Just one generation ago, the courier industry was essentially nonexistent. Today, in 2008, it is one of the largest means of transporting daily shipments for all industry sectors. According to the US Department of Commerce statistics, air freight accounted for nearly 40 percent of all international trade merchandise in 2007, equaling about $4.8 trillion (US), with express delivery accounting for 20 percent (or $2.4 trillion) of that amount
What Is Driving the Courier Industry’s Growth?
Business shifts, including globalization, cost reduction, and consumer demand, have driven the courier industry’s rapid growth. Additionally, the shift of businesses manufacturing more in developing nations has meant an increase in the need for the international shipping of packages and documents.
Many organizations now also outsource their logistics and supply chain requirements to companies that provide complete, seamless logistics solutions. Such solutions or services may include distribution, vendor-managed inventory services, merchandise returns and order fulfillment, and replenishment activities. Managing the supply chain has become a strategic part of C-level discussions in corporate boardrooms.
The Role of Technology in Driving the Logistics Industry
Technology has played a major role in successfully building the supply chains of most organizations. Today, through the Internet, customers can place orders, calculate rates, schedule pickups, track shipments, and verify deliveries. What now seems to be commonplace functionality is actually the evolution of several technologies and philosophies fused into a unified set of solutions.A generation ago, simple material resource planning (MRP) evolved into MRP2. This evolution was an early introduction to the integration of other business applications, such as accounting with finance, finance with procurement, procurement with manufacturing, manufacturing with distribution, distribution with marketing, and marketing with sales. Thus, MRP2 morphed into today’s ERP, which covers the basic functions of an enterprise. Even non-manufacturing businesses, nonprofit organizations, and governments all now use an ERP system. For a complete list of available ERP systems, white papers, and articles on distribution and ERP for services, visit www.technologyevaluations.com.
Project Management as the Change Agent in SCM’s Evolution
“The future ain’t what it used to be.”—Yogi Berra, US baseball player, coach, and manager.
The above quotation is a humorous reminder of how far technology has evolved, not just in our workplace, but in our personal lives as well. Recently, I was at home reading the newspaper when my teenage daughter walked into the living room with one of her friends. She took out her video MP3 player, and her friend was using the wireless PC to do her homework. I looked around and I thought, “if only they had the Internet when I was in college, how much easier my life would have been.” Perhaps I was being overly simplistic, but this illustrated to me just how—within a period of a single generation—some technological changes have impacted our day-to-day lives.
The dynamic environment that brought about these changes also illustrates some of our constraints. Change, as we know, is not only about technology; it is about managing people and processes through that change. In terms of enterprise solution implementation in an organization, many of us know firsthand how difficult it is to come to a consensus on a particular strategy or a process. Project managers have been, and will continue to be, at the forefront of the technological changes in the enterprise environment, as they are the group responsible for executing the vision of how to improve a key business process by the integration of a technological solution.
In part two of this blog post, I will discuss some of the emerging technologies to support logistics SCM operations.