Outsourcing is a topic that is divisive in the business community.
Depending on who you speak with at management level and below, the ability to bring in a third party to oversee a specific department can bring about a series of benefits.
By leveraging their expertise and connections to accessing a fixed price on logistical assistance, their service can end up saving an organisation in time, money and human endeavour.
However, there are inherent risks that are brought about when entrusting a core business practice to another body that is not directly associated with the brand.
The distance and separation of entities can create schisms and doubts for those people who could be entrusted with a program internally, leaving employees to question their role in the enterprise.
In the case of third party logistics 3PL Australia warehouse providers, why would there be reservations about their involvement?
Here we will make note of the dangers involved when hiring a provider who does not do their due diligence for the client, a scenario that no manager wants to face.
Dropping Internal Standards
A 3PL Australia warehouse provider will enter the premises with their own means of conducting business. Amid all of their marketing slogans and ways of communicating to staff, they will operate how best they see fit, and that can occur in contrast to the core business principles that your organisation embraces. Other participants who see a 3PL expert enter into the team culture without adhering to these guidelines can create an environment that erodes confidence and common behaviours, dropping internal standards in the process.
Violating Privacy and Exposing Vulnerable Information
Companies utilise the expertise of a 3PL Australia warehouse provider however they choose, but there are risks to privacy and confidentiality in the event of a breach or compromise. Case studies have showcased that this is can occur when HR departments do not monitor the personal data of new recruits or applicants. In an age where digital hacking poses a significant risk to a brand’s viability, added measures must be put in place.
Lack of Internal Education
Just as individuals can become reliant on takeaway food for the sake of convenience, outsourcing through a 3PL warehouse provider can slowly but surely become a habit for managers that seek shortcuts. By minimizing internal education methods, there can be a reliance on these 3PL Australia companies to come in and offer the quick fix when there are greater structural deficiencies in the warehouse. Eventually those shortcomings will catch up to the business and the lack of expertise on site will create conflict and crisis.
Meeting Growth and Expansion Targets
An outsourced 3PL warehouse provider will look to run an efficient operating model whereby incoming and outgoing goods are run in conjunction with an effective transportation process. To ensure that a client is happy, many providers in this field will look to cut down on mistakes to run in accordance with the budget, creating instances that see conservative decisions made. This can cause opportunities to be lost if a brand wants to embrace a growth strategy, something that is rarely successful if there is a reliance on a 3PL outlet.
Fortunately there are ways and means of combating any issues that arise when outsourcing through a 3PL warehouse provider. First and foremost the participants need to be educated on their role and that of the 3PL operator. Then there must be continual monitoring of their activity to ensure the supply chain is not compromised, and for a robust process to be implemented that mitigates for delays and disruptions.
Very rarely will a 3PL provider be integrated into a business without some setback occurring, and it will be a test for that organisation to see how they can overcome that issue with proactive measurements that will truly count.