Source: www.businessweek.com

New federal legislation presents a unique opportunity to safely improve the efficiency and sustainability of truck shipments. The Safe and Efficient Transportation Act (SETA), now pending in both the House and Senate, would give states the option to set interstate weight limits of up to 97,000 pounds for trucks equipped with a sixth axle. Without lengthening the truck, the sixth axle maintains braking and handling capabilities, with a slight decrease in the current weight per tire.

SETA is critical to making the shipment of heavy goods more efficient. Many trucks packed with weighty goods hit the 80,000-pound federal weight limit before the truck is fully loaded. That means these trucks leave the loading dock partially empty. Under SETA, however, shippers could safely utilize more space in their rigs — and avoid using more truckloads and fuel than necessary.

As the largest food company in the United States, Kraft Foods supports SETA because it would shrink our carbon footprint without compromising safety. About 40 percent of our trucks currently hit the weight limit with significant space left in the trailer. Under SETA, we could reduce the number of trucks we’re using by about 6 percent. That translates to 60,000 fewer loads and 33 million fewer vehicle miles traveled each year. And we could also eliminate 73,000 tons of carbon dioxide annually.

Further, the U.S. DOT predicts that freight shipped by truck will dramatically increase over the next decade as our economy grows. By boosting the amount of freight each truck can safely carry, SETA will reduce the number of trucks and vehicle miles necessary to meet demand — and therefore make roads safer now and in the future. In fact, based on the findings of a 2009 Wisconsin Department of Transportation study, if a law like the Safe and Efficient Transportation Act had been in place in 2006, it would have prevented 90 truck-related accidents in the state that year.

SETA will no doubt improve safety records for U.S. shippers, lower their environmental profiles and save major companies tens of millions of dollars per year in shipping costs.

Please contact your members of Congress, and help us show them that SETA will make truck shipment safer, greener and more efficient. For more information about SETA and this truck weight reform effort, visit www.transportationproductivity.org.

Kraft Foods makes delicious foods consumers can feel good about in 150 countries around the globe and is a customer of Con-way Inc. Harry Haney also serves as chairman of the Coalition for Transportation Productivity, a group of over 160 shippers and related industry organizations advocating for the passing of SETA.

www.fleetowner.com

If you are looking for news from Washington that will brighten your day, please stop reading now!

Since the 1950s when legislation was enacted to build the Interstate Highway System, Congress has passed, and the President has signed into law, a renewal of the federal commitment to surface transportation infrastructure every few years. While initially dedicated to highways and funded by fuel taxes through the Highway Trust Fund (HTF), federal aid to transit was added to the mix about 30 years ago. This was and is justified by the need to reduce congestion on our roads, particularly in urban areas.

Of course, each renewal of these programs triggered vigorous debates about issues such as raising fuel taxes, equitable distribution of funding among the states and numerous other issues. But the need for a robust federal program to build and maintain a vast national road system was virtually universally recognized. We have had a consensus among those who govern us that interstate commerce, international trade and the right of Americans to have individual mobility over long distances all made such a program essential.

Furthermore, until the end of 2008, the consensus seemed to be strengthening. Two commissions created by Congress in the last surface transportation reauthorization bill focused on the need to find additional funding to expand our highway system and related facilities. While there was disagreement about where to find the money (i.e., higher fuel taxes, or a vehicle miles traveled tax or private investment or some mixture of the three), there was recognition that a projected doubling of freight over the next 20 years would overwhelm our existing system. There was also a consensus that, despite the advertising campaigns of the Class I freight railroads, trucks would have to continue to carry the vast majority of freight.

No more.

The last surface transportation reauthorization bill expired on Sept. 30, 2009. The Obama Administration announced in its earliest days that it opposed any fuel tax increase. Furthermore, the Administration not only hasn’t proposed an alternative source of funding, it hasn’t even sent Congress a request for specific legislation provisions. So the country is limping along with periodic short-term extensions of the old legislation. The House Transportation and Infrastructure Committee became so frustrated with the Administration that it passed a draft bill, but with no numbers in it!

Worse still, because of the recession and other factors, the HTF has virtually collapsed.  Over the last two years, Congress has transferred more than $70 billion to highway and transit programs from general revenues and deficit financing. The majority of this money was included, on a one-time only basis, in the so-called “stimulus” bill. Fuel taxes dedicated to the HTF can no longer support current highway and transit programs, much less any expansion. The whole concept of users paying into a trust fund that covers federal surface transportation programs is being undermined.

But the Administration and Congress have poured money into another aspect of surface transportation. Using deficit financing, over the last year and a half the federal government has appropriated more than $10 billion into our rail system, for both passenger and freight service (over 80 percent has gone to “high-speed” intercity passenger service). While most of these dollars have not yet been spent, the U.S. Department of Transportation has been vigorously making grant announcements.

Thus, even though Congress hasn’t passed new surface transportation legislation authorizing such a radical policy change, it is well under way.

If you believe that America needs a strong, growing freight transportation infrastructure system as a key element in a healthy economy, and that trucking must continue to play a vital role in that system, then it really is time to let your senators and house members know.  If they don’t hear from you, they aren’t likely to straighten this out. The consequences for us and for our children will be an America ever less able to compete.

Jim Burnley is a partner in the Washington office of Venable LLP, and is widely recognized as one of the nation's foremost authorities on transportation law and policy

Companies adopt environmental sustainability programs mostly for one of three reasons: the customer asks for it, the government mandates it one way or another or the market demands it to remain competitive. But how do you know if the results of your green programs are measuring up? And how do you know if you are ready to respond when governments ramp up regulation of carbon emissions?

Unfortunately, there’s no single solution and standards vary widely. Nevertheless, transportation and logistics companies can still gain a firm grasp of the strengths and weaknesses in their sustainability programs, and develop a plan to position themselves for success as the playing field changes. They can start by taking stock of their total carbon emissions output.

The most obvious sources of greenhouse gas (GHG) emissions in the supply chain are trucks and other vehicles, such as forklifts, which use fossil fuels and participate directly in the movement of freight. But when accounting for your company’s total carbon footprint, you’ve got to consider every aspect of your daily operations and how it relates to the environment. It means understanding more than the impact of trucks, it means evaluating everything from electricity levels to natural gas use and fully understanding your operations.

Lean tools and methodologies, such as value stream mapping, are especially valuable in helping understand carbon streams and how to drive out waste from them. Understanding the larger picture provides a more complete view of where to focus sustainability efforts. All of this analysis provides insight into the true impact of your organization’s supply chain on the environment.

There are different segments which influence sustainability, and different systems for measuring their impact. Understanding what measurement is most effective for which area of your operation is an important step to accurately and fully measuring the extent of your carbon footprint. These can include, among others, the GHG Protocol, the National Greenhouse Energy Reporting (NGER) Act, the Climate Registry Information System (CRIS), EPA’s SmartWay Transport Partnership and any custom systems. Creating a plan will help to identify your carbon emissions inventory with the various registries, and integrate them into one manageable and measurable program.

The ultimate goal is putting in place effective measurement tools that provide an accurate accounting of sources of carbon emissions, and how these affect your footprint. It’s imperative to creating meaningful, realistic and, most importantly, credible sustainability and carbon management programs. A number of organizations, including Menlo Worldwide, are developing the capabilities and methodologies to help companies manage this emerging challenge.

It’s not an issue of if carbon management and reporting will become a requirement, it’s when. There’s never been a better time to take action and position your company for success. The risks of waiting for an industry standard and not starting out on your own path are simply too high.

Source: www.streetsblog.net

Even casual observers of transportation policy have noticed DOT’s emphasis on livability and, by extension, their fascination with “active transportation’ (aka biking and walking).  Livability is a worthy goal for all communities and, though it is still a somewhat ill-defined policy concept, biking and bike paths are certainly key components.

In an effort to make Washington, DC more livable, the Mayor and Federal policymakers decided to put a bike path down the center of Pennsylvania Avenue from the White House to the Capitol with no connections at either end.  For those who do not frequent that area, this is not a typical bike path.  Instead of narrow lanes down the curb side of the roadway, this bike “path” is a full three auto lanes wide going right down the middle of Pennsylvania Avenue.  Yes, approximately one-third of the capacity of an already busy street in our nation’s capital was taken to serve a handful of cyclists.  The result has been increased congestion, increased emissions, long rush hour delays, and the ire of many DC visitors, cabbies, workers, and residents. This is not a very livable result for any but the cyclists and, in apparent reaction to public pressure, DC has just announced that autos will now be able to use the left lanes again.  Good for them, and an important lesson for other transportation policy makers.

Now, lest you believe I am anti-bike, I want to assure you this is not the case.  Two of my three grown children bicycle regularly in Old Town Alexandria, a nearby Washington suburb.  One does not own a car and cycles to work every day.  If for no other reason than their safety, I support adequate accommodations for cyclists.  That having been said, if cyclists are to be taken as serious members of the transportation community, perhaps it is time that reasonable requirements be placed upon them to insure they can safely interact with other road users and provide the necessary funding to support their projects.

Items that DOT and other transportation policy makers might consider are:

• Training, testing, licensing, and minimum age requirements for cyclists.
• Required insurance coverage to protect cyclists, pedestrians, and other road users.
• Minimum equipment standards and safety inspections.
• Mandatory helmet laws.
• Bike path user fees.
• Bicycle and tire excise taxes to fund bike path construction and maintenance
• Enforcement of all traffic laws for cyclists.

For policy makers who support increased use of cycling, failure to consider and provide proper regulatory oversight of new policies – and appropriate funding mechanisms to pay for it all -- is irresponsible and unfair to other road users.

The real issue is not bike paths.  It is how do policymakers determine the best use of limited transportation dollars to improve our transportation system while increasing mobility for all Americans?   There are many worthy projects, in all modes, that are well worth considering.  A bike path to nowhere is not one of them.

Source: www.rutgers.edu

At a time when it is increasingly acknowledged that the federal government is on an unsustainable fiscal course, you would think the first thing a cabinet agency’s new strategic plan would do is attempt to figure out which of its historical functions are truly federal and should be continued. But that sort of prioritization is entirely absent from the U.S. DOT’s draft Strategic Plan, posted online for comment at https://dotstrategicplan.ideascale.com .

Instead we are given a vast array of poorly justified expansions of the federal role into every nook and cranny of how Americans and their goods should travel—as well as how and where we should live.

One prevailing theme is frustration that current law does not permit the DOT to exercise as much micromanagement as its leaders think they should be doing. For example, the plan laments the lack of federal authority to regulate the safety of mass transit, as well as the lack of federal control over which specific highway and bridge projects states spend their federal highway monies on (as opposed to the numerous programs into which the feds already divide up these funds). It even laments that “DOT’s Federal-aid roadway design standards are not enforceable on local streets,” so that unless the law is changed, the DOT can only “encourage” more states to adopt the “complete streets” model in which every street in America must be equipped with sidewalks and bike paths.

Another recurrent theme is performance measures—but they are selectively and inconsistently applied. For example, something as basic as a minimum benefit/cost ratio threshold (perhaps 1.5) would weed out numerous low-priority projects that sound nice but aren’t worth the money. The only instance in which such a standard is discussed is with regard to possible airport expansion. It is not mentioned with respect to with DOT’s newly favored sectors: transit, streetcars, high-speed rail, the “marine highway,” etc.

The phrase “data-driven” appears several times, but only in limited contexts such as multimodal safety problems—not to evaluate favored modes or favored themes. The notion of a level playing field among transportation modes is mentioned several times—but the only aspects where analysis is suggested are on fuel-use, safety, and environmental benefits. What about a level-playing field comparison of goods-movement modes on cost, delivery time, and reliability?

A major focus of the previous Administration’s DOT, under both Democrat Norm Mineta and Republican Mary Peters, was congestion reduction. This applied to both surface and air transportation, and included active promotion of market pricing in both areas (with no success in aviation, alas). Unfortunately, while the draft strategic plan gives lip service to reducing congestion, its approach to doing this in urban areas is to expand transit, promote ride-sharing and flextime, and support the demand-management form of road pricing. (Tellingly, that reference to pricing is buried in the “State of Good Repair” chapter, which is mainly about asset management.)

And that provides a clue to one of the major omissions from the Plan: capacity expansion. While it expresses limited support for expanding airport capacity, in highways its only concession is the possibility of “targeted investments” in “our national freight highway corridors to address bottlenecks.”

But as far as motorists are concerned, there is not a word about adding capacity to cope with projected growth and reduce congestion. In fact, the plan even suggests that more cities do as San Francisco did after its last earthquake and tear down urban freeways that may no longer be needed. And in its redefinition of “functionally obsolete” bridges, it refers to not having “adequate lane widths, shoulder widths, or vertical clearances,” but makes no mention of not having enough lanes. It also uncritically accepts the “We can’t build our way out of congestion” mantra, despite extensive evidence to the contrary (especially with priced capacity).

Entire chapters are devoted to the Secretary’s two favorite topics: Livability and Environmental Sustainability. Both are notable for broad assertions presented without acknowledging considerable data and analysis calling them into question. For example: “A comprehensive strategy that promotes livability and reduced the demand for auto travel will significantly lower the long-run cost of transportation (and other infrastructure) for both household budgets and taxpayers.” (p. 30) That’s an astounding claim, accompanied by zero evidence. Transit and smart-growth advocacy groups typically argue that substituting transit for driving saves an individual money—but they ignore the large taxpayer cost of the highly subsidized transit alternative.

Another example is a tricky little game played with transportation data. The National Household Travel Survey (NHTS) did indeed find that 11.6% of all individual trips are made by walking or bicycling. Page 51 contrasts that figure with the less than 2% of annual Federal Aid Highway funds spent on walking and biking. First, this ignores the other NHTS finding that in terms of person-miles traveled, biking and walking together come to just 0.9% of the total (but still get 2% of the funding). Second, federal highway funds are supposed to fund important federal highways , like the Interstates. There is also the factoid that 40% of all metro-area trips are two miles or less in length and therefore “could be taken on foot or bicycle”—if you ignore how people value their time, the vagaries of weather, the stuff they have to carry, etc.

Yet another assertion, presented with no attempt at substantiation, is that “Creating livable communities is just as important to residents of rural areas as it is to residents of urban and suburban areas.”

Finally, in the chapter on sustainability, this allegedly data-driven, performance-based plan simply asserts that “to reduce carbon emissions, improve energy efficiency, and reduce dependence on oil,” the nation must begin “development of a national network of high-speed rail corridors.” A similarly vague justification is given for DOT to “strategically expand the marine highway system.” These mode choices are never presented as having emerged from a data-driven, mode-neutral benefit/cost analysis; they are simply assumed to be wise choices on which to expand billions of federal tax dollars. In particular, nowhere in the entire document is there any mention of using a cost/ton standard (such as no more than $50/ton) to sort out cost-effective greenhouse gas reduction measures from highly wasteful ones.

This draft plan is presumably a preview of what the Administration will set forth in its proposal for reauthorizing the federal surface transportation program. That amply demonstrates the need for a fundamentally different alternative to emerge from Congress.

Bob Poole is a Searle Freedom Trust Transportation Fellow and Director of Transportation Policy for the Reason Foundation, the free market think tank. A recognized transportation policy expert, Mr. Poole has advised the previous four Presidential administrations on transportation and policy issues. This column first appeared in the May 2010 issue of the Reason Foundation’s Surface Transportation Innovations e-newsletter.

Source: www.transportation1.org

Truth #1: Truckers and railroaders do not get along.  I sometimes like to pose provocative questions to groups of truckers or railroaders (but not both together) to watch the impassioned discussion that ensues.

Truth #2: Demand for transportation was rising steadily before the recent recession.  Although much of the increase is attributed to rising GDP, growth in VMT must also be attributed to shifts in transportation use.  Increasingly, GDP is made up of services that require fewer VMTs.  Freight (and car) VMTs per capita have steadily increased indicating greater consumption of freight services.

Truth #3: The funds (user fees) collected by all forms of government in the U.S. are not enough to fund road infrastructure.  The recent TRB Special Report 285 and the report by the National Surface Transportation Infrastructure Financing Commission highlight the loss of purchasing power of the all user taxes for road construction and maintenance.

Truth #4: The root cause of our road funding problems is not abuse of the Highway Trust Fund.  Even evil “Mass Transit” may provide capacity by removing cars from highways at a cost cheaper than construction of new lanes.  How many lanes of highway would have to be constructed to replace the Washington Metro?  What would the city look like without it?

Truth #5: Some trucks do not pay the full cost for their highway use.  The book “Road Work” by Small, Winston, and Evans (1989) pointed out that very heavy trucks do not pay the true marginal cost of their highway use.  The primary culprit according to the authors is a user-charge based on fuel use rather than axle weight and miles traveled.  Transportation Research Board Special Report 246 showed much the same thing by comparing several modes of transportation.

Truth #6: Lower cost is not equal to higher efficiency.  For economists, efficiency means getting higher value outputs from a given value of inputs.  While the lower total costs associated with heavier, six-axle trucks are difficult to argue with (with the possible exception of bridge costs), lowering the price of an already underpriced good could be a bad thing for all concerned.  Economists know that price controls, cause shortages because suppliers will refuse to supply at the lower price.  We are facing just such a situation with road infrastructure today.  States are refusing to provide (or maintain) road infrastructure because the revenue received for its use is less the cost to provide it.  In such a situation, lowering the cost still further by permitting slightly more efficient trucks could have the undesired (by some) effect of stimulating increased road use, therefore exacerbating problems with infrastructure financing.

In my opinion, loosening Federal weight restrictions will not occur until usage-based road financing is changed to some scheme that is both accurate and fair.  Such a scheme should be based on the cost of road use.  While many truckers have asked for increased fuel taxes to cover the cost of maintaining roads, few have advocated an approach like Oregon’s experimental VMT tax or Germany’s VMT tax.  Should my colleague’s Mercedes Benz diesel pay the same fuel tax as an eighteen wheeler?  Should a straight truck pay the same tax as a rocky mountain double?

Yes, railroads protest too much, but permitting heavier trucks is no panacea for the highway system either.  Economic sustainability comes from having prices reflect true costs, not from cheaper prices.  Any change that accomplished the later without the former will only make the situation worse.

It is now time for me to step out of the room.

Pete Swan is assistant professor of Logistics and Operations Management at the Penn State Harrisburg School of Business Administration. He is a regular contributor of research, commentaries and papers on freight transportation industry issues and has been a member of the Transportation Research Board (TRB) since 2002. He is currently chair of the TRB’s Freight Systems Group in addition to his academic responsibilities for Penn State.

Source: www.wikipedia.org

For the past 18 years, the University of Tennessee, Knoxville has conducted its “Annual Trends in Logistics and Transportation” study.  This year, the unprecedented challenges brought on by the global recession were at the forefront of survey participants’ minds. Economic hardship produced intense pressure to reduce costs across supply chains. Unpredictable demand for goods and services, increased customer demands, and volatile commodity and fuel prices combined to make 2009 one of the most difficult operating years ever for businesses.

Over the many years that we have been conducting the Annual Trends study there have been several economic down cycles, although none compared to the intensity of 2009. While companies always seek to become more efficient, challenging economic times drive companies to become even more relentless in their quest to reduce costs. What we discovered from our analysis is that these cost-cutting initiatives can impact firms both positively and negatively for several years after the economy recovers. What lessons have we learned that can be applied to the current situation?

• Cost-cutting must be done using a “strategic filter”
• Investments in improving supply chain capabilities should not be delayed
• Even in bad times, customer service cannot be sacrificed

The reflection on the past led us to the theme of the 2009 study — sustainable supply chain management practice. The changes we are dealing with today are not for a season. Some argue that continual economic and social change is the “new normal.” Instead of constantly re-orienting to the changing conditions, perhaps a wiser approach would be to create a supply chain practice that adapts to conditions. While the term “sustainable” has been used lately in the context of environmental and green issues, it also succinctly conveys the need to build and develop approaches and techniques for managing and operating the supply chain that will make the firm more responsive to a host of circumstances such as those cited above.

We have identified five drivers that constitute the core of sustainable practice in supply chain management. These drivers are optimization, synchronization, profitability, adaptability and velocity. They comprise the engine that will fuel growth and success. They represent capabilities that will be difficult for the competition to emulate, and they are fundamental to creating a supply chain that will outpace the competition.

Why are these drivers so critical to successful supply chains? Perhaps it is the unique set of capabilities, both individually and collectively, that they represent. The following provides a short descriptor for each driver:

Optimization is the alignment of global supply chain resources — both tangible and intangible, owned or outsourced — to facilitate the success of supply chain members.

Synchronization is the ability to coordinate, organize and manage end-to-end supply chain flows — products, services, information and financials — in such a way that the supply chain functions as a single entity.

Profitability is the result of creating value through supply chain activities. Asset performance, working capital and returns on investment for infrastructure, technology and people are some of the critical parts that create value in a global environment.

Adaptability is the degree to which respective supply chain members can change practices, processes and/or structures of systems and networks in response to unexpected events, their effects or impacts.

Velocity is the speed at which end-to-end flows occur in the supply chain. It encompasses speed-to-market for new product introduction and execution when conditions are rapidly changing.

As companies work to recover from the economic perfect storm of 2009, revisiting and reexamining their supply chain process against these five drivers of sustainable practice should be a priority. It is an exercise that will help determine if your supply chain can adapt and be successful in today’s “new normal” of continual economic and social change.

Dr. Mary Holcomb is associate professor of logistics at The University of Tennessee. The findings of her 2009 Annual Survey and more information on the five drivers of sustainable supply chain performance can be found at www.transportation-trends.com.

Source: www.ens-newswire.com

According to a national transportation research group, poor road conditions cost Michigan motorists over $2 billion annually. These costs harm Michigan families and damage the competitiveness of Michigan businesses. Instead of directing funds to this important need, federal policies are diverting taxpayer dollars to wasteful purposes and Michigan citizens and businesses are paying more in gas taxes than is returning to our state.

Taxpayer dollars are not being used wisely. Past Transportation Appropriations bills have included numerous wasteful projects, such as the infamous Bridge to Nowhere. The $787 billion (now $862 billion) stimulus package was supposed to include significant infrastructure spending, but money was wasted on searching for fossils in Argentina , puppet shows, and creating a $5 million energy system for a privately-owned mall that is mostly empty. Our roads are crumbling, yet Congress is wasting our money.

Michigan is not receiving its fair share of gas tax transportation dollars. Since 1957, Michigan has only received 84 cents back for every dollar in gas tax revenue collected. This has improved over the years, but Michigan still only receives back 94 cents on the dollar.

The common sense path is for taxpayer dollars to be spent wisely on priorities such as road and highway repair and construction. Additionally, I support federal legislation that would turn back all gas tax revenue collected in each state to that state. Not only will this ensure that Michigan is no longer a donor state, but transportation funds will no longer be diverted into wasteful federal earmarks.

Tim Walberg has worked in higher education, was previously elected to the Michigan House of Representatives, and served in the U.S. Congress from 2007-2008.  He is running as a Republican candidate for the U.S. House of Representatives in Michigan's 7th District.

Source: northcom.mil

More than eight years later, the events of 9/11 continue to have a game-changing effect on supply chain design and how global commerce functions. New concerns and opportunities, such as sustainability and the increasing availability of real time data, may also affect the way supply chains are designed.  It has become an increasingly complex activity, presenting significant challenges yet compelling opportunities.

There are two principal reasons why supply chains have become more complex, and a third reason for why this complexity will likely increase in the near future.  All of these have implications for the transportation and logistics industry, including accelerated outsourcing to companies with supply chain analysis, re-engineering and management expertise.

Reason 1. Supply chain design must account for variable operating models, assumptions and business characteristics that are far more diverse and complex than before.  Globalization, the multi-modal movement of freight, regulatory and cost structures, sourcing and financing practices, international border crossings, congestion at ports (sea and air) and on roads are only a few of the factors today’s supply chains must accommodate.  This model complexity invariably results in significant algorithmic and computational challenges associated with software systems that provide visibility and actionable information upon which supply chain operational decisions are made.

Reason 2. Supply chains are inextricably linked now more than ever to the overall performance of businesses. And while supply chains must first and foremost contribute to the overall competitiveness of the enterprise, increasingly their designs have to consider more than just efficiency. In this regard, lean practices and methodologies – pioneered in the automotive manufacturing sector – are finding wider adoption in logistics. Lean practices are driving significant improvements by removing waste and shop-floor inefficiencies that, once corrected, ripple back upstream to drive more consistency, productivity and cost savings. Lean supply chains thrive when there is little variability.  However, the very nature of globally distributed global supply chains breeds variability. Disruptions are anathema to a truly lean supply chain.  Witness the rapid collapse of the Toyota production system in the late 1990s when a major fire occurred at a key brake component supplier.

The events of September 11, 2001 brought significant attention to several questions and motivated the need to think beyond lean and be able to deal with major supply chain disruptions.  Before 9/11, supply chain security meant preventing things from being removed from the logistics cycle by unauthorized parties.  In the post 9/11 world, concern has also focused on preventing disruptive elements from being inserted into supply chain operations to create violent havoc.  Today we ask:  How do we reduce the impact of new security initiatives on supply chain and freight transportation network productivity and how can we design competitively productive supply chains that exhibit “resiliency” (i.e., degrade gracefully and recover quickly) when a major disruption occurs?  In addition, there are growing concerns about the environmental impact of supply chains and how these concerns will affect supply chain efficiency and hence the company’s competitive performance.

Reason 3. A third future contributor to the increase of complexity in supply chain design and analysis is the growing availability of real time data (e.g., inventory levels, production rates, vehicle status, weather, congestion) that can support real time supply chain control.  The availability of these data is enabled by the growing presence of sensor, communications and computer technology throughout the supply chain.  Explicit consideration of uncertainty inherent in the data represents an opportunity to reach the next level of (expected) supply chain competitive performance. This will be achieved by harnessing the value of information contained in the data, invariably at the expense of more complex supply chain models and computationally demanding algorithms.

All these challenges point to the need for new thought, approaches, skills and practices for supply chain design and management. These are areas where advanced 4PLs and lead logistics providers are demonstrating emerging competency.  The growing complexity of supply chain design can be expected to further accelerate outsourcing and the development of a high growth third and fourth party logistics industry.

Ultimately this emerging skill set will enable global businesses to overcome the increasingly complex challenges of our post 9/11 supply chain world and usher in a new level of advanced supply chain design and management.

Chelsea C. White holds the Schneider National Chair of Transportation and Logistics at the Georgia Institute of Technology, where he is the Director of the Trucking Industry Program and the former Executive Director of The Logistics Institute.

Source: www.boston.com

With major league spring training just around the corner, many armchair fantasy baseball fanatics are evaluating their favorite players and starting to draft their rosters. But rather than fantasize about who will have the lowest ERA, hit the most homeruns or have the best on-base percentage, let’s think about a different game: America’s economic recovery in 2010 and beyond. The lineup card for this game plan focuses on creating scoring opportunities early and often with job creation, housing, energy, infrastructure, anti-terrorism, education and health care.

All great baseball teams have excellent scouts and extensive scouting reports that identify the key issues required to defeat the opposition. America is blessed with several visionary “scouts,” among them: Rep. James Oberstar (D-MN), Department of Transportation Inspector General Calvin Scovel III and columnist Thomas Friedman. We also have the advantage of information-packed “scouting reports” from organizations like the American Association of State Highway and Transportation Officials, Ernst & Young and the Urban Land Institute. Collectively, these focus on the need to rebuild America’s transportation infrastructure, emphasizing the scope of the project ($750 billion over 5 years) and, most importantly, the millions of direct and indirect jobs that would be created.

Swift and proper execution of this strategy to invest massively in America’s transportation infrastructure in the “early innings” will lay the foundation for a winning game strategy. Job creation, the key that unlocks the plan, will lift incomes which in turn will be used to lift consumption, pay existing mortgages and purchase new homes. This will reduce and eventually eliminate banks’ bad loans and allow them to repair their balance sheets and begin lending to small businesses which will create more jobs.

However, the infrastructure rebuilding must be funded without adding more national debt. And here, in the “middle innings,” we get the key homerun that puts America on the path to certain victory: a 75 cent-per-gallon federal fuel tax increase pegged to the price of oil so when oil goes down the tax goes up and when oil goes up the tax goes down.

This is the turning point in the “game” because it will be used to establish a consistent fixed price for fuel. This will give investors in alternative energy as well as motor vehicles a more stable benchmark for fuel, insulated from OPEC pricing gyrations, against which they can project their profitability which will stimulate investment in nuclear, wind and solar energy and promote competition for fuel efficient motor vehicles. All this activity will create additional jobs.

As investment in improved transportation infrastructure, diversified energy resources and fuel efficient vehicles begins to pay dividends, demand for oil will peak and then decline producing two desirable outcomes: the price of oil will drop which will reduce significantly funds for terrorist activities and the need for cap and trade taxes will be pointless.

This “game plan”, to invest in infrastructure, to create jobs, funded by a fuel tax that will attract investment in alternative energy, will stimulate the economy and rebuild America’s balance sheet so that in the “late innings” the increased tax revenues generated by the stimulated activity will be the “closer” to fixing education and health care.

To transform this “game plan” from fantasy to reality, we need to rise from our comfortable armchairs and demand that our Congressmen lead our country boldly and courageously by putting our country’s needs, not partisan politics, first. With that type of leadership, America will be the “World Series” champion in the 21^st century.

John A. Simourian is Chairman of Needham, Mass.-based Lily Transportation Corp., which opened for business in 1958 and today provides dedicated contract carriage systems and services for customers throughout the United States. John also is a lifelong Red Sox fan and fervently believes that the 2010 season will bring another American League pennant and World Series Championship to the Red Sox Nation.