At a recent Plastics News Executive Forum, logistics experts from nearly every industry came together to address the dangers of increasingly complex supply chains and answer the question, “What is logistics management?.” While companies once had robust distribution routes that crisscrossed the globe, recent disruptions have led businesses to reconsider their processes and instead opt for a leaner, more streamlined strategy.
What spawned this broad discussion at the forum was the recent massive recall of nearly every Aston Martin made since late 2007, Plastics News explained. According to Reuters, the manufacturer, owned by a collective of Kuwaiti and private equity investors, is recalling a total of 17,590 cars, which equates to approximately 75 percent of the vehicles made between November 2007 and May 2012.
The decision to recall its vehicles came as a result of the company discovering that plastic material from a Chinese sub-supplier was counterfeit. The phony plastic was used in accelerator pedal arms, which the U.S. National Highway Traffic Safety Administration states could cause the accelerator pedal to break, increasing the risk of a crash, according to Reuters.
The Future of Supply Chain Strategies
During the Plastics News forum, Bill Michels, president of ADR North America, led a special session outlining the perils facing modern supply chains, and why long, complex distribution strategies, like Aston Martin, leave companies open to myriad issues, including cultural barriers, natural disasters and local civil strife.
“The leanest, most efficient and most productive supply chains will have a competitive advantage in the marketplace,” Michels said. “The future requires strategic positioning.”
Michels went on to attribute the changes in supply chain and warehouse management to attempts to not only mitigate potential disruptions but also meet growing consumer demands. He claimed that shoppers these days want companies to be more productive, which means trimming the fat and boosting efficiencies. Since customers are not willing to accept a cost increase, neither should the businesses selling the product.
To meet these new, leaner standards, companies must be willing to integrate their supply chain and business systems, and suppliers must align existing operations with buyer strategies, Plastics News reported. Not only will shoppers appreciated the more affordable price tags, but Michels suggested that if businesses take it one step further and increase supply chain transparency, all stakeholders, from the manufacturer to the store selling the product, will benefit from a greener image. Leveraging the communicative and logistical advantages of supply chain management software, companies can position themselves for sustainable, long-term success.