Survival for logistics operators is about embracing change

The rapid rise of Uber – which has fundamentally challenged the taxi industry – should send a clear message to the business world at large about embracing change and thinking strategically in the face of the string of megatrends confronting it. For the logistics industry technology, big data, e-commerce and the internet of things are just some of the potential ‘disruptors’. And while many megatrends may seem so far away that we don’t necessarily have to deal with them right now, nothing could be further from the truth, says Barloworld Logistics marketing executive Kate Stubbs. “A few years ago Uber was an almost unknown brand. They are now looking at parcels and are viewed as one of the largest logistics companies in the world,” said Stubbs. “It’s a fabulous business model. Effectively they are controlling information and connecting people but they don’t own any assets.” There are several other concepts that currently seem as far-fetched as Uber did a few years ago – but they will become real very quickly. “Autonomous vehicles are being tested in many countries. We need to ask what that means from a job and from a safety perspective. It will take a while to come into the mainstream but it’s coming.” Major car manufacturers and several technology firms have announced the commercial production of highly automated vehicles starting in 2017, according to a report released recently by the International Transport Forum. Many observers expect a wide range of models on the market by 2030 although it is unclear to what extent these will be capable of self-driving in all circumstances. Another example is 3D printing. “We can all buy a 3D printer right now – and the impact is fascinating. It fundamentally changes the supply chain. We’ll either be printing our goods in our own homes or setting up a warehouse with 3D printers and distributing from there.” Then there’s the advent of robots. “Amazon already has over 15 000 robots operating in its facilities.” And while local players believe that such solutions are not realistic in the short term, the reality is that all of these things are coming faster than we think, says Stubbs, “which is why we need to embrace change and start thinking more strategically.” And that’s at all levels – from a personal level, an industry level, a company level and a country level. “These elements talk to the different skill sets that are required and the talent dearth which is a major issue locally and globally. We need different competencies – analytical, change management and strategic ability.” This is particularly relevant in the South African context where the industry is facing a plethora of new regulations that will fundamentally affect the supply chain. “There’s the new labour relations act with regards to labour brokers, the new BBBEE codes, e-tolls, the truck ban, consignor/consignee legislation, carbon emissions … the list is endless. “With all these new legislations, now more than ever industry and government need to find a way of constructive engagement. While there’s been a huge outcry about the proposed truck ban from the road transport industry, it will also critically affect the ports – and goods won’t reach retail shelves for consumers. The down-the-line implications haven’t been thought through and we need to find a way of engaging constructively.” What becomes very relevant, says Stubbs, is how you lead in uncertainty. “There is no normal – and mitigating your risks in an uncertain environment demands agility.” It’s about forming smart partnerships, collaborating, finding different ways to run the business, and finding the right people with whom to partner for a solution. One of the statistics in the Supplychainforesight survey undertaken by Barloworld Logistics revealed that 30% of respondents did not feel that their organisations were at risk from market and technology transformations, which means they had either strategised to deal with the threat of change or did not understand or believe that the changes were likely to impact them. Clearly only those who have the strategies in place are likely to survive. INSERT & CAPTION There is no normal — and mitigating your risks in an uncertain environment demands agility. – Kate Stubbs