Tag Archives: Wild West

“I Fight for the Users!” – What Tron Taught Me about Serving Customers

A Review of the Movies

In the Disney movies Tron and Tron: Legacy, the character for whom the movies are named famously declares, “I Fight for the Users!” In the world those movies create, the Tron character is passionately loyal to the humans who designed and use the computer program. It’s been a few years since Tron: Legacy came out, so here’s a short clip to remember the movie:

Tron - UserYouTube – Tron Recognizes a User

Toward the end of the clip, Tron (also known as Rinzler) sees his opponent bleed and realizes that his opponent is a user (human). Because of his loyalty to users, Tron refrains from killing the human. At the end of the movie, Tron sacrifices himself to save the humans from being killed:

Tron - I fight for the UsersYouTube – Tron Realizes He Fights for the Users

The reason I’m fascinated by Tron’s loyalty to the users is that my supply chain should have equal loyalty to the customers. In all our efforts to fight waste and inefficiencies, we should boldly declare, like Tron, “I Fight for the Customers.” For some reason, however, I often ignore or stop paying attention to the voice of the customer and find myself fighting against, instead of for, the customer.

Voice of the Customer and Putting Away Christmas Decorations

A poignant example of ignoring the voice of the customer happened recently while I was putting away my home’s Christmas decorations. The Christmas lights are especially time-consuming to neatly organize, so I instead gathered everything into a giant ball and stuffed it into a plastic bin. I just wanted to get done as quickly as possible, so I told myself,” I’ll deal with untangling this mess next year.”

However, this is exactly what a good supply chain shouldn’t do. I’m creating a local optimum (putting away my decorations as quickly as possible) that will cause pain to my customer (in this case, me in 11 months). Since I am my own customer, I know the voice of the customer quite well. I remember untangling the lights just weeks before, and I know exactly what I should do to please the customer. I don’t though. Since it’s a hard task and it pays off now to just throw everything into a box, I do the minimum to get the job done when I could increase customer satisfaction.

“I Fight for the Customer”

This same type of local optimization occurs every day along the supply chain. As we get busy or deadlines get scrunched, we naturally reduce the effort we put into pleasing our customers. Whether it’s our internal customers or the end consumer, it’s easy to forget that how we stack a pallet or design a product can negatively affect our customer down the line.

Each day, I need to repeat “I Fight for the Customer” throughout process improvement and Kaizen efforts. As you and I battle inefficiencies and reduce waste, we should have the same natural instinct to stop what we’re doing when it threatens customer satisfaction. For example, I can reduce airspace in packaging boxes, but as soon as my product’s quality is compromised from being too tightly packaged, that’s the blood that should force me to rethink my initiative.

The Empty Chair at Amazon.com

In the early days of Amanzon.com, Jeff Bezos, CEO and customer service champion, reserved an empty chair at all important meetings. He told his team that the chair was reserved for the most important person in the company – the customer. He asked everyone to imagine the customer was sitting there and to keep her in mind in throughout all their decisions. Later, Bezos hired someone to sit in the chair and passionately represent the voice of the customer. This practice helped to guard Amazon against any initiatives that didn’t help its users, and kept everyone’s thoughts centered on who kept them in business.

How Can I Better Fight for the Customer?

What ways can you better proclaim “I Fight for the Customer” in your supply chain? Here are some questions to consider:

  • Do I have adequate channels that bring the voice of the customer to me?
  • Do I frequently review how process changes affect the customer?
  • Do I address both the external and internal customer experience in all major meetings?
  • How can everyone in my organization feel closer to our customers?
  • How can I prioritize initiatives more closely to fit customer needs?
  • How can I better share my voice, as well as my customers’ voices, with my vendors?

By bringing the customer back into focus with your daily efforts, your organization can better solve the needs of those that keep you in business. Building the resolve to fight for the users of your product and services will result in a more loyal and pleased customer base.

“He Ships, He Scores!” Improving Your Supply Chain with Games

Mario Fork Lift
Friday evening had arrived, and I was very excited to be on my way home. My wife and I were going on our first date in over four months – the first time we would leave our new daughter with family as we had some fun. After dinner, we went to one of my all-time favorite places: The Nicklecade. The Nicklecade is an arcade full of older games that each only cost $0.05 to play. Ten dollars can keep two people playing the gaming classics all evening. As we played Ski-ball, Dance Dance Revolution, San Francisco Rush racing, and even Guitar Hero, I was struck by how motivated I was on a Friday night.

I had just spent an entire week in typing emails at a computer and occasionally helping with repetitive physical tasks in the warehouse. Now, on a Friday night, I was in front of computers again pressing buttons and tossing ski-balls up the ramp over and over to try and beat my wife’s high score (which I was unable to top). How could the similar skills and activities be so fun and motivating as I worked for tickets, and less so as I worked for paychecks?

The Game of Work

My question caused me to recall a business book classic called The Game of Work by Charles Coonradt. Written in 1984, before a generation was raised on videogame achievements and scores, Coonradt was struck by a similar question to mine regarding construction workers. They would slowly plod along building a house, but during lunch time, they’d run to a local basketball court and give everything they had to obtain 4-on-4 lunchtime victory. Realizing that the principals of games could increase motivation and productivity in the workplace, Coonradt defined five rules of gamification – harnessing the power of game thinking in traditionally non-game work.

  1. Clearly defined goals – Put the basketball through the basket
  2. Better scorekeeping and scorecards – The score is 87 to 89, our team is down by two with a minute left in the game.
  3. More frequent feedback – The scoreboard tells you immediately if you made a goal, and a referee’s whistle will sound every time you break a rule
  4. A higher degree of personal choice of methods – Score points; it doesn’t matter if they are lay-ups, dunks, field goals, or 3-pointers
  5. Consistent coaching – whenever I have a question, I can look over to my coach for guidance or call a time out for more detailed help

Supply chain and operation works lends itself directly to this type of job enhancement. Below are some examples of how gamification has helped boost productivity.

Charles Schwab Throws Out a Challenge

In Dale Carnegie’s book, How to Win Friends and Influence People, the story of Charles Schwab keeping score is a fun example of early gamification.

“Charles Schwab had a mill manager whose people weren’t producing their quota of work.

“How is it,” Schwab asked him, “that a manager as capable as you can’t make this mill turn out what it should?”

“I don’t know,” the manager replied. “I’ve coaxed the men, I’ve pushed them, I’ve sworn and cussed, I’ve threatened them with damnation and being fired. But nothing works. They just won’t produce.”

This conversation took place at the end of the day, just before the night shift came on. Schwab asked the manager for a piece of chalk, then, turning to the nearest man, asked: “How many heats did your shift make today?”

“Six.”

Without another word, Schwab chalked a big figure six on the floor, and walked away.

When the night shift came in, they saw the “6” and asked what it meant.

“The big boss was in here today,” the day people said. “He asked us how many heats we made, and we told him six. He chalked it down on the floor.”

The next morning Schwab walked through the mill again. The night shift had rubbed out “6” and replaced it with a big “7.”

When the day shift reported for work the next morning, they saw a big “7” chalked on the floor. So the night shift thought they were better than the day shift did they? Well, they would show the night shift a thing or two. The crew pitched in with enthusiasm, and when they quit that night, they left behind them an enormous, swaggering “10.” Things were stepping up.

Shortly this mill, which had been lagging way behind in production, was turning out more work than any other mill in the plant. The principle?

Let Charles Schwab say it in his own words: “The way to get things done,” says Schwab, “is to stimulate competition. I do not mean in a sordid, money-getting way, but in the desire to excel.”

Quoted from Dale Carnegie’s How to Win Friends and Influence People

A Jewelry Manufacturer Keeps High Scores

A factory that made recognition jewelry created a very simple computer program in the 1980s. The employee would log in his or her manufacturing job, say polishing 100 medallions, and the computer would time him. After the employee completed the work, he or she would see how quickly he or she had accomplished the work. The computer then ranked him or her against personal past records as well as everyone else. The program let the employee know whether the score was above or below average – and by how much. This simple program quickly increased efficiency of the entire factory as everyone tried to beat their coworker and their own records.

Real-time Shipping Dashboard Focused our Warehouse

A couple years ago, as our company quickly grew, we felt a need for better visibility to our warehouse operations. I had worked at Sonic in high school where little TV screens showed each order and helped me know how many hamburgers to make. Could we make a dashboard that showed us what orders we had to ship? With some VBA coding, I was able to create a real-time shipping dashboard that did just that. Every ten minutes, the computer would automatically update from our system database and show the orders we needed to ship and had shipped already that day. If an order went late, it would show up in red. As long as everything was green on the dashboard, we knew we were shipping on time and winning for the company. The dashboard was so effective that I was able to completely step away from warehouse operations as the team worked together to keep the dashboard green – or score points –rather than a manager directing every step.

Ideas for Gamifying Your Supply Chain

Having a better grasp of the principals of gamification, how can you better apply them in your supply chain? Here are some ideas:

  • Vendor Scorecards – We’ve been working extensively on a comprehensive vendor-scoring program. We are giving quarterly feedback on how key vendors are doing on dimensions important to our success. We also hope to build a “Vendor of the Year” award to reward good scores. Without the scorecard, however, our vendors can’t be confident in how they can better serve us as their customer.Crosstraining
  • Cross-training Achievements – An easy way to turn long-term training into a game is to create a grid of people and processes. As employees learn new processes, they receive a sticker that becomes a badge of cross-training achievement. Fast-food restaurants do this all the time. When we put this together in our warehouse, I was amazed by how quickly people began asking their supervisor to train them on new skills so that they could mark it off on the grid.
  • Pick-to-voice Warehouse Picking Systems – Wearing a headset that tells you where to pick your next order is a popular technology in large warehouses. These pick-to-voice systems often track efficiency and set goals for each picker. Taking that technology a step further, you could keep score on a large screen or let pickers “level up.” As employees reach certain scores, they could be rewarded with more difficult orders to pick – or move into new zones of the warehouse. Even adding the “1UP” sound from Super Mario and other video game trademarks could make order picking more engaging.
  • Pallet Wrapping Competition – If you have 30 pallets to wrap by hand, divide everyone into three teams and see who can wrap 10 in the shortest amount of time. Whenever students from local colleges tour our company, I ask them to compete in a “warehouse Olympics” game to see how they fare with the most basic of supply chain tasks. I quite enjoy watching college students race, and often struggle, to tape boxes, sort returns, and wrap pallets.
  • Vendor Terms Competition – Our CEO created a list of vendors that he wanted a dozen employees to contact and ask for extended payment terms. Each Vendor had an employee assigned to it. The list was in a Google spreadsheet we all shared, which allowed us to see each other’s progress in real-time. We could approach the request any way we wanted, and we even received a small gift card when we achieved our goal.
  • Real-time Dashboards and Metrics – Building on our shipping dashboard, we now have a large handful of other real-time dashboards. Purchase Orders, Accounts Receivable, and Accounts Payable are just a few examples of how we keep score. Our jobs become a game of keeping the dashboards free of red lines, which helps us focus on activities that help the company.

Supply chain is the ideal place to apply gamification principals. Large amounts of real-time data make keeping score much more achievable than in other less data-driven disciplines.

Whether it’s PlayStation 4, the NFL, or Monopoly, everyone on my team has a passion for games. Tweaking processes to channel that passion has helped my company in powerful ways. Applying Coonradt’s five “Game of Work” principals helps everyone better achieve results that help the company and enjoy their work more. Most importantly, that increase in motivation helps us become a stronger company and a more competitive supply chain.

Now instead of getting back to work, get back to gaming.

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If you’d like to learn more, please check out the below sites that were a source for parts of this article.

7 Simple Ways to Manage Temporary Workers Better

Temporary WorkersWhether it’s a seasonal jump in orders or an unexpectedly large rework project, calling on temporary workers is often the only way to get everything done on time. I refer to temporary employees as one of my three supply chain silver bullets that help me pull off operational miracles. Having managed dozens of projects with workers I just met, I’ve gathered a list of seven ways to make those projects run smoother and quicker. By incorporating the concepts below, your next project with temporary workers will be a better experience for everyone involved.

1.     Start Right with a Clear Orientation Huddle

The first twenty minutes together with your new team sets the tone for the entire day. Use this opportunity to set clear expectations and preempt later distractions and problems by answering common questions.

When temporary workers first arrive, I have them read over a laminated, double-sided sheet. Not only does this protect our company by letting them know of HR policies, but also addresses common issues and questions. The sheet contains a two- or three-sentence summary of our policies on the following topics:

  • About Our Company
  • General Warehouse Safety
  • Forklift Safety
  • Dress Code
  • Time Clock Procedures
  • Breaks and Lunches
  • Bathrooms, Break Area, and Smoking Area
  • Cell Phones and Personal Items (be sure to address cell phones specifically)
  • Substance Abuse Policy (from HR)
  • Harassment Policy (from HR)

After reading over the list, each temporary worker signs an acknowledgement sheet that we keep on file. This protects the company and gives us recourse to send people home that break policies.

After gathering everyone’s signed acknowledgement, I hold a brief huddle. Before going into the days’ work, I emphasize a few key expectations. Specifically, I show them the lockers they can put personal items (or when lacking lockers, ask them to keep everything in their cars). I also point out work and break areas as well as recommend local places for lunch. These few minutes answer 90% of the common questions I encounter, which allows us all to focus on the work at hand.

2.     Set Clear Expectations

Having given a clear orientation, I then strive to set very clear expectations of the day’s work. The key here is many visual examples of the end product and a clear standard procedure to reach that result. For example, if we are trying to build 3000 retail displays that day, then I have several completed examples to show everyone. Each station has a color picture of what the display should look like at that station’s point in the process. I build one or two displays completely with everyone watching to ensure they understand how the display look as it is built and completed.

As much as possible, I strive to make the work mistake-proof. Setting up checks to ensure the display is built correctly helps catch errors. If physical checks aren’t possible, then I ask several people to act as quality lookouts along the assembly line to catch any defects. I empower them with the ability to stop the process and call for help when they see errors. I also let everyone know I’ve asked them to do this job to avoid offense.

Finally, I share with the team hourly and daily production goals. This gives a score to the team’s work and helps them gauge their speed. When I’m building something new and have no experience on what to set the goal as, I just guess optimistically. The team usually rises to meet my estimated goal. Sometimes I even run the process myself ahead of time. This allows me to time how long it takes me to complete a few rounds of the process to set a realistic expectation.

3.     Add Meaning to the Work

Just before they get set to work, I answer the often-unasked question of “why am I doing this?” Even though these workers may just be on the job for a day, I’ve seen impressive results when they know the deeper reason behind their work. My goal becomes theirs as well, and many of the workers will give extra effort and suggestions to better accomplish the larger goal.

The explanation doesn’t need to be long. It could go something like this: “Today we’re building 3000 displays that we’re sending to Walmart. They have to be built this specific way because it helps the Walmart employees quickly put the product out in the store. In a couple weeks, you can visit your local Walmart and find one of the displays you built. Then you can point to that display and tell your friends or children ‘I helped make that.'” As your team is able to focus on the higher goal, not just the menial work that lies ahead, they will rally behind the cause and work hard to produce something they are proud of. Five minutes before lunch or the end of the day, I gather everyone around and solicit their feedback for improvements to the process. Without your team knowing the end goal of their work, helpful feedback is rare.

4.     Create a Positive Work Environment

As the workers begin, I help set the pace and atmosphere by working alongside them. This helps me make sure the project gets off to a good start, but it also helps me learn more about my team. I rotate people to find their strengths and adjust workloads to balance bottlenecks. Once everyone is comfortable in his or her role, I try to ensure enthusiasm remains long after the first hour of work.

If everyone can do a great job while talking together, then those conversations often keep everyone upbeat. However, if they become distracted while talking, then I instead turn on the radio. I always see better results when I try to have a little fun with my team, especially toward the end of the day, than when I am overly strict and serious. Simple rewards for meeting goals, such as cheap popsicles if it’s a hot day, or letting the team take five minutes longer on their break, go a long way toward motivation.

5.     Don’t Make Leadership a Mystery

The biggest problems I’ve had with temporary workers come from not assigning adequate supervision. I am frequently called away from the work, and when I don’t assign someone to be in charge, disagreements often arise. Therefore, if I can’t be there to supervise, I do everything I can to have one of my full-time employees, or at the very least a returning worker, assigned to answer questions that arise. This isn’t to quell power struggles, but to create order in a group of workers who still don’t know each other. Knowing there is a supervisor close who can answer question creates order and prevents most problems.

Having someone you know and trust working on the project also fosters more communication. That person can act as a liaison to the shyer, new employees by giving voice to concerns or suggestions they have. I’ve received some great suggestions for improvement that passed from a new worker, through a returning worker, to me.

6.     Be Detailed in Time Management

Simple Excel Punch Clock

Being exact in timing brings great results. I once used a clipboard to have temporary workers track their time each day. This created some tension because some people would write 8:00, even though they really showed up at 8:07. To avoid this problem, I put together a simple punch clock in Excel – which you can download from the Supply Chain Resources page. Having the computer track the time took away any question of timing – and saved our company a few hundred dollars.

Another time trick I love is something I learned from my high school band director. Whenever we had a concert, she would ask us all to report at 6:53 PM. Such a detailed time was memorable, and many more people showed up on time than had she said 7:00 PM. I use this same concept with breaks. If its 2:03, then I tell everyone, “Ok, it’s break time, we will start the line back up at 2:14 – so be back by 2:13.” This brings much more success than “Be back in 10 minutes.”

7.     Build Your “A” Team

Finally, do all you can to build your temporary worker dream team. If your project spans over many days, only invite back the hard workers – and ask the temp agency to send you others to try out.

If someone is not working, hindering the work, or fostering a negative work environment, don’t be afraid to send him or her home. I’ve only had to do this on rare occasions because talking to the person often resolves the issues. However, if someone is causing a safety risk or HR issue, send that person home as soon as you can. Failure to do so not only invites the issue to grow, and other workers may mirror that behavior since it’s bringing no consequence.

For the most part, however, your team will likely be full of good, hard workers. Pay attention to the best and consider bringing them on full-time. We have found some of our very best employees through temporary assignments. It’s our vehicle of choice to add a new team member in our warehouse because we can try them out for an extended period before investing completely in them.

These seven simple tips have helped me better manage the projects I’ve run with temporary workers. Investing some time and effort into the process will result in more efficient workers and better results. These projects, although sometimes stressful, can become positive experiences for everyone involved.

What other suggestions do you have for managing temporary workers? Please leave your thoughts in a comment.

Five Supply Chain Mistakes that Kill Companies

Supply Chain Epitaph
Any good cowboy knows to be wary of rattlesnakes and stampedes, but the wild west of supply chain also has some precarious situations to avoid. A great supply chain strategy can help you dominate the market over time, but big mistakes can destroy your company in just days. Dozens of smart managers have unintentionally killed or maimed their businesses from these five blunders.

1. Automation – Too Much Too Soon

Supply chain professionals face strong pressures to reduce cost, and automation is an attractive option to accomplish that goal. However, jumping into a new technology without thinking through the strategic process could blur the fundamental problems and goals you face, which often results in investment misalignment. Seven of the incidents described in Supply Chain Digest’s 2006 list of the 11 Greatest Supply Chain Disasters involve poor implementation of new technology and automation. Specifically, the systems were unjustifiably large, unhelpful, or just didn’t work. Sometimes in our zeal to reach the shiny future, we become overly optimistic. Whenever I hear that investing in a new system will, “solve all our problems,” I pause and remember how many failed firms came to that same conclusion. The harsh truth is that the implementation of a new system is much more difficult than is usually anticipated. Furthermore, all too often, companies purchase a system before the demand justifies the investment.

How to Avoid the Mistake:

Don’t use technology as a replacement for a sound strategy and profitable processes. Instead, look to people and processes before technology to solve problems. If you determine that a new system is your best option, be sure to pilot it thoroughly before full implementation so that you don’t make unnecessarily large and risky jumps.

2. Trying to Do Everything Great Results in Doing Nothing Well

As customer needs diverge, you can quickly find yourself trying to provide a wide range of products through many different channels. Lacking a focused strategy can lead your supply chain down the dangerous path of trying to do too much. Richard Rumelt of UCLA compares this lack of a clear, focused strategy to an inept quarterback. If a quarterback were to conduct every huddle with nothing more than the words “let’s win,” then I doubt that team would score many touchdowns. Instead, by narrowing focus and developing a specific strategy of what your supply chain will do – and more importantly, what it won’t do– you can become great at a few objectives instead of being good at nothing.

How to Avoid the Mistake:

Create a supply chain strategy with focus. Strive for a few objectives with which to excel. Avoid vague, all encompassing “let’s win” goals and coaching.

Note: More thoughts on Rumalt’s strategy advice applied to supply chain available at Vivek Sehgal’s Supply Chain Musings.

3. Death by Inventory

Companies die when they run out of cash, and inventory has a nasty habit of eating cash faster than the cookie monster eats cookies. Small companies are especially vulnerable to stock piling inventory in anticipation of opportunities for growth. Never wanting to stock out, some businesses consistently over-order and over-build to capture all remote chances of demand. However, warehouses soon fill with obsolete or expired inventory that is essentially pallets of cash that you can’t use to pay the bills. Small companies aren’t the only ones with inventory issues; big businesses make similar mistakes. For example, Cisco took a $2.2 Billion write-down on obsolete inventory in 2001. More recently, Toyota, a company that prides itself on lean inventory, found itself with too many Trucks and SUVs that it couldn’t sell because demand for those vehicles dropped after the 2008 recession. However, less inventory isn’t always the answer either. Having too little inventory, or having the inventory in the wrong place, can quickly cut your market share and create angry customers. In reality, inventory is a complex creature that requires diligent attention to master.

How to Avoid the Mistake:

Don’t be afraid of politely turning away a few, less-profitable customers and custom items if it means freeing up significant amounts of cash through less inventory. Utilize data to back your decisions to avoid emotional purchasing. Build your company’s sales and operations (S&OP) process to ensure all departments are working on the same realistic forecast

4. Single Sourcing – “Help Me Supplier One, You’re My Only Hope!”

As supplier relationships become more collaborative, having only one primary vendor for key products can make financial sense. However, when your company’s destiny becomes married to your supplier’s future, you’re taking on unnecessary risk. Using one supplier for most of your business often makes good financial sense, but you must also stay vigilant in maintaining good back-up sources. Natural disasters, political unrest, or bankruptcy can quickly make your only supplier unavailable, leaving you in an uncomfortable predicament.

How to Avoid the Mistake:

Always have one or two back-up vendors for critical parts and services – preferably in different geographic locations or countries. Even if they are more expensive, give them a small percentage of your business so they stay engaged with you.

5. Complacency – If It Ain’t Broke, Why Fix It?

Last on the list of supply chain mistakes is complacency – getting too comfortable with a good solution. As Alex Rogo learns in The Goal, it’s difficult to push for improvements without a crisis encouraging change. However, remaining stagnate on a profitable model invites competitor disruption. New business models and supply chain improvements frequently disrupt the dominant firms in a market. Clayton Christensen, in his book The Innovator’s Solution, talks in detail about this phenomenon and offers advice on how to survive and prosper from disruptive innovation. To help our supply chains from losing their advantage, we should strive to improve and innovate before our competition forces us to do so.

How to Avoid the Mistake:

Become passionate about continuous improvement. Keep an eye on competitors, new business models, and emerging best practices. Work today to address risks your supply chain will face in the near and more distant future.

Which of these mistakes could your supply chain be facing – and what can you do to help avoid it? What other advice do you have to avoid these mistakes? Share your thoughts below, and be sure to subscribe free to receive future articles by email.

Could Driverless Vehicles Lead to More Pollution?

The operations and logistics departments of a company often have a greater impact on the environment than most other business functions. This is why when a company wants to “go green,” it often looks to its supply chain to play a leading role. Best practices in sustainability are becoming more crucial to a supply chain’s success as managers balance the triple bottom line of financial, social, and environmental good. All of this led to my interest in a recent Freakonomics podcast on environmentalism.

Driverless Truck Polluting

Electric Cars Could Cause More Pollution

In the podcast, Harvard economist, Ed Glaeser, suggests that electric cars, marketed as a “greener” travel option, could actually do more environmental harm than good. His reasoning is that the incremental cost of driving one more mile in an electric car is drastically less expensive than one more mile on gasoline. Naturally, this will lead to increased driving distances. Although that mile also impacts the environment to a lesser degree, the increased mileage might actually have an overall negative impact on the environment. If each mile produces half the pollution, but you drive three times farther, then you’re not moving forward environmentally.

Driverless Vehicles Means More Driving

This concept of unintended environmental side effects made me rethink one of my favorite technologies – driverless vehicles. I’m passionate that the future of logistics is in driverless semi-trailer trucking. It may be fifteen or more years away, but the pressures to reduce freight costs will eventually lead to driverless freight transport. However, as driverless shipping becomes cheaper, it will likely encourage more trucking.

For example, the main reason that I don’t go on more road trips is not the price of gas but the personal discomfort of driving. If I could simply sleep and then wake up at my location, I would travel by car much more often.

Extrapolating to the logistics arena, I foresee that driverless freight making shipping drastically less expensive. This would affect companies in numerous ways. For example, big-box retailers such as Walgreens could start shipping inventory between their stores to level out over stocks and stock outs. Freight could travel more quickly to greater distances, which would reduce the number of needed warehouses. If UPS and FedEx deliveries could make driverless deliveries, small parcel shipments would skyrocket. Online retailers would grow in dominance as the cost to serve consumers would drop.

Yet with my enthusiasm for the benefits of driverless vehicles, I had not considered the environmental consequences this technology might have. As the cost of freight decreases from not having to pay drivers, the number of miles that trucks drive will increase. The rise in pollution from trucks driving day and night could easily cancel out the advances in fuel efficiency we hope to make in the next few years. However, the decrease in costs and risk to human life involved in accidents still make the widespread use of driverless vehicles appealing.

Now What?

This is article is an open-ended thought, not a call for immediate action. The world is moving toward logistical automation, so anticipating each aspect of that future paradigm is essential. Widespread use of driverless vehicles will require support from society and public policy. Awareness of all the consequences will help the supply chain industry usher in this next generation of technology.

If you’re interested in the topic, here are a couple more articles worth reading:

Thoughts on Driverless Trucks by Kevin Gue of Auburn University

Daddy, What Was a Truck Driver? by Dennis Berman of the Wall Street Journal

The First Driverless Cars Will Actually be a Bunch of Trucks by Evan Dashevsky of Tech Hive

How will driverless vehicles influence your supply chain? Will our society allow the widespread use of driverless trucks? What other consequences must we consider to best utilize driverless trucks?

Please leave your thoughts in a comment below. In addition, if you’re interested in starting a venture into driverless trucks, please let me know. I’d love to be part of the endeavor.