November 24, 2024 in PODCASTS
Industry Trends – Present & Future
April Chapman (00:03):
Hello everyone and welcome to the APLL Pulse Podcast where you can uncover new insights from the logistics and freight forwarding industry through the seasoned experts at APL Logistics, a global supply chain provider. We’ll help you keep pace with the current topics impacting businesses, and advance your logistics strategy.
(00:25):
Hello everyone. This is your host, April Chapman. Today’s guest is a personal favorite, Betsy Ducat, the head of our global key account program. I’ve had the privilege of working closely with Betsy for the last few years leading our women’s ERG, and she is one of my go-to people when I need career advice or guidance. And she’s just an expert in this industry. She is the kind of leader that people want to follow. So without further ado, Betsy, why don’t you say hi to our audience and tell them a little something about yourself.
Betsy Ducat:
Hey, April, thank you so much. It’s wonderful to work with you, too. I really appreciate that. Let’s see, a little bit about myself. I’m actually going on 30 years in the industry. I can’t believe it. I entered as a happy accident. I was convinced it would be two years of experience, and then I would be on over and out to the next thing. And it’s addictive. It’s just an industry where you wake up, it’s something different every day just because of what’s going on in the world and in general. And really glad to be here and to talk to you. So thanks.
April Chapman:
Oh yeah. Let’s talk about the surprises that happen, the disruptions that can continuously happen in supply chain. Can you share some of the most unexpected disruptive events you’ve encountered more recently and maybe how your team has adapted to those?
Betsy Ducat:
Sure. 20 years ago, even 15 years ago, you would have maybe two to three major events in a year that challenged you or drove you to think differently or to need to pivot. And other than that, you can really rely on the standard defined process in order to manage customer programs or what you were doing. And I would say the key theme now is expect the unexpected. And the pivot point in my experience seemed to be the time around COVID because that was just the most impactful disruption, I think, a lot of us had seen.
The most impactful extended disruption, I’ll say, because we certainly had experienced sports strikes and the geopolitical events prior to that. But since then, it has just seemed to be a flurry, whether it’s geopolitical issues related to what everyone’s dealing with with Red Sea impact. I really believe there were many of us, I’ll include myself out there, that in the beginning perceived that that would be a time bound challenge, and now people are just accepting that this is going to be the way that we have to manage and what we’ve got to consider in the future.
But besides the geopolitical situations, we’ve got weather events. More weather events than we have ever dealt with impacting both sourcing locations as well as destination locations. We have labor impacts, whether it was the recent events in Bangladesh or whether it was dealing with ILA renegotiation of the contract, which terrific that it was only a couple of days of shutdown, but really that agreement now we’re dealing with a secondary deadline of January 15 where we’re going to have to manage through this potential disruption again. This has challenged us. In many ways, it’s created a lot of new and interesting projects because challenges like this, they just advance our engagement and our industry. And COVID brought everyone’s E-COM plans, rolled them forward probably about five years. But things like this are, I think, doing the same, related to having to solve these approaches for customers.
April Chapman:
Right. So many of these are global in nature, the impacts, whereas I think the globe has gotten smaller in the way that we’re so connected. And so one thing impacts the globe. And with us being all over, it’s like we’re operating in all the regions. Any region that has some disruption is going to bring disruption to this industry. But we’re in a space where we at least have people on the ground and things that we can do in those areas. So as a Floridian, I am very aware of the weather and how that can disrupt.
Betsy Ducat:
And I do have to say we have been having customer symposiums throughout the globe where we like to get our customers together to have these conversations and create opportunities for people to interact and share how they’re dealing with particular challenges. And the theme of the event that we’re going to sponsor in March is going to be around not only the disruptive events, but the what if scenarios. Let’s get together with our peer group and just talk to each other. Let’s come up with our wildest thoughts about what could potentially happen.
Nobody thought there would be a vessel stuck in the Suez Canal blocking cargo. Nobody thought we would have weather impact water levels in the Panama Canal that would challenge that passageway. No one thought we would have this type of Red Sea extended related disruption. I think people recognize that, okay, you have your risk events that you highlight within the 10K for public organizations, but it has to be a standard way of how we work together with our partners. Have perspective that they can bring from experience within different segments of the supply chain. So we need to get together and we need to help each other really build what if lists so we can work on getting ahead of it. We can solve these things together instead of just waiting and then firefighting and reacting, which is too late.
April Chapman:
Yeah, makes sense. Collaboration is so important. Not just internally for our company and our team, but with our customers as well. That makes a good point. So let’s talk about what’s coming as far as technology and balancing the technology with human experience. So just talking about, what are your thoughts about that balance of how we integrate technology with the need for people, the need for human experiences in our field. So what are your thoughts about that? There’s a lot going on right now. AI is a very, I don’t know, interesting and terrifying nonsense.
Betsy Ducat:
Yeah, yeah. No, no, it’s true. And listen, I am a firm believer in the need for people to complement and supplement the technology because I always believe there are better ways of doing things. Always. But I still am of the mindset that technology will never 100% replace the criticality of the people that are a part of the process. We certainly can have certain tools to make what we do more efficient and effective, but if you don’t bring the experience into that equation, you’re going to miss. Because there are a couple of customers that we are working with who have tried to develop your own planning and optimization tools. And time and time again, and this has been through a period of experience over the past 10 years, they still need our boots on the ground at origin in order to manage the last minute pivot.
The vendor didn’t show up. So that optimization plan we were going to move forward with when it came to something as simple as proving utilization in a container, well, it’s the deadline and they’ve missed. So now what do we do? There is a truck that didn’t show up. So now what do we do? There is a weather event that’s disrupted infrastructure. So now what do we do? There is a lot of that that no matter how many scenarios you establish or set up, there would be an automated solution that takes this challenge on. There are just always going to be needs to have to pivot where there’s a really critical human element part of that process. So it’s great to see the evolution in technology. The main projects we’re working on with the customers that I’m interacting with right now are trying to work around legacy systems that have been in place for such a long time, that are very restrictive and really only account for one way of moving merchandise with a lot of buffer time incorporated.
And our goal in working together is to create and optimize multiple flows depending on what the merchandise need and type is because a purchase order or unit or SKU is not always just equal. Each segment will have a different need for speed when it comes to margin improvement and really helping our customers in meaningful ways. It’s how can we help reduce their lead time? How can we help impact inventory carrying costs? How can we make sure that we’re helping them in this way? Sometimes the answer certainly is slowing something down and then having a work process in a more economic location. So there’s a variety of solutioning we’re trying to work through with our customers. But I would say the common theme even for the last 20 years I’ve been involved with this, is data timeliness, data accuracy, data completeness. Customers need to know and understand what’s happening in order to respond.
So even if it’s bad news, they still need, as early as possible, what it is they have to drive their decisions based upon, in order to respond as they need and tell their internal organizations what’s happening. Communicate with their merchants, buyers about how the merchandise is going to be impacted. And if it is a disruptive event, how long are we going to experience it for? When is it going to be solved? When are things going to be back to normal? So consistently the projects we’re engaged with are how do we create that ability to pivot for our customers? How do we enable their supply chains to be adaptable, flexible, even when they are constrained, when their tools in tech are constrained, what can we do to supplement that?
April Chapman:
Right. I agree with you that there’s always a human element that is important. Tying into what we talked about earlier, the disruptions. You don’t know what the next one is going to be and it could be totally different. And we need that human element to say, okay, well these are the options in this scenario. For this customer, this is the right thing. For another customer, it might be a different thing with the same scenario. I think that human expertise is always going to be valuable.
Betsy Ducat:
Yeah, absolutely. We’re also working more on the planning side because I think customers have been very used to looking in rearview mirrors when it comes to the data and saying, okay, what could we have done differently? But now we’re just saying, why do you have to wait? We have most of the order detail and data. We have exceptions. We have customers that have a much more specialized business where receive the order and then production starts rather than us having the orders in our system 45 to 60 days in advance. But for those orders we do have in our system, there’s incredible opportunity, number one, to see if something is set up to fail just because of the way the order is written, which if you would believe it, between eight to 10% of the orders we receive into our system from our customers are set up to fail based upon the parameters established for that order.
So the tools that we’re establishing are related to planning getting ahead of that instead of dealing with it at the time a vendor is placing a booking and saying, oops, guess what? We’re now immediately in reactive mode. We want to solve that problem 30, 45 days, 60 days out. Also, we’re a part of that what if scenarioing for our customers. What will happen if you have to flow your merchandise from the east coast to the west coast? What will happen if you have to mini-land bridge it? What will happen if you have a spike in your freight rates and all of a sudden it’s going to cost you $2,000 more a container to move? So we’re trying to help our customers, again, get ahead of this game so they can be even more informed and have the right conversations with their internal customers within their own organizations. It’s been a bit of a shift because of the environment we all find ourselves in that which is this perpetual disruption and this perpetual need to pivot.
April Chapman:
Right. Last thought I’ll have because you just brought up something interesting to me, which is the human element is really important. But the technology can help with the human errors because the human element does basically always going to include some level of human error. And so when we can have the technology move into that arena and solve those human errors prior to them becoming bigger, that’s a great use for technology. I want to move on to another topic. Let’s talk about industry trends. Because you are on the ground, you do talk with a lot of customers, and so you have a front row seat to what is happening, what maybe is on the horizon. So I’d love to hear from you about what you think we can expect in the next year, in 2025, in terms of this field or supply chain management.
Betsy Ducat:
I think I should caveat this by saying the customers that I also work with are heavily retail focused. But I still think some of these key themes are relevant. If you see what’s happening for our customers and how they need to pivot based on these trends, they’re looking to be able to save any bit of time they can. If they have a certain trend or style that perhaps there’s an influencer that’s highlighted something and it’s absolutely impacted a segment of their business, so they need to be able to respond to that and even chase it.
But the ability and opportunity to move more into a given market, and it’s not possible still to produce and manufacture everything locally. That’s not quite economical for all of our customers when you’re talking about particular margins that we’re dealing with. So when it comes to trends, it’s, okay, how are the services that we’re able to offer able to respond to that, support that, enable our customers to react and to move their merchandise in different ways. And to make sure that if they need and we need to create 3, 4, 5 flow paths for our customer, that we can do that. That we can support their ability to make a last minute decision about how to do that, and that we can also not only enable it with our management of the suppliers, the data, communication, but we can also create the solutions to move end-to-end. That they can manage and move that merchandise in different ways within our network. And we can provide them with the data as well as the ability to be able to move merchandise in that way.
The data will always be critical. When it comes to trends, I do believe that people who are able to create a high level of confidence about their ability to ensure that we are communicating whatever it is that is exceptional within the end-to-end supply chain. I think the people that are going to differentiate themselves in that way, whether it’s greater visibility to production details and joining the supply chains of the manufacturer and even the raw material movement into that manufacturing facility. The key theme and name of the game still is getting that information as early as possible. Just arming our customers with that level of detail if there is going to be any potential impact to their plan. I think we’re going to see more tools in tech that are focused on what can we do to create this extended supply chain picture. Even if our customers are not the ones that are controlling that piece of the pie.
We know who our customer is that’s paying our bills, but I do have to say we’re also perpetually trying to add value to the supplier community, our customer suppliers. We want to be easy to do business with. We almost want to become a taken-for-granted in that process, partnering with all the suppliers within our customer’s ecosystem. Just managing the piece of the puzzle that we’re employed or contracted to manage, but how can we add value by engaging with the entire ecosystem, whether it’s just engaging from an interaction and personal relationship standpoint and partnering in a way to see what can we do to work on behalf of our customer in better ways. We’ll see ourselves much more interconnected in the future.
April Chapman:
Yeah, we see their success as our success, so we want to help them to be successful.
Betsy Ducat:
That’s right. And more walls are broken down. It’s not as much we have competitors, but I think people do recognize that our ability to differentiate can be in other areas. It’s not taboo to sit at a table with who we would consider to be competitors or again, other service providers that work on behalf of our customer in order to try and solve these problems together. We don’t need the same walls that we used to have.
April Chapman:
Well, Betsy, thank you so much for joining me today on this podcast. And thank you for sharing your insights and your wisdom with us. We are so appreciative. And I hope that you’ll be a guest in the future again.
Betsy Ducat:
Of course. Thank you so much, April. It’s always great to talk to you. I appreciate it. Thank you for your time and anytime.
April Chapman:
Thank you.
Betsy Ducat:
All right.
April Chapman:
Bye-Bye. See you next time on the APLL Pulse podcast.
Thanks for joining us today. If you like what you heard or if you have any questions about today’s episode, reach out to us at Global_Marketing@APLLogistics.com. Make sure to subscribe to us on your favorite podcast apps. You’ll also find us on LinkedIn or visit us at APLLogistics.com. We’ll see you next time on the APLL Pulse podcast.
Thanks for joining us today. If you like what you heard or if you have any questions about today’s episode, reach out to us at global_marketing@apllogistics.com. Make sure to subscribe to us on your favorite podcast apps. You’ll also find us on LinkedIn or visit us @apllogistics.com. We’ll see you next time on the APLL Pulse Podcast.
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