The Top 5 Threats to Delivering the Intermodal Promise: Part One

6 09 2011

By Cento Sharp, Cento Sharp Consulting

Cento SharpThe supply chain has indeed become global, but with this new global expansion comes a host of pitfalls and detractors that could stop the ultimate delivery of the intermodal promise dead in its tracks.

I am delighted to have been invited to write for this brand new blog and over the coming weeks I will expose five threats, their significance to supply chain service delivery and what global organisations can do to shore up their operations to guard against these potential issues.

So, what are these threats?

1) Lack of Technological Innovation

As today’s supply chains become more complex, so have our information technology systems and paper-based processes. The requirement for collaboration among geographically dispersed trading partners, local governments and customs agencies will continue to choke productivity out of our global supply chains if the speed of supply chain technology is not put into overdrive.

2) Poor Development of Transportation Infrastructure

Without transportation there is no such thing as freight. Freight is not created until transportation acts upon it. With only a small portion of the world possessing a multimodal transportation network robust enough to support global logistics and distribution strategies, intermodal organisations will struggle to grow as planned.

3) Lack of End to End Supply Chain Integration

In terms of global operations, complete end to end supply chain integration is merely a myth. Imagine 30 glorious castles, each with their own kings (C-Level Executives), queens (Senior Managers), guards (Regulatory and Compliance) and royal families (Investors and Stakeholders) dependent upon each other, but each with its own desire for ruling the world as they see it. The sooner supply chain managers, intermodal carriers and corporate strategists realise that the risks and rewards of global distribution must be shared equally, the easier highly collaborative linkages will be to obtain.

4) Inability to Meet or Exceed Customer Service Levels

There is a belief that customers are demanding that product be delivered more quickly and at a reduced cost than ever before. This is only partially true.

Customers are simply fed up with the unpredictable performance of their supply chain service providers even though their orders are not becoming more complex. The continual mismanagement of the multi’s (multiple modes); road, rail, ocean, and air by their logistics service providers contribute to this frustration felt by customers. Predictability in terms of landed costs, requested delivery date, order accuracy and quality are the same as they were a decade of ago. Customers are not demanding cheaper, faster and better supply chains; they are simply demanding that there be no surprises.

5) No Long Term Plan for Environmental Sustainability

We are presently in the age of ‘Sustainability’ as a buzzword. Green supply chain initiatives are often fodder for annual corporate marketing campaigns. Until environmental sustainability is required to be put into measureable terms, corporations will be allowed to abuse the true essence of sustainability.

Over the next few weeks I will expand on each of these areas in detail. If you have any questions please do not hesitate to get in touch with me via email – centosharp@gmail.com

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