A new report from AMR Research produced in collaboration with RedPrairie Corporation, a productivity solutions provider, reveals the main challenges facing supply chains are managing external factors, such as the global economic crisis, and addressing green issues.
Transportation Management: Lessons from a Difficult Two Years indicates there are three key external events that have affected transportation in the consumer products, food and beverage, and chemical manufacturing industries. These include oil price volatility, the recession and major catastrophes, such as Hurricane Katrina. More recently, the disruption caused by the much-publicised Icelandic volcanic ash cloud has had a similar impact.
Developing more sophisticated and flexible transportation systems to reduce risk is an area consumer product manufacturers and the food and drink industry need to address, whereas the chemical sector appears to have established systems more able to cope with re-routing due to its history of dealing with natural disasters.
The increased complexity of supply chains, where companies have to manage and integrate imports and exports from around the world, operate national and local deliveries, and multi channel fulfilment, highlights the need for a robust transport management system.
Additionally, there is growing pressure to adopt more sustainable and environmentally friendly transport solutions and processes. However, this can also bring benefits – route and load optimisation can help conserve fuel and drive down costs, while reducing a product’s carbon footprint.
The report reveals that 86% of companies had made some sort of plan to tackle sustainability and that the top three actions taken to improve transport strategy were consolidating orders for full truck loads, collaborative planning with vendors for inbound freight and centralising to a load control centre.
Martin Hiscox, President and Managing Director International, RedPrairie, said: "Companies are increasingly dealing with a wide range of challenges, some of which can be outside their immediate control. The report highlights the need to continually develop strategic and tactical supply chain solutions to meet a constantly changing world."