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New Study Reveals Insights into the State of the Supply Chain Industry

June 29, 2020

With dire worldwide health threats, environmental upheavals, geopolitical tensions, delivery channel pressures and workforce demographic shifts, the supply chain faces its most dynamic period of change in modern times. As a consequence, risk management and recovery planning are now at the forefront of many shippers' planning. Meanwhile, the impact of the "Amazon Effect" on the transportation industry is pressing organizations to focus intently on assuring exceptional delivery service and to consider new investment in e-commerce.

These are just some of the revelations explained in "Five Takeaways from Transportation Leaders Today," a new study by John Lebowitz, a distinguished faculty fellow with the Global Supply Chain Institute in the Haslam College of Business at the University of Tennessee, Knoxville. The report is based on interviews with representatives of 26 companies from various industries, undertaken in conjunction with Green Mountain Technology’s fifth annual Parcel Benchmark Survey.

In accessible prose, Lebowitz discusses the challenges industry leaders see confronting supply chain managers. The report’s first discussion point examines the effects of the COVID-19 pandemic on the supply chain. It notes that the virus has infiltrated every aspect of the supply chain, squeezing supply and delivery functions and crushing distribution operations, all of which are forcing a wholesale rethinking of strategies and planning. Lebowitz foresees a new normal, in which resiliency plans are a given, and interest in regionalizing sources to their markets could signal “a significant shift in procurement and manufacturing strategies.”

The subsequent four points –  the Amazon Effect, technological advancement limitations, growing multichannel pressures and risk management needs – are likewise dealt with in straightforward fashion. On all five subjects, Lebowitz draws salient inferences and observations from the responses included in the surveys, and he includes candid comments from the industry leaders. 

Despite the uncertainty of the times, the interviewees did not register despair. Rather, many respondents said they believe that they have the right processes and systems in place to manage through the challenges.

“Aftershocks from current events will roil the supply chain long after the immediate concussion fades,” Lebowitz says. “As their work proceeds in these extraordinary circumstances, practitioners must be mindful of and quick in response to conditions that may affect the performance of their daily operations, and they must take an aggressive stance on planning for the future.”

To that end, the study offers several recommendations in addition to those mentioned earlier, including:

  • Changing minimum leadership resiliency skill requirements
  • Aligning supply chain leader and information technology priorities regarding final mile capability and tools
  • Training on the conflict between “cost and cash efficiency” and online business development

The report concludes with a summary that briefly outlines how supply chain personnel may be affected by the current recession. However, the overall tone is one of optimism that the supply chain will continue to rise to the challenge of consumer demands.

About the Global Supply Chain Institute

The Global Supply Chain Institute shapes and influences the practice of supply chain management by serving as the preeminent global hub for leading practitioners, academics and students to learn, network and connect.

About Green Mountain Technology

Green Mountain Technology brings innovation and technology together to help large companies manage their parcel spends at a level they could not reach on their own. Their Parcel Spend Management solution combines a best-in-class parcel audit system with intelligent parcel spend analysis software to identify network opportunities and assist with contract management.

CONTACT:

Scott McNutt, business writer/publicist, rmcnutt4@utk.edu