8 Key Innovations That Will Transform the Supply Chain & Logistics Industry
The supply chain and logistics sectors are being transformed by a new generation of innovative solutions. Whether societal, economic or environmental, innovators are scrutinizing the industry’s greatest challenges and developing new business models and concepts with which to address them.
Below are some of the most important innovations which are likely to have the most impact on the industry in the coming years.
1. IoT, Big Data & AI
The Internet of Things (IoT) encompasses the use of sensors, technology and networking to allow buildings, infrastructures, devices and additional ‘things’ to share supply chain information without requiring human interaction. It creates richer data and deeper intelligence for all parties in a supply network.
The potential of Big Data can only be exploited by removing human involvement from the decision-making process and this is where Artificial Intelligence (AI) becomes critical.
2. 3D Printing
3D Printing has the potential to transform supply chains by rebalancing the trade-off between low-cost labour forces, inventory holding and transportation costs. Upstream supply chains will be localized as production previously out-sourced to tiered suppliers is brought back in-house.
3. Robotics & Automation
Demand and supply-side trends, such as diminishing labour forces and the rising importance of e-commerce logistics, are driving the widespread adoption of robotics and automation in the warehouse. Although increasing logistics efficiency, there are potential social repercussions due to the threat of the loss of many millions of logistics jobs.
The Blockchain is a permanent digital record of transactions that are stored across a decentralised network of computers. It has benefits in many parts of the sector such as cost-saving (paperless transactions); data verification; asset tracking; ‘smart contracts’; accountability and compliance.
5. Digital Logistics Marketplaces
Numerous new technology platforms have already entered the road freight, forwarding and warehouse markets with the potential to address the mismatch between supply and demand, eventually leading to better-utilized assets and improved rates for shippers.
6. On-Demand & Crowd-Shipping
Developed as a way of enabling small food outlets and retailers to provide a home delivery service, on-demand technologies have the potential to be leveraged by other sectors in the last mile delivery market. Crowd-shipping, meanwhile, involving ordinary individuals delivering parcels during an existing journey, could create a major new source of capacity in the market.
7. Autonomous Vehicles
The phenomenon of autonomous driving has the potential to revolutionize the global logistics industry. With technology giants such as Google and vehicle manufacturers such as Mercedes Benz investing heavily in the concept, it is only a matter of time before autonomous trucks are seen on roads around the world.
8. Alternative Fuels
The regulation of diesel engines will mean that electricity, hydrogen cells and natural gas will power a much larger proportion of trucks and vans in the coming years. However, despite a wide range of alternatives, no single form of fuel or technology will be able to replace diesel across the board.
There are many reasons for optimism. The improvements in logistics efficiency; reduced levels of environmental impact and a model which focuses on value generation rather than on labour costs will create long-term sustainability for the industry.
However, there are also many unanswered questions. If the logistics sector is transformed from one of high labour intensity to one characterised by high technology and automation, what are the societal implications for the many millions of workers no longer required?