Logistics is a complex but fast-growing industry. According to PwC experts, over the past decade, the transport and logistics sector has experienced tremendous changes connected with the growth of international trade, accelerated digitalization, in particular, e-commerce development, and the introduction of new technologies in the main logistics processes and operations. Such innovations in logistics as artificial intelligence, the Internet of Things, and b lockchains have a significant influence on the transportation and supply chain.
Nowadays, using an innovative approach is not only important but vital. It is due, first of all, to the changing needs of customers of logistics companies, requiring that their goods and services be delivered to different parts o f the world even faster and cheaper than ever. Therefore, companies should adapt to consumer expectations in the face of the projected economic downturn and the global rivalry of trading giants in foreign markets.
If you are interested in developing your trading activities, new technology in logistics, strengthening your position in the internal market, or taking your business to a global level, it is time to introduce technological innova tions. We have prepared the most interesting ones for you!
TOP-5 INNOVATIONS IN LOGISTICS
ARTIFICIAL INTELLIGENCE
Today, when more and more trading companies are moving to the Web, there is an increasing need to optimize data management processes and high-quality remote customer service. AI can automatically analyze millions of orders in onl ine stores, determine the level of consumer demand, and predict the development of online businesses in the long term.
AI tools are actively used in ERP and CRM systems of logistics companies for:
- Automating daily operations: collecting data, searching for customer information, recognizing documents (computer vision).
- Additional verification of clients, when the risks of fraud are high, and translation of conversations into text (speech analytics).
- Tracking unusual frequency of actions, for example, frequent scanning of barcodes of boxes (anomaly detector).
- Distribution of requests for transportation by priority, urgency, and names (linguistic intelligence).
- Warehouse management: forecasting demand, sorting stocks, calculating reserve funds.
- Improving the efficiency of transaction processing and forecasting future financial performance based on market analysis.
- Evaluation of candidates for vacancies, analysis of their productivity.
AI technologies are critical to delivering “the last mile” to distant locations by a commercial vehicle or e-bike. According to research, carriers spend more than 50% of the total shipping cost on it. It becomes possi ble to solve the key problems of the "last mile" using AI:
- Creation of optimal routes for drivers with a preliminary analysis of weather and road conditions.
- Establishing communications with drivers and suppliers to improve delivery efficiency.
- Fixation on the map of places of receipt of goods (retail outlets, retail stores) to save time for drivers and buyers.
- Tracking the location of the cargo in real time, changing the route if necessary.
- Automation of parcel processing, loading/unloading, and transportation of bulky goods using robots.
Thanks to the automation of order processing, internal and external communications, and route planning, there is no need for a large number of employees, which minimizes human mistakes and saves money for logistics companies.
DIGITAL TWINS TECHNOLOGIES
This trend has become one of the most famous in the world of logistics in 2020. A digital twin is a digital model of a physical object (process or service) created to monitor performance and predicting results. All changes made t o a physical object are displayed in its digital analog. It means that a product equipped with sensors collects and transfers data from the real world to the virtual environment, which allows you to control the life cycle of an obje ct.
In fact, digital twins are not an innovation because this concept was introduced back in the early 21st century and was used by NASA as a mirroring method. But in logistics, it has spread relatively recently, being used to simula te a supply chain model. This approach is necessary for logistics companies to carefully study the patterns of delivery processes, identify narrow places, track risks, predict emergency situations, and quickly develop plans to overc ome them.
An example of an application for digital twins is designing and developing durable, lightweight, and environmentally friendly packaging materials for products delivered over long distances. By creating a 3D model of infrastructur e facilities, you can also optimize the management of warehouses where these goods are stored: automate the process of collecting and transmitting data on inventory and operation of facilities, modeling the movement of products, equ ipment, and personnel.
The innovation can assist in tracking cargo at all stages of delivery, involving various logistics elements, including road, air, and water transport, information systems, and personnel. It is expected that in a few years, there will be comprehensive digital twins that will fully cover the logistics network: natural objects, transport lines, human settlements, right down to customer workplaces. They will be able to independently create and update maps, coll ecting data on the congestion of routes, traffic speed, entry restrictions, and the current location of vehicles and people.
IOT
IoT, or the Internet of Things, plays an important role in automating logistics business processes. This system brings together leading hardware and software solutions and industry experts to share data and exchange information o ver wireless networks. The goal of IoT in the context of logistics is to ensure maximum transparency, continuity, and autonomy of the supply chain and, as a result, saving enterprise resources.
The use of IoT is advisable in any sector of the economy where transport is involved: from retail, including e-commerce, to agricultural activities. Monitoring and data collection from stationary and mobile objects, where communi cation coverage is available, occurs in real time using various sensors and trackers. Data is transmitted via GSM, WiFi, IRIDIUM channels to a working server, which stores them in the database. When a critical situation is detected, a decision is made either by a person or by a program that has its own action algorithms.
IoT plays a significant role in innovation logistics because it allows you to receive reliable and up-to-date data on the delivery process, for example, vehicle mileage, fuel consumption, driver condition. In the future, these in dicators can be used for accounting, making managerial and personnel decisions, and planning flights. And information about the current location of the cargo will be used for making changes to the route, calculating the time of arri val at the destination, etc.
According to experts, the Internet of Things is at an early stage of development, although there are already about 20 billion networked devices worldwide!
BLOCKCHAIN
Blockchain is an innovative technology aimed at creating a continuous and secure process for exchanging information that is valuable for all participants in communications. Each of them gets the same level of access to the transa ction register. All transactions are recorded in a block, and their copies are contained on several computers. Their plenty is called a blockchain, where each of the blocks contains links to neighboring ones. The advantage of this d ata organization is eliminating the risk of unauthorized access because any suspicious actions in one block negatively affect all components of the chain and, ultimately, disable the whole system.
What does it mean for the logistics industry? First of all, it increases the reliability of business processes. For instance: suppose, the carrier and the customer do not agree on the delivery time. Blockchain technologies solve this problem by giving both parties access to the same version of documents containing comprehensive information on cargo transportation details. It is essential for those involved in the food delivery process, where it is necessary to track each stage: time, place of receipt, processing, and storage considering the expiration date.
Сompanies that successfully use blockchains in logistics: Walmart, Nestle and Unilever, BHP Billiton, and De Beer.
DATA STANDARDIZATION
Finally, data won’t be fragmented! One of the brightest trends of 2021 is that companies that want to be on-trend won’t use data from storage. So, a step towards standardization was taken by DCSA in 2019: the associat ion aimed to implement common standards in the containerization subsectors (containerized cargo transportation).
As for other areas of logistics, many startups have only recently tackled the problem of information inconsistency. They help major market players prepare data for predictive and advanced analytics, such as digitizing and defragm enting.
As a result of digitization and adaptation to the generally accepted data standards of all logistics sectors, positive changes should occur in the system for forecasting demand, identifying risks, planning, and service supplies.
We understand the importance of following trends because we have been cooperating with small, medium, and large businesses involved in the transport and logistics industry for over 2 years. Specialists of PHP are engaged in devel oping and implementing individual CRM and ERM systems for logistics companies. In our work, we use advanced technologies such as artificial and augmented intelligence, machine learning. If you need to optimize key business processes , we can definitely help you.
