How Innovation is Creating Waves of Transformation Across The Supply Chain and Logistics Industry

September 9, 2021 | By CXO Outlook

Soham Chokshi is the CEO and Co-Founder of Shipsy, India’s first and only end-to-end Global Trade and Logistics Management Platform. His auxiliary responsibilities include ensuring Revenue Pipeline and ARR growth, maintaining key customer relationships, directing measures for brand amplification, ensuring a strong product roadmap, fundraising and investor relations, and overseeing key processes and initiatives for people development.


The supply chain and logistics industry, from being considered a cost center for decades, today is at the forefront of innovation, driving millions of dollars in revenue for enterprises across the globe.

In the recent past, critical drivers of innovation for the supply chain industry have been growing customer expectations, volatile market dynamics, and obviously the pandemic. Traditional supply chain and logistics strategies fail to help businesses respond to same-day/one-hour delivery demands, provide customers the much-needed visibility of delivery processes, simplify growing complexities of 3PL management, and more. All these factors are driving enterprises and logistics providers to embrace digital tools to fuel innovation. As a result, the industry is witnessing waves of transformation in how they execute 3PL operations, run core logistics processes, manage productivity, SLAs, and KPIs, and most importantly, customer experience. Let’s glance through some of the key innovations we are witnessing in these areas.

Intelligent 3PL Management 

The “one size fits all” strategy is rapidly becoming ineffective in the face of constantly changing market needs. Enterprises are fast realizing the importance of designating the right task to the right logistics provider at the right time, keeping in mind all the constraints accompanied by different types of consignments.

For instance, some shipments are time-sensitive, some fall under the radar of rigid compliance, some are volatile, some need cold storage, etc. Businesses need to select the right logistics partner based on their area of expertise. Manually it’s difficult, if not impossible, to analyze all shipping parameters while choosing the right logistics provider. Hence, businesses are using smart logistics management platforms powered by AI and Machine Learning to simplify the selection of logistics providers. Intelligent 3PL management tools can help enterprises to increase their Net Promoter Score by more than 25%.

Logistics Automation

Automation is synonymous to supply chain and logistics innovation. To deal with constantly evolving market dynamics, businesses are shifting from manual and excel based processes to logistics automation. Core delivery operations like planning routes, consolidating orders, assigning tasks can no longer depend on traditional logistics practices.

So, how do supply chain stakeholders plan a route considering multiple external and internal factors while scheduling one-hour deliveries? How can they ensure that the right consignment is loaded in the right vehicle? How can they consolidate orders with zero errors? How can businesses optimize capacity across hundreds of vehicles? The list of questions is exhausting. But the answer is simple–automating core logistics operations. McKinsey Global Institute estimates that the transportation-and-warehousing industry has the 3rd highest automation potential of any sector.

Managing Productivity Using AI, ML, and Predictive Intelligence 

Logistics is a collective of multiple moving parts, making it challenging to optimize productivity. The siloed approach of managing first, middle and last-mile operations is a significant barrier too. To maximize productivity, supply chain stakeholders need to gain a unified view of all the ground-level activities, be it pickups, 3PL activities, hub-to-hub movement, sorting center activities, and more. An essential step towards achieving high levels of logistics productivity is to gain visibility of end-to-end ground-level delivery operations.

Deploying intelligent logistics management tools empower businesses to track, trace and optimize the movement of goods and packages across disparate transportation modes. It helps supply chain stakeholders drive innovation in resolving en route challenges and chalk out proactive strategies to address emergencies and exceptions. For instance, such tools will immediately identify unplanned diversions, unscheduled stoppages, unnecessary idling, and more, and quickly trigger alerts to concerned stakeholders expediting resolution. Predictive intelligence and Machine Learning capabilities allow these tools to predict delays accurately, help businesses gain critical delivery insights, and optimize turnaround times to meet ETAs.

From a delivery executive perspective, a lot can be done to optimize last-mile productivity. Smart logistics management platforms seamlessly link incentive programs with real-time performance scores motivating drivers to be more productive. In-app leaderboards help drivers position their performance, that is, the number of successful, on-time, delayed and failed deliveries against others. This creates a healthy competitive environment. Powered by AI, such a platform also displays suggestions to drivers for improving performance.

An Inbound Logistics report highlighted that by 2024, over 60% of G2000 manufacturing organizations would rely on AI platforms to drive digital transformation across the supply chain, leading to productivity gains of over 20%.

Balancing Cost and Customer Experience

How do enterprises put a smile on their customers’ faces without breaking the bank is indeed a million-dollar question. But thanks to rapid technological innovations, savvy businesses have unearthed ways to balance cost and customer experience.

Modern supply chain strategies backed by robust logistics management platforms are showing the way ahead. It empowers businesses to optimize operational costs in the guise of highly efficient route planning, smart SLA and 3PL management, reduced fake delivery attempts, increased first attempt success, automated cost-intensive manual processes, and more.

At the same time, technology innovation is helping businesses to optimize delivery routes in real-time, boost driver productivity and ensure greater ETA adherence, all leading to faster delivery turnaround times. It does not end there. Smart logistics management platforms provide customers with end-to-end visibility of delivery progress, ensure proper material handling, get real-time notifications and make deliveries flexible.

Even though we are all aware of how important it is to retain customers by enhancing the delivery experience, it’s worth highlighting again. A mere increase of 5% in customer retention equates to almost 25% in profits.

Growing customer expectations, the need to make deliveries profitable and build future-ready logistics processes will keep driving businesses to innovate and embrace digital means of optimizing supply chain operations. It’s the era of supply chain and logistics. Companies that are embarking on their digital transformation will surely emerge victorious in the short and long run.

Read Article Source:

  • World Logistic Passport

  • Logistics Partner

  • Supply Chains


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