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Yossi Sheffi explores how distribution centers can spur economic growth and innovation
Regions and countries around the world are competing fiercely to hold on to factories while incubating new, high-tech industries. Yet, for many, there may be a more sustainable path to success: becoming a logistics center for transportation and distribution.
In "Logistics Clusters: Delivering Value and Driving Growth" (MIT Press, 2012), MIT professor Yossi Sheffi explains how distribution centers are becoming much more than the places where goods are unloaded from boats and planes onto trucks and trains. With some government help, they often evolve into thriving sources of innovation.
"Like other clusters, logistics clusters enable tacit information exchange between companies and attract specialized labor and supplies, thereby improving efficiency and competition and making it easier to start new companies," says Sheffi, director of MIT's Center for Transportation & Logistics (CTL). "Yet logistics clusters have many additional benefits." These include low transportation costs, a high transportation service level, and a broad, stable base of non-offshoreable regional jobs, Sheffi says, as well as a wide range of complementary economic activity in repairs, maintenance, packaging, and manufacturing.
Sheffi’s best-selling book The Resilient Enterprise (MIT Press, 2005) offered strategies for responding to major disruptions to industrial operations and supply chains. He's now working on a major update that offers more insights into the proper role of government in responding to disruption, as well as risk-management lessons from Hurricane Katrina, Hurricane Sandy, and other natural disasters. Other recent projects include research into sustainable supply chains and the challenge of estimating carbon footprint across the supply chain. Read more
