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While Module One reviewed the supply chain function, Module Two involves freight. As long as there is industry and commerce, there will be a need
While Module One reviewed the supply chain function, Module Two involves freight. As long as there is industry and commerce, there will be a need to move goods from one point to another. While freight movement has become drastically more efficient in recent times, it has also become a central part of the discussion for creating sustainable operationsespecially regarding its potential impact on a company's triple bottom line. Financial, environmental, and social impact is driven by a company's mode selection and the manner in which it executes its freight strategy. Freight movement at its most basic has remained unchanged for many years. Goods are moved by air, rail, road, sea, or pipeline. Air and rail are relatively new developments, while civilization has been moving goods by road, sea, and pipeline for centuries. Each mode presents clear benefits and costs. Air is the fastest mode of travel and also the most expensive. Ocean transport is arguably the slowest mode of travel but offers extreme efficiency by carrying great amounts of cargo inexpensively. Pipelines are the cheapest mode of travel, yet not many goods can utilize the mode and it is the most restricted in terms of delivery flexibility. Finally, road, and rail are middle-of-the-road when it comes to cost, speed, and flexibility. In some cases, mode selection is a foregone conclusion. Sea is the primary bridge across oceans, while air transport is necessary for some time-sensitive goods. So which mode is best? The question is not which mode is best, but rather what combination of modes will provide the best financial, environmental, and social balance for a company. While air is agreed to be the fastest mode of travel, its carrying capacity is limited and there is a catch. Air loses some of its advantage over road when the journey is less than 300 miles. Cargo preparation, delivery, loading, and processing actually make air slower than road transportation, especially because most air deliveries require a modal switch to road anyway. Each mode has its advantages, which must be weighed and balanced by a company to achieve its desired end state. In addition to examining the financial impact of freight, a company must also weigh the environmental and social impact. Freight movement confronts the consumer each day through pollution, congestion, noise, and accidents. Pollution is an ongoing by-product of every transportation mode and has to be addressed in a company's triple bottom line 2 QSO 328 Module Two strategy. The faster and more flexible a mode is, the more pollution it produces. Air is clearly the highest polluter in terms of pollutants per pound of cargo and distance travelled, while rail and sea are much greener options (Grant, Trautrims, & Wong, 2013, p. 59). However, being green brings a strong limitation to both speed and flexibility. This is a difficult issue, and the decision must also consider the regulations, consumer demand, and competitive forces that impact a company's financial strength. Congestion, noise, and accidents have all also increased with the growth of the global economy. Ports, railways, and highways have all seen an exponential growth in demand for freight movement. This leads to a host of other problems that affect sustainable operations. Ships, trains, and trucks that are overwhelming their respective nodes are also idling away resources, generating pollution and noise, and increasing the chances of accidents across national infrastructures. Clearly, these attributes will affect each element of a company's triple bottom line. Green freight is a growing field that can improve sustainable operations without adversely impacting the financial bottom line. Alternative fuels and energy sources, such as biofuel and electric power, are becoming more accessible as infrastructure and technology improve. While the cost may seem prohibitive, especially in the latter, there are a number of benefits. Many governments offer incentives to switch to electric power, and the general public will look favorably on a company that is making the extra effort toward green operations. Another subtle way to reduce the environmental impact of freight is through proper planning and data management. There are considerable opportunities to improve sustainability by limiting empty back-haul portions of movement, ensuring that the selected mode is fully utilized, and by routing freight traffic in an economical manner to limit congestion. These initiatives require a company to invest in proper data management solutions, information technology support, and the methodologies to make it happen. While these initiatives may not be as obvious to the general public, they can result in tremendous savings across the triple bottom line. While examining opportunities for greener freight operations, companies must consider the multitude of ways to decrease the environmental and social impact of freight. Balancing these opportunities with the financial requirement to remain solvent is the true challenge. Inevitably, freight has to move, but that movement can be made more efficient, greener, and financially sound through the myriad solutions that are being developed in today's economy. In Module Three, sustainable warehousing will be examined. Reference Grant, D. B., Trautrims, A., & Wong, C. W. (2013). Sustainable logistics and supply chain management: Principles and practices for sustainable operations and management. Philadelphia, PA: Kogan Page consider what balance can be struck between growing demand for goods and the demand to perform as a sustainable operation. discuss the impact that freight movement has on the environmental and financial sustainability of a supply chain. Considering how congestion can affect the effectiveness of a company's supply chain, what options would you recommend to improve freight sustainability and why
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