Chris Mills, director of transportation UK, C.H. Robinson, talks to Annie Turner about the challenges and developments facing the transportation industry including digitising and optimising the supply chain and how creating customer value is becoming vital for providers of logistics services.
Annie Turner : How is digitisation and optimisation of the supply chain delivering better value to customers?
Chris Mills : Digitisation is more than just a trend – it is changing the way we think about supply chains. The IoT is helping to turn our smartphones into supercomputers that are essential for business. Their ubiquity reduces the costs associated with juggling multiple platforms and makes reaching end users much easier.
The logistics world has many moving parts; products are being moved between manufacturers, suppliers, distribution centres, retailers and consumers. Therefore, it is essential to be knowledgeable across the supply network. Digitisation is bringing all these moving parts together. Shipment tracking gives customers real-time visibility of their goods.
By combining real-time sensor data with environmental data, it is possible to build usable intelligence for all participants in the supply chain network. This allows all those involved to make effective – predictive – decisions that will help drive their productivity.
Through this process, the supply chain is moving from a responsive approach to a more proactive one. Right now, we are standing at a tipping point in digitisation – the volume of global digital material stood at 4.4 zettabytes in 2013, and is projected to hit 45 zettabytes by 2020.
AT: How important is digitisation to logistics companies; how great is the urgency if they are to remain competitive?
CM: We will see huge change in how digitisation will drive competitiveness and growth in the next one to two years. The speed of that progress will depend on how businesses go about adopting a unified technology approach. Integration in the supply chain that allows for seamless data flows and visibility will be key.
On the other hand, while urgency is important, efficiency and cost savings will remain essential on the customer side. Companies need to start with their desired business outcomes then reverse-engineer their supply chains accordingly. Keeping the customer as the centre of attention will be the first area to look at when beginning a digitisation strategy.
Only then can you start taking a comprehensive and long-term approach to supply chain optimisation and digitalisation. Effective supply chain management is a lot of work and, as our industry evolves, the way that supply chains are managed will evolve with it.
AT: How far down the line, overall, is the industry? At the early adopters’ stage or is it mainstream?
CM: Big data can be overwhelming. Recent reports indicate that 81% of companies in the industry are investing in big data analytics, and 17% are still investigating. This might sound encouraging, but the average company’s supply chain is only 43% digitised.
The reason for this disparity – and the need to catch up – is that many companies have invested in multiple technology platforms over the years and are struggling to make sense of the data as those platforms need to ‘talk’ to each other. For these companies, it will take time to adapt as they will have to invest valuable resources in reaching a suitable single platform.
An effective integrated technology platform is only as good as the data you feed it. We have a lot of respect for the newcomers in the industry who have done a great job building out and implementing relevant platforms. The question is how fast can they collect and feed their systems with the right data? At the same time, the larger industry players have the right data at hand, but the question there is how fast they can adapt their technology to make sense of all the data?
You need a platform that is designed with flexibility and efficiency in mind. It needs to be compatible with almost any structured data file or ERP to bring all aspects of a global supply chain together. It should provide full visibility of operations, 24-hour online tracking, and a single connection to customers and suppliers, with the ultimate aim of providing customers with tools for more informed decision-making.
AT: What are enterprise strategies? What and who does it involve and why does it matter?
CM: Our strategy focus across Europe will focus on simplifying and standardising data analysis through a business-wide data management strategy, while exploring the range of opportunities offered by machine learning.
As we head towards a more digitised economy, the companies staying one-step ahead will be able to anticipate market conditions and trends, and adapt their business accordingly. Using those insights to evolve a company’s supply chain, business model and operations to a position of strength will be key. Leadership will play an integral role – a clear strategy and support from the top will be invaluable.
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Chris Mills, director of transportation UK, C.H. Robinson was interviewed by Annie Turner, editor of IoT Now Transport