What are the Three Pillars of Long-Term Shipping Success?

Visibility, transparency, and communication are the lifeblood of a successful business relationship.

Without transparency, trust is impossible. Without visibility, transparency is irrelevant. Without communication, improving visibility and transparency is a wasted effort. The three work together and make up the three pillars of long-term shipping success.

Visibility

The last 10 years have brought about a revolution in visibility for the companies that were forward-looking enough to take advantage of them. Digitization allows an unprecedented level of speed and detail when it comes to understanding both internal and external processes. Today’s transport management systems and transport procurement software allow you to see the past more quickly and clearly, watch the present as it happens, and, with cutting edge artificial intelligence and machine learning tools, increasingly accurately model and predict the future.

“When people talk about all the pain points for retailers and manufacturers these days, you hear a lot about difficulty getting products and materials, and how hard it is to get the inputs needed to produce finished goods. What you don’t hear about as much is the lack of visibility into the supply chain that most shippers suffer from,” says Greg Plemmons, Executive Vice President and Chief Operating Officer at OD. “You don’t just want to build a resilient supply chain, you want to build the connections that allow you to get true visibility into that supply chain.”

This visibility contributes another important factor: it allows shippers to gain a deep view of every single aspect of their cost of shipping goods. They not only instantly see where and how they have incurred additional charges, but how often these incidents happen, where they occur most, and when they are most likely to happen next. No longer hidden in paper ledgers and spread out across multiple accounts and domains, these charges are captured in one place, and made actionable and optimizable.

Transparency

Data and knowledge only matter, however, if it is shared with the parties that can act on it from both sides of the transaction. It’s not enough for you to know everything; your shipping partner also has to know everything. This enables open discussions that address real and specific issues that can be handled collaboratively.

With this in place, trust becomes the intuitive and default mode of your relationship and communication becomes more effective. The combination of human intelligence on both sides in conjunction with instant access to every record at every point of every transaction through seamless API integration is a potent tool for transformative change.

“There’s been a slow acceptance that this market is different than most,” says Chris Caplice, Executive Director of MIT’s Center for Transportation and Logistics. “It’s not a commodity, it’s a service.”

Communication

Carriers and shippers that come together for joint planning meetings have a more effective relationship. The most profitable way forward is in true partnership with your carriers using a holistic mindset that benefits both parties equally, according to Caplice.

When both parties understand one another fully, pricing becomes common sense. All factors from both sides can be tested and accounted for, from the organizational advantages of longer planning cycles to the ways investments in capacity ultimately lead to lower fees, penalties, and damage charges on the back end. Over time, with these principles in place, trust and stability — the most effective bulwarks against the uncertain world we operate within — grow.

Visibility, transparency, and communication make rigorous analysis possible to find inefficiencies. At the end of the day, the shipper and the carrier are on the same team, with the carrier acting as an extension of the shipper’s brand.