The Startup Phenomenon: How 3PL’s Can Use it to Increase Value & Capture Market
It’s true that necessity is the mother of invention. Creativity, though, is the father, and knowledge is the midwife.
As people, we are wired for survival. When we are in tough times, our creativity and persistent shine through. By staying focused and thinking creatively, we can come up with solutions and take advantage of each opportunity as it arises. I know that from experience. When I graduated from college as a mechanical engineer, I was hired to do software development because I had math and public speaking skills. I wanted to succeed and thrive in that job, and I kept pushing even though software development wasn’t my forte when I started. Later, I wanted new challenges, so I leverage my grit, persistence and necessity to reinvent myself as a solutions architect and a leader of consulting, technical, operations and integrator teams.
The challenging world of third party logistics (3PL) is ripe for a similar approach. Margins are thin. It’s hard to make money. Inventiveness becomes a critical skill.
When I worked for a supply chain software vendor, we courted luxury retailers and left 3PL service providers alone, knowing that these logistics providers would fight tooth and nail about our rates. I can think of examples when a 3PL would pass us over, though we were known for great execution, to take the lowest priced vendor. Often, that attempt would fail and they would end up back on our doorstep.
Now, I deal with 3PL executives nearly every day, to help them understand how to enable their supply chains with mobile devices. I have found many of them to be great long-term partners to their customers. Another shift: some of these companies have started thinking in really smart ways about how to leverage their customer base and add value by transforming themselves into a full-fledged service provider at every possible level.
They are proving that there are plenty of opportunities for organizations that know what their customers need and who are willing to find startup companies who have developed innovative business technologies. Well-chosen technology has the potential to turn a vendor’s businesses upside down.
It’s something that has been true throughout history. India, for example, was a great maker of textiles since 1600. We were taught poetry in our native language written passionate poets that said the weavers from the Bengal region in India made a special Muslin cloth that was woven of uncommonly delicate hand spun yarn. It was so wide and long that a lady could drape it nicely and so thin that it could be folded into a tiny ball and held inside a locket or a ring.
Marie Antoinette in her famous “muslin” portrait, 1783
Unfortunately India missed the industrial revolution and the technology that came from that and lost out big time. India’s gross domestic product (GDP) went from 25% of the world’s GDP in the 1700s to 4% of the world’s GDP in the 1950s. Any company that ignores the power of technology, innovation, and the opportunity to provide more value to its clients would does so at its own peril.
These same truths hold today. When I worked with one PC maker, I was asked to transition the company from using one small 3PL partner to a much bigger organization. The smaller 3PL partner was offering a shipping service to get the peripherals to enterprise customers. The larger company was tasked with shipping the CPU and the monitor. The OEM had decided to give all of the work to the one big partner.
As part of that switch, I visited the bigger 3PL’s warehouse, where I saw some amazing creativity. During WMS deployments it was uncommon to spend hours debating the benefits of various pick carts and we would often opt for the most expensive one if it was more picker friendly. At this 3PL, though, I saw that these workers had bought PVC pipes at the local hardware store and built some lightweight, sturdy carts that got the job done for much less.
Let us know where you have leveraged creativity in your distribution center in the comments section below.
Originally published at Smartgladiator.com on Feb 27, 2018.
Puga Sankara
Puga Sankara is the co-founder of Smart Gladiator LLC. Smart Gladiator designs, builds, and delivers market-leading mobile technology for retailers, distributors, and 3PL service providers. SG LoadProof is a patent pending Centralized Enterprise Photo/Video Document System on Cloud for Supply Chain. SG LP is built on the fact that photos & videos are vital docs as important as POs/SOs/Legal Contracts/Fulfillment Orders that reside in ERP/WMS/TMS systems, that serve as compelling, conclusive, unequivocal proof of crucial, critical, vital operations executed in Supply Chain within/across orgs when fulfilling customer orders as well as meeting contractual obligations between orgs as merchandise is transferred between different parties that partake in Supply Chain functions & operations. And these photos/videos data should not be stored in someone’s Smartphone or Email Inbox or in their personal/work Computer, but should be stored in a Centralized Enterprise system, where such data can be pushed into super-fast, stored securely, accessible to all stake holders (CFO/Sales Reps/Customer Support/AR/AP) in an org, as well as facilitates super-fast retrieval/sharing. LP is an Enterprise System of record for Photo/Video docs & is as important as an ERP which is an enterprise system of record for POs, SOs, Legal Contracts between parties etc. that have huge legal ramifications, also as important as a WMS (Warehouse Management System) that hold indispensable shipment & fulfillment data on orders. Like how Instagram, Facebook, Snapchat etc. have evolved into social media platforms/systems that enable individuals to showcase their beauty/pretty clothes/lovely cosmetics/hep coolness etc., LoadProof is an Enterprise system that holds similar photos/videos, but for a different reason, not for show off, but to serve as compelling, conclusive, unequivocal & indisputable system of record and proof that can be presented even in the court of law, when there is a dispute between parties while they execute many facets of the Supply Chain functions & operations. Puga is a supply chain technology professional with more than 25 years of experience in deploying capabilities in the logistics and supply chain domain. His prior roles involved managing complicated mission-critical programs driving revenue numbers, rolling out a multitude of capabilities involving more than a dozen systems, and managing a team of 30 to 50 personnel across multiple disciplines and departments in large corporations such as Hewlett Packard. He has deployed WMS for more than 30 distribution centers in his role as a senior manager with Manhattan Associates. He has also performed process analysis walk-throughs for more than 50 distribution centers for WMS process design and performance analysis review, optimizing processes for better productivity and visibility through the supply chain. Size of these DCs varied from 150,000 to 1.2 million SQFT. Puga Sankara has an MBA from Georgia Tech. He can be reached at [email protected] or visit the company at www.smartgladiator.com. Also follow him at www.pugasankara.com.
