- Fragmented or “patchwork” systems environment.
- Lack of technology standardization due to changing customer requirements.
- Providing a balance between global standardization and regional differentiation so that customers get the visibility they need and the local touch they desire.
- Reduce the total cost of ownership through lowered costs and service-enabled functionality.
- Increase standardization and integration simplification.
- Create stable solutions with broad enterprise functionality.
- Ensure flexible and scalable infrastructures.
- Enforce an alignment between business and IT.
While 3PLs have created thousands of customized applications to serve customer needs, a core set of software functions remains for 3PLs. Provider software and IT capabilities are directly correlated to the business processes being outsourced. This unique position of providing custom IT services demands the ability to successfully develop these advanced capabilities and they must create consistent, standardized solutions for those services. A checklist of questions for these providers may include:
- What will you be using the 3PL to do?
- Will you need extensive functionality?
- If you have a specific need, determine if the functionality already exists or will it be specifically developed for you?
- Do you already have the required capabilities within your own systems?
- Are you thinking about taking the function back in house in the future? If you are only going to use the 3PL for a defined period of time, it might make sense to “bring your own” technology to the table when engaging the 3PL.
Check on the size and particular expertise of the 3PL technology team to see if they can grow and adapt with you. Norek concludes: “The growing use of outsourcing and use of third party logistics providers has shed some light on the need for easy technology integration between the 3PLs and their customers. This issue of integration begs the question of whether the 3PL customers should “bring their own” technology to use in the 3PL relationship, or rely on the 3PL for the needed technology.”
By K.B. Elliott
K. B. Elliott is a freelance writer for LogisticsJobSite.com. Working various logistical positions in the Detroit area for over 30 years gives him a unique perspective on the process. More of his blogs are at LogisticsJobSiteblog.com, and be sure to check out the postings for jobs in nearly any industry at Nexxt.
Ready to find that next position as an experienced Logistics Professional? Find your dream job at: LogisticsJobSite.com