Supply Chain Expertise and Technology Blog by TMC, a division of C.H. Robinson

How to Build Working Relationships

TMS Table

Aside from addressing issues that practitioners are keenly interested in (talent management, collaboration, and carrier pricing), our top three Connect blog posts this year by readership underline that supply chain management is a relationship business.

Our post “Why Logistics is a Good Fit for Millennials,” looks at recruiting and retaining Millennials in the logistics industry—a challenge that most industries are grappling with right now.

As the post explains, the logistics business offers a number of career opportunities that are compelling for this group. Companies that recognize and build on these preferences are well positioned to attract Millennials as employees and establish long-term relationships with them.

An obvious example is their connectedness with new technology; these individuals are already tech-savvy by the time they enter the workplace. As a result, they are right at home in an industry that is being transformed by technological innovation. Take just one example, the impact of the Internet of Things on transportation management (for more on this see Matthew Noll’s recent post “Connecting into the Future of TMS Technology)”.

The Millennial generation has an international outlook, and almost by definition, logistics is a global business that offers limitless opportunities for travel, communication, and cultural understanding.

Jobs with a clear sense of purpose appeal to these individuals. Again, logistics fits the bill. An example is the sense of accomplishment experienced by project teams when a network redesign creates significant benefits for shipper clients.

Helping logistics managers establish collaborative relationships with people in customer and supplier organizations is the main theme of another top-three post, “Three Pillars of Effective Supply Chain Collaborations.” Authored by Kelly Allen, Berry Plastics Corporation, and Cecilia Symanski, IPC, the guest post was the first in a two-part series about this important topic.

The two companies represented by the authors have created a successful collaborative partnership in the logistics area, and can offer firsthand advice on what makes such alliances tick.

A trusted, honest broker that functions as a mediator is one key success factor. Facilitators who have a working relationship with each partner organization are particularly effective, because they are already familiar with the each participant’s corporate culture and strategic goals.

Another big plus is a shared technology platform. Commonality in the tech area avoids wasting time on interpreting disparate data sets and trying to make sense of each other’s analytical methods.

Finally, the partners should be diligent about ensuring that they have the right people at the table. Mismatched personalities, roles, and responsibilities cause friction that can impede the flow of ideas.

As the authors point out, these three success factors do not guarantee success, but without them it’s more difficult to build collaborative relationships that endure.

Putting relationships with carriers on a firm footing, especially in understanding how service providers price their services, is the main theme of the “What Factors Impact Carrier Pricing?” post by C.H. Robinson’s Kevin McCarthy. Additional information on the topic can be found in the C.H. Robinson white paper Strategies for Transportation Spend: Understanding the Dynamics of Carrier Pricing, Service, and Commitment. Again, the author offers three key factors.

First, creating synergies between their freight network and those of shipper customers is critical to carrier profitability. Since networks are constantly changing—in response to losing or gaining customers, for example—shippers need to keep an eye on the compatibility of their networks, and make adjustments to recapture alignment when necessary.

Second, loyalty pays; carriers are less likely to jump ship for better business opportunities if they enjoy a long-term, mutually beneficial relationship with core shippers.

And, third, shippers that help carriers to be efficient are attractive partners. Minimizing driver delays is one way to develop such relationships. Shippers that are good to work with are more likely to retain carriers when capacity is at a premium.

When freight transportation agreements stray off track “the better you understand what’s going through the carrier’s mind, the better prepared you will be to understand what could happen next with pricing, and what, if anything, you can do about it,” says McCarthy.

The same sentiment applies to all the industry relationships described in these three top blog posts.

We look forward to providing more practical relationship-building advice in future posts.