Supply chain practitioners need to step up their efforts to develop connected ecosystems if they want to remove stubborn waste and inefficiencies from their networks, one of J.B. Hunt Transport Services’ top executives said Tuesday.
Keynoting FreightWaves’ F3: Future of Freight Festival in Chattanooga, Tennessee, Spencer Frazier, J.B. Hunt’s executive vice president of sales and marketing, said that many supply chains remain fragmented, siloed and disconnected in terms of product and data flows. This comes despite stakeholders’’ making herculean efforts, and spending billions of dollars, in an effort to change the status quo.
“The disconnects still remain,” Frazier said.
The industry’s standard response to extreme operational variability and volatility has been to throw more money at the problem, Frazier said. However, much of those expenditures just result in higher costs, such as building high inventory levels as delivery buffers, without getting at the root cause.
A poster child for this lack of progress is in the area of commercial truck drivers’ hours of service, Frazier said. A 2015 Hunt white paper found that drivers spent 6.65 hours of their allowed 11-hour daily drive times on the road. A similar study conducted earlier this year found that the percentage of actual driving hours had barely budged from seven years prior.
There are common challenges that drivers face as they seek to balance their work and home lives, Frazier said. These include scheduling flexibility, consistent access to loads and safe, available parking facilities. “We need to treat drivers’ hours as if they are a perishable commodity,” Frazier said, repeating a long-held mantra of Lowell, Arkansas-based J.B. Hunt (NASDAQ: JBHT).
One holistic solution, which Hunt will be publicly elaborating upon in the next few weeks, is to build a connected ecosystem that Frazier described as a “network of networks.” The objective is to build end-to-end connectivity in real time, supported by new scheduling standards and more robust demand forecasting capabilities. The endgame is to shrink operational variability, improve customer service and take out millions of dollars in costs.
Today, J.B. Hunt and other providers offer customer-specific solutions that address and resolve challenges in different parts of the supply chain. These solution sets must be broadened, Frazier said.
“We can connect with each other across every platform,” Frazier said in a high-level teaser for what the company is expected to announce. He did not provide details.
Unfortunately, JB Hunt’s brokerage apparently does not listen to Mr. Frazier as they devalue drivers time more than any other broker in the market based on their spot rates.