Emerging technologies that are changing the sector for good and driving it toward the future.
Today, the transformations that India is going through can be witnessed across all walks of life. Our industries are getting modernized as relevant automation and tech-adoptions are increasing their throughput while also improving efficiency. Looking at the larger picture, this development is adding to the market visibility and that of across-the-board processes.
This ongoing transformation is perhaps the best for our logistics sector, which was earlier infamous for complicated processes, bottlenecks, and a near-absolute opacity. So, let us have a look at the emerging technologies that are changing the sector for good and driving it towards the future.
1) Blockchain in Logistics
Documentation (and its verification) is one of the biggest challenges experienced by the logistics players. This is precisely true for use cases such as procurement, transportation management, order tracking, and customs collaboration. These different areas are where Blockchain – the underlying technology that also powers cryptocurrencies – is making a sizeable difference. For the uninitiated, blockchain is a distributed ledger system shared by the interacting parties or individual stakeholders. Its entries (in the form of blocks) are synchronized throughout the network and cannot be altered once registered. If any modification has to be done, another block with the desired adjustment needs to be added to the string of blocks. So, data fabrication is by design impossible in the blockchain.
This aspect of the blockchain technology is today helping us address the areas of frictional in logistics with much simplicity. It is also optimizing the cost and the time associated with documentation and processing for ocean freight shipments. With a safe and protected gateway for information-sharing, blockchain is increasing transparency and helping us save costs by streamlining the supply chain process.
2) AI and ML for supply chain optimization
Machine Learning, a subset of the Artificial Intelligence technology, is also being used by logistics players to automate the supply chain and gather insights that otherwise remain concealed in the burgeoning data. These insights can be directly or indirectly related to tracking, the backend of logistics, internal functions, and so forth. They help in optimizing supply chain as well as in automating, streamlining, and hence, decreasing the turnaround time of various processes. The AI-driven approach is not only cost-effective and time-efficient, but it also plays its part in making the consumer experience more delightful.
3) Low-to-No Asset Networks
Given the sheer focus required to manage every process and the integration of such procedures to the broader logistics operation, emerging logistics providers are now entering the field of tech-driven shipping aggregation. These aggregators do not own any tangible assets such as fleet, cargo movers, warehouses, etc. They instead build a proprietary solution which is then used by individual players (suppliers, shipping players, etc.) as per their business models. This tech-driven approach optimizes logistics operations with the help of networks, technical infrastructure, and automation to reach out to buyers in an effective manner. Doing so also makes scattered demand (originating from an area) visible, helps in bundling them and transfers cost-efficiency to businesses of all shapes and sizes.
4) IoT for tracking
With the help of RFID tags, GPS, and specialized sensors, monitoring of packages is now being done in the real-time. Further coupled with specific approaches, such as geo-fencing, geo-tagging, and proximity alert, more bottlenecks are being eliminated from the supply chain. For instance, an incoming shipment can be easily traced, and the forward supply chain can be readied to process the shipment faster. This practice is enhancing operational efficiency, bringing about superior transparency, and decreasing delays in transfers.
5) Augmented Reality:
High-value consignments have various security threats, including hijacking, that need to be eliminated. Here, Augmented Reality (alongside facial-recognition technology) is paving the way for secured deliveries within logistics operations. Last-mile delivery is also improving with building-recognition and indoor navigation. Similarly, the completeness of a parcel and warehouse planning is also getting enhanced with the introduction of Augment Reality in supply chain management.
6) Autonomous transport
Today, e-Vehicles such as self-driving trucks, ghost cargo ships (autonomous ships), and drones are driving us closer to the future of logistics. It is estimated that this development can save up to 20% of fuel costs by aiding transportation, warehousing operations, and last-mile deliveries. India has already passed its regulation for drones, and similar frameworks are in the pipeline for other use cases. Also, the introduction of 5G in 2020 and, with it, the advent of logistics 4.0 are something the industry has been looking forward to.
It is about time that the Indian logistics sector, as the economy is booming, stands shoulder to shoulder with its western counterparts. With the ongoing technological revolution, it is just a matter of years, and all we have to do is eagerly wait until this happens.
-- Mr. Saahil Goel, CEO & Co-founder, Shiprocket