The Indian logistics industry, like its global counterparts, is undergoing a massive digital transformation in the wake of supply chain disruptions, inflationary pressures and rising customer expectations. Modern technologies such as artificial intelligence (AI), machine learning (ML), blockchain and cloud computing are reshaping the logistics industry and addressing some of the most complex issues in the transportation and shipping space. Due to the highly complex nature of the sector and its low-margin business model, it is essential for enterprises to keep pace with digital advancements to enhance business efficiencies while optimising costs. Industry experts share their views on how new-age technologies are transforming the logistics sector in India, the deployment challenges and the way forward…
What are key digital trends dominating the Indian logistics sector? Which new-age technologies are being leveraged by the industry?
Dax Theknath, Executive Director, Jet Freight Logistics Limited
The Indian logistics sector is witnessing a digital transformation with several critical trends involving AI/ML, cloud and automation/ robotics. The rise of e-commerce and increasing customer expectations for faster delivery have also led to the growth of last-mile delivery services. The emergence of cloud computing and big data analytics is also helping logistics companies manage large volumes of data, enhance visibility, and optimise their operations. These are considered the most leveraged technologies by the logistics industry.
Senior spokesperson, Transport Corporation of India Limited (TCI)
The Indian logistics industry has widely adopted a “phygital” way of working. “Digital” innovations have enabled “physical” deliveries to be trackable, traceable and safer. Technology implementation across the value chain has helped in streamlining operational processes, bringing in agility and increasing visibility. By leveraging new-age technologies such as predictive analytics and warehouse automation, the conventional challenges of route planning, labour shortages and stockpiling have been addressed. Digital tools to measure greenhouse gas emissions have helped logistics companies identify their carbon footprint and build an offsetting strategy, accordingly, thereby contributing to a sustainable tomorrow.
The paradigm shift in consumption patterns has given a major boost to the business-to-consumer/direct-to-consumer models of delivery. This, in turn, has encouraged cashless transactions, real-time liquidation of payments and digital pay-on-delivery. Among many other advancements, the launch of the unified logistics interface platform (ULIP) by the Government of India under the aegis of the National Logistics Policy will bring about ease of doing business by providing secured access to information related to logistics and facilitating a “one nation, one permit” scenario.
How are supply chain management, warehouse automation and drone delivery evolving with digitalisation?
Technologies such as AI, handheld wireless devices, internet of things (IoT) and the cloud are impacting the warehousing business. Supply change management is benefiting by using a lot of AI/ML to help companies manage demand forecasting and route optimisation. Automation in warehouse management has been increasing steadily as it helps improve inventory management, order management accuracy, and speed to dispatch/delivery. Drone delivery is evolving in India and is expected to make a significant impact in the coming years as the infrastructure and ecosystem around it are built and become more acceptable.
Senior spokesperson, TCI
Digitalisation and new-age technological adoption are revolutionising entire supply chain from manufacturing, transportation and warehousing to last-mile delivery, drone delivery, crowd shipping and on-demand services. Digitalisation has brought about Supply Chain 4.0 with massive data analytics capabilities, de-mand forecasting, real-time inventory counting, end-to-end process integration and improved supply chain velocity.
In addition, technologies such as big data help in gathering consumer information and analysing market demand; robotics and digital inventory assist in inventory management and fast order fulfilment; global positioning system and radio frequency identification (RFID) tracking help with real-time visibility and route optimisation; and IoT makes endpoint deliveries streamlined, secure and timely.
Furthermore, drones aim at increasing delivery efficiencies in densely populated and congested urban localities and inaccessible rural regions. In the coming years, they will help reduce traffic congestion and accidents, combat delivery delays, minimise friction and maintain the efficacy of thermosensitive products.
What are the use cases of technologies such as AI/ML, cloud, 5G and IoT in the logistics sector? What are the challenges that you face while deploying cutting-edge technologies?
The logistics sector uses emerging technologies such as AI/ML, cloud computing, 5G and IoT to optimise operations and increase efficiency. AI/ML technology is used for predictive maintenance, supply chain planning, demand management, route optimisation and inventory management, enabling logistics companies to make data-driven decisions and reduce costs. Cloud computing provides the ability to store, manage and share data securely, enabling real-time collaboration and analysis of logistics data. The implementation of 5G is helping improve connectivity and speed, and allowing logistics companies to track and manage their fleet and cargo more effectively. Additionally, IoT is being used to improve supply chain visibility; monitor cargo in real time; allow safety and location monitoring for surface transportation; oversee data loggers/temperature loggers; sensors and RFID tags for inventory management; prevent pilferage; and reduce delivery times. These technologies enable logistics companies to enhance their overall performance, increase customer satisfaction and gain a competitive advantage in the market.
Deploying cutting-edge technologies can be a complex process that presents several challenges for organisations. One of the primary challenges is the lack of skilled personnel capable of effectively managing and operating these technologies. At Jet Freight, we understand that there are challenges to everything; how to curb them needs to be focused on. We ensure that the team gets regular updates and training from IT specialists and upgrade their knowledge to enable change management and adapt to the pace at which new technology is introduced along with the time taken to implement it and adjust to it.
Senior spokesperson, TCI
AI-powered demand forecasting improves resource planning with automated goods dispatch to warehouses and shipment hubs, reduces holding costs for retailers and local warehouses, and eliminates stock-outs with automated warehousing. AI-driven automated robots help humans pick, sort, transport and stow packages. They identify damages and ensure quality control in warehousing with computer vision technology and predictive maintenance. It also helps reduce financial risks by preventing data losses, simplifying resource management, streamlining inventory management, and promoting sustainable business operations.
With regard to deployment and implementation challenges, high costs, lack of executional knowledge at the ground level and the fragmented/unorganised structure of the industry are some of the key areas that need attention.
Going forward, what technological trends are expected to shape the sector?
Several technological trends will shape the logistics sector in the coming years. One of the most significant trends is the increasing adoption of automation and robotics for warehouse management, picking and sorting tasks. Autonomous vehicles, drones and delivery robots for last-mile delivery are also expected to become more prevalent. The continued development and implementation of IoT sensors and data analytics tools will enable logistics companies to optimise their supply chains further and provide real-time cargo tracking and monitoring. Blockchain technology is expected to become more widely adopted, allowing secure and transparent data sharing among logistics industry stakeholders. These trends will likely revolutionise the logistics sector, making it more efficient, cost effective and customer-centric.
Senior spokesperson, TCI
We believe that the scope is huge, especially with AI tools such as ChatGPT Plus literally taking over digital/social platforms and becoming buzzwords. Technologies such as IoT, blockchain, big data and cloud computing will definitely reshape the way businesses operate. However, it is important to understand that, today, logistics as an activity takes place on the ground and requires a “human” to actually deliver. It will take time for these technologies to penetrate the remotest corners of India and show results. Infrastructure development projects under Gati Shakti will enhance connectivity and thereby contribute to a more equipped logistics ecosystem in India.
Another critical factor that will accelerate the adoption of new innovations is public-private collaboration. The best example to cite here would be that of UPI. ULIP’s success will depend on a similar approach. TCI is already on the platform and has tested some of the available application programming interfaces on ULIP.