Navigating complex trade and transportation networks in uncertain times. By Frank Kenney
Our global economy relies on complex networks of trade and transportation to get goods from the factory floor or warehouse to our homes. In the US, it’s not uncommon for food items to make a journey of over 1500 miles before they arrive at our tables! The automotive industry provides an even more illustrative example – on average 30,000 components sourced around the world come together in perfect harmony so a single modern car can be produced. This delicate balance means any disruption within the supply chain can quickly turn into an issue with far-reaching repercussions.
In recent years, numerous supply chain disruptions have made headlines and impacted everyday consumers – from shortages in baby formula to unexpected shortages of essential feminine products.
Unfortunately, businesses are often in the dark when it comes to these disruptions, due to a lack of connection between data sources. Businesses that can integrate data across their ecosystem and analyze that information are in the best position to achieve operational agility regardless of challenging circumstances.
Transit networks in a changing world
Logistics planning is no easy feat. Planners must account for dozens, if not hundreds of challenging elements, including the ongoing Covid-19-related closures and worker shortages, global conflict and the increasing severity and frequency of climate events – keeping them on their toes to adapt to rapidly changing conditions. Since no two situations are alike, creative problem-solving is necessary to navigate any roadblocks that arise, and having all the information required to make creative decisions at your fingertips is critical.
This past summer we saw the Mississippi River run dry and, as the water evaporated, so did the ability to move freight along the river. The river was so low that over 2000 barges were backed up. Those that made it through were forced to limit the amount of cargo they could carry so they would not bottom out. Simply put: a logistics nightmare.
In Europe, the same thing happened with the Rhine River. Drought caused river levels to drop, limiting shipping ability on the continent’s most widely used river route. Meanwhile, the opposite is happening with sea levels, which are rising faster since 1859. This change threatens port infrastructure – and creates more risks to be identified and addressed.
The murky future of waterway transportation
Water routes are vital to global trade. The World Economic Forum reports that 90 percent of the products that move around the globe travel by ocean and water. When these routes are threatened – alternative transportation must be utilized. Rail is one option, but with the revolving threats of rail strikes, this is a less reliable alternative. Trucking is another way, but it requires factoring in fleet availability, driver availability, fuel costs and understanding how weather patterns impact roads.
The ever-evolving landscape of the global marketplace pushes businesses to increase their operational agility and adaptability in the face of growing uncertainty. Companies have already seen the effects that climate change can bring, making it necessary for them to identify solutions that will enable them to overcome challenges, no matter what the future may hold.
Any response to these challenges will require connectivity between data sources. Without contextual insights available to decision-makers, actions taken could be hasty and poorly designed at best – or outright chaotic at worst. Conversely, effective supply chain data management empowers leaders with complete visibility into the situation so they can make informed decisions that tap into all relevant information.
Strong, reliable supply chains are possible with data integration
Diversifying routes enables greater resiliency for a strong and reliable supply chain while integrating data sources across the ecosystem provides logistics agility in choosing the best route for any situation. These two actions, diversifying routes and integrating data for visibility, must be taken in conjunction to ensure transit and logistics agility.
Circling back to our Mississippi River example, logistics firms must brace for the river’s summer and fall water levels, which tend to be lower. By preparing alternative shipping routes in advance and factoring in possible time or cost increases, businesses can ensure their supply chain remains uninterrupted.
Although it’s impossible to completely avoid supply chain transportation predicaments, effective and traceable options can help reduce their effects. By equipping your business with agile alternatives, and fully connected Electronic Data Interchange (EDI), delays in the flow of goods may be kept to a minimum.
Enhance transparency and connectivity with an integration platform
Having an integration platform in place can help improve transparency, connectivity and efficiency across the ecosystem. By leveraging a comprehensive integration platform, businesses can bridge gaps between various systems and operational silos, allowing key data and information to flow seamlessly between partners and stakeholders.
This transparency is integral to ensuring the resilience of the supply chain and allowing transported goods to arrive on time. Of course, the more reliable and on-time you deliver goods, the more satisfied customers will be. On-time delivery also eliminates costly late fees and penalties related to SLAs, allowing businesses to better capitalize on resources while promoting positive connections between customers and trading partners.
When it comes to the modern supply chain, speed and agility are paramount. Gone are the days when a few weeks’ lead time was acceptable; with more products than ever available at consumers’ fingertips, it is increasingly important for CIOs and supply chain leaders alike to build agile transit solutions that can keep up with these changes – or risk becoming obsolete. By leveraging technologies that allow for clear communication across the enterprise and ecosystem, alongside tried-and-true methods of transport, like air freight and rail systems, businesses can create attainable goals for successfully adjusting their supply chain in today’s ever-changing world.
Proactive investments help maintain continuity in uncertain times
Even though supply chain disruptions are inevitable, organizations can prepare for any circumstances by investing in agile, modernized systems and strategies. By proactively anticipating change through traceable supply chains and forward-looking planning, companies have the power to identify innovative solutions that will keep operations running even during difficult times – helping them maintain business continuity no matter what comes their way.
For a list of the sources used in this article, please contact the editor.
Frank Kenney is Director of Industry Solutions at Cleo, an ecosystem integration software company focused on business outcomes, ensuring each customer’s potential is realized by delivering solutions that make it easy to discover, and creating value through the movement and integration of B2B enterprise data. Cleo gives customers strategic, ‘outside-in’ visibility into the critical end-to-end business flows happening across their ecosystems of partners and customers, marketplaces, and internal cloud and on-premise applications. Its solutions empower teams to drive business agility, accelerate onboarding, facilitate modernization of key business processes, and capture new revenue streams by reimagining and remastering their digital ecosystem through robust application, B2B, and data integration technologies.