Descartes’ Study Reveals 54% of Supply Chain and Logistics Operations are Prioritizing Automation to Mitigate Workforce Shortages
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Insights
The findings from Descartes' study on the prioritization of automation within the supply chain and logistics operations have implications for both sector efficiency and the labor market. The drive towards automation, particularly in non-value-added tasks, reflects a broader industrial trend aimed at improving productivity. The adoption of delivery route optimization and real-time shipment tracking technologies speaks to an increasing reliance on data-driven decision-making to enhance operational efficiency. These technologies not only mitigate workforce shortages but also possess the potential to transform the competitive landscape by differentiating companies based on their logistical capabilities.
Investors should observe that the transition towards a technology-centric workflow could lead to capital-intensive periods followed by long-term cost savings, reflecting a shift in operational expenditure. Companies that can effectively integrate and leverage these technologies may gain a strategic advantage, thereby influencing their market position and potentially their stock valuation.
The strategic adjustments in recruitment and retention, as noted in the Descartes study, are indicative of a larger labor market shift. Financial performance and growth trajectories of companies may tighten in correlation with their ability to adapt to these workforce challenges. As companies invest in flexibility and technology to attract labor, the financial outlay must be scrutinized against the backdrop of employee turnover rates and productivity metrics.
These strategies, while potentially beneficial in the short term, carry an inherent risk. Increased wages and educational compensations could pressure profit margins. The study's implicit suggestion that labor shortages are being met with both technological and compensation-based solutions may herald a period of increasing operational costs, which could affect short-term profitability but are intended to stabilize operations in the long term.
The diversification of recruitment and retention strategies reported in the study underscores a significant adjustment in human resources tactics. The balance between offering flexible work arrangements and investment in up-to-date technologies demonstrates a dual approach to human capital management. While flexibility and technology adoption are potent tools for attraction, their effectiveness in retention is equally crucial, as ongoing training and competitive compensation are necessary to reduce attrition.
From a strategic human resources perspective, companies that can create an attractive employee value proposition may ultimately foster a more stable and committed workforce. However, these initiatives must be carefully managed to ensure they do not erode overall business performance or shareholder value. The implications for stakeholders include the need for regular assessment of the cost-benefit impact of these human resource investments.
Delivery Route Optimization & Real-time Shipment Tracking are Top Technology Choices to Improve Productivity
ATLANTA and LONDON, April 15, 2024 (GLOBE NEWSWIRE) -- Descartes Systems Group (Nasdaq:DSGX) (TSX:DSG), the global leader in uniting logistics-intensive businesses in commerce, released findings from its study What Are Companies Doing to Survive the Supply Chain and Logistics Workforce Challenge? The study shows that
In addition to making technology investments to help combat supply chain and logistics workforce shortages, the study indicates companies are also adapting their recruitment and retention strategies and tactics. According to the study, hiring laborers (e.g., warehouse workers and drivers) and knowledge workers (e.g., planners, managers, analysts) were the top areas cited (
“The workforce problem is pervasive, and the study confirms that most supply chain and logistics organizations have made changes to their operational, technology, recruitment and retention strategies to help combat the issue,” said Chris Jones, EVP, Industry at Descartes. “Based on the results of the study, we believe that employers should continue to invest and evolve to get the most they can from their existing resources and focus on more than money to hire and retain a capable workforce.”
The study’s results also showed that the strategies, tactics and technologies used by companies to address labor constraints vary by financial performance, growth, management’s perceived importance of supply chain and logistics operations, and by how successful employee retention programs are.
Descartes and SAPIO Research surveyed 1,000 supply chain and logistics decision-makers in late 2023 across three sectors: a) manufacturing, distribution and retail; b) carriers; and c) logistics services providers. The goal was to understand what supply chain and logistics organizations are doing to improve worker productivity, attract and retain employees and find alternate labor sources to mitigate workforce challenges today and in the future. Respondents were based across nine European countries, Canada and the United States, and held Owner, C-Suite, Director and Manager-level positions in their respective organizations. For the full report, read What Are Companies Doing to Survive the Supply Chain and Logistics Workforce Challenge?
For more information on how acute workforce shortages are in supply chain and logistics operations and the impact of resource constraints on companies’ operations and business success, read Descartes’ report How Bad Is the Supply Chain and Logistics Workforce Challenge?
About Descartes
Descartes (Nasdaq:DSGX) (TSX:DSG) is the global leader in providing on-demand, software-as-a-service solutions focused on improving the productivity, security and sustainability of logistics-intensive businesses. Customers use our modular, software-as-a-service solutions to route, track and help improve the safety, performance and compliance of delivery resources; plan, allocate and execute shipments; rate, audit and pay transportation invoices; access global trade data; file customs and security documents for imports and exports; and complete numerous other logistics processes by participating in the world’s largest, collaborative multimodal logistics community. Our headquarters are in Waterloo, Ontario, Canada and we have offices and partners around the world. Learn more at www.descartes.com, and connect with us on LinkedIn and Twitter.
Global Media Contact
Cara Strohack
Tel: +1(800) 419-8495 ext. 202025
cstrohack@descartes.com
Cautionary Statement Regarding Forward-Looking Statements
This release contains forward-looking information within the meaning of applicable securities laws (“forward-looking statements”) that relate to Descartes’ supply chain and logistics solution offerings and potential benefits derived therefrom; and other matters. Such forward-looking statements involve known and unknown risks, uncertainties, assumptions and other factors that may cause the actual results, performance or achievements to differ materially from the anticipated results, performance or achievements or developments expressed or implied by such forward-looking statements. Such factors include, but are not limited to, the factors and assumptions discussed in the section entitled, “Certain Factors That May Affect Future Results” in documents filed with the Securities and Exchange Commission, the Ontario Securities Commission and other securities commissions across Canada including Descartes’ most recently filed management’s discussion and analysis. If any such risks actually occur, they could materially adversely affect our business, financial condition or results of operations. In that case, the trading price of our common shares could decline, perhaps materially. Readers are cautioned not to place undue reliance upon any such forward-looking statements, which speak only as of the date made. Forward-looking statements are provided for the purposes of providing information about management’s current expectations and plans relating to the future. Readers are cautioned that such information may not be appropriate for other purposes. We do not undertake or accept any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements to reflect any change in our expectations or any change in events, conditions or circumstances on which any such statement is based, except as required by law.
FAQ
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