ITM: What does ‘logistics’ mean to you?
Sumit: In the context of my industry, ‘logistics’ means getting products, parts, raw materials, and services where they need to be consumed, further processed, or stored, on time, and within budget. It is a critical part of any product (physical or digital) or service that has a supply chain; meaning, everything we consume in the modern world. But logistics is not the entirety of a supply chain, though that distinction gets lost quite often. Logistics is one part of supply chains. There are other, equally critical parts like manufacturing (again, physical, or digital), design, strategic planning, labour, forecasting, etc. All these together form modern supply chains.
ITM: If you could change anything about the industry, what would it be?
Sumit: Even today, the supply chain is very cost focused when the need is for a balanced approach that considers both cost and risk. If there is one thing I would change, that is the mindset that cost is everything, and hence organisations must only pay attention to 20% of the suppliers that take 80% of the spend. Even the supplier with the smallest amount of spend can take down your entire supply chain. For example, in the very recent past, some auto manufacturers were unable to ship their cars or trucks because they couldn’t procure cup holders, door handles, grill badges – all low spend items when compared to the overall cost of manufacturing an automobile. Supply chain leaders must transform their thinking and pay equal attention to revenue at risk and customer sentiment.
