First Principles Thinking: The Difference Between a Good 3PL and a Great One
3 minute read
“First principles thinking is a powerful way to help you break out of this herd mentality, think outside the box and innovate completely brand new solutions to familiar problems.” -Mayo Oshin
What do business tycoon Elon Musk, the method of Socratic questioning, the famed philosopher Aristotle, and the team at AM Transport Services have in common?
It’s a diverse list, but there’s a common denominator–the art of questioning assumptions–known as “first principles thinking.” We could add toddlers to the list above. No one is better than a toddler at asking why, why, why–and that’s what first principles thinking is all about.
So what is first principles thinking and how does it work?
In conversation with TED curator, Chris Anderson, Elon Musk, founder of PayPal, Tesla, and SpaceX muses that one of the reasons for his phenomenal success is physics and the scientific method of reasoning called “first principles reasoning.” Musk likens first principles reasoning to “boiling things down to their fundamental truths and then reasoning up from there instead of reasoning from analogy.”
And James Clear, over at Farnam Street, defines “reasoning from first principles” as “one of the best ways to learn to think for yourself, unlock your creative potential, and move from linear to non-linear results.” He goes on to explain that “by identifying your current assumptions, breaking these down into their basic truths and creating solutions from scratch — you can uncover these ingenious solutions to complex problems and make unique contributions in any field.”
How does this apply to logistics and, in particular, to the way we do logistics at AM Transport Services?
Right now, the logistics industry is experiencing an unprecedented capacity crunch. For a variety of reasons–driver shortage, hard enforcement of the ELD mandate, a strong economy, and produce season–shippers are finding capacity a bit elusive. DAT Solutions reported that for the week ending April 7, the van load-to-truck ratio was 7.4 loads per truck, the reefer load-to-truck ratio was 11.0 loads per truck, and the flatbed load-to-truck ratio was a staggering 111 loads per truck with rates soaring.
Shippers need solutions and they need them yesterday.
According to a recent article by Marc Chrencik, one of the best ways to navigate the capacity crunch is to create a strong relationship with a 3PL. He explains that 3PLs:
- Maintain extensive carrier networks.
- Utilize Transportation Management Systems (TMS) that offer increased visibility.
- Handle carrier related issues.
We would add to the list that a good 3PL will schedule pick up and delivery appointments, provide in-house billing, and offer excellent customer service!
But here’s where first principles thinking comes in.
At AM Transport, we assert that a GREAT 3PL specialist asks questions. And that’s what we do! We ask questions in order to understand what our customers want and need. We ask questions so we can break every transportation equation down to its unique components. We build customized solutions for your most vexing logistics difficulties because safe, on-time, and cost-efficient delivery of your freight is our first priority. Every load. Every time.
We don’t assume the rates are set in stone, or the necessary equipment is too hard to contract, or the delivery times can’t be made within the time-constraints because we start new each time. That’s a benefit our customers have come to count on. At AM Transport Services, no problem is too big–or too small–for the first principles thinking of our team.
Give us a call and find out for yourself.