. Enjoy the weekend and the soundtrack of the week, Hamilton.

Editor’s Choice: Never Normal is the New Normal

Logistics Trends | By •

Note: Today’s post is part of our “Editor’s Choice” series where we highlight recent posts published by our sponsors that provide supply chain insights and advice. This week’s blog comes from Oracle, and examines how the global supply chain responds to turmoil.

new normalDisruptions can come in many sizes. From those smaller, everyday disruptions of machines going down, unexpected orders, suppliers missing, or shorting shipments – issues businesses deal with every day, every week, every month. To the medium disruptions such as new competitors like Dollar Shave club which has attained a $1B market cap in only a few years or the shut down of Sears which impacted brands like Kenmore and Craftsman. We also soon forget that only 6 months ago we were in a tariff and trade battle with China and needed to understand the net impact against margins and consider options. And of course, there are the big disruptions – those that have strategic and global impacts ­­–  like the 1978 Oil Crisis, the Tsunami in Japan, 9/11 and the financial crisis in 2008, and the current state of the supply chain now.

As recent events have put a huge spotlight on the global supply chain, they’ve also highlighted just how interdependent we all really are. Like never before, companies need to understand how to be resilient, manage risk, and respond to sudden and sharp changes in their global supply chain landscape. This is just a taste of what the “new normal” looks like. In fact, with so much volatility ahead, I like to say that “never normal is the new normal.”

These past couple of weeks, top analysts such as Deloitte and McKinsey have shared their perspectives on how companies can transition to the new normal or the “next normal”. We are all on the same page. Approaching this from a technology perspective, we’ve identified four key changes that global supply chains will need to be prepared for now and in the future. Let’s briefly look at each one and discuss strategies that companies can use to react, respond, and successfully navigate through these tough times.

To read the full article, click HERE.

A CEO’s Take on Transportation and Coronavirus

Learning & Leadership | By •

transportation and coronavirusTransportation and coronavirus have been getting a lot of attention lately. The global supply chain is becoming more complex due to increased regulations, trade wars, cross-border commerce, and most recently, the impact of coronavirus. When the coronavirus pandemic hit many industries and economies came to a grinding halt. However, transportation solutions have generally been a bit more insulated as goods still need to move from Point A to Point B. This is especially true of essential items such as grocery and personal care products. With capacity constraints, visibility into transportation is becoming more important than ever.

I am finishing up my market study on Transportation Management Systems and kicking off a new study on Transportation Execution and Visibility Systems. Talking with executives at these types of suppliers is a key part of the process. I recently spoke with Matt Elenjickal, CEO at FourKites, about the global transportation visibility market, taking a deeper look into transportation and coronavirus. FourKites is a predictive supply chain visibility platform, delivering real-time freight visibility and predictive analytics to its global network of shippers, carriers, brokers and 3PLs.

Transportation and Coronavirus: Visibility

There are many factors that have historically driven growth in the transportation management and transportation execution markets, such as a strong ROI, the growth of e-commerce and omni-channel, and the emergence of SaaS solutions. However, in my discussion with Mr. Elenjickal, we touched upon a different growth driver, especially in the visibility space: coronavirus.

transportation and coronavirus
Matt Elenjickal, Founder and CEO, FourKites

Mr. Elenjickal said that “supply chain disruption caused by COVID is leading to the need for more transparency. It is one thing to know where the trucks are, but what am I going to do with that data? Who do I contact if something goes wrong? Customers are looking for visibility across the entire supply chain; they want to know where their products are across the entire network at any time. This could be in a warehouse, on a truck, or in the yard. They even need to know where an item is at the SKU level, and this is not easy to pull off without years and years of research and development. The public perception is that these visibility solutions seem very simple. But they are not. They require density and a network to make it happen. Solutions that do not have the density and a network will not last.”

Visibility software has always been important for improved ETAs, which can reduce dwell times and help to eliminate empty miles. But as Mr. Elenjickal noted, this is becoming more important during the current coronavirus pandemic. FourKites serves companies across all industries, with a major presence in the fast-growing markets of essential items: CPG, food and beverage, essential manufacturers, and retail. In the first few days of the pandemic, the company saw a spike in volume, with their customers pushing for increased visibility into where their shipments were.

When looking at where global transportation and fulfillment will go in the future, we discussed the “new normal” quite a bit. As I’ve written about before, the post-COVID world will be very different than it was just a few short months ago. As economies begin to open, restrictions abound and are likely to remain in place until a vaccine is created and administered across the country. In this post COVID world, the supply chain will continue to be a key cog in ensuring that the economy can function, and home deliveries will be the new normal for more and more of our retail needs.

Mr. Elenjickal highlighted a few changes he sees as part of the new normal. First, there will be less paper-based processes; instead, everything will go digital, including proof of delivery and bill of lading documentation. There will also be heightened collaboration between manufacturers and retailers, all of which will take place digitally, in real time. Mr. Elenjickal also sees a lot of demand for last mile to make things completely touchless. The post-COVID logistics workforce will be very different, as jobs that were always done on site have shifted to remote work. This likely will remain the case for the foreseeable future.

Final Thought

The impact of coronavirus on the global supply chain has been significant. The flow of goods slowed considerably as consumers looked to stock up on essential items. The result has been an increased need for real-time visibility solutions within the transportation market. However, these purchases are facing increased scrutiny in these uncertain economic times. As Mr. Elenjickal said, “Non-essential businesses face much higher levels of scrutiny during this time, as many stores remain closed, so visibility becomes a C-level decision. But for essential manufacturing companies, the discussions are more around how much they are committing to visibility upfront.”

With transportation solutions being a bit more insulated, the rebound could come quicker than other industries. Either way, when it comes to transportation and coronavirus, visibility solutions will continue to be a critical component.

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