Emerging technologies that will disrupt the logistics and warehousing sector

Logistics Truck

By Jyotheesh Kumar, co-founder and CEO, ValueShipr

Global technological development will deeply impact and improve the logistics industry. Some of the major technologies in focus today are autonomous vehicles, drones, 3D printing, AI, IoT and Robotics. 3D printing will minimize the need for movement of parts and consumables and will greatly impact the logistics sector in coming years. With AI and IoT already being used in conjunction, their full potential will soon be unleashed, as more and more companies focus on AI for route optimization and IoT for fleet management and better optimization for the fleet users.

Autonomous vehicles are on testing grounds, self-driving vehicles have already made inroads in logistics, reaching a level of maturity for commercial use in warehouse operations. The next step for self-driving vehicles in logistics will be to overcome regulatory and security challenges to deploy autonomous vehicles on public roads. While drones and UAVs still require mainstream adoption, few tests have demonstrated the future potential of UAVs especially in upcountry delivery scenarios. However drones will also be in focus, increased use and optimistic plans from users will completely change the landscape.

Advancements in Robotics, AI and Machine Learning will greatly improve efficiency in logistics and warehousing, through various applications like warehouse robots and automation, route optimization, territorial mapping and dynamic pricing.

How Big Data can revolutionize the logistics & supply chain sector
Supply chains have for a long time now been driven by statistics and quantifiable performance indicators. Supply chain planning is driven by forecasting to make sure the right things are in the right place at the right time and therefore it helps tremendously if you understand the underlying demand.

Traditional data monitoring, which would involve sales and order tracking and point of sales data, is now being supplemented using big data with weather, events and news, social media with the aim being to generate insights in the short term, such as how operations will be affected this week, rather than on a broad, annual timeframe, the impact on sales etc. Big data and real-time analytics have had a big time impact on how the supply chain functions would be conducted in the future. Real time analytics, un-structured data sets would be used by firm to predictive and time bound implementations. Some applications that have already found their way into inventory management, forecasting, and transportation logistics.

In warehouses, digital cameras and sensor based IoT networks are routinely used to monitor stock levels and fleets. This messy, unstructured data provides alerts when restocking is needed. The same data can be fed through machine learning algorithms to teach an intelligent stock management system to predict when a resupply will be needed. Eventually, the theory is, warehouses and distribution centers will effectively run themselves with very little need for human interaction.

Leveraging cloud computing in the logistics sector
Cloud-based applications are nimbler, faster and more powerful than external IT data management systems, allowing for more complex data processing and sharing. Ease and accessibility of access points, allows to retrieve and analyze inventory or transportation data to help take moment decisions based on real-time reporting.

Companies and freight managements can use this real-time reporting capabilities to track and locate products at any point in the manufacturing, distribution, or shipping cycles, which help get them a holistic view of the overall supply chain.

Some of the benefits associated with leveraging cloud computing are:

Scale: Users can scale up or down based on their requirement without having to think of software or massive hardware implementations and massive cost considerations it entails. Unlike more traditional data storage and transfer systems, supply chain planners and managers can adjust the scope of their cloud-based computing capacity based on the projects and markets they’re trying to fulfill.

Cost efficiency: In an era of rapid expansion on a multi location or global scale, the capacity to maintain one central point of data and reporting that can be accessed across multiple points or across the globe is a key driver in keeping information and technology costs to a minimum. Most times implementation of cloud computing solution and the costs associated are based primarily on infrastructure and usage, updates, upgrades, enhancements, and scaling make cloud-based computing a cost-effective method of data storage and reporting, increasing ROI and promoting sustainable growth across all points of the supply pipeline.

Onboarding: Collaborations and partnerships are the routes being adopted for growth and expansion. This means companies will be able to take on more partners or third-party organizations to assist with the complexities of global supply chain management. Onboarding, or the merging of data and analytics between newly acquired or partner groups, can often be a laborious, time-consuming process with a great deal of waste when it comes to resources. Cloud computing helps reduce the amount of lag time when merging large pools of data and reporting and makes the integration of partner companies run as smoothly as possible.

Flexibility: Increasingly the key in global supply chain management is flexibility and a supplier’s capacity to adjust and respond to a variety of factors outside of a supply chain planner’s control. Whether we’re discussing adverse weather conditions, port strikes, labor disputes, product recalls, or spikes in demand, cloud computing provides suppliers with the process flexibility necessary to adequately address these issues. Through detailed, real-time reporting, a supplier can view and evaluate inventory levels, warehouse conditions, and previous freight routes and costs to identify fiscally-responsible solutions to supply disruptions. The ability to share data across all points of the supply stream also allows for suppliers to review these decisions and create best practice solutions going forward.

In lieu of all the above considerations, forward looking users need to leverage the benefits and adopt cloud computing for their enterprises.

Overview of the challenges that companies face in deploying new technologies
In India while a few of the organized players have been implementing technology solutions within their network, the majority of players are devoid of technology. Technology acts as an enabler and a medium of integrating, communicating and bringing about overall efficiencies is utterly lacking in adoption in this sector.

Technology adoption is driven by two primary factors–increasing internal efficiency which is the operational aspect and increasing external business responsiveness dependent on a complete supply chain based on business strategy and long term planning. Technology can bridge the business vision with real-time operational activities of business.

However, the adoption of technology also comes in with a few barriers. Many entrepreneurs still do not have a good understanding of IT and its benefits. Another factor is that the lack of standard practices can hamper the scalability and up gradation in India. The sector has been fairly unorganized till date which makes acceptance of technology a big challenge. Very few logistics sector employees undergo IT training during the course of their employment. Majority of the logistics market comprises small and medium-scale players who due to increased competition in the sector work on wafer thin margins, while some lack formal IT budgeting process and hence don’t plan for their IT investments.

Logistics and transportation processes are quite complex and require a high level of customization in order to enable practical implementation. Since the companies have evolved with their unique legacy processes, their IT system or applications need to be customized which drives up cost.

A large degree of understanding and vision will be required for companies to grow with minimum barriers in an efficient manner. If companies are able to swallow the short term capital cost and create an atmosphere of acceptance to newer technologies their potential for scalability and growth is endless.

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