The Unbroken Supply Chain
How Alaska’s transporters continue to deliver
Editor’s Note: This article was written in mid-April; as Alaska has tentatively reopened for business, the transportation companies that contributed to this article have adjusted, and will continue to adjust, their policies and procedures accordingly.
Alaskans have some experience both with isolation and sudden emergencies. Earthquakes, volcanic eruptions, seasonal flooding, and wildfires seldom schedule their arrival. And while emerging technology and developing infrastructure have allowed Alaska to become more connected, as Alaskans we know we’re still at the end of the road—even more so for those living beyond the road in Alaska’s remote communities.
So while the sudden appearance of COVID-19 in our lives, quickly followed by orders to stop leaving our homes or socializing with anyone, was definitely not normal, at its root it wasn’t completely unfamiliar, and across the state Alaskans demonstrated once again their willingness to do what needs to be done to take care of each other.
In stark contrast to most of the goings-on in Alaska—marked by upheaval and change—the flow of goods and supplies into the Last Frontier hasn’t altered, at least in the eye of the casual consumer. “The supply chain is fully functional: it’s uninterrupted, it is efficient, it is reliable,” says Terry Howard, president of Carlile Transportation.
A Culture of Safety—Upgraded
What’s impressive is that Alaska does continue to receive essential goods, even as the entire transportation industry has needed to adjust their operations. It’s undoubtedly no small help that industry-wide Alaska’s transporters have emphasized a culture of safety for decades.
“Safety is one of Carlile’s core values… the safety of our team members, our vendors, our customers, and our industry partners in all the communities we work in,” Howard says. “We spend a tremendous amount of time on safety… so it’s not a tremendous shift for us to be safety-centric… it wasn’t like we really had to gear up and say, ‘Okay, we need to be more safe now.’”
“Keeping everybody safe within the TOTE network is our number one priority, as it has always been,” says Alex Hofeling, TOTE vice president and general manager for Alaska. TOTE is closely engaged with local and community authorities to ensure the protection of its workforce.
Bal Dreyfus, senior vice president, Alaska for Matson, says “Our first priority is the health and safety of our employees.”
Carlile, TOTE, and Matson all report taking immediate common-sense actions early in the COVID-19 crisis: following all recommendations of the CDC, increasing cleaning and disinfecting protocols, securing and distributing personal protection equipment, and enabling as many workers as possible to work remotely.
A Span Alaska employee cleans to comply with COVID-19 guidance.
But “transportation” is a varied business, and there is no one-size-fits-all solution for coping with a pandemic. Span Alaska’s President Tom Souply says, “We are especially focused on the 6-foot rule. For example, the only time we allow two dock workers in the same container is when freight cannot be moved safely by a single person. If [that is] required, both employees must wear masks.”
TOTE has implemented “special provisions to minimize ship-to-shore interface” with its vessel crews to limit their exposure and has limited or eliminated physically transferring paperwork, instead allowing documentation to take place electronically. Matson “changed the way we process automobiles to avoid the exchange of paperwork” and now does all of that documentation electronically. Carlile has dropped the requirement for customers to sign a receipt. “The drivers will sign those for you, and you have a designated amount of time to contact us with any concerns about your shipment,” Howard explains.
Northern Air Cargo has installed an acrylic sneeze guard at its customer service counter, and, according to General Manager Gideon Garcia, “For our pilot group we have paired up our pilots and first officers so they’ll fly together for an entire month or two,” reducing the number of interactions between different employees.
And to the credit of these companies, they recognized the threat that COVID-19 presented and acted quickly to address it. Garcia is familiar with the perils of exposing a group of people to a virus: earlier in his career, he worked in the cruise industry for many years. “We dealt with NLV (Noro-like viruses) on the cruise ships. I had a lot of experience with that, so I was able to bring [that experience] for our workforce.” He knew early on that Northern Air Cargo needed to secure its own supply line of cleaning and personal protection products and guided the company in acting quickly.
“We immediately stood up our Incident Command System, or ICS,” TOTE’s Hofeling says of their early response. “Really even before a lot of Alaska or the Lower 48 was talking about COVID-19, we stood up the ICS to make sure we could communicate using it.” As early as February the shipping company had systems in place to facilitate its office staff working remotely. “We made sure that we could quickly get everybody working from home without impacting the customer and the market,” he says.
The majority of Carlile’s administrative/office staff is working remotely, “which was something we’re not really used to doing,” Howard says. “But obviously, given the circumstances, we had to adjust quickly.”
Souply says that all of Span Alaska’s employees that can work from home are doing so, and the company is imploring its employees to take their work home in more than one way. “We are encouraging employees to use the same rigorous approach to personal safety when they are away from work; we are asking our employees to be responsible and protect their teammates by practicing the same safe habits away from work we are asking them to practice at work.”
Carlile President Terry Howard wears a fish face mask, setting a stylish example of safety.
Outside the Organization
Transportation is essentially a network, connecting people or goods to each other. So while internal policies and procedures to address safety are absolutely vital, keeping the supply chain solid in Alaska necessarily involves an endless number of other organizations including customers, industry partners, and sister companies. How those other organizations are coping with COVID-19 is both part of the challenge and the solution.
“With the ‘hunker down’ order in Alaska, we are seeing more challenges to deliver freight,” Souply says. “With non-essential businesses closing, our facilities are building up undeliverable shipments. Our sales and operations teams are working diligently, contacting these companies and setting up appointments for them to meet and take their shipments. Our customers have been fantastic, understanding they must support us and keep our operations fluid.”
“What we’re seeing is customers are calling and saying, ‘Please make sure you call before you come over,’ which is not a norm for a lot of customers,” says Carlile’s Howard. “We’re seeing some limited access, something as fundamental as—and this is kind of a sensitive subject—but a lot of the customers will no longer allow our drivers to use their restroom facilities, so you’re seeing a little more standoffish type behavior, but we fully support and understand their reasoning.”
Carlile has suspended some of its fees associated with notification prior to arrival and driver standby (when a driver is waiting at a delivery site) to work with the businesses it serves. “We’ve just had to be more transparent and more efficient with our communications with the customers,” Howard says.
Span Alaska and Carlile routinely deliver goods for customers that operate on a “just in time” system, meaning those customers can’t support extended delays in receiving shipments any more than Carlile and Span Alaska can afford to store shipments indefinitely. The flexibility both companies are demonstrating has been key to keeping the supply chain robust. As an example, Span Alaska works closely with Matson to identify shipments of food and other critical supplies in case space is short on Matson’s ships.
That flexibility is only possible if all parties are in close contact. For Matson, “We are in constant communication,” says Dreyfus. “Most of our customers are long-time, loyal customers and we have very good, strong relations with them. We work with them, they work with us, and the combination has been fantastic.”
Northern Air Cargo delivers goods to many communities that rely on regular and routine transportation services and has similarly needed to communicate clearly and find workable compromises with those communities. “A good example is Unalakleet,” Garcia says. “The village of Unalakleet imposed some travel restrictions in an effort to reduce exposure for the local residents to members of the crew aboard the airplane. However, we still need assistance in unloading the airplane because it’s heavy freight onboard and it’s not the work of just one person, so we had to modify our loading operations to work with our local contractor who does the loading of the plane… And it’s working out well. We had to put some limitations on what we could bring back from Unalakleet, but the key thing is food and medicine and vital goods are going out there on their regular twice-a-week schedule, weather allowing.”
And it’s not just remote communities taking a hard line on outside contact. According to Howard, “The Prudhoe Bay region seems to be the one that’s had the most sensitivity and urgent response to COVID-19; what we’ve been experiencing there is that they have a more aggressive approach to limiting access to Prudhoe Bay.” Carlile has worked with oil field operators to ensure their employees meet strict requirements to continue working on the North Slope: a minimum 14-day quarantine for employees that have been out of state, daily testing, and being aware and respectful of newly limited access to certain facilities.
Collaboration is also ongoing amongst transportation companies. In addition to consistent communication with local authorities, TOTE is working with regional businesses and industry groups to evaluate, share, and implement best practices. TOTE also has a standing meeting with its sister companies to provide updates and discuss how to best support the communities they serve and each other. “Even little things like sharing some of our cleaning supplies,” Hofeling says. “We’re actually doing that right now: somebody’s got a pallet of cleaning supplies and we’re going to work with a sister company to bring it up and we’ll share it amongst each other.”
Palletized goods await delivery at a Carlile facility.
Become an Industry Sponsor
Resolve and Responsibility
Alaska relies heavily on supplies from Outside. Businesses in our local manufacturing and agricultural industries produce items of high quality, but those industries (though growing) are small, and many Alaskans would be faced with incredibly difficult circumstances if our supply lines were to falter. Our freight and cargo movers take that responsibility seriously.
“In our DNA we consider ourselves critical infrastructure to the state of Alaska, and that comes with a lot of responsibility, and it also comes with very robust business continuity plans so that we can continue to provide this critical transportation to the state,” says Hofeling. “Our core values and our standards have not changed… we’re continuing to call on the Port of Alaska twice a week, and we do it safely. The Alaska supply chain, and TOTE, are very resilient and strong and we’ve got continuity plans to deal with any future changes that we may see.”
Matson’s Dreyfus agrees that more changes are to come. “The reality is COVID-19 is not over; we’re in the midst of it. It will change and as it changes we’ll learn more about it and find new ways that things should be done.”
“We get it: we’re in this together, we’re the lifeblood, we’ve got to make sure it works,” Dreyfus continues, adding that since COVID-19 has emerged the international shipper hasn’t missed a single shipping in its network, which includes Alaska, Hawaii, Guam, China, and Japan. “Matson recognizes its responsibility as a lifeline to Alaska, and we’ve got the entire Matson team committed and focused on it… people should feel comfortable that we will continue to provide that service.”
Northern Air Cargo has a simple message for Alaska: “Bypass mail keeps coming in.” Alaska’s rural communities rely on the service, which at the best of times can be unpredictable because of weather. When Ravn grounded its planes and filed for bankruptcy in early April, the most immediate concern for many rural communities was their supply chain. Fortunately, other air carriers, including Ryan Air, were able to take over transporting freight to those communities. As Garcia says, “That is the supply line for rural Alaska, for food, for all the stores out there.” He continues, “Our staff understands this well—and have for the over sixty years of our operation—that we are a vital link to a population that doesn’t have many choices for transportation. If you can’t get there because of frozen rivers and lack of roads, then it’s got to go in by air. Our staff recognizes that our customers are in a unique location and have a unique way of life and that we are a vital part of their livelihood.” He says bypass mail has even seen a modest increase, “due to local populations preparing for worst-case scenarios.”
Souply echoes that Span Alaska employees are committed to making sure Alaskans have the supplies they need. “We understand and take great pride with our role in the Alaska supply chain,” Souply says. “Every employee at Span Alaska understands our connection with Alaska and understands that in many cases the ship arrivals and commerce on those ships are the weekly supplies for Alaskans. This is a critical time for Alaska and our team at Span will remain focused and committed to serving our customers and Alaska without disruption.”
The majority of Alaska’s freight enters the state through the Port of Alaska, “but then a high volume of that freight needs to get dispersed to outlying communities: to the Kenai Peninsula, to the Railbelt, to Prudhoe Bay, to the Mat-Su Valley,” Howard says. That’s standard operating procedure for Alaska, and despite many adjustments, Alaska’s transporters really are operating business as usual—though with more masks, disinfectant, and space.
“For the most part, our operations are operating normally, to the extent that we’re still delivering on time, we’re still repairing trucks and trailers, we’re still paying our bills, and we’re still managing data on behalf of our customers. As an industry, we’re still fully functional,” Howard says. Furthermore, he explains Carlile’s resources aren’t unduly stressed under the pressure of COVID-19. “We’re not operating at 110 percent capacity and pulling our hair out,” he says. “But we’re also not short-changing customers. So when people start to think, ‘Maybe I should buy twelve pallets of toilet paper,’ the supply chain is not strained; it is not overwhelmed. More toilet paper is on the way.”
Span Alaska workers wear PPE and remain as far from each other as possible while loading and unloading containers as a precaution during the COVID-19 pandemic.
In This Issue
2020 Best of Alaska Business Awards
Welcome to the 5th Annual Best of Alaska Business awards. First and foremost, thank you to our readers who took the time to nominate the businesses that you see provide exceptional services to Alaskans. We publish the results, but you awarded these businesses with recognition for the hard work they do in their very varied fields.