For over 30 years the leading pallet and sawmill magazine in America.
Markets in Transition: Designing Pallet Systems for a Sustainable Future
Increasingly we make either/or decisions, such as either one-way rental or pallet exchange. Instead, we ought to consider ideas that best optimize the given application, such as one-way rental for long haul and pallet exchange for a local program.
By Rick LeBlanc
Date Posted: 11/1/2008
Why is it so hard to get customers on board with an excellent pallet system? I hear people ask this question surprisingly often.
The usual answer is that corporate decision makers are not willing to pay for it, even if it is plain as day to everyone else under the sun that their inaction will result in indirect costs far exceeding the required investment. It may be that the costs are unmeasured, or they are born by another entity in the supply chain. Under pressure to achieve short term profits, avoiding new outlays inevitably is more comfortable than inventing a new paradigm for distribution excellence and sustainability. Is this what we want for our legacy?
Pallet systems can be somewhat complex. In the new book, The Necessary Revolution: How Individuals and Organizations Are Working Together to Create a Sustainable World, Peter Senge, a Massachusetts Institute of Technology professor, and co-authors grapple with challenges much greater than pallets. None the less, they offer some important system-transformational insights that are useful to people who design pallet programs.
One of my favorites is that people either must expand their thinking to match the complexity of systems or reduce the complexity of systems to match the limitations of their thinking. How often do we try to ‘dumb down’ programs to match what we are capable of grasping, meanwhile leaving money and our collective future on the table? For example, increasingly we make either/or decisions, such as either one-way rental or pallet exchange. Instead, we ought to consider ideas that best optimize the given application, such as one-way rental for long haul and pallet exchange for a local program.
In order to grasp the complexity of a system as a prerequisite of change, Senge advocates “getting the system into a room.” In other words, have a meeting with people representing the interests of the key stakeholders of the system – people with the authority to effect change.
Another important point made by Senge and his co-authors is that extraordinary change requires building extraordinary relationships. I know in my experience that if a business forms a committee to review its pallet program, the panel likely will include the ‘usual suspects’ — the operations personnel who manage the pallets, and employees in transportation and purchasing.
Does that type of thinking, that level of leadership, lead to transformational change? If we look at the vast potential of pallets to impact supply chain visibility and optimization as well as to revolutionize how products are marketed (i.e., half-pallet, retail-ready presentation), shouldn’t key members of the committee be employees from such areas as business strategy, information technology, retail marketing, environmental management and operations executives?
Senge and his co-authors offer several case studies of mavericks and organizations that collaborated to take bold, innovative steps to help create a sustainable future. They don’t talk about pallets. However, it makes you wonder what the role of pallets will be in the future, and if corporate decision makers will become increasingly skilled at grasping complexities that dictate investments to achieve superior, sustainable supply chain execution.