1) Big Data
Logistics is a data-intensive industry that relies on real-time information to help shipments stay on schedule and enable companies to cut costs. In such a competitive environment, real-time access to data provides greater control over the supply chain and ensures processes take place fast and seamlessly.
Big data analytics is proving vital in that regard. Logistics companies are employing algorithms to crunch data and unveil insights and opportunities they could not previously access. One of the world’s biggest logistics operations is Amazon. To satisfy orders quickly it was recently revealed that the retail giant as put in place links with manufacturers to track inventory. It then uses big data analysis to choose the warehouse closest to the vendor and/or customer to fulfil the order most efficiently. Doing so has allowed the company to reduce shipping costs by 10-40 percent.
Industry insiders agree. According to PwC, 90 per cent of transport and logistics professionals ascribe “high importance” to data and analytics across the next five years, versus an average of 83 per cent in other sectors. Retailers in the US who have adopted data and analytics to enhance their supply chains have seen a 19 percent increase in operating margin across in the last five years.
2) Fleet management systems
Fleet management systems have been around for 20 years but recently they have grown rapidly in adoption. Berg Insight estimates that in 2017, 6 million commercial vehicles in Europe have fleet management systems, and will reach 14 million by 2021.
Connected trucks and vans with fleet manage systems offer a range of features.
It enables companies to use information about entire fleets or individual vehicle-specific data to drive predictive maintenance, letting companies monitor mileage and tyre wear and thereby plan repairs more efficiently - thus reducing costs.
Fleet management systems are also optimizing workflows. Companies can monitor and manage cargo temperature in transit as well as fuel consumption for increased efficiency. Diagnostics notifying potential problems enables proactive maintenance and breakdown prevention, while the very nature of the connected fleet means all bases such as accident notification and stolen vehicle tracking are covered.
3) 3D printing
3D printing has been employed by the automotive and aerospace industries to produce prototypes for a while now, with companies able to manufacture components more conveniently, and significantly, to the same safety levels as previously.
If more industries adopting 3D printing, it could have a disruptive impact on logistics firms, as production will be increasingly decentralize and moved it closer to the point of sale.
This points to a likely big impact on manufacturing supply chain management (SCM), since 3D printing will enable the creation of complex items previously made on a production line. A potential outcome is the need for high volume production too. This means logistics companies must focus on becoming more efficient, ideally more locally focused and more agile to thrive.
4) Augmented reality
The logistics industry was among the first to adopt augmented reality (AR) tools and use them to enable remote workers to operate more efficiently. AR-enabled goggles and glasses utilizing pick-by-vision technology free up workers’ hands and have a positive impact on not just their productivity, but also their safety and comfort. ABI Research predicts that logistics will account for 24 percent of global smart glasses shipments in 2017, and that the same market will grow to US$4.4 billion by 2022.
5) Artificial intelligence
Logistics companies can leverage artificial intelligence (AI) for intelligent forecasting, something that could have a big impact on their bottom lines. Historically logistics companies could only roughly predict product demand and inventory need – today, AI enables a much clearer and more accurate picture of what types of products, quantities, sizes and colors will sell. AI can help logistics companies make forecasting a much more accurate exercise and no longer such a finger-in-the-air process. Forrester predicts that AI will drive a $1 trillion industry by 2020 and Gartner estimates that by 2020, 85 per cent of customer interactions will be managed by AI.
An industry transformed - digitally
Digital technologies are set to transform the logistics space beyond recognition, but companies do need to get a move on according to PwC, only 28 percent of logistics professionals believe their companies have achieved an advanced level of digitization.
Digital is driving disruption and change in a traditional industry but those that prosper the most will be those who move fastest. Discover how to leverage IoT and big data to beat the disruptors in this whitepaper.