Technology has disrupted every industry and Supply Chain is no exception.
With the advent of digitalization, Logistics & Supply Chain industry is getting a complete makeover. As logistics becomes the backbone of every industry like retail, eCommerce, FMCG, and healthcare etc.- the business world today is aligning its strategies with respect to the ongoing and upcoming logistics trends, i.e., Robotics, Artificial Intelligence (AI) and Machine-Learning algorithms etc. The once-futuristic technologies as Google Glasses and drones are already making progression for improving speed, convenience and delight to the customers. With the recent technological advancements, companies are aiming at improving their delivery happiness score and enhancing customer experience. Based on FarEye’s observation of the past two years, here are the trends that will revolutionize the logistics industry in 2018:
1. Blockchain- Blockchain and AI first made its presence felt in the logistics industry early this year. With the security and transparency it offers, blockchain is an impenetrable way to store and share the transactional data and improves credibility with foolproof transactions. For example, if customer’s ID proof is available digitally through a blockchain structure, it cannot be fudged by him at the time of delivery. Similarly, we can map the unique blockchain enabled registration number of every bike against the delivery job IDs. By 2021, 25% of the large global companies will be piloting or using artificial intelligence and blockchain based automation in transactional procurement.
2. Delivery Of Choice- If the customers were not already spoilt for choices in terms of buying portals, products, and crazy discounts, they will also have option to choose amongst logistics companies to receive their shipment by. There were only a handful of eCommerce companies offering this feature in 2017 but the trend will pick up in 2018. This could be the game changer for logistics companies, as they can no more afford to be in the background. They have to compete against each other with differentiated, customer-oriented services.
3. Rise of Elastic Logistics: Elastic logistics refers to the flexibility to expand and shrink capabilities to align with the demands within the supply chain at a given timeframe. Flexible automation solutions increase the agility and elasticity of the logistics infrastructure to cost effectively meet market fluctuations. It is not a “one size fits all” solution. However, it provides a customized answer to requirements like cost control, warehouse management, geographic restrictions, distributions channels, priority deliveries, and much more. Interplay of demand and supply defines the day-to-day operations in the logistics & supply chain industry. To handle the changing demand and the fluctuations in the orders, logistics companies are making their operations elastic to plan the capacity according to the requirement. More and more companies will be taking fleet through outsourcing and the third-party providers. With optimal utilization, companies can deliver delight while keeping the costs intact and the quest to beat the demand will be just increasing. It helps by Enhancing Customer Experience, Adding Real Time Visibility, Connecting All Business Processes and Provides Agility & Scalability.
4. Perfect Order Deliveries: One more interesting trend that cropped up during the last spell of the year -2017 was perfect orders. The complexities of last mile make the odds against fulfilling a perfect order overwhelming, and perfect orders are the ultimate measure of customer satisfaction. Perfect orders are the percentage of orders delivered to the right place, with the right product, at the right time, in the right condition, in the right package, in the right quantity, with the right documentation, to the right customer, with the correct invoice.
5. Rise of Drones and Smart-Glasses: With automation and mobility being the support system to survive the competition, smart-glasses and drones are will drive the logistics performance to next level. Backed by augmented reality, integration with smart glasses will make deliveries easier by hands-free route searches, face recognition for error-free deliveries and personalized deliveries. With the rise in unmanned aerial vehicles and smart glasses adoption, the operational efficiencies of first and last mile logistics can be increased, increased flexibility and speed of delivery in complex and congested metro cities.
6. Data-driven Logistics Driving Anticipatory Logistics -. By anticipating the demand and studying the data-patterns, companies can predict the demand, plan and align the operations well in advance. In the ever-changing business, staying ahead in delivering the service is the key and data-driven logistics will help enhance the future of logistics. Companies will adopt big-data algorithms, data-visualization techniques and smarter analytics to boost process efficiency and service quality by shortening the delivery times. However, the big change in 2018 will be that the companies would use geography based search trends to anticipate demand of certain products in a region and ship in advance. Therefore, if the people in New York are searching a about a new book to be launched next week, some extra copies can be shipped to the nearest hub to make the most of this opportunity.
7. Building a Sustainable & Profitable Supply Chain: Logistics companies have been tying up their business and sustainability goals. With an objective to reduce the carbon emissions, companies are adapting best practices that are helping them reduce carbon footprints. The Paris Agreement and the World Economic Forum has been warning about the alarming rates of Carbon Gas Emissions. According to the World Economic Forum, companies like UPS, DHL, SABMiller and Nestle are amongst the top companies that are focused on sustainability and ended up increasing revenues upto 20% while cutting down supply chain costs as much as 16%. In order to achieve efficiency and reduce carbon emissions, companies will take the help of logistics companies that helps them with intelligent auto-routing and smarter operations.
Overall, the logistics industry is moving towards simplifying the cumbersome processes; eliminate mundane and repetitive tasks to enhance the effectiveness of the organization and improving customer delight.
By Kushal Nahata, Co-founder and CEO, FarEye