Overview of Logistics Outsourcing and Supply Chain Management:
A report filed by Cerasis aptly sums up the importance of technology integration with third party logistics services by saying;
‘Technology has always been the driving force behind the growth of the 3PL industry. Some of the technologies that are likely to transform the market in the near future include 3D printing, internet of Things (IoT), drone delivery, driverless vehicle and augmented reality. Many of the emerging technologies are still in the testing phase, but there can be little doubt that they will have significant roles to play in the future. And the future is not very far down the road; it’s just around the corner.’
The inclusion of technology and innovations driven by technology are likely to bring about more cost-cutting and customer satisfaction in the long run, rather than non-technology driven innovations. The cost of resources that an organization incurs owing to freight shipping, labour, storage in warehouses and other business processes can experience a significant reduction in cost if processes are automated. Businesses also give themselves the added advantage of faster business outcomes in a shorter turnaround time without compromising the quality of goods and services delivered. While 3PL providers get the higher ROI edge, shippers experience the fruition of their expectations into results, making the relationship they share symbiotic in nature.
Though technology has a lot of benefits to offer, small businesses may still be averse to the benefits of technology, putting them at a comparative disadvantage. The initial cost to set-up the technology acts as a major deterrent for small businesses to invest in it. However, what they need to realize are all the long term benefits and cost-cutting that these technology-fuelled innovations shall bring about to their businesses in the long run. Also, they may benefit from an edge that shall be a result of higher and deep sated customer satisfaction. Not implementing technology that is conducive to their business has given way to a greater level of customer dissatisfaction and given rise to shipper complaints, both of which are harmful to the organization.
The widespread adoption and usefulness of technology is forcing logistics service providers to rethink the transparency present in their business processes, so that shippers can monitor and keep an eye on the movement and delivery of their cargo throughout the freight shipping cycle. By eliminating silos and driving higher transparency across levels, logistics providers get to experience streamlining of their organizational processes and enjoy superior customer satisfaction.
The faster logistics companies adopt technological advancements and the sooner they bring about flexibility in their approach, they shall benefit from being more consumer-centric, which is the call of the times. The discerning and digitally-active customers want to be able to digitally track their freight booking, and this is only possible if a logistics provider offers that particular service. A report by Exchange-Traded Fund supports this by claiming that 32% of retailers and manufactures interviewed in the U.S. expect their 3PL organisation to offer services that are supported by augmented reality.
Amazon has set the bar high with its usage of drone delivery tools and augmented reality fuelled software. Though India is far from achieving such finesse in terms of customer service, the days when this becomes a global phenomenon are not too far.
A promising hope that the days to come for the national logistics industry shall not be as bleak seems to be the adoption of technology such as Transportation Management Systems (TMS), Global Positioning Systems (GPS) and Warehouse Management Systems (WNS). These advancements are consistently fuelled with the latest additions that technology enables, giving organizations the much needed ability to deliver more reliable and faster services in real-time at more feasible prices. Software such as truck booking apps will be beneficial to both logistic providers and shippers, as each party involved will be able to monitor the movement of the cargo at any given place and time, as well as monitor other aspects of freight shipping from anywhere.
Trip In is a modern and smart truck booking app that facilitates shippers with the facility to track the process on an end-to-end basis. Details such as the registration number of the vehicle, the contact details of the pilot, and all the necessary details of the cargo are sent to the shipper along with an estimated cost and necessary addresses.
Additionally the shipper is provided with option of tracking the truck’s en route progress and an estimated time of delivery is updated in real-time as well. Toll charges, and all additional expenditure, if any are digitally intimated to the shipper post the safe delivery of the freight. With Trip In, shippers can be rest assured that from booking till delivery, the entire process of freight shipping shall be transparent as it is processed by a technology-fuelled truck booking app.
Supply Chain Trends That Can Help You Achieve Excellence
Supply chain management (SCM) has to work in tandem with business strategy for it to realize its full potential. Let’s look at some of trends that are likely to impact the SCM of businesses and how they can complement it with their business strategies.
1. Data integration
In order for organizations to realize the efficiency that SCM can bring about they need to integrate their data. According to an IDC report, data integration will lead to not just faster decision making, but also enhance the entire process as a whole, resultantly benefitting supply chain processes and operations. Business owners and stakeholders understand the importance of Big Data, but now is the time to leverage that importance and use it to their benefit. IT estates and internal supply chain shall become inter-dependent and organization will experience superior functioning. Shaping and predicting demand will be easier.
2. Warehousing to self-driven vehicles, can all be automated
Automation cannot be restricted to just the giants, it has to permeate to the SMEs as well and it shall. Operations and supply chain management rely on automation for their success. What businesses and their associates need to understand that automation does not necessarily mean cutting-back on labor forces. In fact, a McKinsey report says that automation will enable labor-intensive jobs to get easier and more convenient to perform.
3. Omnichannel experiences will be integral
Organizations the world over are turning to technology and technology-driven innovations to meet evolving customer expectations. Customer experiences have to be consistent throughout their life cycle, meaning achieving supply chain effectiveness is integral in order to achieve so. According to a Forbes article, businesses will look to expand their IT estates in order to provide superior customer experiences to their customers, irrespective of whether they are from emerging or established markets. Technologies such as the internet of things (IoT), such as blockchain technology, will help drive transparency across the SCM and the organization.
4. Resource optimization
The year and the times to come will witness businesses making more and more environmentally friendly choices. This will be a conscious choice, rather a government induced one. Technology and automation will help organization rectify their carbon emissions and make sustainable choices.
CSR activities are also high on a customer’s mind. If a CSR study conducted in 2015 is to be believed, 80% of customers consider the CSR initiatives of a company throughout their lifecycle. This too is driving organizations to make careful choices and invest in more pro-environment technologies.
5. Freight shipping with 3PL
“Business and government organizations are highly aware of the added value that the effective use of logistics outsourcing can have on logistics and supply chain effectiveness.”, says Dr. William L. Grenoble, Executive Director, Center for Supply Chain Research and Senior Research Associate for The Smeal College of Business, Penn State University.
Freight shipping with 3PL makes sense in India because of several reasons, especially since the infrastructure is already overstretched and under developed. Not only is it sensible for organization to partner with a 3PL who has expertise in logistics, it is also revenue-friendly.
This industry too in undergoing a digital transformation and freight bookings are being conducted efficiently online with aggregators and 3PL providers.