Let's be Clear. Logistics Services and Logistics Technology Services Are NOT the Same!
And while the technology they use is important, the initial focus should be on the logistics services and whether the logistics services they offer are sufficient enough for the provider to even be under consideration.
Recently, I came across the headline that offered 5 Essential Technology Questions to Ask Any Logistics Service Provider and, as logistics services are not the same as logistics technology services, I assumed it would focus on judging the logistics provider's general level of technical competence online and off, but the questions were entirely oriented around the technology solution used by the provider. While a good solution is good, because you need visibility, integration, etc., the first thing you need is to get your goods delivered. The second thing you need is sustainability. Then you need technology - and if the provider is deficient, there's always the possibility that you can provide the technology. In other words, while the questions were good, I think they were off track. Here were the questions:
- What does visibility really mean to the provider?
- Can they customize their tools to meet your needs?
- What process integration options do they offer?
- How many current providers are integrated with their technology?
- How mature is their system availability process?
These are important, but I'd start with:
- What technology do they use to manage their fulfillment operations?
- How sophisticated is the schedule capability? Can it handle last-minute shipment changes?
- How much visibility can they give you into their schedules, capacity, and your shipments?
- Is the integration format standard and supported by your systems, or will you need some custom integration work?
- What is their ability to support their system, or yours if their system does not have the requisite visibility?
Basically, you want to know that:
- They are using a fairly modern tool and have a firm, efficient grasp on their operations.
- They can handle dynamic schedules and expedited shipments when needed.
- You can get the visibility you need, even if someone has to do some development work.
- The integration can be accomplished efficiently and effectively.
- They, and you, are not dependent on a third party to manage, support, and query the system.
A logistics services provider is not going to be an expert in software and systems. That's not their core strength, so you shouldn't be asking them questions like they are. That being said, you should make sure they are technologically literate and able to make use of appropriate technology. Find the balance, or you might end up eliminating some potentially great partners.