Successfully navigating risk management and staying competitive with flexible freight solutions
One of the key topics at the most recent UN Global Supply Chain Forum was just how volatile the global trade system has become. For supply chains to survive the near-constant disruption from changing markets and geopolitical issues, speakers at the forum overwhelmingly pointed to the need for more resilient supply chains.
That resiliency, however, rests on agility. Let’s dig into what supply chain agility means, the solutions that make it possible, and why embracing a flexible freight system isn’t just a matter of supply chain survival but competitive dominance.
Understanding agility
Supply chain agility essentially refers to a company’s ability to adjust in the face of change. If a spike in demand requires products to be redirected or a crisis blocks a major route, can the supply chain be reorganized and still successfully get goods to their desired destination on time?
The answer to that question largely indicates how agile a company’s supply chain is. It’s also what often defines their ability to succeed in a fast-paced economy. Market shifts are only a problem if a company isn’t nimble enough to respond. Those that can, however, tend to come out on top.
Deloitte defines supply chain agility as the difference between defensiveness and responsiveness. Where supply chain management has historically focused on trying to prevent disruption, that’s no longer enough to stay competitive. The market is too quick, and there are too many other companies waiting to steal your position. An agile supply chain is all about embracing the inevitable disruptions and using that as an advantage so that it’s no longer just about surviving but thriving.
How flexible freight solutions can help
Understanding how to improve supply chain flexibility has major benefits for the supply chain. Here are a few flexible freight solutions to successfully boost overall supply chain resiliency and agility:
- Diversified transport
Utilizing at least two or more modes of transport in terms of road, sea, air, and rail ensures that if issues arise with one, supply chains can more easily recover. For example, recent hurricane and storm activity in the US hugely limited road logistics, and it was only those who were able to quickly switch to other modes that were able to keep their supply chains intact. At the moment, that’s agility, but over time, that reads as a resiliency that business partners can rely on.
- Integrating technology
Machine learning, AI, and better data technology are at the forefront of flexible freight solutions, and they’re also frequently cited as key factors in a more agile supply chain. They make operations far more innovative and in doing so, ensure that companies stay ahead of the market rather than falling behind.
- Dynamic routing and scheduling
A big part of flexible transportation and logistics is the idea that routes and schedules should be adjustable based on real-time data. The impact that this has in terms of agility and resiliency is significant as it ultimately means that supply chains don’t end up too locked into a single plan. If there’s a roadblock, no problem. Routes are changed accordingly, and schedules are spaced out to accommodate so that the supply chain is simply altered rather than ground to a halt.
Leveraging agile solutions to stay ahead
There’s a strategic advantage that agile freight solutions offer that goes beyond the supply chain itself. Here’s how it can impact the competitiveness of a business too:
- Respond quicker to demand
All the above-mentioned flexible freight solutions ultimately ensure that companies are better positioned to respond to demand spikes. Logistics are easier to reroute, and companies can take advantage of demand shifts rather than losing out because of them.
- Customized to customers
Whether a company is getting goods to individuals or other businesses, customer satisfaction is always a concern, and an agile supply chain makes that far easier to prioritize. It allows companies to offer on-demand delivery and generally be more responsive to customer needs.
- The sustainability angle
Sustainability is a valuable point both in terms of customer satisfaction and in maintaining the longevity of any modern supply chain. Getting the most strategic value out of sustainability initiatives, however, requires agility first.
Harnessing technology
Any technology tool that better allows for real-time monitoring of the supply chain opens the opportunity for greater agility. Even something as simple as GPS tracking on shipments ensures that companies always have a clear idea of where goods are, which then allows for speedier and more accurate decision-making in response to market shifts. IoT, alongside machine learning and AI are also altering how the supply chain is approached so that no aspect of the supply chain goes untraced, and adjustments to the supply chain can be enacted quickly.
This combination is what creates true agility in the supply chain. Companies know where everything is and in what state, and they can use that data to inform adjustments. The competitive advantage of this is near endless as it shifts companies away from only operating on a defensive strategy and into a much stronger, more resilient responsiveness.
For a list of sources used in this article, please contact the editor.
With over a decade of experience in the logistics industry, Nick Fryer is Vice President of Marketing at Sheer Logistics, a leading logistics service provider focusing on data intelligence and analytics. His experience spans markeing, public relations, sales enablement, and M&A at several 3PLs and 4PLs including AFN Logistics, GlobalTranz, and currently Sheer Logistics.