8th Annual 3PL Summit        June 21-23, 2010      Executive Workshop:Developing a Flexible Relationship    to Respond Int...
AgendaEconomic IndicatorsShipper Feedback – SCLA Conference3PL’s - Supporting Customers’ Req’tsInteractive Discussion ...
Economic Indicators       All rights reserved, Joel Sutherland, 2010
US GDP Growth The US GDP is $14.2 trillion or 22.9% of the  world economy – the world’s largest. US GDP growth for Q110 ...
US Balance of Trade  The US leads the world in imports while remaining one   of the top 3 exporters.  The US balance of ...
Unemployment Employers in the US hired fewer workers in May than  forecast and Americans dropped out of the labor force -...
Logistics Indicators  Logistics costs fell to 7.7% of US GDP in 2009 from   9.3% in 2008.  Warehousing costs fell 2% bel...
US Logistics Costs - 2009                      Source: CSCMP’s 21st Annual “State of Logistics Report®”           All righ...
Looking Ahead  The jury is still out on when the economy will   realize a meaningful and sustainable recovery.  Understa...
Shipper FeedbackSCLA ConferenceMay 25-27, 2007         All rights reserved, Joel Sutherland, 2010
SC Management ChallengesEconomic slowdown/recession recoverySupply chain disruptions – natural & manmadeManaging global...
“Best” SC Management Strategies Customer-driven Aggressively pursue innovation and creativity Capitalize on skills of p...
Areas for Improvement  Supply chain accounting/finance (CEO & Wall Street)  KPI’s (more supply chain focused)  Increasi...
What SC Leaders Need to Master  Strategy, tactics and execution  “Push” to “Pull”  Lean  Cash flow and people manageme...
3PL’s: Supporting Customers’Changing Requirements       All rights reserved, Joel Sutherland, 2010
3PL’s Can Help Their Customers’… Contain Supply Chain Costs Increase Supply Chain Visibility Prepare for SC Disruptions...
Opportunity: Develop lean and agile SC capabilities that  allow rapid response to customers’ changing needs andprovide var...
Opportunity: Provide effective visibility tools and facilitate the identification, collection, and use of information to  ...
Opportunity: Become an expert in managing a variety ofpotential supply chain disruptions. Enhance processes and ITto more ...
Opportunity: Facilitate increased coordination, integration, andcollaboration with shippers and suppliers, utilizing infor...
Opportunity: Provide end-to-end solutions, includingcomprehensive visibility and event management, to ensure   reliable se...
Takeaways    SC costs are significant and the pressures to     reduce costs are severe    Supply chains are global, incr...
Interactive Discussion  What are YOU doing in each of these areas?        Contain SC Costs                        Increas...
Questions?            Joel Sutherland           Managing Director    Center for Value Chain Research            Lehigh Uni...
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Joel Sutherland from the Center for Value Chain Research, Lehigh University & OHL, Relationships that Respond Intelligently to Economic Rebound

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Joel Sutherland from the Center for Value Chain Research, Lehigh University & OHL, Relationships that Respond Intelligently to Economic Rebound

  1. 1. 8th Annual 3PL Summit June 21-23, 2010 Executive Workshop:Developing a Flexible Relationship to Respond Intelligently to the Economic Rebound All rights reserved, Joel Sutherland, 2010
  2. 2. AgendaEconomic IndicatorsShipper Feedback – SCLA Conference3PL’s - Supporting Customers’ Req’tsInteractive Discussion All rights reserved, Joel Sutherland, 2010
  3. 3. Economic Indicators All rights reserved, Joel Sutherland, 2010
  4. 4. US GDP Growth The US GDP is $14.2 trillion or 22.9% of the world economy – the world’s largest. US GDP growth for Q110 revised down to 3%, showing that the recovery may not be as strong as many had expected. All rights reserved, Joel Sutherland, 2010
  5. 5. US Balance of Trade  The US leads the world in imports while remaining one of the top 3 exporters.  The US balance of trade deficit in April was $40.3B.  US trade deficit with China was $19.3 billion – nearly 50% of total.  Total 2010 deficit estimated at a record $1.84 trillion.  Represents 12.9% of the economy – highest since 1945.  Forecast to decrease in 2011 – but iffy.  Higher fiscal deficits will likely lead to higher taxes. All rights reserved, Joel Sutherland, 2010
  6. 6. Unemployment Employers in the US hired fewer workers in May than forecast and Americans dropped out of the labor force - showing a lack of confidence in the recovery. Consumer spending (needed to increase production) is weak mostly due to high unemployment rates. It may take a few years to revive 8.5 million jobs lost since the recession began in December 2007. The federal government added 412,000 jobs. All rights reserved, Joel Sutherland, 2010
  7. 7. Logistics Indicators  Logistics costs fell to 7.7% of US GDP in 2009 from 9.3% in 2008.  Warehousing costs fell 2% below 2008.  Although early 2009 saw warehouses full of inventory, by mid-year inventories were reduced leaving facilities with empty space.  Transportation costs 20.2% lower than 2008, with all modes of transportation being negatively affected.  Trucking had a 9% drop in tonnage carried. Source: CSCMP’s 21st Annual “State of Logistics Report®” All rights reserved, Joel Sutherland, 2010
  8. 8. US Logistics Costs - 2009 Source: CSCMP’s 21st Annual “State of Logistics Report®” All rights reserved, Joel Sutherland, 2010
  9. 9. Looking Ahead  The jury is still out on when the economy will realize a meaningful and sustainable recovery.  Understanding your customer’s needs, and adapting an effective strategy that responds to these needs, is essential in achieving successful and sustainable 3PL-customer relationships. All rights reserved, Joel Sutherland, 2010
  10. 10. Shipper FeedbackSCLA ConferenceMay 25-27, 2007 All rights reserved, Joel Sutherland, 2010
  11. 11. SC Management ChallengesEconomic slowdown/recession recoverySupply chain disruptions – natural & manmadeManaging global supply chainsSupply chain visibility and event managementIT: Internet, web applications, social networkingDeveloping ROI for going “Green”Organizational issues Source: SCLA Annual 2010 Conference All rights reserved, Joel Sutherland, 2010
  12. 12. “Best” SC Management Strategies Customer-driven Aggressively pursue innovation and creativity Capitalize on skills of people in every area Leverage core competencies Develop solutions, NOT technology (do after) Inspire competitors to imitate Source: SCLA Annual 2010 Conference All rights reserved, Joel Sutherland, 2010
  13. 13. Areas for Improvement  Supply chain accounting/finance (CEO & Wall Street)  KPI’s (more supply chain focused)  Increasing skill requirements (continuous learning)  Using available information technology Source: SCLA Annual 2010 Conference All rights reserved, Joel Sutherland, 2010
  14. 14. What SC Leaders Need to Master  Strategy, tactics and execution  “Push” to “Pull”  Lean  Cash flow and people management  Sustainability and “Green”  Collaboration  Fundamentals Source: SCLA Annual 2010 Conference All rights reserved, Joel Sutherland, 2010
  15. 15. 3PL’s: Supporting Customers’Changing Requirements All rights reserved, Joel Sutherland, 2010
  16. 16. 3PL’s Can Help Their Customers’… Contain Supply Chain Costs Increase Supply Chain Visibility Prepare for SC Disruptions Improve Customer Service Expand Globally All rights reserved, Joel Sutherland, 2010
  17. 17. Opportunity: Develop lean and agile SC capabilities that allow rapid response to customers’ changing needs andprovide variable cost structures that fluctuate with revenues.
  18. 18. Opportunity: Provide effective visibility tools and facilitate the identification, collection, and use of information to improve supply chain performance.
  19. 19. Opportunity: Become an expert in managing a variety ofpotential supply chain disruptions. Enhance processes and ITto more effectively monitor and respond to disruptive events.
  20. 20. Opportunity: Facilitate increased coordination, integration, andcollaboration with shippers and suppliers, utilizing information technology, to improve end-customer satisfaction.
  21. 21. Opportunity: Provide end-to-end solutions, includingcomprehensive visibility and event management, to ensure reliable service and lowest total supply chain costs.
  22. 22. Takeaways  SC costs are significant and the pressures to reduce costs are severe  Supply chains are global, increasingly complex, and challenging to manage  Effective SC management has a high impact on customer service  SC disruptions can be catastrophic if not planned for  Technology is a game-changer All rights reserved, Joel Sutherland, 2010
  23. 23. Interactive Discussion  What are YOU doing in each of these areas? Contain SC Costs Increase SC Visibility Prepare for SC Disruptions Improve Customer Service Expand Globally All rights reserved, Joel Sutherland, 2010
  24. 24. Questions? Joel Sutherland Managing Director Center for Value Chain Research Lehigh University Joel.sutherland@lehigh.edu All rights reserved, Joel Sutherland, 2010

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