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The critical need to improve South Africa’s logistics

The heads of IMM Graduate School’s supply chain and export management believe the future could be in the hands of the young logistics professionals, a view backed up by experts speaking at the recent Transport Forum held at Stellenbosch University.

 

“Can a logistician be referred to as a professional?” ask Dr Beverley Waugh and Dr Myles Wakeham from the IMM. “We seek to equip school-leavers, and employees and employers already in the workplace, with knowledge and skills to perform their specialised tasks and fulfil their professional roles in the supply chain, in the best possible way for their own development, the profitability of their organisations and the value of the supply chains in which they operate. To do this, they need to be professionals in logistics!

 

Logistics affect national and global wellbeing

And it doesn’t end with the individual, the organization or their overall supply chain. National and global economic wellbeing is also impacted. Speaking at the Transport Forum held at Stellenbosch University in August 2018, Professor Lauri Ojala asserted that logistics performance is critical to the national performance of economies, and that trade logistics are a key element of global economies.

He noted that logistics should thus be a cross-cutting policy concern in all countries, focusing inter alia on measuring supply chain efficiency, identifying problem areas, and providing key information necessary for supply chain managers. South Africa, for example, could benefit from raising logistics competence levels. Ojala pointed out that although performance with regard to costs and processes was very important, reliability within supply and service delivery was ranked even more important by logistics professionals. While cost-cutting was always on the agenda, concerns regarding sustainability, service, and competence were higher on the agenda. Traditional trade and transport facilitation remained at the core of logistics performance.

At the same meeting, Professor Jan Havenga identified the rising cost of logistics as a major concern for South Africa. He noted that government needed to be aware of this and involved in addressing various issues in the inefficient supply of logistics. South Africa has a “built-in” problem because of the overland distances involved in local logistics, and the fact that economic density is spread and mostly situated away from the ports: “South Africa is a spatially challenged country and its ton-kilometre productivity is among the worst in the world,” said Havenga.

Logistics management in South Africa therefore involved “more effort to do the same thing better!”. Havenga asserts that as a result of much South African transport usage being outsourced to blue-chip logistics service providers, the country has up until now been able to achieve and sustain fairly good logistics statistics. The South African logistics service provider industry has achieved excellent results and logistics managers have been well trained. However, he noted that skills in South Africa was becoming one of the greatest challenges, especially the shortage of logistics service provision skills. It was agreed that a stronger concentration on a few strong centres of excellence was necessary to address this.

In addition to these points, Professor Stephan Krygsman identified the need for governments to create an enabling environment for education and research, long-term planning, infrastructure for transport, for example, and so on.

South Africa needs skilled logisticians

Krygsman noted that South Africa is underperforming, not necessarily because of infrastructure, but due to inadequate skills, needed in part to “translate the benefit of infrastructure to increased economic output”. Transport infrastructure is a necessary but insufficient condition for economic development: An educated and trained labour force is also needed. In addition, Krygsman identified key problems in the supply chains of organisations in South Africa as including unnecessary regulations and documentation, and inadequate coordination between industry and ports – leading, for example, to congestion in ports resulting in unnecessarily high capital and other costs for the organisations involved. The cost of doing business and inefficiencies were unnecessarily and unacceptably high.

All role players in the South African supply chains must focus on making it easier and more efficient to do business. Adequate skills are needed for this, and these requirements are urgent for the welfare of the country and its people overall.

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