Monday, March 10, 2008

A Practitioner's Challenges

Ed Tolan, Nippon Paper Industries rose to his own challenge by the Transportation Club of Tacoma and challenged members attending today's meeting with evaluating their strategic planning for the future.

Basically, Tolan listed a dozen strategically important future issues. Listed in no particular order and condensed around similar topics:

  1. Railroad stock is transitioning to 60 feet lengths from the former standard of 50 feet. Companies should be asking how they will manage this change as it will impact their bay access points, with car lengths overlapping the physical location of openings, etc.
  2. The looming debate of re-regulation, especially as it applies to railroads. At first, railroads were totally unregulated, then totally regulated, now unregulated again. The question that looms is will the pendulum swing back to regulation and if so how far.
  3. The aging workforce presents its challenges more as to the retention of a skills base, both in technical and professional knowledge base so as to provide good customer support, effective workforce actions and sufficiency to match demand. The workforce shortage is most acute in the truck driver job. There are a host of factors affecting the ability to pay and retain drivers. Included are: immigration issues, professional criteria and work environment.
  4. Steamship lines also have challenges ahead. The weakening of the US dollar has spurred exports, which has lead to a shortage of containers, once only 20% filled on return voyages but now approaching parity. The growth of international trade has also lead to the adequacy of ship capacity to carry containers. As an overall result, lower value products are being priced out of the export market.
  5. The planned improvements to the Panama Canal, which was said is using Chinese financing, will give Chinese shippers the opportunity to miss both U.S. West Coast ports, roads and railroads.
  6. Citing a string of just Washington State bridges, the point was made that our infrastructure is facing both capacity and adequacy challenges. In the relatively short term, all should expect pre-tolling and its additional cost pressures.
  7. Vehicle and equipment costs, especially for the small business owner/operator is getting out of an affordable range. And fuel costs was an "oh, yeah..."
  8. Shippers and receivers need to form a partnership with carriers to do an overall better job. The issues of workforce and benefits must be addressed in the expected driver shortage. Other issues favor cooperative problem solving.
In responding to a question about the Green movement, Tolan said that the industry should be cautious of paperwork that only documents what's already being done and is not an impact on environmental issues.

Contact Gary Gieser if you wish to know more about the Transportation Club of Tacoma.

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