Risk mitigation in transport planning is now key when preparing for future disruption

The vastly different circumstances the logistics sector finds itself in since the beginning of the year has placed risk mitigation firmly under the spotlight.

For many logistics operations, whether in-house or third-party, it has been a major wake-up call and left them wondering how best to prepare for the uncertainties ahead. While the COVID pandemic is not something anyone could have easily predicted, risk in general can be prepared for, ensuring the consequences of unexpected disruption is reduced or even avoided.

As transport planning has become more complicated over the years, so to have the associated risks and operational vulnerabilities grown exponentially. If there is one learning to be taken from the extraordinary situation this year, it is that logistics operations must become more resilient and agile to be in the best position for any future events.

CUSTOMER DEMAND

There is unprecedented pressure to meet changing customer needs in the most efficient way possible, all while factoring in an ever-expanding number of variables and considerations. The wide ranging, and ever changing, lockdowns and restrictions seen in the UK has exacerbated the situation for logistics operations, with wildly fluctuating demands pressing them to scale up and down transport resources like never before.

Whatever the post COVID world looks like, logistics operations are going to have to be agile enough to adapt quickly to any customer-driven changes. Those that have thrived in 2020 have been nimble and moved at speed to both meet and create demand. For example, we have seen businesses switch to a direct-to-consumer model, but without flexible technology systems in place it is almost impossible to meet the hugely different requirements in a cost-effective and profitable manner. For many, changing from fixed to dynamic routes has proved to be a way of coping with rapidly shifting delivery needs they have faced.

THE CONNECTED APPROACH

We may find that the COVID crisis acts as a tipping point in the move to digital connectivity between different parts of the supply chain that previously did not exist or were not widespread. By having connected technology in place, every activity can interact in real-time, and with this added transport and fulfilment visibility, comes the ability to make a change in one area that is then supported across an end-to-end solution. This convergence of technology — encompassing planning, execution and reporting — offers significant advantages by accessing critical data via a single system.

The take-up of telematics and IoT technology in recent years has also created opportunities for integrated solutions that support better managed deliveries, improved planned versus actual monitoring, and informed decision making. By removing the operational silos that often exist between planners, transport offices, warehouse teams and drivers, it is possible to take complete control.

CONTINUOUS IMPROVEMENT

Having a culture of learning within an organisation is essential when navigating through the COVID pandemic and beyond. By identifying learnings and constantly feeding this insight back into the ongoing response, a logistics operation can be prepared for the challenges ahead. Typically, when a crisis does strike, everything tends to unfold quickly, so having a rapid escalation plan and highly responsive systems are a must.

By taking advantage of a transport planning solution that allows a logistics operation to plan, do, review and then act, it is possible to initiate continuous improvement processes. This provides the tools and data needed to analyse operational performance, identify improvement opportunities, understand the impact of potential enhancements, and ultimately adopt change that makes a positive difference.

FUTURE MODELLING

When planning ahead, business and operational intelligence is fundamental to making complex decisions. Using this insight to ask the right questions and conduct the right analysis – backed by what-if scenarios and business modelling – provides the opportunity to develop a resilient strategy that mitigates risk and maintains business continuity, without surrendering profitability.

With COVID front and centre of everyone’s mind, those that have invested in transport planning systems that allow them to model various scenarios and analyse data are well positioned to deal quickly with changing requirements. By understanding the potential effect of any change they may be considering or are forced to make, it is possible to make informed decisions with complete confidence they these choices are sustainable.

Logistics operations need to understand their vulnerabilities and protect against the risk of future disruption. This can only be achieved by having the transport planning systems and processes in place that prepare for the worst and enable the necessary response should this ever occur.