If you’re on the front lines of transportation management, you know that navigating the ebbs and flows of capacity and rates is a constant challenge, as is dealing with new regulations and changing customer requirements. How can you find the right balance between cost, service, and risk, while also ensuring compliance? That question is more difficult than ever to answer.
Since 2017, Descartes Systems Group has conducted an annual benchmark survey of global transportation professionals to identify the strategies, tactics and technology approach of top-performing organizations. This year’s report was just published, and Mike Hane, Director, Industry Strategy at Descartes, joined me on a recent episode of Talking Logistics to share some of the key findings and takeaways from the report.
Key Takeaways
To get an overall feel for the findings, I started by asking Mike what his key takeaways were from the study. He states that it was clear that executives who saw transportation management as a competitive weapon were more focused on corporate growth and tended to invest more in transportation management technologies to support that growth. In contrast, companies that did not view transportation management as a competitive weapon tended to focus more on cost cutting measures instead of driving business growth or delighting their customers. The research also showed that visibility remains the top area for investment in transportation management technology.
Factors Most Impacting Transportation in 2024
I asked Mike what market forces and regulations are of most concern right now according to the survey. He notes that although fuel costs have come down somewhat and seem to have stabilized, they continue to be the number one concern expressed in the survey. Watch the short clip below for Mike’s thoughts on this, along with other trends making the list.
“What is interesting is what dropped out of the top three concerns – driver shortages and capacity constraints,” says Mike. “This is probably because the market has been soft this year, especially in truckload.”
Creating Value with Technology
What strategies are companies using to drive value through better use of transportation technology?
“It’s interesting with the current economy and inflation that 75% of the respondents are still increasing investments in transportation technology,” Mike says. “Top performers were 2.5 times more likely to be investing more in technology than low-performing companies. Leading companies are not shying away from making investments to add value for their customers even as they look to control costs. Visibility, order management, and fleet routing were the top three technologies cited for investments.
“Fleet routing popped up as a new area of focus this year. This may indicate companies are considering greater use of dedicated or private fleets to capture capacity.”
Sustainability
Transportation is a major contributor to greenhouse gas emissions. With greater focus on this area through regulations and corporate initiatives, how are companies addressing CO2 emissions reduction and reporting?
The study found that 60% of respondents have sustainability initiatives in their strategic plans and/or consider it in their daily decision-making. About 24% said they only report on emissions.
“The interesting thing is that although most companies think this area is strategic, it did not rise to the level of their top three concerns,” notes Mike. “By double digits, European shippers are reporting on sustainability factors more than their North American counterparts. Consumers on the other hand are much more focused on this issue in making their buying decisions.”
This is consistent with studies we have done with our Indago supply chain research community who say they believe emissions tracking and reporting will soon become a critical TMS capability.
Calls to Action
I asked Mike what other findings from the study stood out to him and what calls to action emerge from the research. He shared some interesting insights and advice on those questions and more, so I encourage you to watch the full episode for all his remarks. I also recommend you download Descartes’ 8th Annual Global Transportation Management Benchmark Survey report to learn more details. Then keep the conversation going by posting a comment and sharing your perspective on this topic.
