Ben Ames has spent 20 years as a journalist since starting out as a daily newspaper reporter in Pennsylvania in 1995. From 1999 forward, he has focused on business and technology reporting for a number of trade journals, beginning when he joined Design News and Modern Materials Handling magazines. Ames is author of the trail guide "Hiking Massachusetts" and is a graduate of the Columbia School of Journalism.
Severe weather events have hit supply chains hard in recent years, so as the Atlantic hurricane season looms just two weeks away, many companies are applying some hard-earned lessons to their logistics operations in an effort to avoid disruption and plan for a quick recovery from the next storm.
Traditionally spanning from June 1 to November 30, the six-month span has lately included painful and expensive hits to U.S. roads, rails, and warehouses by hurricanes Florence and Michael in 2018, and by hurricanes Harvey, Irma, and Maria in 2017.
To help businesses take steps to minimize that damage, transportation and logistics provider DHL provides a supply chain risk management platform called "Resilience360" that the company says can help users to predict, assess and mitigate the risk of disruptions. The company on March 25 released its first "Annual Risk Report," listing the top 10 supply chain risk predictions for 2019. Number four declares: "climate change impact heats up," saying that forecasters predict this year could be the warmest year on record, pitting companies against an increasing number of weather-related disruptions.
A forecast from Colorado State University's Department of Atmospheric Science backs that up, saying those disruptions are on track in 2019 to include 13 named storms, including five hurricanes.
While such massive storms are mighty forces of nature, DHL says companies can use technology to mitigate hurricane risk, since storms are usually detectable three to five days in advance through data supplied by weather radar, satellite imagery, and airplanes carrying sensors. "Companies can map their supply chains, see which supplies are where, and what routes they're using," Tobias Larsson, CEO of Resilience360, said in a May 15 webcast. "Then they can see the predicted path of the storm, whether it will impact their suppliers, and note whether those are critical suppliers, who provide high-volume or high-margin products."
Armed with that model, companies can build buffers of backup capacity so they can continue operating even if inventory flow comes to a halt because of flooding, power outages, and other impacts. "Many just-in-time supply chains have very low inventory levels because they are optimized," so they may have to contact alternative suppliers or load some goods into trucks and put their stock on wheels, Larsson said. "You can't mitigate 100 percent of the risk, but you can do better than your competition."
DHL applied many of those lessons to its own practices after Hurricane Maria swamped Puerto Rico in 2017, and the company was scrambling to get its 10 warehouses on the island back up and running, Ewar Rivera, the director of operations for DHL Supply Chain in Puerto Rico, said on the webcast. As a provider of third-party transportation and warehousing services, DHL helped its customers build up inventories, so they had enough "safety stock" to stay in business, even though the movement of goods through the region came to a standstill as Puerto Rico was lacking clean water, electricity, food, and fuel, he said.
Each DHL warehouse has a business continuity plan (BCP) that is drafted with input from customers and from providers of crucial services like internet, fuel, and water. Many BCPs also include pre-agreed standing orders, so a diesel vendor will continue to make deliveries even when communications are down. "We also used catering services to our facilities, so employees could get food while working and even take some home after work," Rivera said. "We were up and running faster than other companies in the area."
Far-flung supply chains mean that essential suppliers, customers, transportation routes, or other dependencies could be located in high-risk areas, spelling danger for their clients thousands of miles away from a storm's path, Travelers said. The insurer provided three points of advice for businesses planning for the upcoming hurricane season:
have a comprehensive contingency plan in place, including back-up suppliers and alternative transportation routes, and make sure suppliers have back-up plans as well.
establish an emergency communication plan for employees and suppliers in case operations are effected.
prepare to monitor social media and have a transparent response ready to address customer concerns, troubleshoot issues and communicate status updates.
Setting priorities before the storm hits is a crucial step in hurricane preparation, according to the American Logistics Aid Network (ALAN), a charitable group that coordinates donations of logistics goods and services to supplement non-profit organizations' response efforts following natural disasters.
In a May 14 blog post comparing storm preparation to the safety pamphlets founds in airline seatback pockets, ALAN executive director Kathy Fulton advised people to "put on your own oxygen mask before helping others," saying that one of the most practical things you can do to help the cause of disaster relief is to be prepared to take care of yourselves and your loved ones.
Generative AI (GenAI) is being deployed by 72% of supply chain organizations, but most are experiencing just middling results for productivity and ROI, according to a survey by Gartner, Inc.
That’s because productivity gains from the use of GenAI for individual, desk-based workers are not translating to greater team-level productivity. Additionally, the deployment of GenAI tools is increasing anxiety among many employees, providing a dampening effect on their productivity, Gartner found.
To solve those problems, chief supply chain officers (CSCOs) deploying GenAI need to shift from a sole focus on efficiency to a strategy that incorporates full organizational productivity. This strategy must better incorporate frontline workers, assuage growing employee anxieties from the use of GenAI tools, and focus on use-cases that promote creativity and innovation, rather than only on saving time.
"Early GenAI deployments within supply chain reveal a productivity paradox," Sam Berndt, Senior Director in Gartner’s Supply Chain practice, said in the report. "While its use has enhanced individual productivity for desk-based roles, these gains are not cascading through the rest of the function and are actually making the overall working environment worse for many employees. CSCOs need to retool their deployment strategies to address these negative outcomes.”
As part of the research, Gartner surveyed 265 global respondents in August 2024 to assess the impact of GenAI in supply chain organizations. In addition to the survey, Gartner conducted 75 qualitative interviews with supply chain leaders to gain deeper insights into the deployment and impact of GenAI on productivity, ROI, and employee experience, focusing on both desk-based and frontline workers.
Gartner’s data showed an increase in productivity from GenAI for desk-based workers, with GenAI tools saving 4.11 hours of time weekly for these employees. The time saved also correlated to increased output and higher quality work. However, these gains decreased when assessing team-level productivity. The amount of time saved declined to 1.5 hours per team member weekly, and there was no correlation to either improved output or higher quality of work.
Additional negative organizational impacts of GenAI deployments include:
Frontline workers have failed to make similar productivity gains as their desk-based counterparts, despite recording a similar amount of time savings from the use of GenAI tools.
Employees report higher levels of anxiety as they are exposed to a growing number of GenAI tools at work, with the average supply chain employee now utilizing 3.6 GenAI tools on average.
Higher anxiety among employees correlates to lower levels of overall productivity.
“In their pursuit of efficiency and time savings, CSCOs may be inadvertently creating a productivity ‘doom loop,’ whereby they continuously pilot new GenAI tools, increasing employee anxiety, which leads to lower levels of productivity,” said Berndt. “Rather than introducing even more GenAI tools into the work environment, CSCOs need to reexamine their overall strategy.”
According to Gartner, three ways to better boost organizational productivity through GenAI are: find creativity-based GenAI use cases to unlock benefits beyond mere time savings; train employees how to make use of the time they are saving from the use GenAI tools; and shift the focus from measuring automation to measuring innovation.
According to Arvato, it made the move in order to better serve the U.S. e-commerce sector, which has experienced high growth rates in recent years and is expected to grow year-on-year by 5% within the next five years.
The two acquisitions follow Arvato’s purchase three months ago of ATC Computer Transport & Logistics, an Irish firm that specializes in high-security transport and technical services in the data center industry. Following the latest deals, Arvato will have a total U.S. network of 16 warehouses with about seven million square feet of space.
Terms of the deal were not disclosed.
Carbel is a Florida-based 3PL with a strong focus on fashion and retail. It offers custom warehousing, distribution, storage, and transportation services, operating out of six facilities in the U.S., with a footprint of 1.6 million square feet of warehouse space in Florida (2), Pennsylvania (2), California, and New York.
Florida-based United Customs Services offers import and export solutions, specializing in remote location filing across the U.S., customs clearance, and trade compliance. CTPAT-certified since 2007, United Customs Services says it is known for simplifying global trade processes that help streamline operations for clients in international markets.
“With deep expertise in retail and apparel logistics services, Carbel and United Customs Services are the perfect partners to strengthen our ability to provide even more tailored solutions to our clients. Our combined knowledge and our joint commitment to excellence will drive our growth within the US and open new opportunities,” Arvato CEO Frank Schirrmeister said in a release.
And many of them will have a budget to do it, since 51% of supply chain professionals with existing innovation budgets saw an increase earmarked for 2025, suggesting an even greater emphasis on investing in new technologies to meet rising demand, Kenco said in its “2025 Supply Chain Innovation” survey.
One of the biggest targets for innovation spending will artificial intelligence, as supply chain leaders look to use AI to automate time-consuming tasks. The survey showed that 41% are making AI a key part of their innovation strategy, with a third already leveraging it for data visibility, 29% for quality control, and 26% for labor optimization.
Still, lingering concerns around how to effectively and securely implement AI are leading some companies to sidestep the technology altogether. More than a third – 35% – said they’re largely prevented from using AI because of company policy, leaving an opportunity to streamline operations on the table.
“Avoiding AI entirely is no longer an option. Implementing it strategically can give supply chain-focused companies a serious competitive advantage,” Kristi Montgomery, Vice President, Innovation, Research & Development at Kenco, said in a release. “Now’s the time for organizations to explore and experiment with the tech, especially for automating data-heavy operations such as demand planning, shipping, and receiving to optimize your operations and unlock true efficiency.”
Among the survey’s other top findings:
there was essentially three-way tie for which physical automation tools professionals are looking to adopt in the coming year: robotics (43%), sensors and automatic identification (40%), and 3D printing (40%).
professionals tend to select a proven developer for providing supply chain innovation, but many also pick start-ups. Forty-five percent said they work with a mix of new and established developers, compared to 39% who work with established technologies only.
there’s room to grow in partnering with 3PLs for innovation: only 13% said their 3PL identified a need for innovation, and just 8% partnered with a 3PL to bring a technology to life.
Volvo Autonomous Solutions will form a strategic partnership with autonomous driving technology and generative AI provider Waabi to jointly develop and deploy autonomous trucks, with testing scheduled to begin later this year.
The announcement came two weeks after autonomous truck developer Kodiak Robotics said it had become the first company in the industry to launch commercial driverless trucking operations. That milestone came as oil company Atlas Energy Solutions Inc. used two RoboTrucks—which are semi-trucks equipped with the Kodiak Driver self-driving system—to deliver 100 loads of fracking material on routes in the Permian Basin in West Texas and Eastern New Mexico.
Atlas now intends to scale up its RoboTruck deployment “considerably” over the course of 2025, with multiple RoboTruck deployments expected throughout the year. In support of that, Kodiak has established a 12-person office in Odessa, Texas, that is projected to grow to approximately 20 people by the end of Q1 2025.
Women are significantly underrepresented in the global transport sector workforce, comprising only 12% of transportation and storage workers worldwide as they face hurdles such as unfavorable workplace policies and significant gender gaps in operational, technical and leadership roles, a study from the World Bank Group shows.
This underrepresentation limits diverse perspectives in service design and decision-making, negatively affects businesses and undermines economic growth, according to the report, “Addressing Barriers to Women’s Participation in Transport.” The paper—which covers global trends and provides in-depth analysis of the women’s role in the transport sector in Europe and Central Asia (ECA) and Middle East and North Africa (MENA)—was prepared jointly by the World Bank Group, the Asian Development Bank (ADB), the German Agency for International Cooperation (GIZ), the European Investment Bank (EIB), and the International Transport Forum (ITF).
The slim proportion of women in the sector comes at a cost, since increasing female participation and leadership can drive innovation, enhance team performance, and improve service delivery for diverse users, while boosting GDP and addressing critical labor shortages, researchers said.
To drive solutions, the researchers today unveiled the Women in Transport (WiT) Network, which is designed to bring together transport stakeholders dedicated to empowering women across all facets and levels of the transport sector, and to serve as a forum for networking, recruitment, information exchange, training, and mentorship opportunities for women.
Initially, the WiT network will cover only the Europe and Central Asia and the Middle East and North Africa regions, but it is expected to gradually expand into a global initiative.
“When transport services are inclusive, economies thrive. Yet, as this joint report and our work at the EIB reveal, few transport companies fully leverage policies to better attract, retain and promote women,” Laura Piovesan, the European Investment Bank (EIB)’s Director General of the Projects Directorate, said in a release. “The Women in Transport Network enables us to unite efforts and scale impactful solutions - benefiting women, employers, communities and the climate.”