The supply chain in 2030

2030-Car-concept-150x122“The oil price is not likely to increase between now and 2030 in the order of magnitude that it poses a threat to conventional means of transport,” predicted Dr. Michael Linz from the Supply Chain Management Institute in Wiesbaden (Germany) on 1 June 2010, when he spoke at software supplier Kewill’s user-conference held at De Verkadefabriek in Den Bosch (the Netherlands). “Even an oil price of two hundred dollars, which is the most pessimistic estimate, will not result in transportation grinding to a halt in 2030.”

Linz based his presentation on his research, which he recently carried out in conjunction with PricewaterhouseCoopers, entitled ‘The Future of Transportation & Logistics in 2030’. 48 experts from twenty countries across five continents took part in this online and interactive study, which was carried out using the Delphi method.

Linz expects the greatest challenge in the years ahead to lie in reducing the carbon emissions from transportation. “In the future, consumers will also be increasingly able to make their own decisions about the logistics and delivery options used in the so-called ‘last mile’,” explains Linz. One notable conclusion emerging from the research is that the market share of road transportation is expected to continue to increase in coming years, from 72.4% in 2005 to 75.4% in 2030, as a result of companies needing to stay flexible in order to cope with potential disruption to the supply chain. “This has an enormous impact on the design of the supply chain,” cautioned Linz. “Supply chains will never be completely immune from external shocks, thus necessitating a high degree of flexibility. It is essential to have a ‘Plan B’. Natural disasters such as volcanic eruptions can be seen as ‘wild cards’ in the contingency plans – they are events which are quite likely to occur at some point in the future.”

In addition to examining the most probable future scenario, the study also considers an extreme variation which factors in sustainability and the price of oil. In the scenario, entitled ‘The restricted, but still ignorant world’, the price of oil has rocketed in a non-sustainable society. This scenario is characterised by a global shortage of resources and energy, mobility has become a luxury and the regional transportation of goods has shifted onto the railways. “Organisations need to have a back-up plan for all four of the scenarios presented,” was Linz’s advice. “The ability to manage the future is crucial. We have to start thinking in terms of scenarios.”