The future of logistics service providers: A people perspective

Henrik Kofod-Hansen, co-founder of novosensus, says LSPs need to make their culture more human and increase the level of positive emotions.

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By definition, logistics, freight forwarding and supply chain management is about collaboration. It is not without reason that we talk about a “chain” because the links need to be connected. 

But collaboration is never mechanical, neither within the organisation, nor with external parties. Collaboration is rather an organic process and emotional experience, driven by the people involved. This cultural operating system is where I believe that logistics service providers or LSPs need to invest much more, in order to create their future. 

In our research of the logistics industry, we identified that employees rate two critical aspects of their employee experience to be at a mediocre level only: internal collaboration and their leader’s capabilities to connect the organisation. The cultural operating system is not good enough. 

This points towards a need to evolve both the company culture, but also the leadership’s mindset and capabilities. But LSPs are notoriously under-investing into these areas, and only few organisations are doing progressive and intentional work on evolving their cultures, how people collaborate and eventually, what their customers experience. 

In order to drive a better employee experience, customer experience and innovation, LSPs need to improve their cultural operating system in two ways. 

1) Develop a new breed of leaders. 

The LSP leaders’ objective is to create the space for collaboration, to make the mission compelling and to enable the organisation to perform. Leaders and aspiring high-potential employees must be trained in how to inspire, how to empower people and how they interact with the organisation across functional and geographical boundaries. The typical silo mindset, focus on own P&L only and command and control leadership must be eradicated. 

2) Develop a more inclusive and empathic environment. 

LSP organisations are characterised by an extreme fast-pace, no room for errors and low margins. This leads to a focus on process excellence, and the human factor is often ignored. Both customers and employees suffer due to this, and it is important to realise, that one third of employees report that they do not feel valued, appreciated and recognised in their company. 

It is therefore key critical to make LSPs more human and to increase the level of positive emotions. While leaders have a big role to play in this, it is also up to the organisation to create the environment and structures that enable people to feel more included and appreciated. DHL, K+N and Maersk have intentionally invested into this “employee care” approach, and the impact is very positive. 

The future of LSPs will be driven by how they are able to move their employees, not only how they move containers. The challenge they have in front of them, is to become a better organisation to work for, for their employeesbecause that will automatically make them a better company for work with as a customer.

(Words by Henrik Kofod-Hansen, co-founder of novosensus)

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