STRATEGY: Domestic vs. International? Or a Combination of Both?
What is the focus of your primary transportation operation? How do you decide what to prioritize? Which one demands the greatest amount of your attention? And why? Which represents the greatest transportation expense? Who is accountable for transportation expenses? YOU? How do you contain unnecessary expense? WHAT’S YOUR STRATEGY?
I think most Transportation Managers and Professionals clearly understand that Domestic and International transportation are two different animals, and that it takes time and experience to be effective at dealing with both. If your responsibility and accountability is clear-cut, then developing a Transportation Strategy is somewhat more straightforward. It should be tied directly to current Company Strategic Goals and Objectives, and you should employ tactics that contribute directly or indirectly to achieving the company’s strategic goals and objectives. Executive Management should realize the necessity of the same, and should encourage, monitor, and measure your contribution to it.
If, on the other hand, the scope of your Transportation Management responsibility encompasses both Domestic and International Transportation planning, management, and expense control, the development of a comprehensive Transportation Strategy is more difficult—and becomes increasingly important.
Why, you ask?
In situations in which you have both Domestic and International responsibilities, planning and execution is often decentralized, making the operational focus a two-ring circus. Day-to-day operational realities require you to look after one or the other, depending upon where the problem happens to be today. Where the two types of Transportation operations overlap is the area where most unnecessary transportation expenses are incurred. This can get real expensive, real quick.
In order to contain and eliminate unnecessary Transportation expenses when your end-to-end supply chain involves both domestic and international legs, it is critical to develop a Strategy that provides optimized planning and control to eliminate risk and expense. The ability of the Transportation function to contribute directly to the Corporate Strategic goals and objectives as a result of the Strategy and Tactics employed here is paramount, as the Transportation Expense involves multiple carrier modes, various assessorial and brokerage services and fees, and—depending upon the INCO Terms—possibly a domestic move within country at both the origin and destination.
If you don’t have the depth of expertise or experience in either Domestic Transportation or International Transportation, just recognize that the relatively small expense of seeking the counsel of an Expert Supply Chain Coach or Consultant will be more than offset by the reduction and/or elimination of unnecessary Transportation Expenses you’ll incur if you don’t!
Get help to develop a comprehensive transportation strategy now!
Think about it! Then take some positive action to help yourself and your company!