Change, and the ability to adapt to change, for shippers and 3PLs is the chief takeaway from the 29th Annual Third-Party Logistics Study, entitled “Navigating Change: Insights Into Evolving Dynamics in Supply Chain,” which was released today at the Council of Supply Chain Management Professionals (CSCMP) EDGE Conference in Nashville.
Created in combination with NTT Data, Penske Logistics, and supply chain professor and researcher Dr. C. John Langley, the annual report looks at the state of the 3PL market. It leverages feedback from shippers, users of 3PL services, non-users of 3PL services, and 3PL sector respondents.
The study found 61% of shippers and 73% of 3PLs view the need for supply chain change management as critical or significant due to factors such as customer demands, economics, or technology.
In an interview with Supply Chain Management Review’s sister publication Logistics Management, Tim Brindley, vice president and practice lead of the supply chain operations competency at NTT DATA Supply Chain Consulting, explained that the commitment, or how to get to a proper framework to address change, is mixed, when looking at the findings.
“The majority of respondents don’t have a real framework around it, so we listed off a few frameworks and what we saw was either they don’t have a framework or they have something they consider as proprietary in-house, which, from my perspective, is that they don’t have something,” he said. “When you think about resourcing to address it, change management tends to be the thing that is cut, in terms of how much is dedicated towards it. If you don’t have the buy-in from the customer or the end user, it tends to fail or becomes very difficult.”
The study also found that 33% of shippers are looking for AI-focused implementations related to supply planning and demand forecasting, and 27% of shippers are demanding transportation and route optimization. However, 28% of 3PLs are concerned with AI integration with existing systems and 25% noted a lack of skilled personnel.
“The biggest opportunity is supply and demand planning,” Brindley said. “Demand planning is massive. If you can keep your inventory working capital down and you’re able to make better decisions from a demand forecast perspective, that is massive if you can get there. And that is the right place, I think, for something with an AI to actually have an impact. The transportation piece also makes sense.”
Jeff Berman has a deeper dive into the findings at Logistics Management. You can read that article here.
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