When it comes to global transport logistics and supply chain management, there is no such thing as “good enough.” Items, products, equipment, and other deliverables can always get to their intended destinations a bit faster than they do currently. Freight can always be processed and handled more efficiently to expedite shipment from the United States to Australia and everywhere in between. The steady advancements of technology have helped make the once impractical easily achievable.
But the world is a very big place, and the overall supply chain is extraordinarily complex. Indeed, recent global events — namely, the COVID-19 pandemic and the measures governments have taken to neutralize the virus— have led to supply chain slowdowns and severe production disruptions. Global trade volume has diminished significantly over the past couple of years, and as economists for the trade credit insurer Euler Hermes point out and CNBC reported, production shortfalls and logistics bottlenecks are the main reasons why.
To more effectively navigate these obstacles, global transport logistics and supply chain management teams will have to optimize their operations and leverage the very latest technological solutions. Here are a few of the technologies poised to improve global transport logistics and supply chain management capabilities in 2022 and beyond.
Tech Trend No. 1: Artificial Intelligence
What once seemed futuristic is today highly commonplace. From navigation apps to intelligent home personal assistants and smart home devices, artificial intelligence is very much a part of everyday life. In fact, 85% of Americans regularly use solutions that contain artificial intelligence technology, according to a Gallup poll.
Just as AI has helped make consumers’ lives easier and more convenient, the same goes for global transport logistics and supply chain management. From intelligent courier robots that assist with transport to the internet of things applications that help to mobilize freight, AI is improving process efficiencies. Robotics have proliferated over the last decade and they’re expected to surge even more in the years ahead, particularly among supply chain and logistics management teams. Valued at $1.7 billion in 2018, global artificial intelligence in the logistics and supply chain market is poised to hit $12 billion by 2027, according to All The Research.
In terms of which AI solutions are gaining the most traction, McKinsey & Company points to the following:
- Real-time inventory management.
- Dynamic margin optimization of end-to-end chains with digital twins.
- Demand planning.
Not only has AI-assisted in the improvement of workflow processes, but it has also lowered costs. Where successfully implemented, it has improved logistics expenses among early adopters of the technology by 15% versus those who have yet to adopt AI or did so very recently, McKinsey & Company reported.
Tech Trend No. 2: Automation
The terms “artificial intelligence” and “automation” are frequently used interchangeably. But in reality, they’re actually different types of technology. Whereas artificial intelligence is designed to perform a multitude of tasks and adapt through the power of machine learning, automation is much more specific, designed to carry out specific jobs that are pre-set. Another distinction between the two relates to the kinds of jobs they are meant to facilitate. Artificial intelligence\is for non-repetitive tasks; automation is for those that are more mechanical.
Because global transport logistics and supply chain management involve both, automation and artificial intelligence are leveraged at roughly the same rate. Whether it’s back-end automation or the kind that is used on the warehouse floor, such as robot installation, automation is increasing in prevalence. For example, in the automotive sector back in 2000, there were roughly 25,000 robotic systems in factory warehouses globally. That number jumped to 103,000 by 2016, according to Oxford Economics.
As much as automation has already been used for supply chain and logistics management purposes, its rollout is poised to continue. For example, according to data compiled by Statista, approximately 60% of supply chain management firms anticipate robotic process automation will have an impact on supply chains by 2025, whether significantly or moderately. Robotic process automation is a solution that automates menial tasks such as certain rule-based IT processes, system updates, and data collection. As polling done by Forrester Consulting found, nearly half of respondents (48%) indicated their employers were increasing their investments in robotic process automation in the next year.
Another automation technology logistics solution teams are getting behind is warehouse automation. Like numerous other industries, warehousing experienced massive disruptions during the height of the pandemic, especially in North America. As the Ontario Chamber of Commerce reported in its annual Ontario Economic Report, nearly three-quarters of firms (73%) in the province that specialize in warehousing and transportation are still dealing with labor shortages. Warehousing organizations in the United States are encountering similar challenges.
Warehousing automation is helping to fill those shortages. The warehouse automation market was worth $15 billion in 2019, according to ResearchAndMarkets.com. But by 2030, its valuation could surpass $37 billion. Some of the technologies warehouse management teams are anticipated to utilize more in the coming years include autonomous mobile robotics, robotic item picking, and robotic case picking, according to Forbes.
Tech Trend No. 3: Blockchain
A substantial portion of global transport logistics and supply chain management teams’ responsibilities revolve around documentation. Accuracy is essential to efficiency so when customers are expected to receive a specific number of orders, documentation helps ensure that the appropriate quantity is available in inventory.
The blockchain makes this recording and storing process more seamless and secure. Used in a variety of industries and job functionalities beyond supply chain management, blockchain is basically a shared database that stores information in special blocks that are bonded with one another, hence the name. This binding process is accomplished through a process called cryptography.
The genius behind blockchain technology, from a supply chain management perspective, is that it makes it easier and more secure to track, record, distribute, and verify data from anywhere across a business network. And, because it’s all decentralized, the blockchain increases visibility over production processes that may be outsourced to another company.
Again, blockchain as a business solution is not unique to the supply chain and logistics universe. In fact, it’s typically associated with financial services and products like Bitcoin, the digital currency system that has gained renewed attention amid the pandemic. But it’s especially beneficial to global transport logistics because there are so many players involved. Entities that have no history with one another can verify that the information added to a digital ledger is accurate because it’s time-stamped. Thus, if something is updated, the logistics team at the other end of the digital ledger can identify when that data-add occurred.
While more organizations are expected to use blockchain technology, Walmart, FedEx, and jewelry developer DeBeers were among the early adopters.
Will the reality of driverless trucks make today’s transportation management systems obsolete? If not, will other emerging trends reshape logistics? Forbes recently turned to Bob Hart, Senior Vice President of Logistics Management at Inspirage, for answers. Read the article here.
Trend No. 4: Autonomous trucks
When it comes to freight transportation, particularly in North America, trucking is the top dog. According to the American Trucking Association, trucks hauled over 10.2 billion tons of freight in 2020, more than any other form of domestic transportation method.
But like warehousing, trucking is struggling with labor. According to the American Trucking Associations, if hiring doesn’t improve notably, the shortage could top 160,000 drivers by 2030, up from the current shortfall of 80,000.
But autonomous trucks — which don’t necessarily require a human at the wheel — could be a game-changer. While there hasn’t been widespread utilization of autonomous trucks, global transport logistics companies, as well as e-commerce giants, are investing heavily in these capabilities. This includes Amazon. As Bloomberg reported in 2021, the e-commerce corporation plans to buy 1,000 autonomous truck driving systems from a company that specializes in software for motor carriers.
There is some question regarding how, or to what extent, the deployment of this technology could displace truckers, but government research suggests that it will also lead to the creation of jobs that rely on human input. Regardless, the autonomous vehicles market is projected to grow in value to more than $11 billion by 2028, up from $1.6 billion in 2021, according to Fortune Business Insights.
When it comes to global transport logistics efficiency, there’s always room for improvement. If you’re looking to optimize your operations, Oracle Transportation Management Cloud is a one-stop solution. From transportation order management to shipment management to booking and tendering, as well as transportation intelligence, Oracle Transportation Management Cloud is a platform that supports the ongoing needs of shippers, receivers, logistics service providers, and many more. Inspirage can help you with the implementation that is customized to your service. Contact us today to learn more.