Supply Chain & Logistics: Innovate or Die?
The Supply Chain and Logistics Sectors are undergoing a rapid and innovative transformation. Whether societal, environmental, or economical, the industry’s greatest challenges are being scrutinised by innovators who are developing new business models and concepts to address these challenges.
So, what are the most important, impactful innovations?
Internet of Things, Big Data, and AI
The Internet of Things includes 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 better data 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 – this is where Artificial Intelligence (AI) becomes critical.
Robotics & Automation
Demand and supply 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. Whilst this is increasing logistics efficiency, it will also create social repercussions due to the threat of lost 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.
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 on roads around the world.
On-Demand and 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.
The regulation of diesel engines will mean that electricity, hydrogen cells and natural gas will power a larger proportion of trucks and vans over 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, 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 workers that are no longer required?
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