In today’s Logistics business time and performance are key to success. Now more than ever analytics, metrics and key performance indicators are critical components in planning and execution protocols. Today’s logistics market is more demanding than it’s ever been. Businesses across the supply chain are now expected to easily adjust to shipment patterns, predict customers’ buying behaviors, provide on-time deliveries through the most efficient routes possible, and reduce the risks of cargo inventory errors and miscalculations. Predictive analysis allows for advanced planning for future demand based upon historical data. This movement towards anticipatory logistics is already widely accepted among industry decision-makers: A study by the Council of Supply Chain Management Professionals revealed that 93% of shippers and 98% of third-party logistics firms feel like data-driven decision-making is crucial to supply chain activities, and 71% of them believe that big data improves quality and performance. 

As we struggle to combat Covid-19 and other mutant strains of the virus, through this year and beyond, logistics planners may want to keep their eye on some key factors affecting the supply chain. You may find some of these topics affecting your logistics planning in the coming years.

America’s roads, bridges and tunnels are crumbling at an alarming rate. Every 4 years the American Society of Civil Engineers (ASCE), an organization made up of over 150,000 civil engineers, gives the United States an “infrastructure report card". The organization gave the U.S. a grade of “D+ in its most recent evaluation. This grade is an improvement from the previous one. The effects of failing infrastructure and the need for the federal government to improve it are obvious, yet why isn’t the government doing anything? There is little disagreement in Washington that repairs are critically needed. The slow response is mostly a combination of trying to secure funding and the snail’s pace at which our federal government moves.

Everyone is anxious to turn the calendar page next month. Industries have transformed dramatically as companies across the world rethink business models, restructure organizations, and adapt to ever-changing rules and regulations.

As the challenging year of 2020 draws to a close it may be useful to review some of your freight payment protocols. A good place to start is a year-end freight bill review. Things are a little quieter this time of year and there is plenty of recent data to review. Typically, this is a no cost exercise provided by your 3PL so there is every reason to have the review done. If for no other reason than knowing your fright payment protocols are working.

What is a Freight Invoice Audit?

Rising freight costs is an emerging area of concern as seen in recent years. The cost of freight has been rising due to the increase in oil prices and all freight cost is highly dependent on the cost of transportation which relates directly to fuel prices and market demand. With high fluctuations of fuel costs, low visibility of the future freight costs and high complexity of the freight quotes, freight cost verification are vulnerable to human and process errors and this requires proper auditing to ensure that the organization does not overpay for services it did not incur.  As a concept, freight invoice auditing is not overly complicated to understand but is a playground for mistakes and inefficiencies due to the volume of transactions. The potential financial leak is significant. The idea is to make sure you only pay the shipping charges you should, and nothing more. In most cases, software does the hard work. However, in some cases more focused auditing may be necessary to identify overcharges or inefficiencies.  An organization is daunted with the task of calculating the freight rates manually and this task can be challenging when the customer has hundreds of shipments shipped each month. Most organizations do not have the manpower to calculate all the freight invoices issued to them and, at best, they perform random sampling to check if the sample invoice is billed correctly.  It is simply a sound business practice to do an annual freight bill audit.

There is little doubt that technology has transformed the Logistics business in the last several years. Will we ever get to fast enough or efficient enough? It's not likely. Under pressure exerted by demand for instant gratification, new tech-first logistics providers are beginning to pervade the fulfillment environment. Without the autonomous hardware that promises to supersede traditional road transportation, they are instead leveraging digital tools to improve the performance of manually executed deliveries and reduce lead times from days to hours, with 24 being today’s bargain-basement service level. These companies, through the use of customer-integrated business platforms, mobile technology, and crowd-sourcing, are finding ways to pick orders within minutes of receiving them, dispatch deliveries on-demand, and bring buyer’s purchases to them in time-frames of two hours or even less.  How are logistics professional going to keep this pace?  Here are some technology trends that may be worth a look as we enter 2021 and beyond.

Robotics

Given the energy and investment in robotics in our space, suggesting that there will be a robotics trend in 2021 is pretty obvious. After all the pilots and promises, what seems to be happening is that robot solution providers, and the end user community, are realizing that there is no one size fits all robotic applications. Quite the opposite is true. The customization is proving so complicated due to the advanced operations of the robots that the programming and engineering has become problematically complicated. Robotic applications are a very customized solution depending upon the product line, distribution protocols and warehouse volume parameters. The challenge, in addition to the design, will be the management system that can bring the components in synchronicity with the rest of the automation. The difficulty seems to be that there is no standardization among the robotic providers. Each have their own standards, communication protocols and capabilities. Someone will have to figure all of that out as robots proliferate. The next generation robots will not just be tasked with simply, repetitive and mundane projects as were the first generation. The robots of today will be much more complicated providing a wide range of services. As you increase the tasks you increase both the software and hardware configurations necessary to support the project. These ambitious goal will certainly be a challenge to the engineers and programmers.

Edge Computing

Masks, social distancing and all the other Covid restrictions will be with us for, at least, the foreseeable future. The uptick in home delivery should remain steady since most people have grown accustomed to home delivery and now prefer it. Many retailers are in a fight for their survival. Here’s a look at what to expect.

The effects of the Covid-19 virus are yet to be accurately measured in terms of human life and global economic impact.  Although the numbers continue to climb in parts of the country, it is the universal expectation that the industry and the world will slowly recover from this pandemic.  Now is the time to formulate your organizations recovery plan. 

Technology is disrupting the supply chain industry at a rapid pace. During this decade, e-commerce and IoT have irreversibly altered every aspect of logistics management. To remain successful, supply chain managers are increasing their adoption of cloud and technology platforms and applications. Innovative technologies, such as blockchain and machine learning, are being implemented today with the potential of significantly reshaping existing supply chain operating models. By 2023, at least 50% of large global companies will be using AI, advanced analytics and IoT in supply chain operations. That same year, over 30% of operational warehouse workers will be supplemented, not replaced, by collaborative robots. In the digital transformation age, logistics is once again undergoing a major shift. Logistics technologies, such as robotic warehouse systems, make automation a reality, while drones improve last-mile delivery capabilities and better tracking with tools like RFID tags, which improve visibility throughout the supply chain. These technologies also contribute to a rise in big data and analytics in the logistics field. RFID tags and robotic warehouse systems generate and transmit data that, when combined with other data sources, allow companies to optimize the supply chain and make better predictions and forecasts to improve efficiency and boost the bottom line.

In the months since the corona virus prompted shelter-in-place orders around the world, entire companies, industries, and economies have been decimated. One market that appeared poised to escape the impact was autonomous vehicles, particularly in the case of companies whose cars can be used to transport supplies to health care workers. But it seems even they are not immune. While limited continued testing of autonomous vehicles will still be possible via virtual simulation tools, AV technology, within the context of the corona virus pandemic, may still present the possibility of addressing critical needs and providing essential services through the use of driver-less delivery vehicles.   The combination of the need to minimize health risks presented to and by human drivers who deliver vital supplies and materials to the public, and the ability of AVs, equipped with disinfection tools, to deliver such items, may incentivize public authorities to authorize expanded testing and use of AV throughout the U.S.