Logistic and Supply Chain Management: Challenges and Opportunities

Sector wise breakdown of GDP contribution

Describe about the "Logistic and Supply Chain Management".
 

Transport and logistics sector has greater contribution in GDP of 15% to the overall economy in the country. Every day there is movement of 1.5 bn tonne kilometre goods suggesting that it has vast opportunities. This sector provides employment to over 58500 people. Any industries cannot be imagined to be developed without help of this Transport and Logistic sectors.

On the edge for significant growth, and with back up of global linkages, there are decent, vast and significant opportunities for operators and their investors to capitalise on a recover in global economic conditions and the growing tendency towards fully integrated, flawless and borderless supply chains (Aldin and Stahre, 2009). Driven by population growth, globalisation and demographic trend that demonstrate a change away from historical population centres, transport and logistics in Australia continues to develop and modify it only by using technology rapidly.

The logistics of NSW is comprised of various sections of the goods within the state, which tends to contribute a freight volume of 62%. The proportionate volume is subjugated by the aggregates and coal. According to Lin (2006), the exports action contributes the brand with 15% of freight volume. NSW has considered 9% to 11% of the freight volume and also in the movements in the manufacturing goods. The import contributes 2% to the volume of freight and the rest of the margin had been retained from the transport actions. Both the domestic and the international demands had influenced the brand to penetrate into the logistics sector.  

The th4e movement of the goods and the demands of the customers had been the primary aspects of the shipment task.   Therefore, the State Final Demand (SFD) for goods had been the key indicators of NSW. The statistics of the past 20 years reflects that the specific indicators have forecasted on the high correlation with the GDP, the value added by the transportation. The prediction over the coming 5 years shows that the annual growth of the brand would get enhanced by 4%.  

Sector wise breakdown of GDP contribution

The primary objective of NSW freight is to reform a transport network that permits the brands to organize its flow with a smooth effort to penetrate into the market. The statistics of 2013 signifies that the efficient amongst the internal resources of NSW and the clogging in the network modes had leaded the enterprise to experience an adversity in the market. As per the opinion of Bowersox and Calantone (2010), NSW is necessitated to implement the system the assists to eliminate and minimize the congestion in the operations. The particular aspects serves immense benefits to uplift its economic margin, productivity and creating a standardized position in the domestic region. With the alignment to the objectives, the NSW had developed its exclusive transportation services to provide a smooth shipment based services. The transportation network would facilitate the brand to cover the dynamics of the regional economy. The management of the enterprise has initiated the specific action to merge up with the productive and non productive actions.

Company Overview (QUBE Logistic)

The statistics of 2006 reflects that the assets of P&O stream Navigation had managed to cover the major portion of the DP world. In the early 2007, the consortium policy of the enterprise with the Kaplan Equity Limited had taken up the automotive, general operation, vendor, land side logistics, and the transportation of the marine operation by the DP world.  The shareholders of the organisation are the P&O Automotive, General Stevedoring and P&O Trans Australia.

In late August 2011,Qube completed an incorporation of the entire assets of the logistics department had been formed by the Qube Holdings. Qube had been listed in the official register of ASX Limited in the year 2011.

The report of March, 2012 signifies that POAGS had rebranded and renamed its entity Qube Ports and POTA to Qube Logistics. The specific approach had been undertaken to represent the wider group of the specific entity. The management of the Qube Logistics had initiated the idea of connecting the services of the port into a single operating group. The group had focused exclusively on the Australian branch and provided a strategic alternative to the international logistics service providers to amplify its operation measures to experience a better outcome in the near future.

In the Australian region the Qube Logistics had had been identified as an efficient service provider of the port logistics and the cargo services. The management of the brand had claimed that the unsurpassed network of the nation and the infrastructure had been driven by the newest technical measures. The brands had managed to serve its best service solutions in the international and the Australian roadway logistics. The Qube Logistics New South Wales operation had been structured to assist the sites like Port Botany Freight terminal, Port Botany, Port Botany Empty Park. On the other hand, it could be inferred that the enterprise had also increased its transport efficiency to serve best suitable services to Yennora Intermodal Terminal, which is situated in the Western suburbs. It permits the logistics to make a direct contact with the rail Port botany and the terminals of Yennora Intermodal Terminals (www.qubes.com.au).

The total capacity storage of the facilities sums up to 8000 FCL containers and 9000 containers generally remain empty.   

• Port Botany Freight Terminal
• Port Botany Intermodal Terminal
• Yennora Intermodal Terminal
• Macarthur Intermodal Terminal  

3.1 Geographical

There are several geographical circumstances takes place within the Australia region. Urban and challenges of the regions are most common amongst it (Arshinder et al. 2008).

Logistic and Supply Chain Challenges

Urban Challenges

Traffic Congestion

Traffic on working days is encountered in cities of Australia. Peak hours have much larger volume of traffic (Blanchard, 2010). Transportation is affected if routes are taken which are having traffic in peak hours.

Toll Roads

Transport companies have to overcome the toll roads by paying heavy charges and thus increased the cost to the company (Bowersox and Calantone, 2010). Tolls are paid using e-tag which is allotted to vehicles and charges are deducted from accounts.

Road Changes

In some cases to avoid the traffic congestion local roads are preferred. Some time roads are under construction and are blocked (Bruce et al. 2009). This local road also has some schools, pedestrian passes. Some roads are blocked for heavy vehicles. Thus creates a problem.

Distance

Foremost challenges are the distance between the major cities which are used frequently and are major hubs (Chapman et al. 2010). Being more distance the petrol station on some of the roads are also less. Location of the roads creates problem as there may be mountains, landslides and some minning sites. Large distance also creates drivers fatigue as they are force to deliver the services on time (Facanha et al. 2009).

Road Conditions

Condition of roads in Australia is quite good, but due to less population maintenance of the road gets large and a difficult work. Potholes may create a problem; in longer journey this condition of roads creates problems (Geyer and Jackson, 2010).

Ageing population in Australia is a severe concern as young and energetic workers are not available (Goh and Ang, 2011). People are also forced to work after their traditional retirement age of 65 for their survival later in the life. Aged people takes time to learn new things so technological up gradation is difficult as they can’t get acquainted to this (Goodale et al. 2011). Urbanization also is the severe problem because more and more people are preferred metros and this sector require a wide spread network covering urban and rural areas. The increased concentration in the cities needs to be constructive enough to secure the basic requirement of the regional centres.

The environmental and the climatic fluctuations in the Australia present diversified challenges to the operational activities (Grant, 2012).

Climate Change and Green Logistics

Global warming is the factor affecting the sector to a larger extent. Awareness about environmental responsibility is lacking (Gunasekaran and Ngai, 2009). Green logistic has become a hot discussion, which can help environment not being polluted. Green logistic has to be an integral part of the company.

The efficient operations had become the primary aspects for the logistics department due to the emergence of the potential competitors in the similar genre (Hakansson and Persson, 2007).  The sustenance of the enterprise, demand for the renewable sources of energy to a wider extent, which serves immense benefit to the enterprise to channelize its shipping actions.

Seasonal Problems

In winter season there is snowfall in The Great Dividing Range, Thus due to snow fall there is a chance of road blocked, so vehicle get stuck and cannot move forward. Studded tyres are rarely used but this can also not work in some weather condition. Large vehicles and trailer does not prefer this road. Closure of road is lasting for several days, so in this case good may not be able to get delivered at the destination on right time. Not only air transport but railways and airways are also affected due to snowfall (Kemppainen and Vepsalainen, 2008).

Hot summer season is prevailing in Australia throughout the summer season from September to late April. Mainly railway lines are affected by conduction of metal which cause the metals to expand. Electricity lines also get affected as a result of high temperature. Due to hot weather some of the goods which are perishable also get damaged as they are required to be stored in cool temperature. Moreover, due to excess heat the cooling system also get affected. The drivers and the employee working out there also feel tired due to hot weather (Ketchen and Giunipero, 2007).

Natural Disasters

Australia is a country where natural disaster causes the damage and effects supply and logistic system. The most common amongst them are bushfires, floods and cyclones. Natural disaster also causes damage to infrastructure and cost to repair them always prevails. During natural disaster the demand also goes up to due to scarcity and weather condition (Kim, 2006). 

Legislations poses rules and regulation that creates problem and new challenges in the supply chain sector arises. National legislation of the region incurs indifferent types of logistics issues. The specific kinds of challenges can create huge discrepancies in the operational and the strategic decision making (Kohn and Huge-Brodin, 2008). The sections discussed underneath execute the logistics related issues experienced by the Australian legislation.   

Disagreements of funding

Responsibility of the government is to provide funds to certain sectors. There is sometimes disagreement between the government agencies regarding who will be paying and providing funds. If such kind of issue arises then there is delay in maintenance of railways and roadways. For logistic and supply chain industry to function properly the infrastructure in form of roads and rail should be in functioning condition and useable.

Transport Regulations

Permits and License renewal rules changes on year to year basis do for logistic company it is difficult to have a track on it. In some case it is also required to have a special permit licence. Process of issuing and renewing license is time consuming and takes longer time incurring some additional cost.

Quarantine

Transport Company has to take care that only the permissible goods are entering in the port. The government authority inspects all material that are incoming that consume times in some cases. Random inspection is also carried out for security purpose.

Work Safety

Government of Australia imposes the strict rules and regulation regarding the safety provided to the employee and workers. This increases the cost of business. Authority have recently introduces high visibility safety vests for all workers in Transport industry and is applicable to all including warehouse worker drivers and also to upper level management. Hardhats, safety glasses and capped steel boots are made compulsory.

The cost of adopting the cutting edge technology adapts the cost to the company. This change is also necessary to compete with competitors. Other additional challenges also arise with advent of new technology (Lee and Dong, 2009).

Additional Costs

The implementation of the latest technology had been comparatively expensive for the organisation. The updation of the existing technology would facilitate the brand to re4paid its budgetary deficit and attain the competency in the market simultaneously. The updation might demands for a decent figure of expenditure; yet, the ROPI can be easily retained.

Lack of Integrated Systems

Integrating the entire system on ERP is difficult as it is necessary that all should work on same platform. So there can be clash in the system.

Indifferent challenges the brand might experience, therefore, it might have to strategise on the resolving measures to overcome the challenges. The challenges are detailed below:

Rising Fuel Prices 

Rise in fuel price cause extra cost to the organization, and suddenly they cannot hike price for the service which they provide. 

Congestion in the traffic

Road diversion is necessitated to amplify the traffic congestion. Create an influence on the public convey to decrease the percentages of road vehicles. Establishing the inventories away from congested areas would be beneficial. Also it is needed proper route planning (Lin, 2006).

Toll roads

Identify different routes that do not include tolls. Maximising lager road to avoid number of trips

Road changes

It is necessary to do proper route planning to pass up trouble spots. Using most updated information about blocked roads

Distance

Reduce number of trips. Consider diverse the rail transportation modes. Recognising the domestic suppliers that tend to reduce the transportation distance. Proper planning and the driver management is a compulsory break to decrease on the fatigue schedules.

Road conditions

Watch for warnings symbols. The road based feedback arrangement permits the community representatives to ask for upgrades or domestic local governmental issues. Re-modifying the older path ways would be beneficial.    

 Climate change/green logistics

It needs to apply use of new technologies that are environment friendly and easy to use. Look at diverse production methods or materials. Look at eco-friendly technical measures for the other processes (e.g. green warehouse technologies).

Seasonal issues

The fluctuations in the seasonal climates and the ineffective transportation route had been the major obscurities of the logistics operations. Observe weather forecasts in scheduling. Also necessary to minimise implementation of the cooling technology in the inventories.  Better management of the employees to prevent the heat fatigue.  

Ageing population

For ageing population it needs proper employee organization, rotational work (i.e. moving experienced staffs to different work locations) and supplementary preparation. 

Funding disagreements

The lobby group needs to make sure infrastructure projects that would be accepted with negligible disruption.

Quarantine

Proper planning and Updated information should be used before travel of the transportation. Rules and regulation must be made aware

Additional costs

It needs for better planning to look at dissimilar technological options, joint venture with other and nearby companies.

Lack of integrated systems

Make sure systems are well-matched. Better association within the supply chain. Coordination between the partners nd use of technology should be acknowledge.

Technological dependency

Use back-up for systems

Resistance to change

Make employee aware about system feature, advantage and benefit, proper employee management and to offer effective support and training.

Adjusting to new technologies

Proper preparation for the functioning of the technologies in to next level  

Rising fuel prices

The increased driver training had assisted to improve the economic margin of fuel. The brand cvolud initiate a partnership with the other brand to share on the fuel expenditure. Determine the inexpensive convey modes (e.g. rail, shipping). To amplify the vehicle maintenance to get better fuel cutback. 

The transport centric actions of NSW are majorly responsible to improve the expe4riences of the customers. Therefore, the management of the enterprise had planned to effective measures like administrative programs, regulations, policy, transport services, freight and the infrastructure. The transport department had been exclusively instructed to emphasise on the service delivery actions, which includes safety, maintenance and road efficiency (Rushton et al. 2010).

Customer Services

For the better customer service, the brand needs establish the communication materials like the educational and the marketing campaigns. The communication advancement would facilities NSW to create a transparency between the shareholders, stakeholders and making better engagement with the community. The specific attributes leads to entangle a collaborative effort of the internal resources, which creates a positive impact on the customer behavior.

Freight, Strategy & Planning

The management of the specific brand had been recommended to establish the strategic plans for its freight, road networks and the public transport. It supports to create an association across the infrastructural strategy. It generally leads to plan on the entire portfolio, which ensures an association to the transportation actions. The above initiation leads to introduce safety standards and similarly makes a smooth coordination in the cargo movement.

Finance & Investment

Establishing a strategic financial plan and management for the accounting domain would be effective.  It facilitates to make the expenditure as per the norms of the governance. The efficient commercial ability would develop a high value and service models for the complex projects. The financial plan would lead to manage the transaction and introduce the development opportunities for the commercial public transportation.

Infrastructure & Services

It is responsible for the service and infrastructural delivery. Offers and support to persistent approach and assists to projects, with adaptability in planning model. It introduces proper commercial insight, which is necessary to develop service models with the internal operators. Single point of window to the freight access and productivity.

People & Corporate Services

Government shows responsibility towards human resources management, communication in the information technology and analytical study of legal services that covers the entire transportation cluster. Provide organizational efficacy with the support of planning, establishment, implementation and persistent enhancement in the entity. The specific approach leads to introduce overall changes in the entire deportation cluster. It basically enhances the efficiency amongst the service providers.  

References

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Blanchard, D. (2010). Supply chain management best practices. Hoboken, N.J.: John Wiley & Sons.

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