Are Layoffs and Logistics Turnover Putting Your Supply Chain At Risk?

If you’re worried about the potential impact of disruptions to your logistics operations due to logistics turnover, here are some steps you can take to ensure your logistics provider is prepared to serve your needs now and into the future.

• Communication: Open and honest communication should be the bedrock of your relationship with your 3PL or 4PL. (We think this is so critical, we built our entire company and culture around the importance of truth and transparency). Ask your logistics partner about their succession plans should key members of your account team leave their organization. Don’t wait until key people depart—start planning for disruption now.
• Executive Involvement: Are key executive leaders at your 3PL or 4PL involved and engaged with your supply chain challenges? Hands-on management by members of the executive team ensures that they understand the nuanced complexities of your needs and is a good indicator that your logistics partner values you and your business. This involvement and attention increases the odds that supply chain disruption due to layoffs or turnover will be minimized.
• Employee Tenure: Layoffs aren’t the only driver of employee turnover. Since the pandemic, “The Great Resignation” phenomenon has driven historically high turnover rates for organizations across multiple sectors of the economy, and logistics and supply chain has not been immune to this trend. When evaluating your logistics partners, ask about employee retention rates and average tenure. Businesses that put an emphasis on retention can offer greater stability in the face of industry volatility.
• Employee Training: Employee training is another key factor driving retention and ultimately, the quality and stability of the service you receive from your logistics partner. Ask your partner if and how they cross-train employees. Doing so can add critical bench strength to ensure seamless service in the face of disruption due to everything from illness to weather events and employee turnover.
• Systems and Processes: Beyond having the right people and executive support, does your logistics provider leverage the right systems and processes to ensure seamless service? In other words, if your account lead were hit by a proverbial bus, would key information about your logistics operations vanish with them? Is your 3PL’s knowledge of your business primarily “tribal” or is it codified in SOPs and business rules that have been established within your TMS? Are there established processes that take the guesswork and potential for costly missteps out of the equation? Look for a partner that leverages technology and processes that drive scalable, repeatable success even in the face of staffing disruptions.