A study by researchers at Penn State University has found that supply chains are using data-driven approaches and emerging technologies to deal with the current challenges to the supply chains.
The study, the 28th Annual Third-Party Logistics Study, surveyed third-party logistics (3PL) providers and users of 3PL services to determine what the state of 3PLs are and how their relationships and use of data is growing. Performed in conjunction with NTT Data and Penske Logistics, the study was presented to the Council of Supply Chain Management Professionals (CSCMP) EDGE conference in Kissimmee, Florida.
“The 3PL sector continues to face a number of externalities, and providers of logistics services are focused on improving logistics effectiveness and reducing overall supply chain costs,” professor and researcher Dr. C. John Langley of Penn State University said. “3PLs and their customers are leveraging their relationships along with technology, data, analytics and supply chain talent to increase agility and enhance success.”
The report found that 95 percent of shippers were satisfied with their 3PLs, up from 12 percent last year. However, more shippers (78 percent) reported that they would be consolidating or reducing their 3PLs, up from 71 percent last year. Additionally, almost half of the shippers and 3PLs said they have plans to automate supply chain planning decisions, and that 25 percent of shippers and 27 percent of 3PLs said they were already starting to automate low-risk decisions.
Challenges surrounding hiring is impacting service levels, the study found. In the study, 78 percent of shippers and 40 percent of 3PLs said they were experiencing labor challenges, and that hourly positions both licensed and unlicensed, were the hardest to fill. Both shippers and 3PLs said they were adopting technology and automation to increase efficiency, make work safety and to attract employees.
“Now in its 28th year, the 3PL Study continues to be a great benchmark of the supply chain trends as well as changes and emerging trends in the shipper & 3PL/4PL relationship,” Irv Grossman, senior vice president, NTT DATA Supply Chain Consulting (formerly Chainalytics), said. “The insights shared throughout will help both providers and shippers be more effective in today’s supply chain environment.”