Supply Chains Face Increased Safety and Financial Strains

By Dr. Kandis Boyd Wyatt
Faculty Member, Transportation and Logistics, American Public University

The year 2020 has placed an increase strain on the U.S. transportation infrastructure when it comes to the supply chain industry. Supply chain disruptions can cause significant losses in terms of finances (62%), logistics (54%) and corporate reputations (54%).

With the pandemic altering how we purchase goods and services, delivery vehicles are making more deliveries, which creates issues such as congestion, emergency management, energy and environment protections, and safety. Because addressing these issues can seem like an insurmountable task, first and foremost I’d like to discuss the essential aspects of the supply chain industry, especially in terms of safety and finance.

Safety Issues

Safety includes developing an intermodal perspective, integrating priorities more effectively across levels of government, and striking a balance between national and local interest. SafeStart, a safety company that is focused on human factors and seeks to reduce preventable deaths and injuries, cites six key safety issues:

1. Driving without concentration and distracted driving

2. Slips and falls

3. Failure to conduct proper walkarounds of vehicles

4. Other drivers

5. Driver fatigue

6. Changing conditions

Financial Issues That Affect Infrastructure Projects Cannot Be Overlooked

The financial aspect of infrastructure cannot be overlooked; this includes increasing taxes on fuels, air travel, and waterways levied by various federal agencies. The Committee for Economic Development of The Conference Board (CED) cites five financial issues that greatly affect infrastructure projects:

1. Traffic congestion: In 2014, traffic congestion wasted 6.9 billion hours of motorists’ travel time and almost 3.1 billion gallons of fuel.
2. Repair and operating costs: Driving on poorly maintained roads costs motorists roughly $112 billion annually in additional repairs and operating costs.
3. Delays: If the average daily delay for a UPS truck is five minutes due to bad road conditions or congestion and capacity issues, that translates into $105 million in additional annual operating costs for UPS alone.
4. Deficient bridges: Americans take over 200 million trips daily across deficient bridges in the 102 largest metropolitan regions.
5. Traffic fatalities: Poor road infrastructure led to a 7% increase in traffic fatalities from 2014 to 2015.

The National Highway Traffic Safety Administration (NHTSA) reported an estimated 36,120 people died in motor vehicle traffic crashes last year, down 1.2% from 36,560 in 2018, even as travel rose 0.9% to 3.23 trillion miles.

All of these interconnected issues call for an integrated solution. As commerce continues to grow, there will undeniably be a direct increase in traffic congestion, parking difficulties, longer commutes, transportation inadequacy, paucity of public spaces, land footprint and energy consumption. As space becomes a more precious commodity, reimagining how to accommodate the entire supply chain with limited resources is essential.

All supply chain systems are interconnected, which creates a domino effect on the industry. Energy and the environment will always play a part in infrastructure upgrades. Increasing public demand for better and more efficient transportation means enhancing competition and providing incentives.

Developing Infrastructure Solutions

Infrastructure maintenance — which includes upkeep and repairs to roads, highways, and bridges — is costly, and the federal government does not bear the entire cost of upgrades. This puts a greater burden on private industry to develop better ways to transport especially heavy loads, which often end up damaging public roads. So there is an ongoing discussion between private and public funding on maintaining heavily traversed roads and highways.

In intermodal transportation, congestion in any one mode (land, air, sea or pipeline) will affect other modes and how we transport everything from fresh produce to foreign-made autos. Research and development into systems, policies, and the utilization of technology will help us leverage our resources and increase our understanding of these infrastructure challenges, especially in the areas of safety and finance.

About the Author

Dr. Kandis Y. Boyd Wyatt, PMP, is a professor at American Public University and has 20 years of experience managing projects that specialize in supply chain management. She holds a B.S. in meteorology and an M.S. in meteorology and water resources from Iowa State University, as well as a D.P.A. in public administration from Nova Southeastern University.