Viewpoint: New culture of collaboration

We’ve certainly been reading and hearing more about the benefits of improved communication and collaboration in logistics management—be it with our carriers, third party-logistics (3PL) providers, suppliers, and even competitors.

By ·

We’ve certainly been reading and hearing more about the benefits of improved communication and collaboration in logistics management—be it with our carriers, third party-logistics (3PL) providers, suppliers, and even competitors.

You’ve heard the basic collaboration axioms by now: Through more real-time contact with carriers we can cut driver detention time. By sharing long-term plans with our 3PLs, we can expand existing relationships, put more of their services to work, and create a strategy that benefits both parties. We can improve freight visibility and inventory management through collaborative planning with our suppliers. And we may even be able to cut rates and help our TL and LTL carriers improve service if we’re willing to fill more trailers with the help of our competitors down the street.

And that list is just scratching the surface. Collaboration can come in many shapes and sizes and now needs to happen at every level of supply chain management. The very foundation of e-commerce, for example, is built on the backbone of improved collaborative planning between distribution center operations and transportation. The most sophisticated order fulfillment operation in the world is useless unless the trucks are at the dock to move the goods.

Logistics Management has covered the growing culture of collaboration extensively through case studies and columns—and based on some of the results we’re hearing, we are not about to stop.

This month’s cover story is an inspiring example of the power of collaboration between a shipper and an existing 3PL partner. Starting on page 26, Executive Editor Patrick Burnson explains how international home and leisure goods giant Hermes-OTTO set out to re-launch the Bombay Company brand and expand in North America with the help of the 3PL partner that was with them at the start.

“In these situations, shippers are often faced with the difficult decision of either spreading the risk of network expansion among multiple 3PL players or sticking with the provider that got them there in the first place,” says Burnson. “It was refreshing to report that, even though Bombay considered other capable players, they decided to collaborate and build on the existing trust.”

By setting up new pricing arrangements and customizing the existing contract to meet Bombay’s needs in the region, the expanded 3PL partnership yielded a multi-channel supply chain built from the ground up. “They now openly share volume forecasts and are able to maintain a fully optimized fulfillment network with deliveries direct to stores, direct to customers, or back through the reverse loop.”

Beginning on page 32, Contributing Editor and Columnist Peter Moore offers his unique insight into the power of collaborative LTL contracting. According to Moore, LTL plays a critical role in our national supply chain network, yet all too often shippers look at these carriers as little more than a commodity—a perception that Moore contends is causing harm to the budgets of both parties.

“It’s time to toss out the traditional LTL contract and impersonal RFP,” says Moore. “Both the shipper and the carrier need to envision themselves sitting across the table from their mutual challenges.” The objective, adds Moore, is for both parties to share the benefit of optimized costs and improved service. What’s not to like about that?


About the Author

Michael Levans, Group Editorial Director
Michael Levans is Group Editorial Director of Peerless Media’s Supply Chain Group of publications and websites including Logistics Management, Supply Chain Management Review, Modern Materials Handling, and Material Handling Product News. He’s a 23-year publishing veteran who started out at the Pittsburgh Press as a business reporter and has spent the last 17 years in the business-to-business press. He’s been covering the logistics and supply chain markets for the past seven years. You can reach him at [email protected]

Subscribe to Logistics Management Magazine!

Subscribe today. It's FREE!
Get timely insider information that you can use to better manage your entire logistics operation.
Start your FREE subscription today!

Latest Whitepaper
Increase Efficiency and Profits with Smarter Logistics Planning
Optimize your fleet by maximizing capacity and reducing empty miles
Download Today!
From the May 2017 Issue
Everyone is talking about terms like digitization, Industry 4.0 and digital supply chain management, but what sort of technologies fall under these broad terms, and how will they change the management capabilities at our disposal? To find out, we talked to some noted supply chain analysts, consultants and technology executives and gathered six digital trends to watch.
Transportation Trends and Best Practices: The Battle for the Last Mile
2017 Technology Roundtable: Are we closer to “Intelligent” Logistics?
View More From this Issue
Subscribe to Our Email Newsletter
Sign up today to receive our FREE, weekly email newsletter!
Latest Webcast
Going Beyond Rate Negotiations for Logistics Cost Savings
The pressure to reduce cost is a fundamental part of every organization today leaving many supply chain professionals constantly renegotiating rates. This webcast examines four areas that may hold untapped savings potentials and even help organizations negotiate better rates.
Register Today!
EDITORS' PICKS
The Evolution of the Digital Supply Chain
Everyone is talking about terms like digitization, Industry 4.0 and digital supply chain management,...
2017 Salary Survey: Fresh Voices Express Optimism
Our “33rd Annual Salary Survey” reflects more diversity entering the logistics management...

LM Exclusive: Major Modes Join E-commerce Mix
While last mile carriers receive much of the attention, the traditional modal heavyweights are in...
ASEAN Logistics: Building Collectively
While most of the world withdraws inward, Southeast Asia is practicing effective cooperation between...