Gene Gander - VP Business Development, Americas - illustrates exactly why it’s important to never stop chasing innovation.
To follow a best practice is to only say ‘me too.’ Innovation is what sets you apart, what makes you a leader. To shift your business from being a good company to being a great company – and staying there – involves getting the mix right. You’ll need to find your own flavors of leadership, people, and underpinning technologies to accelerate growth. Becoming ‘great’ involves only one constant: the willingness to change.
Whether you’re mass shipping 40’ containers on a pure commodity cost base, or you’re targeting higher service industry niches such as pharma, everyone needs to control costs and stand out in order to win profitable business.
Best practice isn’t the pinnacle, but it is the foundation from which innovation builds. Zero to One by venture capitalist, PayPal co-founder and early Facebook investor Peter Thiel, states that best practices will only make you comparable to the top half of the field. But as a ‘me too,’ a best practice still makes sense. After all, why reinvent the wheel? Using a best practice as a benchmark for improvement, onto which your differentiators can be firmly placed, is the running start for a great business.
Getting started with ‘me too’
Most businesses start looking around for a new technology platform only when their existing system is about to fall over. Often the obvious choice is the market leader, for a reason. But, much like a gym membership, it isn’t just what you buy, it’s what you put into it.
In reality, many implementation projects fight the brushfires first, and, once they’re under control, start to squeeze more and more from the new functionality.
Driving the Ferrari at 30 mph
No one will ever use 100 percent of any of the latest systems, and, frankly, it shouldn’t be a consideration. That’s because today’s single-platform, cloud-based systems are designed with a breadth and depth geared to cover the diversity of the global logistics sector. As subscriber-based solutions, vendors can put everything in one offering, but users don’t have to carry the weight of a massive system. You simply take what you need as your business evolves and pay for what you use.
The fact that you are “only driving the Ferrari 30 miles an hour” (as one customer put it) is not a problem. However, it is a problem if you go through a 60 day implementation phase only to stop innovating after that. It is a problem if you don’t fully explore the value you pay for.
Creating new – highest level - standard procedures
What a single system achieves is that it removes so many of the variables from the equation and delivers data quality, efficiency, business intelligence, and reporting.
High-quality, automated templates for industry-wide, standard tasks - including booking confirmations, pickup instructions, delay alerts, Customs release information, delivery instructions - are configured to the communication requirements of each of your customers at the push of a button.
Workflow management should be directly responsible for considerably shortened DSOs (Days Sales Outstanding). I have worked with a large asset-based operation for which cash flow was a major issue. Now, with automatic triggers for invoicing, the faster client billing works in conjunction with the Collection module for tighter credit control and on time payment.
I have a recent example of a rates desk where all quotes and shipment ratings processes have been automated:
Operators no longer manually rate. As an exception only new rates go to the desk to be managed in the initial instance and then become part of the automated resource for future scenarios.
Miss-bills are now virtually nil.
Output per ops person has doubled.
Quote preparation time dropped from 20+ minutes to 90 seconds.
Quote turnaround to customers is faster by a factor of five.
Won Shipment to Quotes ratio increased by a factor of two.
Developing your human resources
With technology platforms creating standardized workflows, there’s greater opportunity to sharpen the skillsets of individual staff members from the core system. You have the flexibility to move them out of business silos. When everyone works from the same eSOP (electronic Standard Operating Procedures) you can take those with potential and try them out in open positions anywhere around the world. Using staff more effectively across departments makes it easy to manage peak workloads. Your people then become greater company assets.
Automating semi-manual tasks, such as alerts and communications, is key to establishing a great benchmark. Arrival notices should be automated at the actual time they arrive from a carrier so that the same, accurate information can flow behind the scenes between you, your accounts, and your customers.
Taking it further
From a data standpoint, when you have information entered at origin and operating from there on a ‘single version of truth,’ you can build your own centers of excellence or lower cost process centers. Customer service is no longer tied to the time zones of your operators. This gives you direct quality control over more flexible and proactive service delivery.
Having truly worked hard to capitalize on the user functionality, one international logistics forwarder, 10 months after their initial go-live, wanted to extract even more value from their system. The logical extension was to start leveraging the integration tools to exchange information with forwarder/shipper trading partners. They have now created powerful links to not only win business but to lock it in. Those partners are now less susceptible to commoditized, competitive market factors. And on the other side, their agent development strategy has changed to a preference for those in the chain that can, or wish to, integrate with the platform.
Then, without having to implement any separate system, they simply ‘flicked the switch’ on other automated workflows. Accessing the integrated warehouse tools enabled them to present and win inventory-based bids. This new flow of business and revenue has changed how they see innovation. Now they’re re-examining how they do everything. In the course of only a few months they have eliminated their standalone sales CRM and configured a new sales process into this same single platform.
To move beyond a commoditized business, start with one innovation at a time. The effect of many small initiatives acts like compound interest. The great companies of both today (and, more importantly, tomorrow) stand out as they innovate.
Gene Gander is VP Business Development, Americas for WiseTech Global
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