I write this first Chairwoman’s report with great pride, after 56 years the Supply Chain & Logistics Association of Australia has given me the honour to travel into 2017 with the responsibility and challenge to change our horizons, increase our strategic leverage, change the ‘think tank’ of the current landscape and enhance what was already and is a great Association led by dynamic past Chairmen. The strongest factor is what would be the consequence of not accepting this responsibility and what will that mean for other women who have the desire to rise to accept the challenge of responsibility in a changing market-place. So it is with this statement that I begin another journey with you into unchartered territory and it is with great determination that I will charter these unknown waters to carry the mantle and no doubt be judged continually along the way which is half the test and gratefully welcomed.
There currently is a 56% gender pay gap across all industries and it goes without saying that 2016 has brought with it a challenging economic environment that is ominous and ever present in the Global Supply Chain. The impact of globalisation, our shrinking manufacturing sector, increased technology and regulation for the industry have seen business of all sizes continue to strive for continuous improvement with dwindling margins and highly competitive and volatile environments. In today’s economy trying to offer clients good ROI with increased regulation and compliance has never been more complex and with these changes companies need to be more versatile, innovative and commercially astute than in any other period seen prior.
With economic conditions changing the industry has never been seen to be trendy or in vogue, but the supply chain offers a dynamic global platform for innovative and creative entrepreneurial minds to change the processes and fundamental intricacies of the complexities of the supply chain. Technology moves rapidly and as buyer behaviours change to a more centric online model this will continue to challenge the way we view what has become a very transactional society and push us to re-think the speed of ever present change and one that continually threatens our monetary stability. In total, during 2015 core transportation revenue worldwide will be projected at $4.6 trillion. This includes air, rail, water, pipeline, courier and warehousing segments. At about 6% of global economic activity (GDP) transportation’s core sectors add to an industry that is growing by TEU (19.6%) up in 2016 and an estimated 6,364,000 TEU (19.1%) up in 2017.
Transportation continues to evolve, no matter what the type of transport involved is on the road, on the sea or in the air. Business and technology trends have driven immense changes in the transportation sector over the past three decades. The information age; with its introduction of sophisticated databases that can track inventory levels and shipments on a global basis via the Internet, has created vast transport and logistics efficiencies. As a result, supply chain technology has been one of the fastest-growing segments in the information field. Mobile applications are also bringing transportation request and management directly to our smart-phones. For example, Uberisation of the industry famously enables individual passengers in many nations around the world to request transportation, tailored to their specific needs, to be delivered rapidly. This business model is spilling over into services for local truck service and less-than-truckload (LTL) long distance services.
The rapid adoption of outsourcing has led many companies, when shipping is vital to their businesses, to turn to logistics services providers for all manner of shipping support, including warehousing, scheduling and distribution services. (These services are sometimes described broadly as “3PL” for Third Party Logistics.) The sectors of transport, supply chain management and logistics services are permanently intertwined, creating efficiencies once undreamed of in the transportation arena.
All nations worldwide face a daunting task in maintaining airports, seaports, highways and railroads that can handle commerce and passenger traffic efficiently. The amount of government funds available for roadway development is never enough to keep up with long-term needs. One of the biggest challenges facing the global transportation sector over the mid- to long-term is a focus on lowering carbon emissions and enhancing energy efficiency. Airlines have placed immense orders for fuel-efficient jets like Boeing’s new 787, which promises fuel efficiency gains of 15% to 20% per passenger mile, as well as engines that are quieter and burn fuel in a cleaner manner. Container ship operators are under intense pressure to reduce contamination and emissions while in port and at sea, and the latest designs, such as Maersk’s massive new Triple-E class of ships, are making huge strides in this regard. Automobile and truck manufacturers are struggling to respond to demand for fuel-efficient vehicles.
Tremendous strides in green technology are also being made throughout the transportation services and transport equipment sectors. Lee Schipper, a Senior Engineer at the Precourt Energy Efficiency Center at Stanford University, pointed out that air transportation in developed countries today uses 50% to 60% less energy per passenger-kilometer travelled than it did in the early 1970s, while trucking uses 10% to 25% less fuel per ton-kilometer.
Governments continue to outsource their transportation infrastructure to private operators as Governments are short of cash. They are selling or leasing toll bridges, ports and highways to private operators/conglomerates reaping cash windfalls in the process which hopefully will be used to expand and develop our much needed infrastructure (transport).
As consumers take more responsibility for their purchase decisions and factor in ethical supply chains, companies that satisfy this need will stand out from their competitors. This may be one of the more slow-burn supply chain trends, but socially responsible, environmentally friendly and legally compliant operations will continue to win market share.
So with this we enter 2017 with great confidence, in preparation for the ever changing dynamics in the supply chain and logistics sector. It is in this new role that I will dedicate myself to work with our valued National Partners and our valued members.
I want to take this opportunity to wish all a Merry Christmas and a safe and prosperous 2017.
SCLAA National Chairwoman