Tuesday, March 4, 2014

How are Current Trends in Technology affecting the Supply Chain Industry?

The supply chain industry is still not mature when it comes to the level of technology used. Many technologies are available in the market for better managing supply chains, and they are slowly being adopted. Nevertheless, there is a certain trend about certain technologies that are increasingly being adopted by the relatively more technology-focused firms.

One of the most prominent trend is moving towards Cloud technology, such as SaaS TMS. Giants in the logistics service providers, such as FedEx and UPS, are slowly moving their infrastructure to cloud, out of their own premises. There has been some resistance towards moving Big Data on Cloud, but the industry seems keen on taking full advantage of the cloud-based infrastructure, offered by the industry leaders, such as Microsoft and Amazon.

Smaller companies in the logistics industry have up till now not been able to afford a world-class Transport Management Solution (TMS) solution, because of the high cost of the software and the organizational complementarities, i.e. the infrastructure, that would have been required for the software to work. However, even these smaller companies are now moving towards software service-based TMS systems. Many technology companies are able to provide such cheaper alternatives to smaller companies, often in forms of business-to-business (B2B) software services.

Another big trend is being seen in Mobile technology. All big logistics providers are trying to provide their customers with different facilities through mobile capabilities. Through the technology they enable customers to, for instance, request a code on their mobile, then book a shipment online, and track it, as well as get alerts as the shipment moves from its origin to its destination.

Mobile technology is very useful for field staff - it allows them to get hands-on information on the inventory, load capacities or truck positions. It evens allows to mobile orders whilst they are talking to customers on the fly. Enterprise mobility in this sense can bring significant cost-savings and efficiency in the supply chain industry.

The third biggest trend is being seen in Business Intelligence (BI) – an area that has gotten very mature in the last few years. The technology takes a step further in taking the function of softwares from reporting on, e.g. sales or the number of shipments booked, to giving action-oriented information that can be used for strategic decision-making. For a transport and logistics provider, BI can provide information on the best modes of transportation available with different carriers, or the company’s top ten clients who have booked through these modes of transportation. It even provides real-time data that be visually presented through graphs. BI is helping businesses improve, reduce costs and increase efficiency. The supply chain industry produces huge amounts of data, and until now, it had proven extremely difficult to analyze them. 

If you are a CEO of a transport and logistics company, then you need to examine the trends that are going to affect the industry, and how you can benefit from it. 

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