Skip to content
Search AI Powered

Latest Stories

THIRD-PARTY LOGISTICS

Change management: An existential supply chain capability?

Image showing a hand drawing a line with arrow sweeping upward. Standing on the line is an icon of a business person steering a helm.

As technology advances and disruptions multiply, third-party logistics providers and shippers must continue to work together to respond and adapt to change.

Supply chains are subjected to constant change, and the most recent five years have forced supply chain professionals to navigate unprecedented issues, adapt to shifting demand patterns, and deal with unanticipated volatility and, to some extent, “black swan” events.

As a result, change management has become an essential capability to help improve supply chain operations, support collaboration both internally and with external partners, deploy new technology, and adapt to sometimes continually changing market pressures. Recognizing this importance, the 2025 Annual Third-Party Logistics Study (www.3PLStudy.com) took an in-depth look at change management. The majority of respondents to the study’s global survey—61% of shippers and 73% of 3PLs—reported that the need for supply chain change management is either critical or significant.


A bar chart shows how critical shippers organizations rank various drivers of change, such as customer demands, economic factors, technological advancements, supplier considerations, societal shifts, and labor constraints.

Shippers says that the biggest drivers of change in their supply chain organizations are customer demands, economic factors, and technological advancements.

2025 Annual Third-Party Logistics Study

Figure 1 above focuses on several factors that were identified as likely drivers of change in supply chains. Among shippers, the biggest drivers of change in their supply chain organizations included customer demands, economic factors, and technological advancements. Other factors included supplier considerations, societal shifts, and labor restraints. 3PL responses were similar to shippers’ except 3PLs ranked labor restraints as the fourth most important driver of change.

The study also asked respondents to identify areas in need of change. The most-identified area was supply chain visibility, cited by 69% of shippers and 68% of 3PLs. Technology, planning, and relationships also ranked highly.

Respondents also reported varying degrees of receptivity to change. About one-fourth of shippers and 3PLs said they are extremely receptive to change, while 45% of shippers and 53% of 3PLs said their organizations are moderately receptive to change.

AI underscores need for change management

Most supply chain professionals agree that the need to embrace change is likely to continue to increase. Technology is advancing rapidly, and artificial intelligence (AI) and machine learning are creating new opportunities to increase efficiency, improve decision-making, and optimize operations within the supply chain.

Among the many pertinent messages that received attention at the 2024 CSCMP EDGE Supply Chain Conference and Exhibition was that nearly every aspect of the supply chain will be involved with or impacted by AI. Example areas where significant improvements and results may be achieved include demand forecasting, inventory management, warehouse operations, predictive equipment maintenance, supplier relationship management, and more. As a result, AI may bring change to nearly every aspect of supply chain management and every level of employee.

This year’s 3PL study also focused on the growing role of AI in supply chains. Shippers and 3PLs are aligned on the top use cases for AI, with supply and demand forecasting and transportation and route optimization ranking at the top. Order management also ranked highly for both groups, while 3PLs see a slightly higher use case for warehouse automation than do shippers.

Both groups are also aligned on their view of AI as a tool that can automate data analysis, identify patterns, solve problems, and automate repetitive and mundane tasks. The hope is that AI will help companies better use their data to make improved and informed decisions. AI can process data and identify patterns and repetitive operational issues faster than a human can, which can improve forecasting, uncover inefficiencies, optimize processes, make predictions, and increase resiliency. Machine learning, a subset of AI, is expected to be especially useful for solving complex logistics problems by refining its predictions and recommendations over time to create more efficient operations.

Shippers and 3PLs agree that the greatest return on investment from AI will come from service-level improvements—cited by 40% of shippers and 37% of 3PLs—as well as data accuracy, cited by 34% of shippers and 39% of 3PLs.

Given the potential benefits of AI, shippers will increasingly be looking for 3PLs that offer AI solutions that they can use to achieve reliable results and gain a competitive advantage. Nearly three-quarters of shippers said 3PLs’ use of AI would influence their choice of a 3PL partner. On a more granular basis, 13% of shippers reported that they are very likely to switch 3PL providers based on their AI capabilities, 29% said they are likely, and 32% said they are somewhat likely to switch 3PL providers based on their AI capabilities. As demand for AI-based solutions increases, 3PL offerings will evolve, further exacerbating the change that supply chain organizations are experiencing.

Realizing benefits from change management

While the ability to manage change is critical to survival, so too is the ability to determine when change may be needed. To determine whether they need to change, companies should start by assessing their current state and opportunities for improvement. Next, they need to identify the desired state and benefits of change. To help drive success, the change management strategy should create a vision, identify solutions, and develop a plan for change.

For successful change to occur, stakeholders must work together to operate as a systematic supply chain rather than working as individuals with departmental goals that may not align. It is also critical to gain support for the change initiative among those who may be involved. Educating stakeholders about the need for change, creating a clear vision of what the change will accomplish, and outlining the benefits can help build support.

Many companies have found that using a structured change management process can reduce resistance to change, improve communication, and increase the likelihood of success. In the study, 58% of shippers and 76% of 3PLs reported using a change management framework. The two most frequently cited frameworks used by both shippers and 3PLs were the McKinsey 7-S (which identifies seven factors that influence an organization’s ability to change) and the ADKAR change management model (awareness, desire, knowledge, ability, and reinforcement). Use of an in-house proprietary system was cited by 36% of shippers and 29% of 3PLs.

The good news for those in supply chain is that key stakeholders are dedicated to minimizing disruptions, enhancing agility, and ensuring long-term success. In this year’s study, 89% of shippers reported that they are committed to the success of the broader, end-to-end (E2E) supply chain. It is clear that shippers sense a deep commitment to the broader concept of supply chain management and recognize the need to align themselves with multiple supply chain participants to create value for their end-user customers and consumers. What’s more, 64% of shippers reported that their 3PLs share this commitment to the E2E concept, and 69% indicated that some of their 3PLs are involved with their change management processes. Also encouraging is that 77% of shippers agree that their 3PLs are enthusiastic about joint efforts relating to change management.

In the complex and ever-evolving world of supply chains, change is inevitable. With effective change management practices in place, shippers and 3PLs can navigate these changes with greater confidence and turn them into opportunities for growth and improvement.

More Stories

attendees at the EDGE resource center

Attendees visit the CSCMP EDGE 2024 Resource Center.

Lean into your supply chain community

As I assume the role of Chair of the Board of Directors for the Council of Supply Chain Management Professionals (CSCMP), I fondly reflect on the more than 10 years that I’ve had the privilege of being part of this extraordinary organization. I’ve seen firsthand the impact we have had on individuals, companies, and the entire supply chain profession.

CSCMP’s journey as an organization began back in 1963. It has since grown from a small, passionate community to the world’s premier association for supply chain professionals. Our mission—to connect, educate, and develop supply chain professionals throughout their careers—remains not only relevant, but vital in today’s world.

Keep ReadingShow less
illustration of two people working together with the help of a neutral party

The standing neutral: An innovative approach for managing supplier conflict

Editor’s Note:This article serves as a follow-up to “Avoiding supplier conflict and disputes before they begin,” which appeared in the July/August 2024 issue of Supply Chain Xchange.

The concept of using a neutral third party to resolve conflicts between suppliers and customers is not new. Mediation and arbitration have long been considered as more efficient and less costly ways to resolve contractual disputes than litigation. In fact, 2025 marks the 100th anniversary of the Federal Arbitration Act, which allows for contract disputes to be resolved through a private resolution process instead of going to court.

Keep ReadingShow less

Idea in action: EY case study

The global consulting firm EY was looking to outsource the food services, cleaning services, and maintenance at its facilities to the provider Integrated Service Solutions (ISS). But the company wanted to do so in a way that was completely different from how it had approached outsourcing workplace services in the past. EY and ISS wanted to create an outsourcing agreement that was highly collaborative and beneficial for both parties.

To do so, they incorporated a standing neutral in the contracting process from the outset. Together the parties selected one standing neutral—Erik Linnarsson, a lawyer from Cirio Law Firm—as a deal facilitator. Linnarsson was trained as a certified deal architect (CDA) to craft complex outsourcing agreements.

Keep ReadingShow less
chart of global trade forecast

Tariff threat pours cold water on global trade forecast

Global trade will see a moderate rebound in 2025, likely growing by 3.6% in volume terms, helped by companies restocking and households renewing purchases of durable goods while reducing spending on services, according to a forecast from trade credit insurer Allianz Trade.

The end of the year for 2024 will also likely be supported by companies rushing to ship goods in anticipation of the higher tariffs likely to be imposed by the coming Trump administration, and other potential disruptions in the coming quarters, the report said.

Keep ReadingShow less
chart of global manufacturing levels

North American manufacturers stockpile goods ahead of Trump term

North American manufacturers have begun stockpiling goods to buffer against the impact of potential tariffs threatened by incoming Trump Administration, building up safety stocks to guard against higher imported costs, according to a report from New Jersey business software firm GEP.

That surge in orders has sparked a jump in production, shrinking the level of spare capacity in global supply chains to its lowest level since June, the firm said in its “GEP Global Supply Chain Volatility Index.” By the numbers, that index rose to -0.20 in November, from -0.39 the month before, based on GEP’s measurement of demand conditions, shortages, transportation costs, inventories, and backlogs from its monthly survey of 27,000 businesses.

Keep ReadingShow less