The Point by Buyers Meeting Point
Book Review: Introduction to Global Logistics, 2nd Ed.
If you feel surprised that you missed the first edition of Introduction to Global Logistics: Delivering the Goods 2nd Ed., by John Manners-Bell, you’re not alone. I was puzzled by the same thing. If the first edition came out in 2014, how could I possibly have missed it? I didn’t - and maybe you didn’t either. The title of the first edition book was Global Logistics Strategies: Delivering the Goods.
Title and edition questions notwithstanding, this book provides considerable updates and new content. There are three completely new chapters, as well as an updated preface. Since I reviewed Global Logistics Strategies (you can read it here) I focused my time with the 2nd Ed. on the three new chapters:
Chapter 12: Supply Chain Technologies
Chapter 16: Supply Chain Innovation and Disruption
Chapter 17: Ethical and Sustainable Supply Chain Strategies
It can hardly come as a surprise that new supply chain technology provides the option for companies to handle more complexity and gain additional visibility without sacrificing either accuracy or speed. And yet, enough progress has been made in technology that in many cases it is no longer the gating factor to progress – concerns about culture and/or data security are. For instance, in the section about supply chain control towers, Manners-Bell points out that their main barrier to earning a full ROI is not technical, but rather the willingness or ability of multiple companies to provide each other with full and instant access to their systems.
There is also an interesting section on global sourcing technology in the Global Trade Management (GTM) section of Chapter 12. Isn’t sourcing technology fairly established at this point? It may be, but the complexity and specialized requirements of global trade – think external factors such as additional costs, specific risks, and international regulations – affecting each supplier and their associated supply chain may justify an alternate solution for some projects.
The chapter on innovation and disruption is fantastic. Manners-Bell explores the potential impact of drones, autonomous vehicles, and 3D printing. No surprises there. What is a surprising revelation (to me at least) is the impact on logistics of changes in the workforce. As he points out, home delivery and B2C are not quite the same thing. Many B2C logistics providers built their models in a time when there was usually someone home to receive the goods. Now that a huge percentage of women are in the workforce, carriers such as UPS and FedEx may have to try 2-3 times to deliver a package before returning it to the sender. These additional costs – on top of the 1/4 to 1/3 of costs already tied up in the last mile of deliveries - require a significant rethinking of in-place models.
Uber seems to hang like a cloud over logistics providers, much like Amazon Business does for distributors and B2B supply providers. One reason for this is that less than 50% of vehicle trips are full, a source of inefficiency that creates the ‘inevitability of a paradigm shift’. Freight companies are becoming more like middle men or distributors because shippers can go direct to drivers. And yet, freight exchanges haven’t taken off like you might expect in a crowdsourced, Uber-ed economy. This trend has, however, increased the role of small, local carriers as a competitive force against the larger players in the space.