An irresistible Commercial Carrier Journal headline caught our eye as a sign of the times: “Will 2023 Bring On The Best Recession Ever?”
Clickbait? For sure. But there’s a grain of truth inside that sensationalism. When the economy is buzzing, supply chain vendors and shippers make good money, somewhat regardless of how efficient their operations are. Who’s to blame them? Why risk messing things up to get an extra few percentage points of margin? The risk just doesn’t match the potential payoff.
Shippers get a little more desperate for excellence, however, when inflation and slower demand squeeze those margins towards zero. Analytics firm Manhattan Associates explains supply chains’ appetite for change with “Gleicher’s Formula,” a super geeky, but useful, equation developed by Arthur D. Little and David Gleicher in the 1960.
The formula is: D x V x F > R = ∆. Simple, right?
In the equation:
- D is how dissatisfied you are with the status quo.
- V is the vision of what can be done to improve it
- F is the plan needed to turn the vision into reality
- R is resistance to change
- ∆, of course, is change.
So, that long-winded academic-ese tells us that when managers are dissatisfied enough and know what needs to be done to overcome resistance, change happens.
What does that have to do with 2023 manufacturing supply chain life? Manhattan Associates and their partner research firm Indago discovered that as our economy creates more dissatisfaction, the two biggest obstacles to change are lack of resources (specifically, human resources) cited by 64% and inadequate management support (52%).
Their vision includes hiring more, collaborating with other suppliers, and investing in technology.
If only there were a way to achieve enough of those factors higher than resistance and get to the big ∆.
Morgan specializes in “if only.” We take an “all of the above” approach to custom tailoring supply chains for the industry leaders* who are our clients. More than three decades of walking docks, analyzing data and writing code have taught us the that best solutions require the best in people, process and technology.
Whether you’re looking to optimize cost efficiency, increase resilience or gain sustainability, chances are Morgan can help.
Now more than ever, the prospect of economic recession is stoking dissatisfaction with the manufacturing supply chain and transportation status quo. Morgan can help you build the plan to support your organization’s vision for change. Contact us today to start custom tailoring your own initiatives for change.
Perhaps 2023 will be the best recession ever to create positive change in your own enterprise.
- In fact, two of Gartner’s “Supply Chain Top 10” manufacturers rely on Morgan as their strategic partner.