How do transportation and logistics providers keep up with rising consumer demands and prepare for the future of the movement of goods has been saved
How do transportation and logistics providers keep up with rising consumer demands and prepare for the future of the movement of goods
Three pillars for an emerging movement-of-goods ecosystem
Meeting consumer demands has become more of a challenge over the last few years. Even simply maintaining today’s delivery speeds amid rising global parcel volume points to an enormous throughput challenge. How to prepare for the future of the movement of goods?
An ecosystem issue
With the global population swelling, urbanizing, gaining purchasing power, and shifting to e-commerce, the amount of daily parcel deliveries is increasing rapidly. In China alone, the volume has almost tripled since 2015. To make matters more complicated, roads, ports and airports are already overstretched. Over the past two decades, container ships have nearly doubled in capacity, but many ports have not kept up. This is not a problem for ports only - it’s an ecosystem issue. First-mile delays also affect intermodal rail and drayage operations, regional warehouses, and retailers.
Solving the limitations of the physical infrastructure
A global shipment can involve up to 30 different organizations and more than 200 different interactions. Without horizontal connectivity to each other, it is difficult to tap into unused capacity. The result: higher costs and dissatisfied customers. The limitations of the physical infrastructure could be solved by a new digital infrastructure and processes to increase throughput, reduce friction, and improve transparency and coordination. We have identified three pillars for an emerging movement-of-goods ecosystem: connected community, holistic decision-making, and intelligent automation.
Connected community for end-to-end transparency
The first strong examples of connected community already exist, for instance in horizontal partnerships forming around ports. Integrated data platforms powered by the cloud – e.g. in Hamburg and Rotterdam – exchange critical port information (like ship arrival and departure times) to participating ports, shipping lines, and marine terminals coordinating drayage. This collaboration has already reduced dwell times for ships by 20%.
Holistic, data-driven decision-making for agility
Many of today’s global movers are already data-driven. The next step is: limiting the time between data collection and meaningful action. This will enhance agility. One of the biggest players in shipping already commands a fleet of 270,000 IoT-enabled cold containers that are transmitting data on temperature, location, and refrigeration power supply to the cloud to help automate oversight, exception alerts and quality control processes at ports. Eventually, data-driven decision-making will become more sophisticated, with smart city sensors, predictive traffic flow models, and other data sources.
Intelligent automation for continuous movement and supply
The foundations of a global, touchless supply chain are actively forming. Some ports already offer an entirely robotic ship offloading process, some warehouses use robotics that lift, move and sort, autonomous cargo ships are being developed, and there are pilots for last-mile automation (from drones to droids). Eventually, this will create a fluid system of continuous movement and supply.
Where to begin
For global movers, building a solid foundation around these pillars is pivotal. Leaders should be looking to build businesses toward a movement-of-goods network that is adaptable to change. It is difficult to predict exactly what will work best in the long run, but we have compiled a list of strategic questions for leaders as they continue their journey to the future. Even incremental digitization of logistics operations can deliver plenty of benefits.
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