When 8×8 interviewed logistics leaders on their predictions beyond 2020, it’s little surprise that all of them mention some variations of a digital transformation and logistics automation.
Let’s begin to find out what these leaders are doing to prepare for these upcoming big changes, and how you can navigate them.
Logistics Automation Trend #1: Digital Freight Matching
Digital freight matching (also known as automated freight matching) enables shippers to instantly match their load with a carrier through the use of communication chips.
These communication chips come with a “signal” that decides pick-up times, assesses the availability of trucks, and directs multiple loads to a central hub.
The central hub serves a district, state, or region of a country.
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To navigate this trend, John Sabatino, COO of Becker Logistics, shared that they’ve partnered with an AI-powered logistics platform to integrate digital freight matching into their offerings.
He adds, “We’re communicating this benefit to our customers through sales calls, emails, and social media, so they know that it exists and is available to them.”
Sabatino cautions that technology will not be a quick fix. He wants to remind other logistics companies that customer service still takes priority in today’s digital-first world:
“Make sure your team maintains relations with the shippers so that they know exactly who to go to if there are any issues. Use technology to automate and streamline what you can, but make sure the correct level of customer service is still being offered.”John Sabatino
Logistics Automation Trend #2: Autonomous Vehicles
Stacey O’Neill, Director of Nationwide Courier Services, sees autonomy in vehicles in the coming years — thanks to the inroads made by Tesla and other logistics companies.
For the company, this means setting predefined routes for haulage trucks to a central hub before distributing packages to smaller vans, which in turn deliver to specific houses or offices.
Dan Lysogorsky agrees. The President of IPL Management says:
“The use of autonomous vehicles, electric-based transport and self-implemented importing of goods to reduce costs will receive attention from the biggest players globally. The result concludes an overall decrease in transport costs and an increase in technological placements that would ultimately generate more profit and savings for the end user.”Dan Lysogorsky
Lysogorsky’s views ring true.
Strategy&, a global strategy consulting firm at PwC, estimates that the autonomous vehicle ecosystem is set to reduce logistics costs for standardized transport by 47% by 2030.
How can smaller companies compete with the giants?
“Run a lean operation so that you can constantly ensure that you’re on top of things,” advises O’Neill. “This would lend itself nicely to the idea that you can easily implement new technologies and become as flexible as possible for future innovations.”
Lysogorsky shares a different tip: Integrate personalization into your services, so you’ll have better brand recognition.
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His company, IPL Management, is in the process of incorporating personalization to gain more exposure on the road and overseas.
The logistics company is also eliminating brokers and third parties that provide bookings, transportation services, and warehouse products to save on costs and regain a quicker, better-controlled turnaround delivery time for customers.
“Providing brand name packaging — like equipping equipment with personalized labels — improves the overall customer experience and develops a solid brand base. It’s also important to consider going global and expanding to more markets to get a larger presence and an opportunity to grow.”Dan Lysogorsky
Logistics Automation Trend #3: Vertical Connectivity of Stakeholders
Robert Khachatryan predicts connectivity among logistics parties — acquiring information in the coming years will be more efficient, which in turn speeds up the decision-making processes.
The COO of FrieghtRight explains:
“A typical international shipment involves at least eight parties. They all deal with the same data sets but operate in silos. This is a low hanging fruit for automation and one that is relatively cheap to exploit. As a result, it will have the biggest impact this year.”Robert Khachatryan
Khachatryan is focusing on hiring employees — specifically, those who understand the logistics ecosystem — to prepare for this trend.
“We have shifted from hiring people with experience in automation to people who have a better understanding of the big picture and understand data flows through the various systems that stakeholders use.”
Khachatryan is reporting improvements after making this shift.
“All of these are put together for complete visibility. Now there is more uniformity in the data across all of these departments,” he shares.
“Since many of these stakeholders have advanced their technology, it is very easy to integrate all this data and break down data silos. As we hire more and more people who understand the big picture, the DNA of the company changes to one that nourishes more holistic and comprehensive data.”
The COO shares with 8×8 that the company is also investing in new technology to better support its operations.
FrieghtRight previously developed its own platform and applications to adapt to its unique needs. Right now, the logistics company is going with the alternative — using third-party solutions.
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“There are plenty of well-developed, matured segments that are readily connectable and available. Why would you spend millions developing a customer relationship management (CRM) tool when you can integrate communications APIs into your existing systems?”
As the interview draws to a close, Khachatryan shares his tip for logistics companies that want to improve connectivity among their stakeholders: Look outside the logistics industry for solutions.
“There are plenty of tools out there that can be easily adapted to work with the systems so prevalent in our industry,” observes Khachatryan.
“Spend a month researching and talking to companies, and you will see that you can reign over both the multinational competitors and startups.”
Digital Fitness: Changing Expectations in a Complex Industry
Adopt a digital-first mentality.
It’s expensive adapting to new technology, but it is a must to survive in the logistics industry. With it, the odds of you enabling new levels of asset productivity, streamlining planning, and boosting customer experience innovation will be so much higher.
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