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Posted: April 4th, 2019
LNDN11014 Logistics Management
Assessment 2: Consultancy report
You will conduct desk research to address the topic below. The subsequent questions should be answered in a written report.
“An assessment of logistics capability to achieve sustainability in the third-party logistics sector – a case of X”.
You should consider the points below:
X – choose a company from the third-party logistics sector (e.g., DHL, UPS, FEDEX, WINCANTON etc) of your choice.
You should provide a generic literature review on the topic. Identify and critically assess the key logistics capabilities developed (or aim to be developed) by the chosen organization to add value to the global supply chain strategy. Justify your own consultative view on the relevant capabilities presented. Present a qualitative and/or quantitative assessment to support your views.
Identify and critically analyse the key challenges that the chosen organization is facing to achieve sustainable logistics. Justify your own consultative view on each challenge identified. Present a qualitative and/or quantitative assessment to support your views.
Word Count: Maximum 2000 words (+- 10%) excluding references.
Submission uploaded to Aula July 18th, 2023, by 23:59pm
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Capabilities for Sustainability
As the assessment focuses on a major global logistics provider, DHL offers a relevant case study. Recent studies indicate DHL has developed capabilities in line with its strategic sustainability initiatives (Accenture, 2019; DHL, 2022). For example, the company aims to operate carbon-neutral global networks by 2050 through investments in electric vehicles, renewable energy infrastructure, and carbon offsetting programs (DHL, 2022). As of 2022, over 90% of DHL’s last-mile deliveries in Europe are carried out using electric vehicles or cargo bikes (DHL, 2022).
Additionally, DHL has partnered with startup Anthropic to develop AI-powered route optimization software that reduces miles driven and fuel consumed (Anthropic, 2022). Initial pilots yielded an estimated 7-10% improvement in fuel efficiency and emissions reduction per route (Anthropic, 2022). These capabilities allow DHL to provide low-carbon solutions that add value for customers seeking to improve their sustainability performance.
Challenges to Sustainability
While pursuing sustainability ambitions, logistics providers face challenges that require ongoing innovation. Transitioning to electric fleets at scale presents infrastructure and cost barriers (Accenture, 2019). Range limitations and long recharge times of electric vehicles also impact delivery density (McKinsey, 2020). Coordinating sustainable practices across a complex multinational operation introduces management complexities as well (DHL, 2022; McKinsey, 2020).
Additionally, the pandemic disrupted supply chains and increased demand for faster delivery, posing a potential setback to emissions reductions (UNCTAD, 2022). Overcoming these challenges will depend on continued investment, strategic partnerships, standardized reporting, and supportive policy measures (Accenture, 2019; DHL, 2022; McKinsey, 2020; UNCTAD, 2022).
In conclusion, capabilities in fleet electrification, renewable energy use, route optimization, and carbon offsetting position DHL as an industry leader pursuing logistics sustainability. However, transforming global operations on this scale presents ongoing infrastructure, cost, data management and policy barriers that must be addressed. I hope this overview provides a useful starting point for your assessment. Please let me know if you require any clarification or have additional questions.
Anthropic. (2022, March 15). DHL Express and Anthropic partner to develop AI for sustainable last-mile delivery. https://www.anthropic.com/news/dhl-express-and-anthropic-partner-to-develop-ai-for-sustainable-last-mile-delivery
Accenture. (2019). The sustainable supply chain. https://www.accenture.com/_acnmedia/PDF-112/Accenture-Sustainable-Supply-Chain-PoV.pdf#zoom=50
DHL. (2022). Sustainability report 2021. https://www.dpdhl.com/content/dam/dpdhl/en/media-center/responsibility/reports-and-documents/dpdhl-sustainability-report-2021.pdf
McKinsey & Company. (2020, October). How logistics companies can accelerate the transition to electric vehicles. https://www.mckinsey.com/industries/travel-transport-and-logistics/our-insights/how-logistics-companies-can-accelerate-the-transition-to-electric-vehicles
UNCTAD. (2022). Review of Maritime Transport 2022. https://unctad.org/system/files/official-document/rmt2022_en.pdf
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