The logistics sector has been seeing a rapid uptake of various technology solutions as enterprises push the pedal on digitalising their businesses and operations. New-age technologies such as internet of things (IoT), artificial intelligence (AI) and automation have made inroads into the sector in recent years. The onset of the Covid-19 pandemic has further accelerated the digitalisation trend. Prateek Joshi, Senior Manager, IT, India Infrastructure and Logistics shares his views on the evolving technology landscape, the challenges faced in deploying new-age solutions and the future outlook for the sector…
What are some of the key information and communications technology (ICT) trends that have shaped the logistics space during the past few years?
Due to the easing of trade barriers and the introduction of developed technologies, logistics has become a strategic concern and key for companies to develop sustainable competitive advantages. One of the critical factors in differentiating logistics is technology. This fact is gaining prominence with the emergence of new technologies such as radio frequency identification (RFID) and bar coding which, coupled with GPS tracking, are being widely used in tracking inventory on a real-time basis. This information can be integrated with warehouse management systems for effective inventory management and forecasting, thus reducing complexity and uncertainty in supply chain environments.
The emergence of new technologies is a crucial factor that has changed the scope of logistics. The internet and ICT are incontrovertible enablers of logistics innovation. They do so by sharing information among all parties in a supply chain and connecting them. They facilitate information flows and communication among partners, enabling global logistics processes. The advent of the internet has led to the growth of e-commerce and the emergence of diverse business models. The now common online shopping has opened new business opportunities for logistics firms that manage order fulfilment and distribution. The recent development of mobile technologies and their applications has accelerated such trends by helping the transition from multi-channel to omni-channel environments. Now that customers have multiple options to interact with firms and need a seamlessly integrated experience, logistics operations have become complex. Such roles are becoming increasingly important for customer satisfaction and company performance.
What role did ICT and digital solutions play in helping the logistics industry during Covid-19?
In just a few months’ time, the Covid-19 crisis has brought about years of change in the way companies in all sectors and regions do business. Logistics companies have accelerated the digitalisation of their customer and supply-chain interactions as well as their internal operations. Consumers have moved dramatically toward online channels, and companies and industries have responded in turn by rapidly shifting to interacting with customers via digital channels. Companies from all industries are doubling down on advanced technologies, from blockchain to AI to machine learning (ML) and robotic process automation (RPA). The current fragility of global supply chains, the necessity for end-to-end transparency and the availability of digital technology for rectifying the situation has created an exciting surge of companies exploring new applications and possibilities. With chatbots for customer enquiries, ML-powered analytics for planning and forecasting, self-driving vehicles, etc., the logistics sector seems to be ready to take a giant leap towards digital transformation.
What are the key ICT and technology solutions being used by your organisation, and how are these benefitting operations? Did you deploy any new technologies/digital solutions during the past year in response to Covid?
We are spending around 3.5 per cent of revenue in the adoption of digital technologies in line with new digital transformation trends. Our core IT strategy is focused on:
- Customer experience: Introducing a brand-new customer experiencing by adopting real-time data interchange methodologies, both in terms of shipments delivery and forecasting, to satisfy the changing needs of customers as well as market demand. We are helping our customers reduce their costs and time delays by keeping them abreast of planning and delivery of their shipments.
- Automation and operational excellence: With strategic planning and investment in technologies such as mobility, RPA, advanced analytics platforms and RFID solutions, we address a wide range of scenarios, from solving asset under-utilisation and supply chain inefficiency to increasing visibility and connectivity across multiple systems.
- Cloud computing environment: Cloud computing has emerged as a major technology in the optimisation of operational efficiency and cost in the logistics sector. We have adopted cloud technologies in multiple fields, including shipment tracking, operational planning and asset monitoring.
What are some of the most pressing issues faced while deploying new-age solutions?
Some common challenges faced in an organisation during the adoption of new technologies are:
- Adopting new tech just because it is new: A lot of new technology is useful, but some of it is just designed to sell. Even when the technology is useful, it may only be so for individual companies. Finding the right solution for your business needs is very important, and proper time and effort should be given in this direction.
- Not implementing the right systems and procedures: New technology must be integrated into current business processes to utilise its full potential. Buying new technology is not enough. After the purchase, your existing systems and procedures need to be adjusted to incorporate the new technology in a way that limits disruption and the need for additional training, while still taking advantage of all that the new tech has to offer.
- Failing to win staff over to the new technology: Some people love learning how to use new technology. Others resent any change to what they consider tried and true systems. For the new technology to be successful in any organisation, your internal users must be included in the selection and adoption of the technology.
- Not training staff adequately in the utilisation of the new technology: Every new technology adopted by the organisation is going to require training so that the employees can use it. Just because the new tech claims to be “user-friendly” does not mean there is no need for training. Training is an expense, and it is an area where some businesses get cold feet after spending so much on new technology. The success of any technology depends on how well the users are trained in using it.
- Not monitoring data: One of the greatest things about new technology is that you can control numerous data points to get a clear picture about its usage and effectiveness. Monitoring data and progress can seem tiresome and unnecessary, especially when you are personally watching your employees and company. But it is the most efficient way to measure progress toward your goals.
Going forward, what will be some of the key digital trends that are expected to surface in the logistics sector as the new normal unfolds?
A few of the popular emerging trends in the digital space in supply chain logistics are:
- Planning and forecasting: With supply chains incorporating more end-to-end digital technology, companies are now able to take a holistic view of processes via collected data. ML algorithms can be programmed to analyse statistics, factor in historical and environmental information, and then produce insights into patterns or trends.
- Warehouse and stock management: The possibilities of AI-based automation within warehouses are extensive. From mechanical arms that can sort, select and handle cargo to software capable of calculating daily stock movements and even automated cleaning robots programmed to work in dynamic environments, AI can facilitate the fast-paced changes required by supply chains.
- Chatbots: Able to mitigate large volumes of customer enquiries in a qualitative manner, AI chatbots can be an invaluable resource for liberating employees from routine or repetitive duties and refocusing them on more client-centric tasks.
- Self-driving vehicles: Although still at nascent stages of development, self-driving vehicles have the potential to dramatically transform modern supply chains. AI systems, fed a constant stream of data in real-time using cutting-edge network technology such as 5G, will give vehicles the autonomy to make road-based decisions that factor in traffic, weather conditions and terrain challenges.