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‘But Brutus is an honorable man’

By Joel Anderson | 11/11/2013 | 12:27 PM

Perhaps the most effective speech in all politics (fictional or real) remains Marc Antony’s words at the funeral of Julius Caesar. Why were Shakespeare’s words in Antony’s mouth so effective? And can they still guide successful public affairs? Of course they can.

  • First, Antony faced a situation where the public sentiment was strongly against him.
    The underlying suspicion of means and motives set an impossible barrier to overcome.
  • Second, Antony faced a situation where the speaker who preceded him (Brutus) possessed
    great public esteem. After all, he had just slayed a dictator. He made the case that the people were saved by his actions.
  • Third, Antony faced a situation where he was aligned with the slain dictator. Many in the audience would view his comments as an apology for backing the wrong leader.

Facing impossible odds, Antony moved away from any personal attack on Brutus. By the same token,
the words he used orchestrated the most effective personal attack in recorded political speech. Antony set the stage in his opening comments, noting that he had not come to praise Caesar but to participate in the funeral service, and that Brutus was an honorable man in allowing Antony to participate.

For all readers of this blog, please note the careful framing: Antony did not conduct a head-on attack.  He simply set out the terms of his speech. Each time he gave an example, he did it to compare and contrast Caesar’s actions to the claims of Brutus about Caesar. He closed each comparison with the affirmation of Brutus as an honorable man. 

The final effect? Even as he affirmed Brutus, Antony built a case against Brutus as a liar and a manipulator who cannot be trusted.

The lessons I have gained from this speech and a life in politics is to be smart when you run into
a well-entrenched opponent who appears to be riding a public wave of popularity. When you are in the minority, as was Antony, you must compare and contrast your opponents’ words with the consequences of their behavior. 

The American people are rugged individualists and we want to find out a person’s character for
ourselves.  They don’t want to be told who or what is bad. When your first approach is to attack your opponents, you give your opponents an opportunity to bolster their standing with supporters: Your
listeners are uncomfortable with attacks and may find comfort in their known leaders.

Instead, take the lead from Shakespeare’s Antony: When faced with opposition that has taken the
“high moral ground,” find a way to reverse the posture.  Identify the negative people consequences of the opponents’ objective. Then pound away at the negative consequences.

Taking this approach gives the individuals you address the facts to independently arrive at a
different conclusion. Let facts and your courtesy be the secret ingredients in winning when faced with impossible political odds.

North American Developments Impacting the Global Supply Chain

By Joel Anderson | 10/30/2013 | 7:18 AM

 

Global-supply-chain-technologyThird-party logistics organizations reduce landed transport costs and thereby enrich the wealth of trading partners, says a new report from the World Trade Organization.  The “World Trade Report 2013: Factors Shaping the Future of World Trade” includes a section about transportation costs. According to the report, “The cost of transportation determines where the line between tradable and non-tradable goods is drawn and shapes which firms are able to participate in trade and how they organize their production internally.” 

These data reflect several advancements that members of the International Warehouse Logistics Association (IWLA), based in North America, are experiencing as a result of new technology, innovations and infrastructure development. The following are examples of contributing factors to this reduction in transportation costs:

  1. Technology. IWLA members implement new technologies in their warehouse-based logistics companies. Mobile technologies, cloud-based warehouse-management systems and business intelligence data collection systems help members create greater transparency around the movement of their clients’ goods and sales projections. The e-commerce boom drives use of new technologies. Warehouses place high priority on measurement of operational efficiencies and productivity to meet client needs.
  2. Near-shoring and enhanced multi-modal transportation structures. Infrastructure development in new ports, intermodal ramps and highways pave the way for U.S. transportation operations to effectively use labor/resources in Mexico, South America and China. The expansion of the Panama Canal provides a useful route for moving goods by sea helping reduce costs across all modes of transportation.
  3. U.S. government recognition of the warehouse-based third-party logistics industry. IWLA members are becoming more recognized for their key role in transportation and economic development in America through a robust government affairs program. This concerted effort gives our industry more influence over the regulatory/legislative environment that affects the U.S. supply chain.

As the global supply chain continues to grow, North American developments will have lasting
impacts on shores near and far. For example, according to the report, data from nine Latin American countries showed a 10 percent reduction in average transport costs associated with a 10 percent increase in the number of products exported and a 9 percent increase in the number of products imported.

Unlocking these benefits requires firms with expertise in the fundamental determinants of transport costs.  Third-party logistics providers are those subject-matter experts whose knowledge includes the geographical features of the country, the quantity and quality of the physical infrastructure that support the transportation services, the procedures and formalities used to control the movement of goods from one country to another, the extent of competition in the innovation sector and the cost of fuel (Behar and Venables, 2010). 

Logistics is a science that is as much about cultures and governmental relations as it is about new innovations to assist in the physical movement of products. And, it is the 3PL that works across and through these determinants to move products throughout the world.

IWLA vice president Jay Strother and senior coordinator of marketing & public relations Morgan Zenner contributed to this posting.

Five Principles of Useful Political Activism

By Joel Anderson | 09/10/2013 | 7:13 AM

No amount of money or time can influence political activities if the right components are not in place. My political experiences led me to five guiding principles that pave the way for advocacy success. These allow you to evaluate the worthiness of engaging in a political effort. Ultimately, these five points divide successful campaign from failed campaigns.

1) Be on the side of the angels.
Asking your legislator to vote your way is asking them to potentially encourage an opponent to run against them in a primary or a general election. Can you frame your argument to give your position the presumptive moral high ground? If you can, you have an action that reaches above party lines.

Always imagine that what you ask of your legislator will be on the front page of the legislator’s local newspaper. Your very first task is to make him/her look good in front of his/her constituents and have solid, fact-based data/proof to support your claim. The goal is to pass your legislation and build a relationship with the elected official. Ideally, your representative will see you as trustworthy source of information, and as someone who knows how to protect long-term interests.

2) Make your opponents uncomfortable.
If your opponent has an argument nearly as strong as yours, the legislator’s default position is not to act. Legislators hate to galvanize a group of special-issue voters against them because they know those voters remember the past. When planning your activism, it’s important that you examine the arguments of the individuals with contrary positions. Figure out how to frame your position as the best solution to a gnawing problem so that your opposition is portrayed as heartless to the public need in the elected official’s district.

3) Carefully select and groom the advocates who will present your position.
If your industry has the strength of diversity, demonstrate that diversity at every public and political event you hold. In a world where generalizations of an industry are a matter of convenience, your efforts to dispute those generalizations are critical to your success. For example, IWLA oftentimes asserts the openness of logistics career ladders by gathering studies by government groups that show the career progression, the diversity of the workforce, and the industry’s attention to safety and human resources. This requirement is crucial when dealing with groups that cherry-pick employers who have exploitation charges against them. Know your opponents tactics and have your spokespeople represent the full diversity spectrum of your workforce.

4) Stay on message.
Ask for one thing, keep to one thing and be happy when you obtain that one thing. Never be seen as greedy.

5) Always be gracious, even when you lose.
Politics is a long process that can revive itself when least expected. Losing today teaches you how to win tomorrow. You create future opportunities for yourself and your clients by thanking your sponsors and treating your opponents with respect.

During my career, these principles have enabled the two associations I’ve led to transcend the normal odds and pass or kill legislation when others never expected us to prevail.

IWLA’s vice president, Jay Strother and senior coordinator of marketing & public relations,
Morgan Zenner contributed to this posting.

BY SAYING “NO” TO LOGISTICS JOBS, GOVERNMENT SAYS “YES” TO POVERTY

By Joel Anderson | 08/30/2013 | 12:51 PM

How can the United States rebuild an eroding middle class? Logistics and supply chain activities are replacement industries for what once provided domestic manufacturing jobs.

Recent research conducted by L.A.-area economist John Husing (owner of Economics & Politics Inc.) revealed that the median wage for the logistics industry in the Inland Empire of southern California is $43,583. More than that: 28 percent of the area’s job growth between 2012 and 2013 came from the logistics industry. 

These data points come from an area that was hit hard by the “great recession” with 18 percent of households earning below the poverty level. Were it not for logistics companies moving in and providing replacement work, the 72,000 jobs in this area from this sector would not exist.

Husing’s research – coupled with Yossi Sheffi’s research cited in a previous blog – highlights the importance of the logistics industry and logistic clusters in particular as middle-class job and wealth creation machines. 

Studies conducted in Alameda County in California, in Los Angeles County, and in the state of Pennsylvania note and highlight the robust career ladders intrinsic to the logistics industry. And logistics jobs cannot be off-shored: They stay close to the end consumer and the end consumers are in the United States. 

Those opposed to logistics job creation include regulators who see freight and distribution as a public health hazard. They think this “hazard” must be suppressed, if not eliminated. 

Take, for example, the South Coast Air Quality Management District: This group’s sole mission is to eliminate pollution. It appears to me that SCAQMD’s definition ignores any consideration that poverty leads to greater pollution levels and that poverty brings with it socio-economic health hazards.

In fact, a University of Wisconsin Public Health Institute 2010 study cited socio-economic factors as four times higher than environmental factors in key determinants of public health. Yet the SCAQMD ignores this published research and proceeds down a cynical path that unemployed folks are better off than our workers who can put a roof over their head, food on the table, clothes on their backs, and provide for an education and medical care for their children.

Our industry is leading the way on MANY environmental fronts apart job creation:The supply chain and warehouse-based 3PLs in particular are tapping into solar power, using battery charged forklifts, installing skylights  and LED lighting, and finding low-carbon alternatives to fossil fuel. The response from the SCAQMD and regulators is do more, do it on our schedule and poverty be damned. 

We are at the point where SCAQMD’s programs create more poverty. While direct environmental impacts are worthy fodder for public policy discussion, the most pressing arguments should focus on the broader and more immediate issue of public health. Let’s have a full-throated debate to discover who is doing more to eliminate poverty, provide for a middle class and increase public health: People sitting behind a desk working algorithms? Or businesses engaging a trade that cannot be off-shored?

Logistics Clusters Offer Job Creation, Innovation and Sustainability

By Joel Anderson | 07/25/2013 | 7:03 AM

Yossi Sheffi, Ph.D., professor of engineering systems at Massachusetts Institute of Technology (MIT)
knows the importance of logistics clusters in driving growth and commerce. While his Winter 2012 article in IWLA’s 3PL Americas magazine provides an overview of his research, Sheffi also published a book about clusters that is essentially a long-term analysis of the societal value-add of government pursuing and enabling these hubs.

“Logistic clusters are able to lower transportation costs and improve customer service, advantages that attract more companies. And, as the member base expands, costs diminish even further and service levels continue to improve, luring more companies to the community,” Sheffi writes in the article, “Realizing the Economic Potential of Logistics Clusters.”

IWLA-member companies are a major player in growing logistics clusters: They provide needed warehousing and offer a diverse array of value-added third-party logistic services, including returns processing, light assembly, kitting and packaging. Manufacturers, distributors and shippers outsource warehousing services to save money on costly real estate and to take advantage of the efficiencies associated with well-managed inventories.

For IWLA advocacy purposes, Sheffi’s work demonstrates a long-term sustainability of logistics jobs (you cannot outsource local distribution work) with fulfillment operations that are located in metropolitan markets in close proximity to the end-consumer. In fact, Sheffi’s research is validated by U.S. Bureau of Labor Statistics’ employment data, which show year-over-year increases in the warehouse and logistics sectors from 2010 to 2012.

However, despite the positive impact, the government (at all levels) continues to challenge our industry with undue tax reforms. Case in point: Minnesota recently included a service and sales taxes on warehouse service providers in the state. These misdirected extra costs on warehouse-based 3PL companies hinder the flow of transportation of goods and commerce. The long-term impact will be detrimental if the course is left unchanged.  

Of similar importance is the growth of the semi-skilled workforce development in logistic clusters. As policy makers, particularly in urban areas, look to high-tech industries to rebuild taxes and employment, they overlook logistic clusters as a growth area. And, unlike other professions that employ a semi-skilled and entry-level workforce, logistic companies have a fully developed and upwardly mobile managerial career structure.  

Below is a video of Sheffi in his own words describing his research. My recommendation is that every practitioner of logistics secure his book and use it a reference manual for your own workforce to provide them the big picture of what we do, and make it available to your zoning commissions, your elected officials and others who seek create jobs in urban areas.

 

 

Filibuster Reform: Good or Bad, It Moves Power from the Senate to the President

By Joel Anderson | 07/18/2013 | 8:24 AM

U.S. Senate tradition and rules make it the branch of government where, unlike the House of Representatives, the minority can have significantcontrolling influence. This power of the minority is most pronounced in the power of advice and consent on presidential appointments.

Conservatives long grimaced at the Democrats’ refusal to approve the appointments of Presidents Ronald Reagan, George H.W. Bush and George W. Bush.  Equally, President Obama’s second term has seen the ire of liberals over the Senate’s refusal to approve presidential appointments. 

However, rules have changed because of a procedural amendment, brokered by Sen. John McCain (R-Ariz.), with respect to non-judicial presidential appointments of the executive branch.

The agreement (which can be undone by future Senates, but only as a rejection of their tradition of compromise and courtesy) limits the filibuster on executive branch appointments by returning power to the executive office and removing power from the Senate. This compromise came from frustration of both parties, and not from a deep analysis by the sitting senators of the power they just gave away.

I tend to agree that there should be very limited rejection of a president's executive branch appointments, but that has not been the case and practice of the opposition party in the Senate for many, many years. The Senate has now removed power from itself and set a new tradition that  centralizes more power in the executive branch and removes a check on the individuals the president appoints.

Time will tell whether it will be good or bad.

Update on Minnesota Warehouse Services Tax

By Joel Anderson | 07/05/2013 | 2:31 PM

This column provides the case that must be made by the Minnesota public and contract warehouse industry to successfully repeal a newly enacted 6.5 percent tax.  This tax will take effect April 1, 2014, unless otherwise delayed or repealed by the state legislature and such delay or repeal is signed by Gov.  Mark Dayton.


First, it is much, much more difficult to repeal enacted legislation than to amend, kill or delay pending legislation.  Once a bill has been passed through the legislature and signed by the governor, the task of reversing a decision is huge. 


One example of a successful repeal of a bill is the Michigan Services Tax in 2007. That experience taught us of the importance of the economic groundwork that must be done in three key areas:

  • Demonstrate that warehouse services taxes are outliers. This fact must be proved by a survey of all tax provisions state-by-state.   Government research will often claim household goods or self-storage as evidence of a warehouse-services tax.  Our industry knows this claim is wrong; but proving it from a respected third-party source is fundamental.
  • Demonstrate the tax receipts will be far less than the programmed receipts in the budget and that by moving forward with the tax, the administration is creating a structural budget deficit.
  • Demonstrate the actual impact of the tax will create a negative yield in terms of job flight and tax receipts.  IWLA was able to prove the second and third points to the Michigan Legislature via the study we commissioned from Michigan State University.

However, economic proof is actually the lesser of the mountains to climb.  The higher mountain is to create “safe” ground for the politicians who voted to impose the tax and who now need to reverse their votes.  They will look to our industry to find them that “nonpartisan” ground so that the tax’s repeal cannot become campaign fodder in the next contested election.  Again, IWLA was able to do this in Michigan through a coalition that worked to develop an alternative revenue stream to make up for the budget shortfall.

In summary, our industry has a scant five months to gather economic facts and provide a safe ground if we are to secure repeal of the tax.  We know what must be done and how it is possible to get it done.  But that is only a roadmap and the journey is ahead. We will keep you informed.


###

ATA Estimates 1.5- to 4.0-percent Productivity Reduction from Hours of Service: What Can 3PLs Do?

By Joel Anderson | 06/25/2013 | 6:00 AM

 Unless the American Trucking Associations prevails in its legal challenge to the U.S. Federal Motor Carrier Safety Administration’s regulations, the new Hours of Service rules for interstate drivers will commence July 1, 2013. ATA has a legal challenge from the District of Columbia Circuit Court of Appeals. This litigation asks the court to vacate the FMCSA rules on the standard that the changes are not supported by science; and as a result, they are arbitrary and capricious.

 As you read this column, you should start developing your new routes and dispatches to incorporate the changes coming down on July 1. ATA has an excellent guide on its website www.trucking.org. You can also click through to the ATA testimony before Congress on the hours of service.

 If you have a trucking operation, download all the materials and read the changes. If you broker or arrange for the brokerage of freight, be sure to talk to your providers to determine what routes will need be changed, what pickup and delivery schedules will need to changed, and what mix of freight and loading practices will minimize the disruption to productivity.

 3PLs are the logistics experts in moving freight across the United States, Canada and internationally. The changes in the hours of service have added another wrinkle, one that will in all instances reduce the hours available for motor carriers to provide service to customers.

Now is the time to sit down with your providers and your customers and be prepared.

 ###

ATA v. City of Los Angeles: All Politics - and Courts -are Local

By Joel Anderson | 06/19/2013 | 6:04 AM

The legacy of the American Trucking Associations v. City of Los Angeles case is this: The more distance the judges (both physically and emotionally) were removed from the case, the more accurate the judicial rulings. The ultimate decision? A 9-0 slam dunk eliminating the City of Los Angeles power grab against Congress and validating the supremacy clause of the U.S. Constitution. 

This case history is a script about how difficult it is for law to prevail unless business is willing to invest millions of dollars in getting the case out of the venue of the home crowd.  In a decision reversed and remanded by the very liberal 9th Circuit, the Los Angeles-based District Court trial judge ruled Los Angeles City has the powers to regulate interstate and foreign commerce, despite the fact Congress had specifically extended its power to deregulate at federal, state, regional and local levels.

On remand, the District Court judge still found reasons for the regulation to continue. The judge simply took into account those areas that the 9th Circuit said were wrong. ATA then had to go back to 9th Circuit to undo once again the ruling of the District Court judge.   The 9th Circuit reversed a second time, but still let in certain powers of the City of Los Angeles with respect to placarding and parking.

ATA then appealed to the U.S. Supreme Court, which, being both 3,000 miles away from Los Angeles and the 9th Circuit read the facts as a matter of law. Justice Elena Kagan, an appointee of President Barack Obama, wrote the court’s opinion. The nine justices found no basis in law for City of Los Angeles’ regulatory scheme. 

Here’s the bottom line: Were it not for ATA members investing millions of dollars to seek a hearing and review of the law at the Supreme Court, our industry would again be facing bad laws out of California.  The City of Los Angeles, taking advantage of taxpayer-funded legal expenses, and a District Judge (who lived in the area) devised a scheme that lost 9-0 at the U.S. Supreme Court. 

The International Warehouse Logistics Association’s retained labor attorney Kerryann Haase Minton always reminds me “that distance brings objectivity.” This is one of the many reasons she is my second opinion on all personnel matters. As the ATA v. City of Los Angeles case demonstrates, distance also brings objectivity in the application of the rule of law.  

The Tribal Politics of Advocacy: Shape Up and Be Successful

By Joel Anderson | 06/11/2013 | 1:42 PM

The goal of this column is to discuss the latest research on how individuals form themselves into peer groups with respect to legislation and regulations.  This research is important to IWLA and our membership because our goal is to pass the legislation our members seek or defeat the legislation our members oppose.  As a result, we gather and analyze these studies and apply their findings to advance the policies and practices of our membership. The publication cited for this column is, The Three Languages of Politics, which gives an excellent “how to” of the best techniques in being effective in public policy and regulations.  Author Arnold King describes three streams of American political sensibilities: 

1)      Progressives see political governance and political responses in terms of oppressors vs. oppressed.

You can read examples of this context in the propositions of progressives: labor vs. management; poor vs. wealthy; race vs. race; gender vs. gender. Read any press release from the California South Coast Air Quality Management District and you will see it breaks society into oppressors vs. oppressed divisions.

 2)     Conservatives see political governance and political responses in terms of civilization vs. barbarism.

You can read examples of this context in the good vs. evil of foreign affairs; prudence vs. spending; checks and balances vs. a living Constitution. Read any column by George Will and you will see he discusses current issues in terms of civilization vs. barbarism.

 3)     Libertarians see political governance and political responses in terms of freedom vs. coercion.

You can read examples of this context in many places: the new regulations on financial institutions vs. the viewpoint that any new government regulation is an infringement on freedom; the EPA vs. the free market in reducing pollution; the mandate of health insurance vs. choice to not be insured. Read any column by Nick Gillespie and you will see he sees the fierce hand of the state against individual freedom.

IWLA shapes its arguments and advocacy for the protection of our membership. In California the governing party is the progressive wing of the Democratic Party. Many elected officials come from trade union backgrounds and their bias is an “us vs. them” bias. To represent our membership, IWLA must present our positions in California through impacts on jobs and career ladders, referencing studies done by the University of California or a similar government-related source.

In dealing with the U.S. Food & Drug Administration, our filings first emphasize the positive impacts of our proposals on health and safety. Industry cannot be heard at the FDA until we first demonstrate to them our integrity and build credibility that our requests are consistent with the public health.  Unless we prove our trustfulness, the agency will dismiss our concerns.

The most difficult public policy argument to make is when the regulator or elected official is embedded in their ideology and logical arguments make no difference. The prime example of this reality is the U.S. National Labor Relations Board. Employers can try to frame their arguments in terms of employee advancement; but, in my opinion, that is simply wasted resources. NLRB members have shown their intent to push through an agenda that all workers are oppressed unless represented by a union.

With the NLRB, the IWLA position becomes one of opposition from the beginning because of the strong ideological orientation of the regulators. We have read their decisions and their reasons. We understand that in all instances they see employers as the oppressor.

 I would recommend as you read the daily political reports, you apply this three part “tribal division tool” to discern the orientation of the person talking to you about politics. You will find this approach gives you a neutral space to evaluate how to protect and advance your company with elected officials and regulators and to present yourself and your company in a manner completely unpredicted by your opponents.

The opinions expressed herein are those solely of the participants, and do not necessarily represent the views of Agile Business Media, LLC., its properties or its employees.

About Joel Anderson

Joel Anderson

Joel D. Anderson is president and CEO of the International Warehouse Logistics Association (IWLA). Based in Des Plaines, Ill., IWLA is the 120-year-old association of the warehouse-based third-party logistics industry, with 500 members in the U.S. and Canada. Before joining IWLA, Anderson spent 28 years at the California Trucking Association, the last 13 as executive vice president and CEO. An economist by training and profession, Anderson was also a past board member of Cascade Sierra Solutions. He is a frequent speaker before supply chain industry groups.



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