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6 steps to making your logistics operations digital

Artur Alves | 01. Oct 2019
5 minutes read

Due to the rise of ecommerce, the B2C experience is driving user expectations in this environment as well. Customers in all parts of the world are now increasingly voicing demands in terms of levels of service and the flexibility of logistics services. 

To stay competitive and retain market positions, logistics service providers need to address a range of new issues: rapidly growing customer demands, cost reduction requirements, and the need to being compliant with environmental legislation. Use of digital technologies has been identified as key in overcoming these challenges.

Digital transformation in logistics

In a rapidly evolving digital economy, there are numerous benefits and opportunities of digital logistics operations, such as:

  • New product development 
  • Better customer service and higher customer satisfaction
  • Improved access to real-time data and information
  • More agile and efficient processes and operations
  • Increased control, visibility and collaboration
  • New sources of revenue

So how do you go about making your logistics operation digital in order to meet disruptions and growing demands?


6 steps to digital logistics

1. Understand the strategic reasons for embracing digital technologies

    • Reducing costs
    • Improving customer service
    • Long-term survival
    • Exploiting new business models or new sources of revenue
    • Generating competitive advantages over your competitors
    • A mix of several of the above

2. Look for opportunities to streamline costs and increase efficiency

Digital solutions for logistics optimisation and collaboration have proven to unleash great savings (up to 35% cost reductions and up to 50% carbon footprint). You can look for opportunities in several different areas. For instance, have you considered what the average truck fill rate is for your operation? Or how much time is spent by your resources on data entry activities? Digital solutions can help optimise and streamline many of these areas.


3. Be prepared to make your logistics customer experience digital- It is expected of you!

Most companies that subcontract logistics services, favour digitally enhanced and user-friendly experiences at every stage of the customer journey. Brands like Airbnb, Uber, and Spotify are now well established in the competitive landscape, and many companies have realised that the value chain has moved from the possession of assets and production tools (i.e. costs) to the mastering of customer interface (where the money is!). Making the customer experience digital is a key issue.


4. Connect to your partner network

Many logistics service providers right now have to externally integrate with suppliers (3PLs, ocean carriers, air forwarders, and more). By using the cloud, all systems can talk to one another, allowing for easier transactions such as uploading orders or checking order status, booking or downloading invoices. Already, there are logistics cloud services that can close a gap many LSPs are not even aware exists.


5. Demystify the data chaos

Typically, logistics service providers build the IT infrastructure using different interface formats to create data connections with different partners. As the number of partners rises, so does the complexity of connecting them all.

State-of-the-art architectures simplifies the process of integrating supply chain data with multiple standards, formats and communications channels. You only have to connect once – and everything is housed on a single platform. At the same time, it is possible to link your existing systems to these new platforms.


6. Be prepared to embrace change and cooperate with tech and innovation companies

There’s no reason to be afraid of disruption from startups and tech companies. Instead, see them as a means to an end: enhancing and evolving your core business, while establishing ties to the innovation community.


Conclusion

Driven by the pressures of competition, cost-reduction and performance, digital technologies are set to transform the logistics industry. For many companies, however, this has not been a strategic priority so far. It most certainly ought to be. Making your logistics operation digital creates great opportunities for new business concepts, revenue generation, and improved efficiency.

Plus, it helps you shrink your environmental impact. What can be better than that? 

Start taking our 6 steps to going digital today, and you’ll be well on your way to logistics leadership.

 

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