Hype about delivery lead times.
Citizens find it difficult to escape the call from politicians and the popular media to increase productivity and support innovation; typically without explanation of what productivity and innovation are or mean. Allied to the call are press releases and articles that tell us of the wondrous new technologies and all their benefits.
As an interested observer, I used some of my year end break to read articles about the new world of delivery that (depending on the writer) is either upon us or will shortly appear. The articles provided excited reports concerning the Uber business model in relation to transport; deliveries by unmanned aerial vehicles (drones) and unmanned road vehicles (the common white vans without external identification, to also be without a driver). These new models and technologies will, it seems, provide deliveries within hours and at no cost to the buyer.
But, as a supply chain professional I remain a positive sceptic. That is, I am very interested in new developments, but at the same time question what is being said – the old approach of asking ‘why’ five times is a good starting point. This process should provide an approximate timeline for the technology, from hype to reality; that is to adopt, accept then utilise.
In medicine, a 2006 report by the School of Public Health at Saint Louis University in the US, considered that it took about 17 years for tested original (that is discovery) research to be integrated into mainstream medical practice.
In economics, Dani Rodrik (1997) argued against conventional economics in his book Has Globalisation Gone too Far? He wrote that few gains from global trade go to unskilled people and there would be a future backlash from this group. It took 19 years to happen (Trump and Brexit as examples).
If the 17 to 19 years is applied to barcode technology (first used in 1974), it would mean that acceptance and implementation in the wider Logistics community occurred in the early 1990’s and that is what happened. An elapsed time of nearly 20 years for a new technology or approach to become mainstream is not a definitive figure, but it indicates that acceptance is not instantaneous. This is illustrated by the well known Hype Cycle, produced by the Gartner Research Group in 2009. They showed the process for a new technology (often referred to as ‘disruptive) going through a number of steps:
- The trigger is an announcement or product launch that generates attention in the media, including ‘future’ (and always positive) scenarios for the technology
- The peak of inflated expectation is the increasing unrealistic expectations with more implementation failures than successes, some receiving negative media attention
- The trough of disillusionment happens when the technology is abandoned by a substantial percentage of new entrants and initial users in the market and the media lose attention
- The slope of enlightenment occurs when the remaining businesses, with a belief in the technology, persevere to understand the practical applications of the technology and the implementation challenges
- The plateau of productivity is reached as the technology becomes stable and the benefits are accepted and used within a wider or niche user community
Reality about delivery lead times
The hype process for a technology will take many years (nearly 20?), with only some of the current technologies coming through the process to be implemented by many enterprises or adopted by a reasonable percentage of the population. In the meantime, Logisticians need to fix today’s challenges that do not necessarily require the latest technologies, but an understanding of the principles and practices to achieve consistent ‘delivery in full, on time, with accuracy’ (DIFOTA).
I experienced three instances of reality at the same time as reading the hype about new delivery technologies:
- Sports shoes purchased from a manufacturer’s retail outlet. My size was not available in store, but it was at the warehouse, a distance of about 40 kilometres. A pair was therefore ordered, with delivery at two to three days. I was contacted by the store after eight days to inform me the shoes had arrived. When the new shoes were presented for fitting, they were the wrong size!
- A book ordered through the local bookstore (I want bookstores to remain in business, so that I can browse). The publisher’s warehouse is about 900 kilometres from the bookstore and delivery took eighteen days!
- Enquiring from a manufacturer about a unit of equipment, illustrated in their catalogue. I assumed the unit would be assembled to order (ATO) from stocked sub-assemblies and component parts. The only ‘make to order’ part would be special brackets to secure the unit in its operational area. The lead time from date of order was quoted as 10 weeks!
These are examples of real life challenges that need to be fixed and they do not require ‘leading edge’ technologies. In each of these situations, the first question is: what is an acceptable delivery lead time? The lead time decision is followed by a review concerning how these lead times times will be consistently met (on time) without errors (accuracy) – not difficult to do, but challenging to implement the revised process and consistently meet the performance metrics!