Supply Chain Velocity - A Relationship-Based Approach
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By: Garrett Laudenback

If there’s one thing we’ve learned through our decades of experience in the transportation and logistics industry, it’s this – a supply chain is more than a sequence of processes. It’s a network of relationships. And when optimized, these relationships can be a key driver of supply chain velocity.

When we talk about supply chain velocity, it brings to mind an array of strategies designed to accelerate the flow of goods from production to consumer. Eliminating bottlenecks and streamlining processes, implementing agile inventory management practices, designing robust logistics and transportation networks, fostering a culture of continuous improvement – all these are significant in enhancing the speed and efficiency of a supply chain. However, in this post, we choose to shine the spotlight on a fifth and often overlooked strategy, one that has the power to supercharge all the others – effective collaboration and communication, or as we like to call it, “A supply chain of relationships.”

In the ever-evolving landscape of global supply chain and logistics, particularly in the post-pandemic world, this strategy has never been more pertinent. Disruptions, varying shifting ports of entry to labor shortages and augmented government scrutiny, have emphasized the misaligned incentives among stakeholders. Transporting goods into the United States, against such odds, might seem akin to the Greek myth of Sisyphus endlessly pushing a boulder up a hill.

Our journey at TSOR Group has placed us at the epicenter of this complex industry, and over time, we’ve identified a key differentiating factor between successful logistics teams and those that struggle. It’s not just relationships, but the power to lead logistics partners through the strength of these relationships.

To illustrate, let me share an experience from my tenure as the Terminal Operations Manager at a major container terminal in the Port of Los Angeles. During the tumultuous longshore contract negotiations of 2014, we faced immense operational challenges. Worker slowdowns led to massive cargo backlogs and a lengthy queue of ships waiting to be unloaded. Managing a supply chain during this period was a trial by fire for anyone in the industry. However, amidst this chaos, one organization navigated the crisis exceptionally well – Target.

Under the guidance of an innovative leader, Target demonstrated how a strong network of relationships, coupled with effective leadership, could turn the tide even in the face of a severe crisis. The strategy employed by Target is a testament to the effectiveness of the a relational approach to supply chain management. They did four things better than anyone else:

  1. Building Trust: Rather than wielding the power of “Target Corporation,” they sought to understand the challenges faced by their logistics partners. They invested time and effort into getting to know individuals on a personal level, thereby building mutual trust.
  2. Sharing Vision: They communicated their objectives clearly and invited suppliers to be a part of their vision. This transparent approach ensured that everyone was working towards the same goal, creating a sense of camaraderie rather than obligation.
  3. Delegating Authority: This trust and shared vision enabled Target to delegate decision-making authority to their suppliers. The suppliers were encouraged to contribute to problem-solving, which resulted in innovative solutions and a sense of ownership over outcomes.
  4. Evaluating Progress: Target continually assessed the shared strategies and outcomes, engaging in regular review meetings and brainstorming sessions. This was not merely a routine process. The suppliers cared about Target’s KPIs because of the authentic relationships they had formed.

Target, as a large corporation with an advanced logistics team, provides a blueprint that is applicable to organizations of all sizes. Whether you’re handling logistics in-house or outsourcing to a 3PL or freight forwarder, the principles remain the same.

Ask yourself: Do you have strong relationships with key contacts at your logistics provider? Are your logistics partners aligned with your vision, or do they merely see another transaction? Have you allowed your logistics providers the autonomy to innovate? Are your service review meetings leading to real, impactful improvements?

Navigating the logistics landscape can be challenging, but remember, a relationship-based approach is a surefire way to overcome these challenges. Every vessel carries not just your goods but also your dreams for future growth and the promise of your company’s viability.

Let’s make it a priority to cultivate relationships that transform perspectives. Let’s empower ourselves to lead with conviction and strength. Because at the end of the day, a supply chain is more than a sequence of processes. It’s a network of relationships, a supply chain of relationships, if you will, and it’s high time we give it the recognition it deserves.

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