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Technology Moves: Increasing use of IT solutions by logistics companies

March 24, 2017

Technology Moves: Increasing use of IT s...

Enterprises in the logistics space have been increasingly using information and communication technology (ICT) systems to drive operational efficiencies. These solutions have become critical for tracking shipments and gaining end-to-end visibility. Technologies like internet of things (IoT) and cloud are gaining traction amongst logistics companies for ensuring effective communication with consumers as well as within the organisation. Going forward, the industry is expected to step up its ICT investments for the adoption of technologies like augmented reality, which would optimise the collection, warehouse planning and freight transportation processes. Enterprises in this space talk about their IT strategies, emerging technology trends and future plans for upgrading their ICT infrastructure….

How are telecom and technology solutions helping improve performance and efficiency in the logistics sector? What are the key technology solutions being used?

Prateek Joshi

Emerging technologies are creating strategic opportunities for organisations to gain a competitive advantage in all areas, including logistics and supply chain management (SCM). These technologies are helpful in coordinating activities to manage the supply chain. Moreover, the cost of information is decreasing due to the increased adoption of such technologies. The latest technologies being used in logistics and SCM can be segregated into three broad areas: automatic identification technology including barcoding, radio frequency identification (RFID) and voice recognition; communication technologies like electronic data interchange (EDI), geographical positioning systems (GPS), track and trace systems and information directed systems (IDS); and information technology (IT) consisting of hardware and software that captures, analyses and provides information whenever it is needed.

Moreover, the use of IT tools like enterprise resource planning (ERP) by logistics companies has given them a competitive edge by enabling a quicker response to customer needs, reduced inventory costs, improved service levels and lower logistics costs.

Amol Jumde

The solutions being used in the industry include technologies such as RFID and GPS. These two technologies have eased cargo/container and vehicle tracking activity in the logistics sector. Activities that were previously event based and depended on manual action are now equipped with end-to-end automation to provide real-time data. This has increased accuracy and reliability in service and led to time and cost savings.

Ashwani Kumar

Technology and telecom combined form a key element of empowerment for today’s businesses. They provide a platform to bring in business efficiency and cost savings. Technology and telecom solutions are playing a big role in cargo management and customer relationship management (CRM) in the logistics industry. Some of the technology solutions used by the industry are GPS, RFID and optical character recognition.

What is your company’s IT blueprint?

Prateek Joshi

Our IT systems deliver increased efficiency, reliability and responsiveness through the automation of supply chain activities, end-to-end visibility and a wealth of business intelligence. We employ IT to provide best-in-class service to our customers by implementing ERP systems and technology. Our track and trace systems are powered by GPS technology and provide our customers with real-time information of their consignments on email/SMS/web portals. These systems are designed to generate auto notifications to various stakeholders on certain events.

Further, EDI systems with our partners and customers have helped us achieve faster and paperless information exchange in real time. By making use of data analytics tools, which give the management visibility of cross-functional data under single dashboards, decision-making is now more data-driven. We are also exploring various auto ID technologies for seamless information interchange on a real-time basis.

Amol Jumde

At the WAN side, we have firewalls and routers as customer premises equipment. We also have last-mile connectivity on Wi-Max and radio frequency. As far as enterprise-level applications are concerned, we have the cloud federation service (CFS) Mag 3.0 and RFID-based HAWK system for operation and Infor SunSystems for finance. Moreover, a proprietary mobility application, which will be based on the Android and iOS operating systems and be supported with encryption, multilevel authorisation and secure payment facility, is being developed. Our security framework is based on the ISO 27001:2013 information security management standard. The main applications used for security include firewall consols, active directory-based authorisations and antivirus software.

Ashwani Kumar

We have our core software and telecom solutions, which drive our network topology. We have a clear distinction between what is enterprise, what is horizontal and what is vertical. SAP is used as an enterprise application across our group. CRM, telecom, software-determined operating systems and warehouse management systems are used by us.

What are the new IT initiatives taken by the company? What benefits have you derived from them and what challenges did you face in deploying these solutions?

Prateek Joshi

With the company’s focus on diversification of business product lines and growing pressure on cost reduction, we are formulating our IT initiatives accordingly. Over the next few months, we are planning to augment our technology architecture to make it more robust and efficient by undertaking new initiatives. However, the major challenge is in terms of the changing technological landscape wherein you need to work hard to maintain the right balance between handling existing processes and introducing new ones without causing a disruption in business. We faced technological challenges in introducing GPS-powered tracking systems as there were severe limitations in latitude and longitude mapping of the railway network in India. However, the gains realised after the roll-out were overwhelming. Today, we are able to provide our partners and customers end-to-end visibility on their shipment through more efficient fleet utilisation.

Amol Jumde

There are two prominent initiatives that Ameya has taken recently. These are enterprise-level application implementations and RFID-based real-time container tracking solutions. Both these initiatives have enabled us to provide single-window operations and a timely status reporting system to our customers. The challenges we faced were basically on the technology side and the overall scope management of the project. Another challenge we faced since we were among the first few to implement RFID for container tracking was the lack of a standard enterprise-level application in the CFS industry in India.

Ashwani Kumar

Some of the new IT initiatives are a terminal operational system, a CRM system, and interface integration among major customers and the government system. These are helping us in automating the data, which, in turn, helps us in conducting data analytics. We did not face any problems in putting the technologies in place. We had a very clear vision, and proper education, training and counselling were imparted to the people involved.

What has been the impact on the IT requirements of the logistics industry due to the boom in the e-commerce sector?

Prateek Joshi

The overall growth of e-commerce has been dramatic and it will continue to be fuelled by business-to-business activity. The future, solutions that offer flexibility of use and enhance the visibility of the supply chain will be the need of the industry. Mobile devices and apps are the most important technology disruptor in the field of logistics, followed by big data analytics and cloud computing. The e-commerce boom will only increase the demand for performance by logistics service providers in terms of delivery timelines, volumes and costs. Last-mile delivery will be the focus of this demand. In India, warehouse automation is currently the most underutilised category of technology development. Local material handling and robotics manufacturers are equipped to provide high quality warehouse automation support. The adoption of this technology is also driven by the demand from e-commerce fulfilment centres.

Amol Jumde

E-commerce enables direct business-to-consumer or business-to-business engagement with the respective parties. IT has been a major enabler of e-commerce. With the growth of e-commerce, we needed our IT infrastructure to be focused on accuracy, quick response services and information security.

Ashwani Kumar

In the e-commerce and logistics industries, the highest cost is incurred in transportation. Not having visibility on cargo can be a major issue. So, unless the logistics industry is driven by technology and develops technologies at par with the e-commerce sector, it will be ruled out by the market.

What is the level of adoption of applications such as CRM, SCM and sales force automation in the logistics industry? What is the outlook for the adoption of new technologies like IoT, cloud and big data analytics?

Prateek Joshi

The need for faster and multi-device remote access of information is pushing the industry to shift to the software-as-a-service model for its information management systems, such as transport management systems and warehouse management systems (WMS). Moreover, big data and analytical tools, when used to structure the large sets of data generated by these information management systems, promise to bridge inherent inefficiencies. Meanwhile, augmented reality, automation and autonomous vehicles in the warehousing environment have proven to improve the efficiency and time taken for loading-unloading, storage retrieval, picking-packing, and other processes. Mobile devices such as tracking devices enable faster order and inventory management by integrating the shipment location data with the WMS, thereby letting the systems prompt and enable easy shipment detection.

Further, the utilisation of big data analytics is reflected in route optimisation based on traffic congestion data and shorter route analysis on mobile device apps such as Google Maps. Fleet management vendors are benefited across economies by these developments due to a reduction in fuel consumption and delivery timelines. Freight forwarding service providers deal with multiple stakeholders such as shippers, carriers and third-party vendors, all of whom need access to dynamic shipment information to ensure optimised transactions. Therefore, freight forwarders need to stay abreast of technology advancements. Access to information and solution systems via multiple devices and mobile devices  cloud computing drives the adoption. Further, enhanced demand forecasting and inventory optimisation mechanisms using predictive modelling drive the adoption of analytics. Meanwhile, the demand for supply chain visibility drives the implementation of shipment identification and tracking devices.

Amol Jumde

The level of adoption of applications like SCM and cloud technology in the industry is high. The adoption of IoT is moderate in terms of CRM and sales force automation, while that of big data analytics is low at this point of time.

Ashwani Kumar

The adoption of CRM, SCM and sales force automation solutions is dependent on three factors – usability, adoptability and the benefits that a user derives from these solutions. Currently, we have 100 per cent adoption of these solutions. The adoption of IoT, cloud and big data analytics is very important. However, their adoption also depends on the organisation’s trust in the technology. When an organisation has adopted IoT and big data analytics, it has to ensure that there are engines on the cloud that can act as an interface to several things. The adoption of new technologies also depends on the complexity of the IT architecture, company policy and data security. If these are deployed within the enterprise’s architecture, it is easy to deploy, but if these are deployed on a different level of infrastructure like the cloud, it may be difficult.

Going forward, the logistics industry needs a single integrated platform. We are competitors but we must think about the end-customer as well. If we develop a forum where the customers can get all the information, they can choose the best alternative.


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