Even logistics professionals with years of experience in the supply chain may face new challenges when working with construction companies that need heavy equipment.
The novel coronavirus pandemic is still wreaking havoc on all sorts of processes in the supply chain and beyond, even several months after it first took hold in the U.S. As such, companies have continually been forced to pivot to new suppliers and strategies, and that's a trend that's not expected to reverse course any time soon.
Indeed, according to chief financial officers who responded to a recent PricewaterhouseCoopers survey from a host of major companies, supply chain issues were cited as one of the three largest concerns for 21% of companies. Meanwhile, nearly two-thirds said they were going to try to change the products and services their companies relied upon, and a quarter of respondents said they were shifting their supply chain strategies overall.
No doubt, this will include shifting to a more diversified and broader group of suppliers, and the following reasons show exactly why your company would be wise to do the same:
1) Prepare for any eventuality
As the coronavirus, wildfires, Atlantic hurricane season, military strife abroad and more have all shown in the past several months, you just can't plan for everything these days, according to Thomas. As such, it's critical to be able to quickly tap new suppliers if distribution problems arise, to ensure a smooth situation on your end of the chain. Often, more than one issue persists at the same time, meaning you need to have contingency plans for your contingency plans.
2) Ethics and sustainability
In addition to just being able to avoid problems stemming from natural disasters and COVID-19, you might want to diversify your supply chain simply because more consumers are increasingly concerned with sustainability and ethical consumption, Thomas added. For that reason, you may have to start thinking about ways you can reduce your carbon footprint in the supply chain and otherwise do more to meet consumers' expectations. That can even become a selling point for your company, as long as it's consumer-facing.
3) Keep up with the competition
As that PwC survey showed, other companies are already strategizing for a more diverse supply chain, so you can't allow them to get an edge on you if you can avoid it, according to Supply Chain Digital. Even if the big impetus to do this is just to keep up with everyone else in your space, that's as good a reason as any to put in the time and effort required to find more suppliers that can meet your needs on short notice.
4) Gain more visibility
If you've been in the logistics business for a long time, you may have many old standbys you support because, well, you've long relied on them, just as they've relied on you, Supply Chain Digital said. But those partners might not be as integrated as you need them to be, in terms of providing you all the visibility you require. It's always worth the effort to gain that extra little bit of operational efficiency and insight.
If your company is thinking about expanding its purchasing department and bringing new workers aboard, there's a lot to consider. Particularly when it comes to unique skills in today's hyper-competitive market, there are some things that should stand out more than others in terms of giving your new hire the ability to hit the ground running.
What are those key indicators of future success? The following should at least put you on the right track:
1) Data analysis skills
These days, everything about your procurement efforts probably boil down to pure data at some level, and your new hires need to be able to quickly look at and interpret any set of statistics or numbers, according to the Oxford College of Procurement & Supply. Being able to spot trends and otherwise get to the bottom of whatever the numbers are saying will help you make the most informed decisions as quickly as possible.
2) Market knowledge
It should go without saying that anyone you hire must be intimately familiar with the world of procurement in general, but you should really focus on the candidates that seem to understand your specific corner of the sector well, the Oxford College of Procurement & Supply said. The more they can tell you off the tops of their heads about your potential partners or industry trends, the better off you are likely to be pursuing a long-term relationship with that professional.
3) Creative problem solving
This is a skill less specific to the world of procurement, but nonetheless invaluable in getting that kind of work done day in and day out, according to Business 2 Community. There are any number of knots to untangle in the course of a week, month or quarter, and you need to be confident your new hire can pull all the right strings to maneuver you out of a problem spot.
4) Team skills
You are likely expecting anyone who's hired will integrate somewhat seamlessly into your purchasing department as a whole; that means they need to be team players who are good with people, Business 2 Community added. That quality has an added benefit: This new hire will also spend a lot of time dealing with people outside the company, and building relationships is a must.
5) Researching techniques
No one in your company should feel as they though have everything about their jobs figured out and, therefore, have to be continually looking for new knowledge and insights, according to Argentus. Do they know where to look? Are they actively engaged in the ongoing conversation industry-wide about the world of procurement? That kind of skill is going to be invaluable as the sector grows and changes.
6) Negotiation skills
Part and parcel with good people skills is the ability to get the best possible deal for your company on every order you make, Argentus noted. Being able to negotiate without causing hard feelings with suppliers and other people in the supply chain is a critical skill for any procurement pro.
As of mid-October, most major players in the retail and logistics sectors have laid out their plans for holiday hiring, even if they haven't started onboarding new workers yet. This year, despite the economic downturn and the still-raging novel coronavirus pandemic, hiring expectations are still sky-high for many of these companies.
Indeed, the retail titan Target recently announced that it plans to hire some 130,000 seasonal workers for the coming season, more or less the same as last year's total, but with a bit of a twist, according to CNBC. Instead of just hiring normal in-store staff as usual, the pandemic has led the world's second-largest retailer to push new hires to work on same-day pickup fulfillment, either curb-side or in-store, as well as increasing the number of workers in its distribution centers.
The reason for this shift, beyond the pandemic itself, is simple, the report said. Some projections show holiday sales climbing by as much as 1.5% over last year, despite the fact that tens of millions are out of work, and Target is trying to ramp up operations to meet needs in a very different economic and social environment than what has been seen in years past. Generally speaking, Target will aim to retain up to 40% of the seasonal employees it hires in the weeks ahead.
Another big effort
Meanwhile, Walmart — the world's largest retailer — says it will strive to hire more as well, continuing a surge it has been experiencing for months, according to a separate CNBC report. Since the start of the pandemic in March, it has hired some 500,000 new workers, and wants to add another 20,000 for the holidays, all to work in its fulfillment centers. Like Target, Walmart sees its efforts at reaching consumers shifting dramatically.
As part of that, it is shifting away from the traditional Black Friday deals it offers to people who show up in stores the day after Thanksgiving, and instead extending them for the entire holiday season in stores as well as online, the report said. Meanwhile, it remains to be seen how the company will handle brick-and-mortar staffing because it has typically preferred to stretch existing workers' hours rather than go on a hiring binge like Target.
From Point A to Point B
Of course, many companies need to do more shipping at this time of year, whether it's business-to-business or direct-to-consumer, and as usual the freight giants UPS and FedEx are hiring a huge number of support workers to meet that need, according to Supply Chain Brain. In addition to hiring tens of thousands already throughout the pandemic — as package volume increased 23% on an annual basis — UPS will seek to bring aboard some 100,000 seasonal workers as it projects record-high demand for shipping services.
Likewise, FedEx is planning to hire as many as 75,000 workers, a number that is up 27% from what the company sought last year, the report said.
With all this in mind, companies would be wise to start seeking holiday hires sooner than later to avoid the heaviest competition in years for such workers.
At the best of times, your procurement department should function like a well-oiled machine, but if you're like a lot of companies, the need for that kind of certainty will most definitely increase around the holiday season. The more you can do to fully plan these efforts in the next few weeks will help your entire organization be fully prepared for the ups and downs of the hectic holidays.
Especially because of the complications accompanying the novel coronavirus pandemic, this planning should already be underway and it requires more insight into the kinds of behavior your supply chain partners and consumers bring to the table these days, according to Google. Largely because of the outbreak, demand for e-commerce is surging and shipping processes have changed quite a bit for many companies, especially in comparison with what they looked like last year.
For all these reasons, it's absolutely critical that you examine how your past efforts contrast with the current situation and determine what it will take to get these considerations up to speed, the report said. This, of course, comes with the understanding that you can't predict everything that will crop up in the weeks ahead, but the more you can do to plot out some fallback positions and contingency plans based on the most recent data — and not just what has worked in years past — the better off you are likely to be.
Perhaps the most important thing to keep in mind these days is not how you will tap suppliers, but rather how you will get the things you purchase from Point A to Point B, according to Material Handling & Logistics. Connecting with carriers to determine what the freight charges will cost for your various shipments, either individually or collectively, is the kind of effort that can really help you identify potential areas for savings. Moreover, getting estimates for shipping times will typically help you properly weight your decisions between price and speed.
Along similar lines, the more you can do to see your purchases in real time as they move from a supplier to your front door will be critical, so making sure you have access to tracking data could also be a good idea, the report said. That may be particularly important if you choose a shipping partner you haven't tapped in the past.
Get it done sooner than later
You certainly don't want to be in a position where you are still waiting to see how some orders will shake out the week of Thanksgiving, according to Elementum. For that reason, whatever you can do to ensure shipments have arrived and are properly sorted out before that all-important week is going to be extremely valuable. Moreover, it may give you extra operational flexibility to handle any lingering problems from yet-to-arrive orders.
All of these efforts may require a more holistic, top-down view of your purchasing operations as a whole, but if you start laying the groundwork before November arrives, you'll be in better shape to handle everything with aplomb.
Going green isn't just for individuals and it's not just something executives promise to do and not follow through — it's increasingly how businesses operate. This is for more than altruistic reasons, but also because consumers legitimately care about the carbon footprint companies create, and in many cases, because it can be cheaper in the long run. As such, more organizations that operate in or adjacent to the logistics sector are committed to greening their supply chains on an ongoing basis.
One such company is the consumer goods titan Unilever, which recently announced that it uses geolocation data and even satellites to ensure deforestation in its supply chain is kept to a minimum, according to CNBC. Too often, when it comes to a supply chain, businesses are in a position where "one hand doesn't know what the other hand is doing" and there isn't a lot of transparency from one end of it to the other. That's increasingly changing because consumer pressure is pushing Unilever and other multinationals to change.
Now, the company uses cellphone data from truck drivers to track how items in its supply chain move, then overlays that information on top of satellite images, the report said. If the company determines that deforestation is part of a supplier's stock and trade, then it can discontinue those business partnerships. Unilever says it further hopes other companies will join in the effort, reducing costs and carbon footprints.
Why it's important
Experts stress that carbon emissions are a growing problem in the retail game overall, largely because of how much online shopping has become the norm, according to the World Economic Forum. Think of it this way: There are now perhaps a few extra steps in the supply chain between a source and the end consumer simply because brick-and-mortar retail stores have been cut out of that picture. Now, instead of going from a regional supplier to a centralized store that consumers visit at their convenience, a pallet of 100 items will typically be delivered to 100 different homes, many of which are delivered by individual vehicles.
As such, for many companies that don't control manufacturing processes on their own, going green starts at the procurement stage. Logistics firms may increasingly strive to cut out one or more partners in the supply chain to increase efficiency, lower costs and, perhaps most important in the big picture, slash the carbon footprint of their operations, the report said.
What's at stake
However, even as online shopping has proliferated between the end of the 20th century and today, companies have been extremely good about finding that efficiency, even if they don't put a name to the efforts. Edie.net notes that between 1990 and 2018, the emissions from manufacturing in the U.K. slipped by 56.7 million metric tons, and many industry experts say they're on a path to net-zero emissions within the next few decades.
With all these issues in mind, it's important for companies at every level of the supply chain to investigate how they can reduce emissions in their own processes and ensure going green is more than just an industry buzzword.
Every business should strive to get as much efficiency and effectiveness out of every department under its roof as it possibly can. Of course, that's often easier said than done, but when it comes to the purchasing department in particular, there are some simple steps you can take to be more effective overall.
These include the following simple changes or tweaks to your current processes:
1) Put one department in charge of all purchasing
First and foremost, if you are leaving each individual department at your company in charge of its own purchasing, this is probably a mistake, according to Business Development Canada. With a centralized purchasing department, everyone else gets to drill down on their own expertise, and leave the purchasing efforts to someone who specializes in the field.
2) Look for local suppliers
One of the biggest problems many companies face in purchasing is they rely on a long, complicated global supply chain, Business Development Canada added. While that's sometimes unavoidable, it always pays off to find local or regional suppliers whenever possible, simply because it cuts down on headaches.
3) Build your relationships over time
Just like anything else in life, if you have a good relationship with your suppliers, they're more likely to want to help you out whenever they can, according to the Purchasing & Procurement Center. The longer your supplier relationships last over time, the better off you're likely to be when it comes to ironing out any hiccups.
4) Craft fallback plans
In the world of procurement, you can't expect every process to go exactly as planned every time you place an order, the Purchasing & Procurement Center said. For that reason, you need to have contingency plans in place any time something goes awry so you can quickly and easily pivot to the next step.
5) Train workers to refine their skills
No one in any aspect of business today has all the answers, even if they've been on the job for decades, the Purchasing & Procurement Center further advised. As such, prioritize regular training as a company-wide effort, including in the procurement department. That way, you can always be sure your employees are keeping up with the latest trends and setting you up for success.
6) Seek out the best talent and strive to retain it
In a highly competitive field like logistics, there can be serious competition for the right talent, and you'll start to feel the pinch quickly if you struggle to attract or retain great employees, according to Supply Chain Minded. As such, you need to make sure you offer the most competitive salary and benefits packages you can, especially when you've already found a great worker.
7) Measure everything you can
Key performance Indicators are everywhere, as long as you know where to look, Supply Chain Minded noted. The more you can do to keep a careful eye on every aspect of your supply chain and purchasing efforts, you'll be in a position to grow.
For professionals in the logistics industry, the need to maintain a strong posture against cybersecurity risks should be obvious. However, there are often so many of these potential pitfalls that it's hard to recognize them, especially because many are all but hidden from their view. That's especially true because of the sheer volume of supply chain partners with which they typically share data.
Indeed, 80% of supply chain businesses that were hit with at least one cybersecurity incident in the last year believe the incident originated with a third-party partner, according to a recent survey of industry executives found from BlueVoyant. On average, those businesses experienced nearly three breaches in that 12-month period, and worryingly, 29% said they have no way to assess risk from their partners.
That should come as little surprise, however, as only 22.5% of those polled said they have the capability to monitor all aspects of their supply chain and almost 1 in 3 re-examine these risks twice per year or less, the survey showed. It's little wonder, then, that 4 in 5 executives polled say they are increasing their cybersecurity budgets.
"The fact that cyber risk management professionals are reporting difficulties across the board shows the complexity they face in trying to improve performance," said Jim Penrose, BlueVoyant's COO. "It is encouraging that budget is being committed to tackling the problem, but with so many issues to solve, many organizations will find it hard to know where to start."
What to consider
Because of these issues, companies would be wise to take stock of potential vulnerabilities more regularly, but also more holistically, according to Tripwire. That includes looking at all assets — including workers — they have under their roof, as well as a realistic assessment of the risks they might face. Not having insight into partners' own risks is clearly a big red flag, but it's also important to understand what data you are sharing and how that might expose you both in-house and via third parties.
Once you have this information and have your best minds focused on dealing with these issues, it becomes easier to find ways you can improve, the report said. That can include working more carefully with your partners to get more insight into their own potential exposure to come up with a better path forward together.
It starts at the beginning
When making new connections with third-party supply chain partners, a critical assessment of those companies' cybersecurity risks and readiness should be standard operating procedure, according to Machine Design. That kind of due diligence can go a long way toward keeping your risks minimized and allow you both to succeed on your collaboration — whatever it may be — on an ongoing basis. However, this kind of issue doesn't always get the scrutiny it deserves when making new business partnerships, so your entire integration process may have to be reconsidered from the ground up. The good news is that as you put more effort into these changes, the better off you're going to be in the long run.
Let’s face it – everyone looks forward to payday. For most it comes every other Friday but the schedules vary across the board. Some get paid weekly, bi-weekly or twice a month, it all depends. Even the day of the week can be up for grabs with Friday being a favored pick for many companies but some paying on Wednesday’s or certain numbered days in a month. Many people are familiar with their payroll company as it normally shows up on the corner of their paystub. ADP, Paylocity and Fidelity are a few big names that readily come to mind. What many don’t realize is there is a lot that goes on behind the scenes to make sure you actually get paid at the end of the day. Depending on the service provider it involves some manual or automated steps and a seamless integration with your companies HR, Finance and Accounting departments. Payroll providers also do more than just paying employees. They help manage any unemployment claims, wage garnishments and even things like performance review portals. This leads us to a very important question, is your company getting the most value from your payroll provider?Value in the payroll space can be determined in many different ways. To name a few:
1. How seamlessly do they integrate with your companies systems?
2. Do they provide a suite of offerings or only core/basic services?
3. Do they offer competitive pricing in the marketplace?
Payroll companies at their base all offer a basic utility or service – the administration and transfer of funds from one party to another. However as described above many have competitively differentiated themselves in the marketplace to offer a full array of services catering specifically to the HR suite. Many HR leaders are overwhelmed with many different offerings, it is important to cut out the noise and really evaluate what is important to your organization. Cost may not always be the driving decision factor, rather capability and features may outweigh everything else. There is no one size fits all approach but it is important to ensure that you are not significantly overpaying for the basic utility or service and that is the actual fulfillment of payroll. Many important factors go into cost structure such as the frequency of payroll, number of employees and complexity of integration. This being said it is important to note that a “good deal” may be very different between a large and small organization.
Many times either a CHRO, other HR leader or Finance leader makes a final decision on a payroll provider. It is important to take a step back and truly understand if your organization is driving the right value for this service offering. Additionally, it is very easy to get engrained and comfortable with a payroll provider and see prices that continue to skyrocket year over year. Taking your offering to market can help ensure that you are getting the ultimate value for you, your company and your employees. If nothing else it will help reset your relationship with your current vendor. Realize that optimizing these services is ever more important in today’s environment where every dollar counts.
In today’s bleak economic environment many businesses are looking for financial resources to weather the storm. To name a few these could be anything from a business loan/line of credit, better payment terms on credit instruments, additional incentives for treasury services and much more. While demand is heightening, supply is shrinking. Banks are tightening up the purse strings and increasing requirements for lending. If a business did not already have a stellar credit rating chances are finding credit opportunities on the marketplace are going to be slim to none. This is where relationships come in. In finance especially coming off cold from the street does not help the case to have a bank loan you large sums of money. Long term relationships groom trust and understanding. These relationship should be leveraged strategically even if there is nothing currently on the table as you never know when in the future a need might arise.
Recently I was working to find a credit line for a customer with a sub par credit rating but a compelling business case showing future growth. In shopping the market and identifying potential banks we hit many stone walls. It was not until I started to get creative and think what relationships could I leverage to get my clients foot in the door. Ultimately we found a large bank who was willing to take a call and consider our request. As we progressed down the vetting process there were upper level concerns at the bank. They wanted to feel like they had an open line of communication to our customers management team and preferred that the relationship be groomed over time. This brings me back to the key mentioned at the beginning - relationships are key and must be groomed over time!
These lessons go to show that networking is key. Many times there may not be an immediate benefit but connections and interactions leave a lasting impression. In the finance realm trust is key. Banks rely on credit ratings, annual reports and financials. These all tell them if a client is responsible with their money, can pay the bills and whether they may be poised for future growth. What cannot be determined though is the cultural integrity and whether all the financials will live up to the name and principles. In this time of extreme difficulty continue to keep networking top of mind. While in person events are out of the realm of possibility there are many opportunities for virtual connecting on LinkedIn, through webinars and just picking up the phone and talking to a long lost connection. Let the power of networking work for you in this environment and lead to better sway with financial relationships down the road.
During times of stock shortages or last minute changes to orders we tend to lean heavily on our relationships with suppliers. And, most suppliers will understand the need to manage to changing customer requirements, respond quickly to changes, and fill orders on time for a competitive cost. However, we've seen relationships that begin with a mutual understanding of needs with a preferred supplier become difficult to manage, and costs can creep up year over year with an ad hoc management arrangement.
Getting a new Procurement Technology implementation set up is a daunting task, with implementation generally taking months. A large part of that implementation is building a new future state, and that is where the biggest mistake for most Procurement Technology implementations occur.
The Covid-19 pandemic has shown how resilient and effective procurement organisations can be. But how can we ensure that we are spending correctly?
What are the opportunities available to improve efficiencies, deliver with greater speed, build an even more resilient supply chain and be adaptive to other changes that could come our way - such as another wave of the pandemic or Brexit??
When we look back the way this pandemic changed the way we procure and interact with our suppliers, there is an opportunity to understand how spend analytics could provide better visibility into the spend through transparency, provide decision points, monitor and improve spend, identify demand-supply gaps and help us respond to these challenges in a quicker and a more effective manner.
We all saw how NHS scrambled its forces together to assemble the essential PPE kits required for its hard working staff and how the decentralized nature of this mammoth organisation did not really help with the leverage it could have otherwise had.
We all faced empty shelves when we went to the local supermarket to stock up on flour, bread and even toilet paper!
We all realised how little equipped our retails chains were to respond to the huge demand in items such as hand sanitisers.
So how then do companies ensure they get the balance right (if and when such a situation arises in the future) between recognising opportunities to generate savings, meeting the demand-supply gaps that arise and above all, keep focus on a sustainable supply chain?
Its important that we stop and ask ourselves:
1. Do we have visibility into our spend? Where, how much and what are we spending on?
2. Do we have the skill set and more importantly tools to perform analytics that can show us where the opportunities are?
3. How quickly can we perform such analysis to not only create plans in wake of such situations but also deliver on low hanging fruits?
4. How do we identify savings levers specific to each category/sub-category and implement these quickly and effectively?
5. What metrics can we track beyond spend, savings and cost?
6. How do we work collaboratively with suppliers whilst supporting them with data that is available and visible to us?
Spend Analytics is key to identifying answers to all these questions. It not only helps you build a road map on category sourcing but also helps identify savings, tail spend, procurement KPIs, behaviours and provides visibility as well as action points to track spend.
Understanding and analysing spend has helped organisations succeed by identifying levers that help unlock savings and value. What further helps identify and implement strategies or tactics to manage spend during a crisis such as the pandemic is an effective digital platform or tool that is capable of raising alerts without the need for a resource intensive process. The fact that most of us have had to work remotely and will probably continue doing so while collaborating with colleagues and suppliers across the world only builds a stronger case for a digital strategy. If you have not considered a digital platform with spend analytics as a part of it, now is the time to do so.
Applying spend analytics can help a procurement organisation make better and informed decisions by providing a better control over your spend and can help navigate crisis situations more quickly and effectively. Spend analysis can enable competitive advantage, enable better supplier relationships, you may even want to see it as the most exclusive secret weapon at your disposal.
Diego summarizes the importance of spend analytics in his podcast here.
Logistics operations are always on the lookout for ways they can reduce turnaround times and improve efficiency in everything they do, and technology increasingly allows them to do just that. These days, that often includes the use of artificial intelligence and automation to identify and address efficiency issues before they even have the chance to really take root.
Today, many warehousing businesses are looking to technology options that will allow them to get an edge in the industry, and that often includes automation, according to a recent industry survey from the ARC Advisory Group and DC Velocity. For instance, a combined 17% of businesses say their current highest priority for tech investment include robots that work collaboratively with employees, case-picking robots and automatic sorting machines.
Indeed, 33% of respondents said they plan to invest in automatic sortation within the next year, the survey found. Moreover, autonomous technology dominated investment plans on a three-year timeline; companies favored shuttle system/robotics hybrids (49%, the largest share for any single type of warehouse tech), robotic case picking (45%), automated collaborative robotics (43%), automated zone-based robotics (38%) or robotic item-picking (36%).
However, while it must be noted that the bulk of the survey was conducted before the novel coronavirus pandemic really took hold in America, companies aren't likely to be deterred from short- and long-term investment planning, said Steve Banker, vice president of supply chain services at ARC Advisory Group, writing about these findings for Forbes. The reason why is simple: As collaboration between humans and automated robotic systems improves, companies have less of a need to pack their warehouses with workers to meet demand.
It's not clear how long this virus is going to be a risk factor for businesses, but the odds that companies and workers alike are more cognizant of infectious disease risk going forward — for years to come — are high, Baker added. As such, automation and robotics can be a great way to ensure the risk is minimized on an ongoing basis.
Many uses for the technology
Of course, the practical application of robotics can go beyond simply picking and packing, working with warehouse employees and so on, and overseas efforts highlight that fact, according to Smart Industry. In Asia, for instance, warehousing firms have utilized robots to check workers' temperatures as they report for their daily duties, and others patrol the warehouse floor distributing hand sanitizer.
Likewise, AI and robotics used in concert are allowing more companies to operate automated forklifts, the report said. In some ways, it seems the COVID-19 pandemic has only strengthened some companies' resolve to make these investments as a means of simultaneously keeping workers safe and making operations more efficient.
Certainly, this is the kind of thing that all businesses in the industry should at least be considering. For those determined to take the leap, it may take careful planning to make sure these devices can be seamlessly integrated into your current operations.
Industrial workplaces can be potentially fraught with hazards for workers and managers alike, but as warehousing has continued proliferating across the U.S., more effort is being put into reducing and eliminating such risk. As such, the broad consensus in the industry as a whole is that it is now safer than ever to work in a warehouse, especially when it comes to heavy equipment.
The initiatives the industry has taken to improve safety include National Forklift Safety Day, which seeks to educate workers about proper use of such machines, the dangers they can pose and so on, according to EHS Today. As one might imagine, this has been a years-long effort, but industry leaders say it's having a big impact on reducing forklift-related accidents. This is, in part, because the education around this issue highlights one salient fact: Maintaining a strong safety record takes buy-in from the warehouse floor to the boardroom.
"t's important to understand that safety isn't an outcome, it's a culture," Don Buckman, EHS manager, Americas Division, for Yale Materials Handling Corp., told the site. "Safety is everyone's job and must extend across operations and the supply chain."
New challenges emerging
However, even as various aspects of traditional warehousing work have become safer, more issues are on the rise these days, according to NBC News. For instance, while summer is wrapping up around the country, climate change seems to be having an impact on logistics work as well. From 2015 to 2018, major shipping companies in the U.S. regularly saw workers hospitalized for heat-related health problems, and as a general rule, temperatures are only likely to keep rising in the years ahead as well.
Experts note temperature-related health issues aren't just about heat stroke or cramps, the report said. R. Jisung Park, an environmental and labor economist at the University of California, Los Angeles, told NBC that "there's evidence that finds that hotter temperatures raise the risk of other injuries, too." These could include disorientation and body strain that leads to things like heart attacks and passing out, which increase on-the-job risk significantly.
COVID-19 becomes an issue
While it may be temporary, the novel coronavirus presents its own problems for warehouse workers, according to human resources expert Deb Best, writing for the Albany Times-Union. Certainly, demand for shipping and supply chain services is on the rise, but now is the time to institute hard and fast rules like social distancing, mask enforcement and staggered shifts to reduce the likelihood of workers becoming ill, as well as encouraging workers who are experiencing symptoms to stay home without financial penalty. That way, the risk of an outbreak in your facility is greatly reduced.
With all this in mind, warehouse managers need to take a holistic look at all the risks their workers face and take reasonable steps to reduce those risks. That could include everything from training to extra break times in the summer to cool down, but every business has its own problems in this area.
Let's consider an example in the telecommunications category. In most cases, barring acquisition activity, the majority of telecom spend falls to one or a few suppliers for each of wireline and wireless. That means, these categories tend to be looked at from a 30,000 foot view when slotted into a roadmap with the driving factor being the answer to, "Do we need to negotiate or source this category this year?" The answer often comes from a quick look at the contract and the run rate vs. the volume commitment and that decides it. The problem is that two out of three years the answer arrived at will be, "No." And, after all, if there is no sourcing or negotiation to be done, what value can Procurement bring to the table in that category besides jumping in to support tactical and one-off needs during the term of the contract? It turns out a lot. And involvement during those "off" years could pay extraordinary dividends to the years when the answer to that question is "Yes."
For this category and so many others, the behaviors and contractual obligations resulting from day to day management of a category are what set the stage for exceptional results or can largely diminish the results to be expected from broader strategic sourcing efforts. The reason this challenge seems to be so common is not because it’s not known to Procurement leaders, it’s that they lack the flexibility, scalability, and agility with their team to address these concerns. They’re too unpredictable to reliably factor into a roadmap and most Procurement leaders tend to head toward to knowns that will drive toward their spend under management and cost reduction objectives leaving little or no room to address day to day changes.
This is just one reason why many companies rely on third party support like Corcentric provides. Having an on-demand team to draw from provides more flexibility to assign the right internal and third party resources to the right projects and activities at the right times to optimize spend under management. It’s not the only solution, but it’s often the shortest and lowest risk path to discerning which categories or spends should be hedged more conservatively to allow for some agility to manage the day to day. This conclusion is drawn from the upside realized from broader strategic sourcing efforts for the category vs. perhaps the more tactical spends that would have taken up that resource time. This is an area of untapped potential for many Procurement organizations due to the pressure placed upon them to maximize their metrics with the resource they have. The variability and unknowns associated with applying more resource to day to day category management without an immediate ROI is just too high risk. Consider ways you can close this gap within your own team and don’t rule out bringing in additional support to simplify the process, reduce risk, and maximize results.
The holiday season is nearly here and if your logistics firm is trying to improve its operational efficiency during this time, it's important to take some time now to make sure all your ducks are in a row. That should certainly include ensuring your purchasing department and decision-makers are fully aware of the challenges that lie ahead, and have a plan to clear any hurdles that may arise.
As such, they will need to keep the following issues in mind throughout the holiday season planning process:
1) You need to forecast need as accurately as possible
In general, your procurement department likely does a good job of managing purchases and planning, but the holidays are hardly a time when general rules apply, according to Supply & Demand Chain Executive. Consequently, it's vital to do as much homework as possible to determine hiring trends from past holiday seasons and take into account which items you may order, if any, are going to be in particularly high demand.
2) Start your conversations with suppliers and carriers now
Once you have a good idea of what your holiday procurement needs are going to look like, it's time to start talking to the companies that supply the items you buy, as well as the shippers that carry those products from Point A to Point B, Supply & Demand Chain Executive recommended. This way, you can see what efforts will be feasible and get a better picture of everything you can do to keep things running smoothly throughout.
3) Identify potential weak points in your supply chain
In the talks with shippers and suppliers, you will likely get a pretty clear picture of aspects of your procurement efforts that should be fairly easy, and those where you might encounter difficulties, according to Zycus. If you know the potential problems in advance, it becomes easier to craft backup plans so that, when problems arise, you can quickly pivot to another reliable option for success.
4) Keep careful records
Whenever you make plans for what you will do in a given situation, it's important to put them into writing, and the same is true of taking notes about the discussions you have with shippers and suppliers, Zycus said. That way, if someone doesn't hold up their end of the bargain or it becomes critical to find a new path forward, there's no ambiguity about how to proceed.
5) Plan for shipping problems, including weather
The overarching theme for the holiday season in the logistics industry is "expect the unexpected," which means you should never rest on your laurels and think everything will go according to plan — and that may be particularly true for shipping, according to EC Sourcing Group. After all, trucks will be packed to the gills, highways jammed with motorists, weather delays and more, all of which might mean your orders don't arrive on time. You need to have plans to deal with these issues, as well as shortages from suppliers, to fully deal with the ups and downs of the season.
While the holiday shopping season is still a few months away, many companies in the logistics sector haven't yet begun their hiring efforts to account for the extra demand. That may lead them to play catch-up or hire workers who aren't among the best in their region. However, if you start planning now and roll out these efforts in the near future, there's still plenty that can be done.
The fact of the matter is that competition for talent at this time of year is likely to be fierce, according to IQ Talent Partners. Even as many are out of work and it may be easier to find willing candidates, there is likely to be a lot of workers who are uncertain of their prospects for seasonal work, especially if it's outside their previous industries. As such, it will be vital to continue to make sure workers are being offered something quite attractive when it comes to working for your company specifically.
Something as simple as employee discounts, signing bonuses, flexible schedules or even just the most casual dress code possible can all go a long way toward ensuring your logistics business is set up for success, the report said. The same is true of a referral bonus system for your current employees, because they know what the job takes and which of their friends and family members are likely to be the ones who can fill such positions most effectively.
The reality of the situation
At the same time as you are planning to hire a potentially large number of seasonal employees, you also have to build contingency plans, according to Talroo. The reality for many companies is they can hire 10, 50, 100 or even more workers for the holidays, but they have to operate with the understanding that some of those new employees are going to wash out. For them, it may be relatively low-stakes at the end of the day, and if they find they don't like the work or aren't suited to it, they may move on before the holidays come to an end.
When that happens, you need to have a thick file of backup candidates to tap in short order, the report said. You could also simply offer your current employees bonuses for filling the shift slots that the departing employee left open if they left abruptly.
Getting the word out
Even if your seasonal hires aren't going to start working until, say, November, it's important to start advertising your job listings sooner than later, according to LSM Guide. The more runway you give yourself to interview, hire and wait-list candidates, the better off all are going to be in nailing down their holiday work plans. That, in turn, helps set everyone up for success.
Drawing lessons from the holiday-season wins and losses you've seen in recent years could further help determine the proper strategy for dealing with how you approach this year's efforts, and set yourself up to hit all your benchmarks in the months ahead.
How do you know when you're bringing aboard the best possible workers? The following tips should help:
1) Get referrals
The simplest way to find great new hires is to ask your current employees if they know anyone they would recommend for the job, according to Staff Management. The reason why is simple: They know what it takes to do the job, and wouldn't want to work alongside anyone who might not meet your company's standards — especially because it could risk their own reputation.
2) Start far out from when you need more staff
Generally speaking, you should have a pretty good idea of when your staffing needs tend to rise, and that means you can more effectively plan for that hiring period, Staff Management noted. The farther out you start your process from the day by which you need to have all your workers in place, the better off you will be when it comes to making sure you have not just enough people, but the right people.
3) Pay better
A simple way to attract better workers is to offer stronger pay and higher-quality benefits, according to Cyzerg. That way, you will not only make sure you can attract talent on an as-needed basis, but also keep the best workers from every crop of new hires when you want to.
4) Trust your new hires with added flexibility
Along similar lines to strong salaries and benefits packages, it's also a good idea to include perks such as scheduling flexibility, Cyzerg added. In many cases, it can be perfectly acceptable for someone to come in an hour early so they can leave an hour later, or set their own schedule, as long as they're still meeting all their work requirements. Workers will value that option.
5) Make your listings more specific to what you need
If you find that your past hires haven't always worked out despite the fact that they looked good on paper, you might want to consider honing your public job listings, according to Recruit Shop. That way, there's no ambiguity about what you're looking for, and would-be hires can calibrate their interest accordingly.
6) Know the signs of potential problems
If your hiring efforts aren't getting the results you're hoping for, it may be time to reevaluate what you're looking at in candidates and why you're welcoming them aboard, Recruit Shop warned. That kind of introspection could help you understand why there may be red flags you're missing in your previous processes.
Office Amenities Shouldn’t Break the Bank
From a talent retention and recruitment standpoint many organizations have found themselves investing heavily in perks and amenities catered to employee satisfaction. In addition, companies that rely on client facing interactions often find themselves offering similar perks to their guests and visitors. The purpose of this blog is to provide insight and guidance on how organizations can offer a strong menu of offerings to employees and guests that can boost morale while protecting your bottom line.
Just about every office space in the country offers simple amenities such as coffee and water. In fact, hot coffee and a water cooler for employees is just about as consistent as pen and paper in today’s day and age. However, many employers simply accept this expense with very little market intelligence and true understanding of the costs and additional benefits associated with these perks. Historically offices tend to delegate this task to HR or a front of house receptionist to simply order and restock product once inventory starts to decline. If you’re a large-scale corporation with numerous facilities across the country this practice could be creating quite a sizable dent from an annual expense standpoint.
The saying “power in numbers” especially holds true within this unique category. The ability to understand the total value of these small incremental purchases, location-by-location within your company portfolio over the course of a full calendar year can be staggering once fully realized. More often than not this category is simply treated as a sunken cost in many organizations, when in all actuality there is a lot of flexibility and cost savings opportunity once your purchasing power is realized and out to bid with suitable providers.
When it comes to identifying suitable providers to bid on this opportunity the first key metric to understand is the coverage area and range required to service this category. The end goal is to hopefully identify a single source capable of providing competitive pricing while also servicing and delivering to your entire portfolio. Utilizing one supplier capable of satisfying this need enables a streamlined category management and communication process while also opening the door for product standardization company-wide for even greater discounts.
Product consolidation is the next critical piece when it comes to successfully managing this category. Historically product selection is rogue across the board with brand preferences varying by location. Leveraging your total annual spend within a select group of standardized products across your entire portfolio will immediately establish strong discounts when compared to the unit price you were originally acquiring similar products at.
Supplier Consolidation Leading to Expansion of Amenities
If your organization successfully consolidates this category to one awarded supplier, a world of additional value add opportunities and additional perks will be made available to your employees. In particular, national providers such as Aramark or Sodexo may offer additional services to high volume locations with amenities such as cafes staffed with baristas capable of providing beverages and fresh food options.
If properly negotiated and discussed with your national provider at the time of contracting, you may be to obtain these perks at no additional cost to your company which would establish a win-win for all parties involved. Your awarded national provider would establish a small revenue stream within your organization while employees have the added perk of a full-service café just steps from their desk. This drastically improved food and beverage service offering helps instill strong morale for employees while also establishing greater productivity with food and beverage options housed inside your facility.
In summary, food and beverage amenities provided to your employees are a crucial yet often overlooked expense within many organizations. If this category is properly managed and effectively consolidated the reward of a strong culture and boost in employee morale can be realized while also managing to obtain significant cost savings.
Throughout the Coronavirus pandemic, there have been many items that have gone through a shortage. The initial items that were difficult to come by were paper goods like toilet paper and cleaning products such as Lysol. As time has progressed, these hot commodity items have changed. With schools resuming, whether it be in person, online, or a hybrid of both, laptops and tablets are the latest items that are nearly impossible to come by. School districts all over the United States, as well as other countries are experiencing shortages of these devices.
Lenovo, HP, and Dell have told school districts they have a shortage of about five million laptops. The delays started in the spring and have only intensified with the continued demand. Schools that have placed orders months ago have either received part of their orders or are still waiting for their orders to be fulfilled. Many schools had delivery dates prior to the start of the school year, however their delivery dates keep getting pushed back without a definite date of arrival. The Denver Public Schools district ordered 12,500 Chromebooks back in April and May and are still waiting on the delivery on these devices. The state of California noted that their school districts are waiting on roughly 300,000 computers and schools in Alabama are waiting on 33,000 computers. With the shortage continuing and school back in session, many districts are scrambling to fill the gaps.
A school district in Buffalo, NY is waiting on the delivery on 10,000 iPads. To cope with the devices not being delivered, teachers are printing packets for the students who do not have access to a computer or tablet. They are doing this with the hopes that students without a device can keep up with students who do have a device. In Duval, Florida teachers are noticing a gap between students who have access to a device and those that do not. Teachers whose students lack access to a device and are doing a hybrid of learning, are failing classes due to their inability to log on on days they are remote learning.
In Newport Connecticut, the director of technology at one of their schools said how they just ran out of devices. The school developed a five-year plan in which it would be able to provide all their students with technological devices. Once Covid-19 hit, they had to condense this five-year plan into a five month plan. Although the school ordered about 22,000 Chromebooks, they still get about 60-100 requests for devices a day.
The shift towards remote learning due to Covid-19 has had a large impact on technological devices. The demand is skyrocketing and the access to parts and devices is declining. While schools are waiting on the delivery of their shipments, they have organized laptop and tablet donations. They have also asked students who received a device from the school to return it if they have a household or personal device they can use for school. The districts are then redistributing these devices to students who do not have access to one. As time progresses, schools hope to overcome this obstacle and be able to give each student their own device, closing the technological and academic gap.
While the novel coronavirus is still a problem across the U.S. — and one that's not likely to go away anytime soon — some aspects of the business world are returning to normal slowly but surely. Based on recent industry data, that certainly includes the logistics industry. After a definitive fallow period around the start of the outbreak nationwide, demand for warehousing space is once again surging, portending big things for the sector in the months and years ahead.
A big part of the reason for this, of course, is more people are staying home and thus ordering from online merchants who need more space to meet demand, according to The Financial Times. The e-commerce titan Amazon has, in recent months, signed leases for some 35 million square feet of additional warehouses in locations from coast to coast, and that seems to be a sign of the times.
Consumer habits have shifted — perhaps permanently — as a result of the lockdowns, such that it's expected online sales in the U.S. will approach $20 billion annually within the next few years, the report said. As such, some industry estimates show that demand for warehousing space will hit 333 million square feet by the end of 2022.
What's at stake?
The fact of the matter is that years-long trends are converging for the industry at a time when the space to actually fulfill needs may be somewhat limited, according to Business Insider. Because of how companies have increasingly offered low-cost or free shipping with quick turnaround times, the need for additional space closer to population centers is on the rise. Moreover, just-in-time inventory strategies have become common, but that leaves companies vulnerable to unexpected shifts in demand and the like.
Because many logistics firms have to effectively be all things to all people in today's environment, they require more space than ever — as much as three times more than retailers, the report said. However, it's worth noting that retailers are also trying to get into the warehousing game at a higher rate these days; shutdowns and slowdowns have forced them to close brick-and-mortar locations, but these companies largely still exist and have loyal customer bases. As such, they need their own warehouses to keep up with demand.
As with anything else in business, when demand for something rises, so too do prices, and that's certainly been observed in the world of industrial real estate, according to Globe St. Indeed, rents for such spaces in the second quarter set new records in just about every major market nationwide as companies moved to claim space at levels comparable to pre-pandemic rates. Demand is growing so quickly that some companies may look to convert large retail spaces into warehouses.
With all this in mind, it's critical for any logistics manager to at least consider what their companies' growth strategy will look like in both the short and long term. Knowing far in advance how you will need to evolve to continually meet your goals will help you craft the perfect roadmap to do so.