DC Velocity - July 2019

professor at Auburn University’s Raymond J. Harbert
College of Business. “When your corporate strategies are
threatened by an essential function like transportation,
you are compelled to learn more about it and pay more
attention to it going forward. These C-level executives are
becoming well-attuned to my mantra that you can develop,
build, and market a great product, but if you can’t get it
to the customer, then your money and efforts have been
wasted.”
While transportation is becoming increasingly import-
ant, it is also becoming increasingly complex. The growing
demand for smaller, more frequent shipments and for
greater visibility of delivery status requires sophisticated
tools and capabilities. It’s perhaps not surprising, then, that
respondents expect to outsource more of their transporta-
tion responsibilities in the decade ahead. Almost 70 percent
projected that their use of outsourced transportation ser-
vices would increase by 2030. (See Exhibit 1.)

As for which tasks they’ll hand off, the report indicated that technology, operations, and regulatory compliance would be the most widely outsourced transportation activities. (See Exhibit 2.) “We’re not doing anything directly like we used to with spreadsheets and analysis; we’re handing all that over to 3PLs (third-party logistics service providers),” said one focus-group participant.

As their outsourcing activity ramps up, however, companies will need to grow their own capabilities with regard to vetting, selecting, and managing service providers. The report also suggested there will be some changes in the way they manage their 3PLs. While review meetings, key performance indicator (KPI) dashboards, and service scorecards will continue to be important, the report indicates that the use of onsite representatives—where service provider representatives work directly in the customer’s operations or customer representatives work directly at the service provider’s operations—will increase by 50 percent.

BUILD YOUR BENCH

Regardless of how they structure their outside partnerships, it’s clear that companies will require in-house transportation expertise in the coming decade. However, filling those jobs will continue to be difficult as competition for top talent intensifies. Gibson believes there are currently not enough transportation professionals available who could step into the shoes of today’s leaders if they were to retire or change jobs. “There’s a great deal of technical transportation knowledge and savvy that will be difficult to replace,” he says.

To complicate matters, most survey respondents believe it takes more than just technical skills and experience to be an effective transportation leader. It also requires strong skills in problem solving, communication, and analysis, they say. (See Exhibit 3.) However, 40 percent of survey participants said this combination of analytical skills, lead-