September 19, 2018
Managing transportation risks in international shipments
By: Pierre A. David

Being Spot-On about Transportation Risks

After five years as an international logistics manager at Erickson Metals, a company that sells specialty steel used in medical applications, you have had your share of international shipments that did not go as planned. You have just been hired by a competitor, and within your first week, a large customer who has just received a small shipment of a sensitive metal in Poland calls you to report a problem. After inspecting the shipment, the customer found that the metal is spotted by what appears to be water droplets. You are surprised because good packaging policies should have guarded against such problem. At Erickson Metals, all overseas shipments were always packed with two layers of plastic liners, and desiccants were always included inside the box. However, it seems that the shipping department at your new employer is not following similar policies.

Your first concern is to reassure the customer that you will take care of the problem. You replace the entire shipment and send it as soon as possible. You also personally supervise its packaging to ensure it arrives in perfect condition. You then start a thorough internal review to determine what else your new employer should be doing to mitigate its transportation risks.

There are several questions you should address before making changes in your new company’s shipping policies:

  • What are the transportation risks to which its shipments are exposed?

  • Where are shipments going, and which nodes and links do they use to get to their destination?

  • What preventive measures can be used to reduce the probability of losses due to transportation risks?

  • What possible insurance policies should your company consider in light of its practices and the risks that its shipments face?

As the new international-logistics manager, it is your responsibility to find answers to these issues, so that your company can ensure its customers receive their shipments in good condition.

What are the effective techniques for reducing the impact of transportation risks? Which insurance policies should your company consider for protecting against these risks? The Accenture Academy courses Transportation Risks in International Shipments, Preventing Transportation Risks in International Shipments, and Mitigating Transportation Losses in International Shipments will help you identify and assess the transportation risks your company faces and mitigate the effects these risks can have on the supply chain when losses occur.

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