Shipping can be a labyrinthine matter. Although most people think it’s a “Point A to Point B” operation, when a company is receiving stock from different vendors, shipments come from multiple origins — so it’s more of a “Point A, B, C, D, E to Point F” scenario.
When we handle multiple shipments, things can get complicated…and costly. Demurrage, detention and other charges can be a significant factor in doing business when moving freight between shipping ports.
Not only can these charges be costly for a corporate, but they can also create delays thereby effecting stock availability. Of course, the wider spread your supply chain is, the higher the chance for your corporate to incur these charges throughout the various ports around the world.
To add to the confusion, different locations, carriers, and ports have different policies and regulations, all of which translate to additional complexities and costs.
Especially during the current pandemic scenario, while corporate are trying to fix bottom line for cost damages, corporates should always look for cost reduction on logistics whether business is good or bad.
In logistics that involve the numerous container movement, lilliputian variable logistics charges, detention and demurrage are considered as inevitability of moving cargos. These small indirect costs are aggregated to huge amount forming lopsided corporate budget.
Corporates are in a dilemma on the controlling indirect logistic costs. The conventional thinking is most of those cost are small accidental or unforeseen, cannot be rectified and thereby it occurrence is accepted as normal norm.
The 3 P’s: People, Process, Partnership
We came together largely due to a shared conviction that aligning the different complex nodes with 3P; People, Partnership & Process are the essence of spearheading logistics efficiency and that when we keep all 3 elements at the forefront of our strategic approach, real magic can happen.
People, Partnership, Process forms the foundation of our approach, our principles and our methodologies. We wanted to start with a brief overview of why we believe so firmly in each of these approach.
The 3P approach of the logistics; strong leadership with cross functional teams, reengineered process and partners forms the synergy by increased transparency in information flow through each nodes and shared KPI, thereby increasing the logistics efficiency. Each Ps act providently on combining together. You could see the 3P always camouflage, as the goals are shared. The corporate team, process and partners collaborate each other for achieving target, it could be time or cost.
People: Strong leadership & cross-functional teams
Strong leadership is driving force of the change management, building a cross-functional team with a mix of skills and expertise to micro-manage the day to day operations and forecast; which insist on a clear team goal and developing a plan to achieve it. Work hard and smart to gain the commitment of team members and other stakeholders to the team’s goal; emphasize collaborative efforts and team rewards; provide training on how to work with diverse group of group; and create a set of policies and procedures that support a team-based environment
Process: Micro Managing with a bigger vision
We leveraged the EIT and process re-design capabilities, KPI of our Team to accelerate the improvement of our supply chain, in terms of accuracy, reliability and speed. Without benchmarks, supply chains would run inefficiently and face the risk of falling behind the competition. By setting clear objectives, logistics management can minimize the impact of risks, such as missing deadlines, by optimizing workflow to work towards goals. Processes should be set based on to provide better visibility, to communicate it across the 3Ps.
Partnership: Partnering with a network
Arguably the most important tenet to consider when looking for a new logistics partner is their existing relationships with shipping lines, port authority, freight clearance, transport etc. That’s because, for a 3PL, a strong network of preferred partners is the backbone of consistent, stellar logistics functioning. Without trusted go-to partnerships, it could become difficult to keep pace with cargo volumes. Building a trusted and reliable partnerships with capacity of managing high volumes and with efficient Management System.
Read full article at Logistics Middle East
