The economic turmoil, ironically, presents exciting opportunities for logistics managers because they can press for smarter, on-demand supply-chain management technology on the basis of how much money it will save the company overall.
The on-demand model means that companies connect with supply-chain partners quickly, and get charged only for as much data-crunching and connectivity as they actually use. In tight times, it’s more obvious than ever that this beats the conventional license-and-install software model, which involves huge upfront costs and long delays before there’s any benefit. In other words, you’re paying for an outsourced service rather than an asset.
Further, important savings come from more efficient monitoring of carrier performance against their contracts; better control of total landed costs; and earlier warnings about delays that might otherwise require expensive expedited shipping. In a thoroughly connected world where supply-chain data is universally and immediately available, shippers can even work with their banks to increase the availability and reduce the cost of capital another point of pain in the current credit crunch.
For the logistics manager, of course, the advantages go way beyond reducing costs. On-demand logistics technology provides extraordinary visibility into the supply chain, empowering logistics professionals with real-time agility in responding to delays and diversions. It also provides the ability to analyze costs at the fine-grain level another huge advantage in reporting and planning when every penny counts.
The recession may well end up accelerating the acceptance of truly 21st century technology in the supply-chain industry, much as the Y2K scare ended up forcing people into updating their computer systems. In this case, you might say necessity is the mother of adoption.