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5 Pitfalls of Transportation Silos and How to Fix Them

5 Pitfalls of Transportation Silos

And How to Fix Them

If you’re managing or looking to improve your organization’s supply chain, then it’s your responsibility to reduce inefficiencies, speed bumps and anything else that negatively impacts your process. But sometimes the root cause of these issues can be hard to find.

More often than not, the issues listed above are caused by transportation silos. But what exactly is a transportation silo, and how can you tell if they’re present in your supply chain, let alone fix them?

We’ve listed 5 common transportation silos below along with solutions to mitigate the potential threats they pose. But before we get into that, let’s get on the same page…

What is a transportation silo?

We’re not talking about grain elevators. A transportation silo is a single role or section of a supply chain that has limited visibility to how it is impacting other parts of the same supply chain. Think of a transportation silo as a bump in the road that impacts integration of new products, speed to market, freight costs, efficiency, ROI and basically anything else it touches.

Important roles, processes and responsibilities affected by transportation silos

Transportation silos impact anyone who is responsible for supply chain management. If you’re not exactly sure who that is, take a look below to see who you need on your side to help improve your supply chain and break down transportation silos.

  • Supply chain management: The organization and planning of a sequence of processes involved in the production and distribution of your company’s products and resources. Basically, how your products go from creation to consumers.
    • Who’s responsible: Depending on the size of the business, this would be the logistics coordinator, department managers, or members of the core leadership team of the business.
  • Distribution management: The overall coordination of your supply chain, distributors, products, resources, transportation, employees and departments.
    • Who’s responsible: Department managers across your supply chain are responsible for managing the logistics and ROI of their part of the chain. The core leadership team of your organization shares the responsibility of the performance of the entire chain as a whole.
  • Logistics Management: The modes by which products and resources are used to transport from the beginning to the end of the supply chain. The employees, partners and suppliers that provide these delivery services fall within the transportation area of your supply chain.
    • Who’s responsible: Department managers across your supply chain are most likely responsible for organizing transportation efforts.

Transportation silos can impact your entire supply chain, your organization’s success and even your job safety if you’re not constantly staying vigilant. Get to the root cause to understand how you can collaborate solving them before they cause bigger problems within your supply chain.

 

How can you fix a transportation silo?

Every employee in charge of an individual part of your supply chain should have full awareness of how their decisions are impacting the rest of the supply chain. This way, they can make informed decisions instead of siloed ones.

The best way to help department managers and leadership teams make informed decisions is to increase their visibility to the supply chain as a whole. To do so, you’ll need systems that allow for more communication and consistent data collection.

Use our list of 5 common transportation silos as a starting point to help you identify silos in your supply chain. Compare your process to our examples and see where you can make real improvements with actionable ideas and new supply chain system solutions.

How visibility in supply chain management can fix these 5 common transportation silos

1. Lack of communication between department managers

Why is this an issue?

Department managers tend to solely focus on their role in the supply chain without much communication with other departments or sections. Once they’ve done their job and shipped the parts or products they are responsible for, they start the cycle over again.

Although different departments focus on different responsibilities, they would benefit from communicating with each other. Increased intercommunication between department managers leads to:

  • Collaboration and sharing of time-saving ideas and techniques
  • Coordinated and productive effort across your supply chain

The Fix:

Integrate an analytics and reporting system and allow all managers access to see how each department is performing, including KPIs.

How it works:

You don’t have to hide transportation data and reports from your department managers. Increasing their awareness of others’ successes can be a motivator and productivity booster across your supply chain. Employees want to know their job is valued (don’t we all?), so if they see another department performing better, they may want to up their game.

Plus, increasing a manager’s visibility to supply chain data can give them more control to prove they’re moving their department’s numbers in the right direction. This makes for happier employees who in return want to continue to work harder and feel confident in their contribution to the company as a whole.

 

2. Disparate suppliers and freight procurement decisions

Different departments of your operation may be using the same suppliers and not know it. Or there could be an opportunity to team up to find a supplier that can provide everything for less.

By combining department needs, you could unlock access to deals, savings and discounted freight or production services from suppliers.

The Fix:

Increase visibility for yourself and supply chain department managers on procurement of resources, freight and packaging services.

How it works:

Leverage your entire supply chain to find opportunities by using a system that allows you to procure all-in-one suppliers or transportation providers. This may or may not be an option for all parts of your supply chain, but it can help you find a hidden competitive advantage.

Using a transportation management system (TMS) helps you make more strategic procurement decisions, regardless of whether you’re integrating services or not. You can also incorporate department managers’ insights through the increased visibility these systems provide to find additional service providers for freight, resources, materials, and everything else you need to improve overall ROI.

 

3. Unmet company goals

When communication between company stakeholders and supply chain leadership is minimal, a lot can be lost in interpretation. Poor communication can hinder a company by reducing employee trust, effort, innovation and performance. Without proper communication, shared goals and KPIs, company goals will likely be an afterthought instead of integrated into a new process as they were intended.

The Fix:

Create goals for specific departments that align with company-wide goals for the entire chain. Then, incorporate a system where managers have increased communication (more than just Skype calls and Slack messages) and access to accountability data.

How it works:

  1. Create a meeting with managers of each area of the supply chain to clarify and agree on how performance of each area impacts the other.
  2. Agree on individual and shared goals of performance, and integrate a system that details how each department is performing. This strategy will work to improve department performance, as well as cross-functional unity.
  3. Make it clear that your goal is to have departments working together, sharing ideas and holding each other accountable for goals (so you don’t have to!).
  4. Encourage an environment where everyone feels inclined and excited to meet goals and earn incentives. This is best done through real-time data analytics, valuable incentives and transparent communication across departments.

 

4. Lack of ownership of sustainability

Sustainable efforts only happen when strategic planning and company-wide participation is present. If there are some leaders pushing ideas without support from the entire organization, there will be missing links.

The Fix:

Consider integrating a new transportation management system to help you meet sustainability goals across the supply chain.

How it works:

A TMS system helps transportation planning and execution and provides means to see where things are operating efficiently (fuel, freight, carriers) and where things need improvement. Some TMS systems can also provide you with options to increase your sustainability efforts through:

  • Mode selection
  • Using providers with efficient equipment
  • Load optimization (using all available capacity)
  • Routing optimization (minimizing miles)

Some TMS systems are also capable of measuring the carbon emissions of your transportation through the use of carbon footprint calculators.

 

5. Disjointed data capture

When different departments are using different resources and tools to capture data, collection can be slow and painstaking to decipher, compare and use to make informed decisions. And forget Excel (a.k.a., spreadsheet Hell). If just the thought of trying to analyze and implement data into yet another spreadsheet makes every day a chore — you need a change.

Disparate systems and Excel make analyzing data a time-wasting process (especially when data integrity is in question) and make decisions more difficult. It’s time to make your job easier.

The Fix:

Find a system that can easily extract raw transportation data and turn it into visual information you can use to analyze your supply chain and make informed decisions.

How it works:

Integrated systems technology is necessary to ensure everyone has access to the same real-time data. This is only possible once a shared information model, such as a cloud-based SaaS TMS solution, is in place. This can help you find all of your potential transportation silos and break them down through data insights, trackable performance metrics, increased cross-department communication and much more.

 

Visible Supply Chain Management Tools to Make Your Job Easier

Give yourself more visibility into your supply chain performance so you can make fact-based decisions confidently. Reduce speed bumps in your supply chain with a TMS system and a trusted supply chain cloud technology provider. See who has trusted Alpega to improve their supply chain performance for the better. When you’re ready to learn more, let us know. Give us a call!

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