Over the last couple of years, logistics has been adopting digital innovative solutions at a slower pace when compared to other industries. Such a reluctance to ‘go digital’ could create some serious potential risks should the companies of the field ignore them. Luckily, not everything is so gloomy in the realm of ever-growing digital transformation: digital platforms gain importance in the logistics industry, allowing small companies to have a global reach and compete with the sector’s established players. They estimate that very soon a newly-shaped global digital platform will transform the customer’s experience of logistics and will convert into a key issue in defining which enterprises will win the competition in a recently remodelled logistics sector. The experts are positive that transformation will inevitably be accompanied by crucial social and environmental benefits by augmenting efficiency and cutting down energy consumption and emissions.
Does logistics trail behind other industries to embrace digital revolution?
The studies confirm that media, telco, banking, and retail sectors are already ahead of logistics when it comes to adopting digital alterations. In this already fragmented industry, traditional logistics companies are known to be plagued by underutilization of assets, old and inefficient manual processes, and outdated customer interfaces that significantly decrease response times. Hence, with a purpose to facilitate transformation of the industry, the following three key digital actions should be implemented by the businesses:
1. Development of new business models and projects. New digital platforms will help remove supply chain inefficiencies, solve problems associated with asset underutilization, improve demand-supply matching, and increase visibility and connectivity across systems. Introduction of the advanced analytics elements will bring efficient data-driven solutions to work that, in their turn, will optimize clients’ operations and efficiencies. The use of the solutions that improve operational visibility and connectivity between previously siloed systems enables stakeholders to connect to one another throughout the supply chain.
2. Digitalization of crucial operations. Logistics businesses apply advanced analytics to optimize operations in pricing, routing, and partial load shipment consolidation. As for the customer experience, digital front end provides customers with a problem-free experience and improves internal operational visibility, automating previously manual processes. Automation of core internal business processes will surely simplify labor-intensive logistics operations.
3. Shaping a solid internal digital platform. Logistics companies should actively attract smart digital talent to maintain efficiencies and deliver on the promise of value for customers.
Significance of data in the world of logistics
Nowadays, data connects all walks of life with customers. In the hectic world of logistics, data is the link interrelating trucks and warehouses with quality monitoring and artificial intelligence. Data provides the distributors and third party logistics with a unique chance to to differentiate their value propositions. Valuable insights facilitated by the data use ensure real-time visibility, security and efficiency, as well as allow the specialists to foresee and proactively act on supply chain risks. Leveraging of big data is a secret ingredient used by the businesses to reinforce their competitive edge and solidify reputation by offering expertise and insights that can help manufacturers and retailers achieve their strategic goals. With an ability to run the entire supply chain on behalf of a customer, logistics experts of today got an opportunity to adjust their ordering and inventory levels that grant them invaluable insights that are extremely beneficial to improve the general service levels.
Apart from that, data analytics speeds up rendering of strategic value benefits to the customers, including producing predictive insights and real-time visibility into their supply chains. As a result, the clients are presented with a dynamic supply chain that allows them to make efficient decisions that reduce network latency, shorten cycle times, as well as protect profit margins and establish long-term partnerships.
Blockchain technology is another breakthrough causing a big disruption for distributors and third party logistics. Although this cutting-edge technology can reduce stock wastage and increase the efficiency of the supply chain by offering an option to track goods throughout each point of the supply chain, from manufacturing to sales, it still presents substantial challenges in the sector.
As for now, there’s still lots of room for improvement. Information and logistic services, delivery capabilities, and circular economy are just some of the key digital themes, where digital transformation will be notable over the next years. Although shipping and logistics industry is in constant search for innovative solutions aimed at improving already existing processes, cutting costs and increasing the transparency of the supply chain, transport companies still consider digitization their biggest challenge.
Many companies from the high-tech sector do their best to penetrate the industry and secure large market shares through their IT marvels. This makes the competition for traditional forwarding agents ever harder. No doubt, logistics companies should consider their operational improvements via robotics and artificial intelligence, that, in the long run, will elevate a logistical organization’s operational efficiencies in distribution, warehousing, and picking and packing. By and large, logistics sector must exercise high agility in the solutions development in order to maintain the pace of digital changes, maximize its benefits, and stand out among the numerous competitors.