Driving Disruption: Planning for the Future of Logistics
If things aren't evolving in your supply chain to make room for operational improvement, it's time to think about it and plan for it.
Royal Oak, MI —They're popular buzzwords industry-wide. Technology, innovation, disruption—you hear them often and in various context. But what do they really mean for your supply chain and your business?
Industry standards have been set based upon antiquated systems. This leaves the industry caught between legacy processes and a growing need for real-time information.
"Technology capabilities are evolving dramatically faster than general adoption in the logistics industry," said Chief Information Officer, Frank Soehnge. "From automated electronic ordering, real-time truck tracking and automated delivery notification, the technology is there, but the standard industry adoption is still way behind."
Businesses worldwide are overcoming roadblocks created by legacy technologies, manual processes, lack of visibility and lack of collaboration. If things aren't evolving in your supply chain to make room for operational improvement, it's time to think about it and plan for it.
"We take for granted the technology available when we order from Amazon," said Soehnge. "The general logistics industry simply has not caught up with the revolution that is happening. At the end of the day, if you want to be in business tomorrow in logistics, a strategic path to implement these technologies is critical."
Long-term strategic planning and a shift in focus will make a significant impact on the future of your business. Understanding current technology and tech trends that will disrupt and change the way logistics is done today—will allow you to pivot in a way that is realistic to plan for tomorrow.
"Look at technology that will enable operational efficiency," said RPM Chief Commercial Officer, Jake McLeod. "This can be something as simple as addressing inefficient route planning or poor truck utilization."
From apps and robots to artificial intelligence and autonomous vehicles, technology continues to move at a rapid pace. This tech will ultimately replace a good portion of the human element that moves the industry today—eliminating the risk of mistakes and wasted dollars.
"We will see a big push for warehouse efficiency. Loading and unloading trucks quickly will continue to be a way to help reduce cost," said McLeod. "With ELDs now firmly in place and limited hours of service available, current shippers and consignees who are not efficient are going to find themselves short on capacity and paying above market rates."
How businesses plan for market shifts, future tech developments and the use of technology available today, is the key to developing the proper strategy for your supply chain. According to McLeod, customers should have started planning for 2020 in 2017. But it's never too late to start.
"Technology has allowed companies to run leaner than ever," said McLeod. "Carrying no inventory is possible by complex scheduling software, material planning software and transportation tracking software. This has created huge savings for manufacturers."
A few years from now, the logistics industry will look very different than it looks today—most likely adapting to and utilizing high-level algorithms, big data, and early versions of smart programs like artificial intelligence (AI) and machine learning.
"The technology of tomorrow will not only help track inbound freight, but align available capacity in conjunction with these deliveries," said McLeod. "Creating less deadhead and discovering better utilized equipment for a particular load."
Preparing for a future that is more reliant upon technology should remain a priority for companies worldwide. Failure to plan for this will be a critical mistake for players in the logistics industry.
"The pace of advancement and expectation is faster than ever before in our lifetimes," said McLeod. "Knowing where freight is at all times is becoming a reality. The Amazon Prime effect, with the ability to track and know exactly where items are, has become a normal expectation for customers. This is the future of the logistics industry."