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The future of global trade and logistics is agile: AEB releases new study

13-Dec-2017
The future of global trade and logistics is agile: AEB releases new study
Agile project management is on the rise in global trade and logistics: 84 percent of companies believe that an agile approach lends a clear competitive advantage, and two-thirds expect agile methodologies to eventually replace traditional project management in global trade and logistics. That’s the finding of “Agile Future – How Agile Project Management Is Transforming Global Trade and Logistics,” a study conducted by software developer AEB and DHBW University in Stuttgart, Germany. The study, which can be downloaded free of charge at www.aeb.com/uk/media/global-trade-management-study.php, surveyed 155 experts in the areas of logistics, global trade, and IT. Also included are practical tips for implementing agile project management.

Experts look to agile project management for better results

Most of the experts taking part in the survey view agile methodologies favorably: 87 percent expect more efficient processes, 86 percent anticipate faster implementation, and 79 percent predict better results. Agile project management also scores high from a cost perspective, with 60 percent seeing lower project costs as likely. In addition, 83 percent of respondents expect agile project management to boost employee motivation. “This experience aligns with the basic principle of self-organising teams in agile projects,” notes Dr. Dirk Hartel of the DHBW University in Stuttgart and co-author of the study. “You can take it for granted that greater freedom heightens the sense of responsibility and motivation of individual team members.”

Key success factor: corporate culture
The most important prerequisite for successful agile project management is a corporate culture that is open to it. Nearly three-fourths of respondents, especially those under 50, see this as critical to success. Other key factors include support from supervisors and a radical willingness by those with management responsibility to adopt agility in their own roles. “What we need here is a new awareness that permeates the entire company,” explains Dr. Ulrich Lison, a member of AEB’s Executive Board and the study’s other co-author. “Agile project management can only work hand in hand with a modern approach to management.”

Experts fear lack of discipline
In addition to the many positive expectations, however, some experts also have concerns about the application of agile project management. Nearly one-third fears that the greater freedom of self-organising teams will lead to a lack of discipline. To counter this risk, Lison cautions, it’s important to assemble the right team and ensure that everyone is properly qualified. “It’s also important to train employees appropriately in the methodology,” he adds. The most serious concerns about agile project management relate to the ability to stay within cost parameters: 56 percent consider budget overruns likely, and half of respondents also see risks in a greater need for coordination (54 percent) and inadequate project documentation (51 percent).

High expectations vs. scarce empirical data (so far)
Although most respondents see agile project management in global trade and logistics as positive and believe it will deliver a competitive advantage, only 36 percent of the companies have already begun using it. One-fifth currently plan on implementing agile project management, but 44 percent – predominantly from companies with fewer than 2,000 employees – have no such plans. For most, the reason is not a lack of potential. It’s primarily a lack of proper expertise and the absence of standards. “We expect this gap to close in the coming years through the targeted training of high potentials,” says Professor Hartel. “But professional associations should also step up and take more responsibility for supporting smaller businesses in introducing agile methods and implementing agile projects.”

About the study
The study “Agile Future – How Agile Project Management Is Transforming Global Trade and Logistics” draws upon a survey of 155 experts working in the fields of logistics, global trade, and IT across various industries. The respondents are employed by companies of various sizes in more than 8 different countries. One in ten is a member of the executive management or board, and over half of respondents (55 percent) hold a mid-level management position as the head of a business unit or department. Software developer AEB and DHBW Stuttgart have been conducting the survey annually since 2013, and since 2015 it has also been conducted in English. All the published studies are available at here.