Analysis of transportation distribution systems and sources

Transportation

(Attention: Because I do not have the full citation information for the 3 articles provided, I have referred to them as follows in the text. Powerpoint, Japan PDF and Carbon PDF. You will need to insert the correct citation and add a Works Cited page, if that is required.)

As the global supply chain evolves and matures, there are several considerations to take into account in the areas of transportation and distribution. The global economy is in full swing, and exports are outpaced world GDP significantly. This high demand food goods has resulted in an increased need for more international shipping options, especially maritime transport -- moving materials by ship. Changing to a more international system is not without consequences, however, including the quite serious possibilities of piracy, terrorism and a substantial negative effect on the environment. For managers in charge of logistics and supply chain management, the "right choice" has become less and less clear.

Over the past 30 years there has been a dramatic shift in how much countries export to other nations. In 1970, exports were less than the world GDP. In 1990 they were even, but shortly thereafter exports rose steeply and now far outpace the GDP (Powerpoint, Slide 2). While in 1980 most exports were fuels and minerals -- petroleum, for example -- currently machinery and transport equipment and other manufactured goods lead the way. Combined, these two categories make up 80% of all world exports (Powerpoint, Slide 3). The modes of transportation available have also influenced exports. Roads and rail are often not good options. Roads are often underdeveloped and railway capacity can't keep up with demand, so ocean cargo liners are handling more and more trade traffic (Powerpoint, Slides 4,5,6). Technological advancements in logistics have also influenced shipping choices, as managers can use several modes of transportation (inter-modal systems) more efficiently while having the information they need about each mode at their fingertips.

One of the major consequences of the shift to maritime shipping has been the increasing threat of piracy and terrorism. People probably think of Somalia first when they hear of modern pirates, but there is also a large threat in Asia, specifically at the Strait of Malacca, which runs between Singapore and Malaysia. Each year more than 60,000 ships pass through the strait, making it an excellent target for piracy (Japan PDF p. 1). Eight percent of the oil that Japan and South Korea import goes through the strait. According to the statistics presented in this article, there were 37 pirate attacks in the strait in 2004, despite the fact that worldwide piracy fell. More than one-quarter of all pirate attacks that year occurred in Indonesian waters, a total of 93 attacks (Japan PDF, p. 1) Japan, as the recipient of much of the merchandise that passes through the strait, has established a crisis task force to deal with the attacks, one of which was on a Japanese tugboat. The situation is politically sensitive, however, and since Singapore, Malaysia and Indonesia are the littoral states bordering the strait, they are the primary actors in any anti-piracy or terrorism efforts. The region is also particularly sensitive to interference from other nations, and balked at accepting help from the United States when it was offered (Japan PDF, p. 2). Increased intelligence sharing and law enforcement activity on land, however, should help decrease the problem.