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2012 SUPPLY CHAIN VIRTUAL CONFERENCE
Now ON-DEMAND @ logisticsmgmt.com/global2012
“ Nobody has yet taken out
all of the excess costs in
supply chains. Opportunities
for improvement continue
to exist.”
—Jeanne Dailey, Accenture
Those companies that do make the
connection between technology and
global trade compliance don’t always
make the best decisions around business
case and vendor selection. For
example, Peterson highlights some of
the worst practices in global trade management
(GTM) as follows: Looking at
automation as a “cure-all” for woes of
non-existent or inefficient processes;
capturing hidden costs such as delays,
handling and service charges, duty
advancement fees, and bond charges;
and allowing financial models to trump
compliance requirements.
To avoid these challenges, Peterson
says that a better approach includes
measuring cost versus benefit; benchmarking
with other companies; cleansing
and protecting your data; thinking
beyond borders and companies; and
assembling a cross-functional team to
handle the software selection, implementation,
training, and other functions
associated with the GTM.
Taking an initial, introspective look
at the company’s current processes and
resources before integrating technology
into the global compliance mix is
equally as important. “The biggest mistake
[companies] make is they implement
a solution without even beginning
to measure what they were doing before
they implemented it,” Peterson adds.
Session 2: How to cut global logistics
and transportation costs
As the global economic recovery continues
to inch forward, shippers are starting
to see shrinking capacity and higher
rates across all transportation modes.
In this session, Accenture’s Jeanne
Dailey, senior principal, and Brooks
Bentz, partner, discuss the trend and
offer attendees practical steps for gaining
more control of their transportation
budgets and overall operations.
According to Dailey and Bentz, various
forces are affecting supply chain
behavior right now. Permanent volatility
is becoming the “new normal,” they say,
and what used to work well for companies
will not suffice in the future. Not
only are supply chains more extended,
global, complex, and more demanding,
but transportation costs now exceed 63
percent of total supply chain costs.
To deal with these current challenges,
and those that rear their heads
in the future, Dailey and Bentz say
companies will need to have dynamic
operations and agility. “Nobody has yet
taken out all of the excess costs in supply
chains,” says Dailey. “Opportunities
for improvement continue to exist.”
A few of the common practices that
companies are using today include
conducting sourcing events for select
carriers and modes; keeping a limited
number of carrier contracts in place
and performing limited auditing on
those carriers; using decentralized and
manual shipment planning and execution;
and relying on a limited number
of transportation management systems
(TMS) and other logistics tools.
“Just how shippers operationalize
their supply chain functions depends
on their capabilities and chosen operating
models, frequently varying by
industry and geography, even within the
same organization,” says Bentz. Both
Bentz and Dailey point out that the
roller coaster of events of the last few
years left an “unprecedented change
in how transportation is managed and
brought havoc to logistics budgets and
attention at the highest levels of organizations.”
The good news is that the decline in
rates has provided much needed relief to
cost pressures. “With the recession fading
and volumes returning, the rate of
change in transportation costs will likely
revert to the increased upward pressure
on rates,” says Bentz. “This rate of
change and the complexity of transportation
make granularity and visibility of
information and the tools which enable
it paramount in controlling costs and
maintaining service levels.”
Session 3: Taking a collaborative
approach to ocean shipping
Many companies find it difficult to collaborate
effectively with third parties
that are in close geographic proximity
to their own hubs, let alone across the
86 LOGISTICS MANAGEMENT WWW.LOGISTICSMGMT.COM | December 2012