Global Logistics Perspectives

Global Logistics Perspectives

In discussions with one of my mentors and past supervisors in many years past, we often lamented on how the new generation wasn’t prepared for the multiple crises facing us in the supply chain as they haven’t been through the tough times that we have been through.  They were frozen and needed help. Often, we discussed we had seen everything and there was nothing new that we would face.   Fast forward to today as we emerge from the pandemic and unprecedented times, my leadership lessonsstart with a curious-growth mindset. How best can we all prepare for the new era and influence to shape it?  I find myself having many more questions than answers, but with a confidence in the great team around me to stress test new ideas and concepts that will deliver a better future.

I believe the world is a much better place than 20 years ago and the gap closing between the developing and developed worlds; however, with growth and change there is much more disruption.  While our world is big and complex, human progress is still about life at ground zero, up close and in detail.  As I’ve traveled the globe, I find local areas dramatically differ from overall country statistics and averages. 

The purpose of Logistics exists remains the same…. get goods to the final destination and provide information that builds confidence in our companies and supply chains by completely answering the internal or external customers’ questions in a manner that builds confidence.  The lens and hierarchy of executing this through 1. People 2. Service 3. Cost & Productivity have taken on many new challenges with growth and disruption.

People used to mean safety, training, performance, and engagement.  While all these are core, it’s simply not enough in today’s landscape. We focus on culture by relating everyone’s job to a higher purpose and mission.  At Mattel, we foster a child’s learning and development by getting toys in the hands of children across the globe.  We also care deeply about operating with the highest commitments from a DEI (diversity, equity, and inclusion) perspective. Every role in Mattel Logistics plays an important part in our success to accomplishing the higher purpose and I’m proud to work for a company that makes a difference to our customers, employees, and shareholders through achieving equal pay by gender globally, 2021 Human Rights Best Places to work for LGBTQ equality, and 2021 Forbes Best Employers to Work at.

Logistics labor shortages across many markets will accelerate technology deployment and it’s exciting to see the amount of investment in our industry.  How will these technologies impact logistics work and social order? How willtechnology, companies, and geopolitics interact to shape our new economy?75% of the world’s population have cell phones and this has made the world a much different place, especially how we interact in the workplace.

 

Service used to mean OTIF- On-Time and In Fulland rigorously measuring every order, every line, and every piece for both On-Time and In Full.  We still pay a lot of attention to these and with On-Time measure covering every order for 1. DC Dispatch- DC had order ready at prescribed pick ready time 2. Carrier Dispatch- Carrier exited guard gate at prescribed dispatch time and 3. Customer Delivery – goods arrived at original customer promise time. We have also extended this metric to cover merchandise condition (accuracy and damage free) which can vary by customer. There are many unique customer requirements and metrics for order preparation (ticketing, bagging, labelling, and VAS-value added services) that add to Logistics complexity.  In addition, the growth of E-Commerce DTC (direct to consumer) will add many additional requirements and complexities to your Logistics network.  One of the key logistics strategy questions to answer is should you have both B2B and DTC i.e., all channels and brands in a single logistics network?   While there are many considerations, the approach is to have great “cost to serve” data to support your overall logistics network strategy.

Service also took on a whole new meaning with supply chain disruptions impacting the international ocean trade during the pandemic.  One of the key successes was the ability to find many new ways to flow goods and overcome the challenges and constraints.  It took advanced teamwork across all the functions in supply chain working together along withstarting a3-year shipper of choice strategy before the pandemic to partner with key logistics carriers and partners on best-in-classpartnership metrics for equipment turn times, detention, demurrage, volume commitmentsi.e., do what you say and say what you do. We were able to secure additional capacity during the pandemic based on the credibility and partnerships we formed with our logistics partners.  In addition, having end-to-end goods flow visibility continues to be a key critical and competitive advantage and requires the best technology, people skills, and processes to ensure goods get to each market to satisfy customer demand OT & IF.

Logistics cost and productivity remain at the forefront of a company’s success.  The adage of a dollar saved in logistics falls to the company’s bottom line P & L remains very high in importance.  I often use the line that “we are in the penny business” and one that I heard for the first time from a successful CEO who was interviewing me for the next level top global logistics role. I demonstrated during the interview a thorough understanding of logistics costs and a cost to serve mindset. Winning at cost and productivity in today’s environment requires logistics leaders to not only understand the details of all cost inputs butcan influence and translate across your internal and external organizations.  The past two years have been ensuring the internal organization understands the inflationary items significantly impacting logistics costs and influencing scenarios and decisions the overall company takes.  This will continue to be at the forefront supply chains performance dominating the CEO discussions. With logistics suppliers, it’s ensuring you understand “should costs” of their business and developing a vested win-win partnership that’s flexible to everyone’s needs. While there is no single, best approach, the 3PL relationships I believe are successful and long lasting have established levels pre-set for escalation and problem solving, involve active participation with quarterly reviews, and are open book with high transparency and accountability. 

Lastly, it’s about leaving the world a better place and we have organized across 3 ESG pillars 1. Sustainable design and development of our products with goal of reducing plastic packaging by 25% in 2030, responsible sourcing and production, and thriving and inclusive communities.  Specially in Logistics, we have upgraded lighting in our company owned DCswith lowest energy consumption at great payback savings, introducing EV’s where possible, and have expanded our outbound freight networks with our customers.  In cases where our customers, have more efficient freight networks, we have negotiated freight collect agreements which significantly reduce energy consumption through more efficient modes of transportation. 

As your company transitions to the new era, I hope you are as excited as I am about the roles and contributions you can make as logistics leaders to shape and influence a better world for the next generations to live in!

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