2019 Digital Transformation Trends in Logistics

The modern development of any field is impossible without technology. With the market demands for accuracy and customer expectations for services, the human factor becomes too significant for the company efficiency and reputation.

6 min read, Jul 16
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The integration processes of non-technical scopes with IT now are known under the title digital transformation and make the top charts of the list of the current field trends.

Logistics & Supply Chain required new approaches to business running for years. The number and diversity of factors that should be considered for efficient strategic planning made calculation extremely complicated for existing algorithms.

Digital transformation trends 2019

The breakthrough in AI, Robotics, and IoT provided the field with tools for solving problems of various nature and complexity including supply chain security challenges. But field representatives till now have been approaching novelties with caution slowing down the whole scope evolution.

Nevertheless, according to investment expectations into innovations for the next five years indicates that 2019 will become a turning point. This year each of the successive trends is going to gain more active followers who will lead and drive the field of digital transformation.

Meeting customer requirements

The last stages of supply chain and namely retail and eCommerce that are also currently going through BPA demand from service providers to go on the new level concerning speed and transparency without affecting the quality and complicating the procedure.

Digital solutions allow tracking a product and its state along the way from a warehouse to a customer door and sharing required details in the most convenient way for the client's patience. Such service level expectations now are valid and for the SME sector so it should go towards them and go digitally to stay in the game where such players as Amazon are present.

Customer support automated by tools like chatbots has financial and productivity benefits. But it doesn't cancel the strategy approved by customers that this company department should continue implementing a personal approach to each client by using advanced AI solutions and keeping the option of human touch.

Business process automation

Such internal procedure covers not just implementation using robotics force and appropriate management systems. It's changing the business core by reshaping its operating model, optimizing workflow by simplifying its components and reducing the impact of negative factors like talent gaps.

These software and machine-driven processes are already inducing global market changes concerning planning, workforce, required resources and tools, etc. Due to the business environment conditions, they will only accelerate under the pressure of competition and customer vision.

BPA also affects the list of chosen metrics for measurement as well as their desired readings that should be noted for defining the conformity with the quality standards and business strategy. Approaches of AI subsets allow performing data collection and analysis of the required complexity.

Logistics Digital Transformation

New approaches to collaboration

Moving communication on various stages of establishing partnerships in the digital environment is natural nowadays. Spammed professional social networks now are replaced by online collaboration platforms that allow discovering initially more suitable partners for the business model and goals.

The usage of digital solutions raises the level of visibility not only for B2C processes but also for B2B. Despite that it raises the competition even more, it allows creating more long-lasting and efficient cooperation.

The main reasoning of companies’ involvement in collaborative logistics movement is the aspiration to cost-efficiency. Cooperative processes according to Sysco experience allowed cutting expenses up to $600 million. Saving of such source can be invested in further business development.

Supply chain security management

The main goal of digital transformation in logistics and supply chain is to define, address and if possible resolve existing and potential field challenges. One of the most crucial ones is security setting and maintenance.

Starting with determining and calculating risks logistics security management implies all processes required for the prevention of their realization and assurance of product or service safety, quality and integrity. And that can be done only through the efficient collaboration of all supply chain participants.

Logistics security solutions include anti-theft & anti-fraud automation for warehouses, workforce management, and product path traceability to avoid delays due to delivery errors and on-road incidents. Computer vision algorithms allow maximizing the accuracy of gathered data of the product state and status.

Logistics and digital transformation

The most significant potential result of such fusion is providing the field representatives with the fully-equipped toolkit to become a reliable and high-efficient service provider. Equipped this way companies are partly diminishing the influence of their initial size, budget and talent acquisitions.

Such an outcome reinforces the SME sector of the supply chain simplifying multimodal shipping and logistics challenges overcoming for them that usually require significant investments or staff size.

For instance, multimodal shipping software allows establishing the required level of control over the process. It helps to minimize outsourcing-related risks and ergo consequential expenses that are extremely crucial for small and midsize businesses.

Taking a digital approach to all basic processes of the supply chain makes the whole system more flexible and ergo more adjustable to constantly changing market requirements. Therefore this strategy acquisition affects the company future no less than its today’s operation.

Surely, the progress of applied alterations don’t depend only on the field representatives’ proactivity they should affect. Without the constant ongoing development of Information Technology it’s impossible and in particular of its following subsets:

  • Artificial intelligence and Machine Learning
  • Computer vision and Image Processing
  • Robotics and Internet of Things (IoT)
  • Blockchain and Cyber-Security
  • Cloud Computing and Data Warehousing
  • Data Science and Big Data
  • Augmented (AR) and Virtual Reality (VR)

Though the way to digitization is a response to market requests it backfires in reshaping them as well. Digital transformation changes are not only processes but also approaches to collaboration and service providing particularly.

Considering the field conservatism the most noticeable results are and in the nearest time will be seen in supply chain stages that are work directly or close with end customers like Last-Mile Delivery and 3PL/5PL.

Despite the potential to complete the establishment of the digital supply chain transformation will remain a necessity since this business environment highly depends on multiple external factors and other field trends. But its evolutionary or forced changes are no longer reversible or optional.

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