Transport and logistics digitization: Challenges and opportunities

 Digitization in supply chain management and logistics

Researchers tell us that the logistics and transportation industry has always lagged behind the curve when it comes to transport and logistics digitization and innovation as compared to other industrial genres. The $300 billion and counting industry has experienced challenges related to agility, visibility and sustainability. These combined with the pandemic-driven digital transformation has made it important for logistics companies to respond to the change, fast via digitization in transport, supply chain management and logistics. 

If they need to exist in business, they need to digitize their operations, adopt digital technologies in logistics, explore the digital trends in logistics, and offer seamless and well-connected digital solutions for logistics to their customers.

The challenges faced by the transport and logistics market

Over the past year and so, the transport and logistics industry took a heavy blow, just like all its peers. With stalled product movement, fewer invoices to raise, and the increasing pressure to move online, the industry suddenly found itself surrounded by changes, challenges, and expectations. Most of these challenges were related to the lack of a reliable and modern logistics digital platform, which made it difficult for leaders to time and cost effectiveness of their operations. These challenges were: 

Challenge #1: Siloed and unintegrated transport and logistics operations

With the digitally-driven buy-and-sell ecosystem comes the increasing dependence on supply chain, transportation and logistics industry to fulfill the order demands, move product quickly across boundaries, and do so at affordable costs. This poses a challenge for professionals who, without digital solutions for logistics, were already finding it hard to consolidate and centralize the logistics and transportation industry. Now with the global trade into picture, the already siloed and manually-led operations present a competitive threat to the companies who aren’t dedicating efforts to break them down, opt for transport and logistics digitization of operations, and add flexibility to their models.  

Challenge #2: Too much data, too little knowledge to effectively use it

The industry generates and maintains surmounting amounts of data and information, especially with current trade expansion in picture. However, accessing this information becomes challenging, especially when it’s segmented and stored at different locations. This along with manual data entry and handling leads to erroneous outputs that hamper the goal of bettering customer experiences. Logistics digital solutions not only effectively track and manage this data, but connect all the disparate sources on a single integrated digital logistics system. Moreover, digitization in supply chain management and logistics helps enterprise leaders to adhere to the new data management standards and fulfills customer expectations too. 

Challenge #3: The lack of resiliency and process automation

The labor-intensive human-led internal transport and logistics operations are not only time consuming but error-prone and inefficient. And the pandemic was the final bolt for the L&T industry. To gain a 360-degree view of business processes, and facilitate omnichannel customer interactions, process automation via transport and logistics digitization becomes imperative. Therefore, the embracing of digital solutions for logistics and automation capabilities will lead to a more agile, flexible, and resilient business model. 

Challenge #4: Too much dependence on legacy systems

Aging systems not only delay process operation but hamper productivity and elevate technical debts. To scale without risk, ensure business continuity, and future-proof your model, the L&T industry needs to adopt a modern approach to conducting business. It is now time to replace paper with a transformative digital logistics platform that integrates well with legacy systems. 

Challenge #5: The lack of mobility management plan

Mobility is the heart of any digital transformation strategy. However, as the number of devices demanding a connected experience increases, so does process complexity, IT pain points, and competitive risks. And with the lack of a mobility management plan, logistics digital solutions, especially with the increasing number of devices, not only fuels data silos but makes it unable to deliver expected ROI and competitive differentiation. 

How transport and logistics digitization can fill in the gaps?

Digital transformation is referred to by industry peers as disruptive and it is quite true. The transport and logistics industry is not the same it was a few years back. Technological evolution, business expansion, complex supply chains, and rising competitive gaps have compelled logistics leaders to elevate operational standards to stand apart from their peers and succeed in the market. The World Economic Forum states over $1.5 trillion is at stake as a result of that digitization in supply chain management and logistics up until 2025.

transport and logistics digitization can efficiently and timely solve these challenges. Digital solutions for logistics enhance collaboration and sharing, increase the flexibility of internal operations, and reduce efforts spent on otherwise complex tasks. Logistics digital solutions address the key challenges faced by the vertical- globalization, the need for more flexible operations, improved security and compliance. 

The below-stated points shine light on how a digital logistics platform can be a guiding beacon for the supply chain, transport and logistics industry. 

Advanced analytics for data-driven decisions:

Integrated digital logistics platforms implement powerful data-driven insights to optimize operations, solve internal inefficiencies and better customer interactions. Logistics digitalization enables data analytics that further improves operational visibility and connectivity between systems, allowing products to move seamlessly through the value chain. 

Automate back office processes for higher accuracy and fewer errors:

High operational costs have always been an issue for the transport and logistics industry. Operational costs such as salaries, capital expenditure, property costs, etc., all contribute to the high costs that must be priced into the overall shipping quotes. Manual and human-led solutions occupy a major chunk of these operational costs, which is why moving to a centralized digital logistics platform seems to be the best solution. It offers better integration, flexibility, visibility and connectivity than the traditional systems and helps accomplish the much-talked-about goal- the supply chain, transport and logistics digitization. 

Logistics digital solutions automates more of the mundane tasks, freeing up your workforce’s time to work on more valuable and revenue-generating processes. Then, you gain complete visibility into integrated digital logistics operations like order management, warehouse management, fleet management, financing, customer service, customized pricing, etc., with all these operations benefiting from digitization. 

Such a connected, resilient and agile digital logistics platform provides a more customer-oriented, efficient and proactive approach to managing internal operations and costs. 

Efficient management of the transport and logistics operations:

Digital solutions for logistics allow vendors to store, analyze, and manage shipping documents and link the critical documents with the related business processes. A centralized digital logistics platform also allows customers to gain greater insights and control into supply chain management. They can easily track products and order movement in real-time. Such transparency is the basics to customer-centric transport and logistics management. 

Incorporate leading digital technologies in logistics:

The top digital trends in logistics say that AI and machine learning are there to increase the competency of the transport and logistics industry. These technologies not only accelerate transport and logistics digitization but allow vendors to service customers in a focused, fast, and flexible manner. 

  • These digital solutions for logistics instantly share data between all parties and systems to ensure transparency and visibility 
  • Provide optimized results to improve operational efficiency and lower costs, for instance, the fastest and most cost-effective routes to destinations 
  • Allow real-time tracking of goods and vehicles through GPS-enabled services 

Such a versatile combination of digital technologies in logistics offer fastest shipping, reduces order delays, and reduces delivery costs, broadening the gap between you and your competitors.

Better customer engagement and retention:

A centralized digital logistics platform enables a single view of your customers across enterprises and third-party service providers so that you can quickly respond to inquiries and behavior changes and expedite issue resolution. 

Logistics digital solutions, after enhancing core business processes like customer engagement, billing, and account management, enhance the overall customer service experience throughout their journeys. Digitization in transport, supply chain management and logistics also helps in predicting future demands and market forecasts. 

Expediting invoicing and payment solutions:

Integrated digital logistics solutions eliminate the need to chase down buyers and manually update the freight payment processors and shippers. Automated digital solutions for logistics send out reminders for pending invoices, therefore, maintaining a steady flow of cash throughout. 

Transport and logistics: Digitization is the future

Moving to a centralized digital logistics platform doesn’t have to be daunting. It can be simple, efficient and straightforward. As a partner of some of the leading digital transformation platforms like OutSystemsMicrosoft SharePoint and Salesforce, our experts have assisted several transport and logistics service providers unlock the greater value of digital technologies in logistics, gain valuable insights, and win over the customers. Our integrated digital logistics solutions can help you achieve a competitive advantage over other freight providers as you grow and evolve your logistics business.

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