Survival of the Fittest: Why shippers must build resilience into their supply chains without delay

Survival of the Fittest” has greater meaning for the logistics industry than ever before.

Charles Darwin stated, “It is not the strongest of the species that survives, not the most intelligent, but the one most responsive to change.”

The post-pandemic marketplace is rife with change. Marketplace conditions have changed dramatically. The logistics industry is at a tipping point.

We’re witnessing an unprecedented number of changes impacting supply chains. And these changes impacting supply chains are unrelenting. Unlike the recent past, increasing volatility and uncertainty have become the norm.

At best, shippers that don’t build resilience into their supply chains will struggle. At worst, failing to adapt may result in extinction.

To survive in this new environment, shippers must respond to those changes. And they must respond quickly, effectively and efficiently. To do that, shippers must understand the main drivers of change.

Thus, this post will discuss three pivotal drivers of change shippers must address.

 

Driver #1.  Unending Uncertainty: It all starts with uncertainty. No one has a crystal ball – although that would help in anticipating and responding to changes. If you don’t know what to expect, it’s hard to plan for it. More to the point, if you don’t know what’s coming at you, building resilience into your supply chain is difficult.

Building resilience into your supply chain is imperative because uncertainty has increased. In the post-pandemic marketplace, we see no end to change. That’s important because change can sabotage your operations. It can damage your brand. It can result in lost market share and revenues. Finally, it can put you out of business.

But when you accept change as the status quo, you can redesign you supply chain for resilience. That will enable you deal with change as a matter of course. it will allow you to compete rather than struggle.

Building resilience into your supply chain, will enhance your responsiveness to change.

 

Driver #2. Growing Complexity.  Covid-19 laid the complexity and weaknesses of supply chains bare. And we’re still dealing with many of those complexities now.

Again, supply chains are complex. They typically have many suppliers and customers. Suppliers and customers are located in various geographical areas. Some are local. Some are regional. Some are national. And some are international. Complexity arises from connecting these disparate stakeholders.

With trade wars and the prospect of changes coming from a new administration, relocation of suppliers will add more complexity. And that may impact your customer base as well if a tariff regime favors one country or another.

Another layer of complexity lies in communication. Executing seamless logistics support relies on a communications. Those communications must be seamless. To be seamless, they must be networked. However, some shippers use outdated systems that were great when they implemented. But over time the pace of technological change has rendered these systems obsolete.

Complicating matters, many shippers use disparate, non-integrated systems. As a result, systems are stove-piped. They reflect the needs and available technology at the time.

In either case, existing IT systems and infrastructure confuses and complicates communications.

Without connected networks including all your stakeholders, you can’t respond proactively to change. If you can’t do that, you can’t compete.

 

Driver #3.  Increasing Competition.  As everyone strives to reset after the pandemic, competition is heating up.  Perhaps, the biggest driver of increasing competition comes from rising customer expectations. We see that with the move to E-Commerce.

Customers want their goods… and they want them now. And don’t forget, they expect free shipping as well. That by itself has ratcheted up competition. And that trend isn’t slowing down.

To put this into perspective, customers are demanding added value. They value speed.  They value availability. And they value low prices. Companies that can deliver on these stringent expectations will thrive. Think Amazon.

As companies make customers the center of their operations, competition will increase. Customer-centric business is the new paradigm. Already headed in that direction, the pandemic hastened this trend.

Building a resilient supply chain means being responsive to customers’ needs. Shippers will thrive when they position themselves to respond to customers’ needs.

Shippers that fail to respond to their needs will feel the heat of the competition.

Are You Ready to Adapt to Survive and Compete?

To survive to compete tomorrow, supply chains must embrace uncertainty, complexity and competition. Shippers who anticipate and embrace change will likely thrive. That’s because they will respond proactively rather than reacting reflexively.

On the contrary, shippers that fail to plan for change, handicap themselves. That invites greater competition leading to loss of market share and revenues. It’s a no-win proposition given the rate and scale of change in today’s marketplace.

Addressing these three drivers of change requires sustained focus and direction. It means, as a shipper, you must devote a fair amount of attention to change. Also, you must decide on the direction to take in building resilience into your supply chain.

Are you swamped? Or maybe you’re unsure of how to navigate the changes impacting your supply chain?

If so, you should contact American Global Logistics for help.

At American Global Logistics, we take a fresh approach to change. We provide solutions tailor-made for today’s increasing uncertainty, complexity, and competition.

Contact us today to find out how we can work together to build resilience into your supply chain.