Addressing The Challenges Of Modern Logistics And Supply Chain Management

Challenges Facing Moorebank Intermodal Company

In the current era of globalization, one of the key sources of gaining competitive advantages in the market is the effective supply chain and logistics management. This is due to the reason that, due to the initiation of the concept of the globalization, contemporary business organizations are having their operations in different countries around the world. Thus, more effective and cost benefit way will be their logistics; the more will be their global operations (Seuring 2013). This will help them to maintain the seamless supply of their products in different locations around the world.

However, logistics involves various complex elements and factors that are to be considered by the contemporary business organizations. This becomes difficult for them to maintain separate arrangement for their global distribution process. This is the key reason behind the growing popularity of the intermodal companies in the recent times (Assadipour, Ke and Verma 2015). The key responsibilities of these companies are to provide effective intermodal process of transportation to transport the goods from the consignor to consignee. This helps the consignor companies to have fewer responsibilities in transporting their goods along with incurring less cost in the process.

Moorebank intermodal company is one of the leading freight transportation companies in Australia facilitating the development of the intermodal terminal in Sydney. It was being incorporated in 2012 by the government of Australia (Moorebank Intermodal Company 2018). The key objectives of them include providing assistance to the consignor companies to provide effective supply chain and logistics. Moreover, they also helps the consignor companies in achieving cost effectiveness from their supply chain and distribution process by the effective and efficient alignment of different modes of transports. However, Moorebank caters to water, road and rail transportation. However, in the recent times there are various challenges being faced by them in their business operation. Some of the challenges are being emerged due to political instability in the global market, while some are emerging from the lack of proper infrastructure. Thus, it is important for them to effectively identify the issues being emerged in the recent times and implement strategies to overcome them.

This report will discuss about the issues that are being faced by Moorebank intermodal company in their business operation in Australia. In addition, various theories in relation to the supply chain and logistics management will also be critically analyzed to gauge the effectiveness of Moorebank. Different recommended steps will be discussed in this report in accordance to the identified issues.

Theories of Supply Chain and Logistics Management

As discussed in the earlier section, there are various challenges being faced by Moorebank. However, with time, the challenges for them are becoming more varied and diverse and are being originating from different operational areas. The following issues will discuss about the various issues being faced by them in the recent time.

• One of the key issues being faced by them in New South Wales is the less availability of the freight rails in comparison to the passenger rails. According to the reports, the movement of the goods including the agricultural products between the New South Wales and Queensland is facing the issue of lower infrastructure of freight corridors (Ghaderi et al. 2015). Moreover, with the recent expectation of increasing the traffic of passenger rails, it is being feared that this issue will get further amplified. This is due to the reason that, with the increase in the traffic for the passenger trains, the traffic for freight trains will get reduced in the existing rail corridor.
• Another issue being faced by them is with the transportation of the dangerous items such as fuel. This is due to the reason that, according to the reports, more than 11.2 Mt per annum of fuel is being transported in New South Wales as of 2016. However, on the other hand, there are various restrictions initiated by the government in transporting inflammable fuels through the tunnels. Thus, it proves challenge for Moorebank to transport the fuel due to the reason that, there are various tunnels through which the rails and roads are being passed (Mirzabeiki 2013).
• For the intermodal companies such as Moorebank, one of the key competitive advantages is the transportation of the goods in minimal time. However, congestion in the roads of New South Wales is ever increasing, which is hindering the smooth movement of the goods (Nguyen, Currie and Young 2015). It is being reported that, the movement of the goods is efficient inside the port. However, the congestion in the connecting roads is causing issues in the movement of the road carriers. This is leading to the incurring of more time in the process of the transportation.
• In Australia, transport through the rail network is cheaper by 35 percent compared to road transport (Stanton et al. 2013). Thus, the preferences for the rail transport are more. Moreover, intermodal companies such as Moorebank will be more effective when they can align the two modes effectively. However, New South Wales is having limited access to the rail network, which is causing pilling of the goods in the part. It is also reducing the speed of transportation for Moorebank.
• Moorebank is also facing issues in terms of sustainability. This is due to the reason that, in the recent times, degradation of environment is one of the key challenges being faced by the contemporary business organizations (Amiril et al. 2014). Thus, more companies prefer sustainable way of transportation. It is important for Moorebank also to promote more sustainable mode of transportation in order to maintain their existing customer base. However, it is difficult for them to promote sustainable business operation by having the road, water and rail mode of transport. Moreover with the lack of the rail corridor in New South Wales, they are more depended on the road corridor, which further reduce the sustainability.
• Another issue being faced by them is the huge variation in the customer segments. This is due to the reason that, logistic management involves transporting goods from different country of origin with having different regulations (Mezzadra and Neilson 2013). Thus, it becomes difficult for Moorebank to comply with the safety requirements and regulations effectively by managing different consignment from different countries. Moreover with the different requirement of the customers, it is proving challenges for them to cater by having limited resources.

Intermodal freight transport is effectively used in the modern day supply chain management as it use for goods movement. As mentioned by Borgatti and Li (2009), higher level of security and minimum risk of damage are considered to be the major advantage of this mode of transportation. The efficiency of supply and Logistic management performance is dependent upon the performance level of the operational department. Transportation is considered to be one of the key element for smooth functioning of logistics and supply chain in intermodal freight.

Nilsson (2006), has mentioned about the importance of considering the on certain factors that are associated with the entire operations of supply chain management. The Complexity within the network of transportation in intermodal freight increased due to less availability of the freight rails. This mainly due to the increasing demand of the customers in the areas of New South Wales. It is therefore essential to use the theory of uncertainty within the logistic operation. There are four main factors under the uncertainty theory

• Customer demand and expectations: With new types of consumable product being introduced in the market, the demand of the same are increasing at a rapid rate in the market. It is also important to consider the fact that the customers are becoming more aware about the delivery time of product. In order to meet up with this increasing new demand it is essential for the supply chain department to get more involvement of the customers by gathering their opinion. It is therefore possible to improve the level of customer relationship and thereby help to gain the level of customer Trust. Proper procurement strategy can also be implemented in the given context, which is essential to deal with crisis situation.
• Internal processes: Effective level of internal business communication is believed to be one of the key element for maintaining efficiency within the operations of supply chain management. Lowson(2007), has mentioned about the importance of effective communication between the sales or marketing agent with that of the logistics partner, which can help to deal with the uncertainty issue within the intermodal freight transport. The improvement of the IT infrastructure is also considered to be one of the essential part of internal processes.
• Human factors: It is also essential to consider the human factor that is believed to be one of the major source of all errors within the operation of supply chain. It is important to involve more people in the matter of decision making as an important strategy of the logistics management. This help to minimise the chance of errors that are caused due to human factors.
• General Trends: The operational department within the supply chain management need to consider all type of general trends and development in the technology that can be implemented in intermodal freight transport. For example with the introduction of radio frequency identification (RFID), it is easily possible to track the movement of the freight and determine the exact location. This strategy will therefore help to provide better information and maintain high level of clarity within the supply chain management.

As the uncertainty factors within the Logistic management are predicted using the above theory, it is possible to bring about sustainability. It will be possible to identify the factors that are causing delay in the overall transportation in intermodal freight. With faster mode of delivery approach it is possible to reduce the overall energy consumption in the supply chain process. As mentioned by, Wu et al. (2015), it is important to consider the above-mentioned uncertainty factors that includes general trends and change in customer demand that can help in implementing a proper strategic theory for sustainability in the supply chain.

The institutional theory can be applied in the given context, which can help the International freight transport organisation to understand the social structure and thereby implement the respective corporate social responsibility principle. The organisational structure can therefore be modified accordingly to changes that occurred in the external business environment. The institutional theory can also help the supply chain firm to understand the pressure for a particular mode of transportation and thereby suggest alternative transportation routes. This can be Highly Effective in the current situation of New South Wales. There is also the element of stakeholder theory, which can help in a coordination of multiple level of stakeholders, who are associated in the operation process of Logistics.

Recommendations for Overcoming Challenges

The NSW government also plays a significant role in providing the basic transportation infrastructure that is required for movement of the vehicles. They can also play significant role onto deciding of the technological infrastructure that can provide detailed information related to that of the movement of the inbound logistics.

The transaction cost theory can helpful in improving the level of cost efficiency in the overall transportation process (Touboulic and Walker 2015). In the area of New South Wales most of the products are being imported from foreign regions. It is essential to increase the total number of channel of trade and transportation business, which will allow the company to get better quality of cost effective service and co-ordinate most of their activities in easy manner. This can also help to deal with the competitive challenge that are currently encountered by the international freight transportation company due to cheap availability of railway network in New South well areas. In the given context, the government plays the important role by reducing the taxation for trade and transportation.

Karatas-Cetin and Denktas-Sakar (2013), have mentioned about the importance of implementing social network theory as a part of the supply chain operations. The social network is believed to be one of the effective tool of business communication in modern days that are aimed to provide greater information details. The overall social structure of the organisation can properly be evaluated with the help of the social networking theory. As the complexity of the social structure within the supply chain is increasing, it is essential to collect essential information relevant to transportation operation. It therefore possible to analyse multiple dimensions like the frequency and total duration in a supply chain business. Most continuous and discontinuous process of supply chain can be analysed through the medium of social network.  

Optimisation of product design and product management is considered to be essential in bringing about innovation for supply chain operations. This can also help to bring about sustainability within the market and deal with essential changes. It is highly essential to implement effective decision in the early cycle of product development, which can help to improve upon the cost effectiveness. Optimise product for the supply chain can minimise the hazard and risk of damage during transportation. All essential cost required for the transportation purpose need to be analysed to maintain balance across end-to-end business.

The about section has clearly highlighted about essential theories that are relevant in the context of dealing with the issues faced by Moorebank. It is highly recommended for the company to consider the practical application of each theory owing today present condition of sustainability issues along with competitive challenges.

• Primarily it is essential for the company to improve upon their IT infrastructure and implement RFID. This will provide them very essential and updated information.
• Use of social media for internal business communication and digital marketing can also help to provide detailed information to the respective client and thereby improve upon their customer base relationship (Borgatti and Li 2009).
• Strictly monitor every source of spending that are needed to improve upon the cost effectiveness of the entire supply chain process.
• Another strong recommendation for the company is to procure their resources by increasing the total number of vehicles. It is also essential to considered the factor of environmental degradation and improve the quality of vehicles that are used in transportation purpose.

Conclusion

Conclusion 

Thus, from the above discussion, it can be concluded that, there are various issues being faced by the intermodal organizations such as Moorebank intermodal company in Australia. This report discussed and identified various issues that are being faced by them in the recent times. One of the key issues being identified is the shortage of the rail corridor in New South Wales. This is causing more consumption in the process of transportation. In addition, this report has used different models in relation to the supply chain management and distribution channels in order to measure the effectiveness of the business operation of Moorebank. In accordance to the identified issues in this report, there are various recommended steps are being discussed, which will help to overcome the emerged challenges. It is being expected that, effective and efficient implementation of the logistics strategies being discussed in the recommendation section will help Moorebank intermodal company overcome the identified issues and come up with more effective business model.

Essential supply chain logistics strategy including institutional and social networking theory can be applied by the company to provide greater amount of information. It is also essential to consider the uncertainty factors, which will help the company to maintain greater sustainability in business operations.

References

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