How is the longest government shutdown in US history impacting your transportation logistics operations? How well are your existing logistics processes and technologies protecting you from negative consequences stemming from this impasse that shows no signs of imminent resolution? Although the worst consequences have not yet materialized, here are some potential problems shippers might expect as this debacle continues and ways that transportation management software can help.
<> OTR Shipment Planning Disrupted by Slowdowns in Other Modes
<> The Longer the Shutdown Persists the Economic Drag Increases Chance of Recession
<> The Sooner Top Technology is Deployed, the Quicker a Shipper is Protected
Today’s global economy and the complex supply chains supporting healthy commerce are always at risk of disruption. The current partial US Government shutdown demonstrates the risk of unexpected events roiling supply chains beyond the more commonly experienced disruptors such as weather, war, labor issues, trade disputes, etc. As the shutdown stretches into day 33, here are a list of impacts growing in severity, which underscore the highly variable and fluid nature of a shippers’ operational environment and the mission-critical role played by transportation management software in ensuring optimal supply chain efficacy in any environment.
Supply Chain Interruptions Across All Modes – While most reports reveal minimal impact to over the road freight movements in the US, slowdowns (and potential stoppages) at ports of entry as well as in air and rail systems rankle the regular transportation plans for OTR movements.
Ocean – US ports and borders are currently still open for trade and Entry Specialists are working. However, numerous critical processes have been shut down leading to delays in customs clearing at ports as government employees are placed on furlough. Complicating matters, once containers have cleared ports those moving freight such as food/agricultural product, medicine and other product categories still require approval from a number of government agencies like the USDA, US Consumer Product and Safety Commission, FDA and EPA. All are closed while the shutdown continues.
Air – Numerous reports suggest the number of air traffic controllers may soon dwindle below functional levels as these workers cannot continue to work without pay. Pilots are also considering calling a strike due to legitimate safety concerns of flying busy airspace with compromised staffing levels in air traffic control.
Rail – Paid from a trust and not by Federal appropriations money, rail transportation is heavily affected with Federal Railroad Administration employees on furlough.
Economic Destruction – More than 800,000 federal workers have already missed one paycheck and many have missed two. The loss of these workers’ spending has already cost the US economy some $3.6bn. Economists suggest if it persists, the US could potentially slide into recession. This will certainly have a depressive impact on demand, sales and freight volumes.
All these unnatural conditions couldn’t possibly fail to have an impact on a shipper’s transportation plan. Supply disruptions, radical changes to consumer demand and manufacturing volumes, import/export delays, modal disruption and more conspire to make life challenging for the transportation department unable to make nimble adjustments and adaptations to existing shipping plans and execution strategies.
One supply chain industry watcher lamented, “That’s the toughest part about shutdowns, the uneven impacts that are very difficult to predict.” This is why it pays to have strong, flexible, easily configurable and fully integrated transportation management software solutions in place. You just never know when the next unexpected calamity will arise, but you can bank on the fact that it will. The sooner you implement the right technology, the quicker you can protect your organization from the negative consequences of unplanned disruption.