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Drivers Of Last Mile Complexity

Last mile as a part of supply chain is always complex and getting more complex. Many of last practitioner has been trapped in this complexity without any clues, the sources of it. Since the emerging of E-Commerce industry, last mile become favourite channel for costumers and merchants to deliver the products. Time to time, the expectation of costumer for the service level growth in exponential way, from 2-3 days delivery level service time then come to 2-3 hours. Whereas last mile industry players have not prepared robust system related to this growth.

Before we identified the drivers of complexity, and find the solution for mitigate or minimize it. First we need to understand what complexity is!

According to Herbet Simon (1962): “A system is complex if it is made up of a large number of parts that interact in a non-simple way”

Pay attention to the keywords, large number and interact.

Meanwhile, there are two types of complexity (Senge, 1990):

  • Detail complexity: Distinct number of processes or parts within the system
  • Dynamic complexity: Unpredictability of response of the system due to interactions

The Drivers

Dr. Chris Caplice, Executive Director, MIT Center for Transportation & Logistics, has describe the drivers, there are;

  • Numerousness - number of suppliers, products, customers...
  • Variety/diversity of the different entities or components
  • Interconnections/interactions between those entities
  • Opacity of interactions
  • Dynamic effects

Now, lets we connecting it to last mile industry.

  1. Numerousness, related to capacity, both of places, equipments, and people. Sometimes the growth of the numbers are faster the preparation of capacities. For example, it's never been easy to find a driver which not only can master the delivery area, but also has high performance, and dedication.
  2. Variety/diversity, we can divide varieties into three main categories, namely; shipment deadline, destination area could be urban area with high density people or perhaps remote area.
  3. Interconnection/interaction, the farther the shipment point, the more parties involved in shipping, and certainly the number of interactions between parties will increase.
  4. Opacity of interactions, bad address from costumer could the increase of complexity.
  5. Dynamic effects, costumer always expecting more faster and more chipper.

After we can describe the drivers, that we can find the approach to minimize and mitigate it, with the synergy from every parties in the chain structure, from marketing side, sales side, to operational side, and supporting side.

Rama Wijaya

Last Mile Expertise

Drivers Of Last Mile Complexity