The Wave of New Technologies in Logistics Requires Data Management Excellence
Q: Technology seems to be having its moment in the logistics space. What do things like the Internet of Things, Big Data, and Blockchain mean for shippers and logistics providers?
A: These elements are becoming critical parts of modern supply chains because they allow companies to harness data they might already have, or incorporate previously inaccessible external data, to increase revenue. It shines a light on the actionable data that companies have been sitting on but didn't know how to use because they didn't have the right solutions to tap into it.
Q: Shippers are increasingly turning to international logistics service providers (LSPs) for areas other than just buying capacity. Are these LSPs up to the challenge?
A: The truly valuable commodity in supply chains these days is data, but it's hard for freight forwarders and NVOs to find the resources to collect and manage that data internally. In a low-margin industry like international logistics, there is limited bandwidth to throw at technology initiatives like rate management or documentation. Yet, shippers want those services more and more from their logistics providers. Anyone can pick up a phone and find space on a vessel or a truck, but the LSPs that are differentiating themselves are those that can provide true value add and actionable data.
Q: When you say forwarders and NVOs struggle with resources and bandwidth, what do you mean?
A: Not every logistics company is adept at technology development. In fact, most are better served concentrating their resources on what they're exceptional at, which is sales, customer service, and application of industry expertise. In our experience, if you can take things like systems development and maintenance or documentation entry off a forwarder's plate, that frees them up to do more things that drive actual revenue.
For instance, if you outsource the rate management process and documentation entry, then there aren't valuable resources tied to repetitive (though important and complex) tasks. Those people who would have been filing rates or searching through spreadsheets for accurate rates, can actually be in front of customers figuring out how to better serve them. That translates directly to a stronger bottom line.
Q: How does data management come into play? Are these things linked?
A: Absolutely. If a logistics provider is not burdened with data entry, that helps in multiple ways. First of all, as mentioned above, resources are freed up to think more creatively about serving customers, not entering data. Second, when data entry is automated, it is more accurate and more real time.