This Week in Leadership (Nov 29 - Dec 5)
Questions—and answers—about the Omicron variant's impact on organizations. Plus, critical year-end moves to boost your career.
The 2016 20th Annual Third Party Logistics Study shows continued collaborative and positive relationships between shippers and third-party logistics providers, which have been developing since the study began 20 years ago. This year’s survey suggests 3PLs and their customers are becoming more proficient at what they do, individually as well as together, which is improving the quality of their relationships. Both parties—93% of 3PL users and 94% of 3PL providers—reported that their relationships are successful and that their work is yielding positive results.
The 2016 3PL Study showed that 70% of those who use logistics services (shippers) and 85% of 3PL providers said the use of 3PL services has contributed to overall logistics cost reductions, and 83% of shippers and 94% of 3PL providers said the use of 3PLs has contributed to improved customer service. Moreover, the majority of both groups—75% of shippers and 88% of 3PL providers—said 3PLs offer new and innovative ways to improve logistics effectiveness.
Gainsharing and collaboration remain important to many relationships, and 46% of shippers and 81% of 3PL providers agree that collaborating with other companies, even competitors, to achieve logistics cost and service improvements holds value.
As seen in recent years, the most frequently outsourced activities continue to be those that are more transactional, operational and repetitive. Activities that are strategic, IT-intensive and customer-facing tend to be outsourced to a lesser extent.
Although relationships between shippers and 3PLs are successful overall, there are some areas in which they could improve. Many shippers are still working to shift management structures to better reflect the role supply chains play in the business.
Shippers continue to rely heavily on the IT services 3PLs provide, and the ability to manage the provision of IT-based services is a necessary core competency of 3PL providers. While the IT Gap—the difference between what shippers feel is important and their ratings of their 3PLs’ current IT capabilities—has stabilized, further opportunities for improvement remain.