Post-pandemic: The Value of Relationships in Repairing Logistics

The Value of Relationships in Repairing Logistics in a Post-pandemic world?

Industry alone cannot repair all that needs fixing. To address the gaps exposed by the panoramic industry has turned to technology with great expectations.

Certainly, technology can play a significant role in addressing many of the shortcomings. It can help optimize operations to get to a state of better, faster, and cheaper.

But reliance on technology alone won’t meet today’s demands.

Why not?

There are too many other variables that bear on achieving an end state that includes seamless flows of information, materiel/supplies, and money.

At a strategic level, logistics and supply chains operate within a system and work based on relationships. Those relationships are between:

  • suppliers and manufacturers
  • manufactures and wholesalers
  • wholesalers and retailers
  • retailer and customers
  • 3PLs/4PLs and shippers and their customers.

Looking at it strategically, the complexity of logistics and supply chain management becomes clear. It’s a wonder anything gets done.

This list highlights the significance of relationships in addressing the gaps exposed by the pandemic. They’re certainly essential, but they are only one way to address the gaps that exist.

Government and Industry as Strategic Partners

But there’s a greater issue that prevents logistics and supply chain management from realizing consumers’ expectations. As mentioned above, logistics and supply chains operate in a system. At the highest level, that includes the government.

In today’s world of trade wars, recent wars, inflation, policies, laws, regulations, and mandates. Governments affect logistics and supply chain management more than ever – domestically and globally. Think of sanctions, embargoes, taxes, tariffs, subsidies, and quotas.

In the post-pandemic world, the effects of government actions have wide-ranging consequences. In many cases, those consequences have detrimental rather than beneficial effects on logistics/SCM. Navigating this morass makes logistics/SCM seem like an impossible task.

But as we can see, the flow of information, goods, and money is happening despite these challenges, barriers, and roadblocks. Businesses work because of leadership, teamwork, innovation, partnerships, and technology.

But without a favorable system in which to operate, these fall short of their potential. What’s needed is a supportive government that engenders cooperation rather than conflict and chaos.

To answer the question at hand, the logistics/SCM gaps exposed by the pandemic can be fixed. One caveat is that besides the initiatives listed in the bullets above, a total fix is impossible without a supportive government.

The Need for an Integrated and Synchronized Strategic Ecosystem

Government must provide a strategic network or ecosystem that facilitates seamless flows of information, product, and money. Government’s laws, policies, regulations, and mandates must be clear, consistent, constructive, and cooperative.

According to Jim Tompkins of Tompkins Ventures, “The supply chain task at hand is not an enterprise problem; it is an end-to-end network problem involving multiple enterprises. The solution does not lie with fixing one link in the chain but in devising an ecosystem where all the links of the chain work together…”

Tompkins goes on to say that the answer to logistics woes lies in technology. We don’t disagree.

However, we believe a complete solution lies in achieving a strategic partnership with the government. Any solution requires a strategic foundation that provides an integrated and synchronized ecosystem.

The New Normal presents opportunities and challenges. To overcome the challenges, the industry must partner with the government to help create a cooperative climate within which to operate, nationally and internationally.

That’s probably the greatest challenge facing shippers, 3PLs/4PLs, and other stakeholders in fixing logistics/SCM.

That’s not to say you can’t achieve progress by pursuing some or all of the other initiatives discussed. You can.

However, the operating environment must provide a favorable operating environment.

Since the government’s role has expanded after the pandemic, it is more important to foster a cooperative strategic relationship between industry and government.

American Global Logistics stays ahead of changes in governmental trends and issues. Investing time in staying ahead of governmental trends and issues means compliance is not an issue.

Rather than be blindsided, we seek opportunities for changes in governmental direction. In doing that, we give our clients a competitive advantage.

Contact AGL today to find out how we can help you achieve a competitive advantage.