Digital Transformation & Implications for Logistics Industry

Transcription

1 Digital Transformation & Implications for Logistics Industry India Logistics Expo 2016 May 19-21, Mumbai Gopal R, Global Vice President Transportation & Logistics Practice, Frost & Sullivan

2 Story Board What are the Game Changing Technologies? Which Areas of Logistics are the Technologies Changing? How are the Technologies Changing in the Areas of Logistics? Last word Predictions! 2

3 Story Board Where Are We? What are the Game Changing Technologies? Which Areas of Logistics are the Technologies Changing? How are the Technologies Changing the Areas of Logistics? Last word Predictions! 3

4 Cloud Computing Big Data and Analytics Devices and Apps Game Changing Technologies Technology Enablers that will Shape Industry Growth & Transformation devices include smartphones, tablets, and other portable devices that are used to connect the end user to the Internet. apps are software applications that are designed to run on these mobile devices. Autonomous Vehicles are vehicles that have built-in sensors, connectivity facilities, and capabilities to control and manoeuvre the vehicle thereby eliminating human intervention in the form of drivers. Autonomous Vehicle Big Data and Analytics are specialized tools that collate, structure, and analyze large data sets. The Internet and the Social Media are the driving forces of large data sets being generated. Game Changing Technologies Replacement of machines and robots to perform routine, repetitive, and rigorous tasks in warehouses are included under the scope of Automation / Robotics. Automation / Robotics Cloud Computing utilizes a network of systems over the internet for data processing. This eliminates the need to set-up dedicated IT Infrastructure to run software-based solutions. Augmented reality is a technology that enables live superimposition of computer-generated input on the view of real-world environment. The computergenerated input is based on the real-world elements in the view. Augmented Reality 4

5 Game Changing Technologies (Continued) It is imperative to implement new technology developments to ensure efficiency, reduction in turnaround time and cost, and therefore to stay in the industry. Cloud Computing Big data and Analytics devices and apps Automation / Robotics Autonomous Vehicles Augmented Reality Enables remote access through multiple devices including mobile devices Eliminates the need for internal IT infrastructure Helps identify regular pattern through largesets of data Useful to generate reports to identify gapsin processes and hence bridge the same Necessary to ensure shipment tracking and hence maintain supply chain visibility to plan and track Apps are now marketplaces for freight forwarding services, crowdsourcing information,cargo, and warehousing capacities Reduces manpower intervention in repetitive and mundane tasks, especially in warehousing environment Improves efficiency and turnaround time and efforts Reduces accidents and costs of accidents Establishes scope to increase driver work hours dueto reduction in driver efforts Platooning, a method enabled by autonomous capabilities, considerably reduces fuel costs Enables paperless environment in warehouses, distribution, and delivery scenarios Smooth flow of informationand activities 5

6 Story Board Where Are We? What are the Game Changing Technologies? Which Areas of Logistics are the Technologies Changing? How are the Technologies Changing the Areas of Logistics? Last word Predictions! 6

7 Five Areas of Digital Disruption in Logistics Area of Focus Entire supply chain of the Logistics Industry is undergoing a process of revamp due to advancements in the field of technology. Information, access to data, connectivity, processing mechanisms, and tools that were restricted to few military departments about a decade ago, are now available for industrial and public use, at economical rates. These dynamics have changed the very mode of business giving rise to disruption in multiple areas. Logistics Market Segments Freight Forwarding Services Transportation Services Warehousing Services Value-added Services (VAS) Logistics Value Chain Sourcing and Intermediation Outbound Shipment Handling Inbound Shipment Handling Logistics Market Segments Role in the Value Chain Freight Forwarding Transport Warehousing and VAS Transport Warehousing and VAS Transport Supply Chain Information Management Systems Areas of Digital Disruption in Logistics Freight Forwarding Services Warehousing Operations Distribution and Delivery Fleet Management 7

8 Five Areas of Digital Disruption in Logistics (Continued) Advancements in technology have not only changed the way the following activities are conducted but also introduced newer ways of performing the same activities. Access to technology at economical prices is becoming a driving force for these disruptions. Supply Chain Information Management Systems Information Management Systems such as Transport Management Systems (TMS) & Warehouse Management Systems (WMS) are widely used in the logistics industry to capture, manage, and process data throughout the value chain. Order management, inventory management, fleet management, and many other processes are executed using these tools to manage information and generate reports, invoices, and keep track of the flow of shipment. Freight Forwarding Services Warehousing Operations Distribution and Delivery Areas of Digital Disruption in Logistics Freight forwarding services Warehousing Operations include Distribution and Delivery include sourcing of transport and storage and retrieval of activities include distribution warehousing services, planning, shipments, palletizing & de- planning, last mile delivery, and and brokerage services. palletizing, picking & packing, and brokerage services. others within a storage facility. Fleet Management Fleet management includes vehicle maintenance, tracking, and routing and management of speed, driver,and vehicle safety. It encompasses activities that deal with drivers and commercial vehicles such as trucks, cars, etc. 8

9 Story Board Where Are We? What are the Game Changing Technologies? Which Areas of Logistics are the Technologies Changing? How are the Technologies Changing the Areas of Logistics? Last word Predictions! 9

10 Five Areas of Digital Disruption in Logistics These are some of the technologies that are disrupting the following areas of Logistics. Big data and Analytics Automation / robotics Autonomous vehicles Big data and Analytics Cloud Computing Supply Chain Information Management systems Devices and Apps Augmented reality Warehouse Operations devices and apps Autonomous vehicles Fleet Management Devices and Apps Autonomous vehicles Big data and Analytics Augmented reality Distribution and Delivery devices and apps Cloud Computing Freight Forwarding Devices and Apps 10

11 Supply Chain Information Management Systems Expertise and Labour Advantage from the ITES Sector Need for faster and multi-device remote access of information are pushing the industry to shift to SaaS model for its information management systems such as Transport Management Systems (TMS) and Warehouse Management Systems (WMS). Big Data & Analytical tools, when used to structure large sets of data generated by these information management systems, promise the prospects of bridging inherent inefficiencies. Big data and Analytics Abundant availability of ITES workforce and imperative need to adopt SCIMS to maintain shipment visibility drive the adoption Adoption is on par with developed markets Cloud Computing Supply Chain Information Management systems Devices and Apps E-Commerce boom and need for supply chain visibility drive the implementation of shipment identification and tracking devices Availability of integrated solutions to capture and display data from the devices adds to the growth of adoption rates Comparison of Adoption Rates between India and Developed Markets (N. America & Europe) Technology India Developed Markets Cloud Computing Low-Moderate Moderate-High Big Data & Analytics Low-Moderate Moderate-High Devices & Apps Moderate-High Moderate-High Growth in Adoption Low Moderate High 11

12 Warehouse Operations Lack of Infrastructure and High Implementation Costs Deter Adoption Augmented Reality, Automation, and Autonomous vehicles in Warehousing Environment have proven to improve efficiency and time taken for loading-unloading, storage-retrieval, picking-packing, and other processes. devices such as tracking devices enable faster order and inventory management by integrating the shipment location data with the WMS, thereby letting the systems prompt and enable easy shipment detection. Automation / robotics Autonomous vehicles Lack of infrastructure support and high cost of implementation hinder the adoption However, e-commerce boom demands fast logistics turnaround time pushing adoption of augmented reality, automation and autonomous vehicles within controlled environments Warehouse Operations Augmented reality devices & apps Lack of infrastructure support and high cost of implementation hinder the adoption However, e-commerce boom demands fast logistics turnaround time pushing adoption of augmented reality, automation, and autonomous vehicles within controlled environments Comparison of Adoption between India and Developed Markets (N. America & Europe) Technology India Developed Markets Automation and Autonomous Vehicles Low Low-Moderate Augmented Reality Low Low-Moderate Device & Apps Moderate-High High Growth in Adoption Low Moderate High 12

13 Fleet Management Route Optimization and Vehicle Tracking Widely Implemented Utilization of Big Data & Analytics is reflected in route optimization based on traffic congestion data and shorter route analysis on mobile device apps such as Google Maps. Fleet management vendors are benefitted across economies by these developments due to reduction in fuel consumption and delivery timelines. Industry adoption is driven by a combination of the following factors: Evident advantage of tracking vehicles and shipment Plummeting costs of smartphones & tracking devices and easy integration of device data into proprietary systems Smartphones and apps utilize Big Data & Analytical Tools to generate, capture and utilize relevant data Big data and Analytics Fleet Management Lack of traffic discipline and infrastructure support deters implementation of Autonomous Vehicles in India on roads Autonomous vehicles Devicesand Apps Technology Autonomous Vehicles Big Data & Analytics Device & Apps Comparison of Adoption between India and Developed Markets (N. America & Europe) India Developed Markets Low Low-Moderate High High Moderate-High High Growth in Adoption Low Moderate High 13

14 Distribution and Delivery Devices and Apps to Disrupt Delivery Business Models Autonomous Vehicles will see delayed implementation in India compared to developed economies. Regulatory bans and security concerns are delaying usage of Unmanned Aerial Vehicles (UAV) such as drones for last mile delivery. However, service providers are utilizing mobile devices and mobile device app-based marketplaces for last mile delivery. Regulatory ban on drones for commercial and individual usage deter industry adoption High cost of implementation is hindering the adoption of Augmented Reality Augmented reality Autonomous vehicles Distribution and Delivery devices and apps Real-time tracking capabilities augment adoption of mobile devices in last mile delivery device appbased marketplace act as interface between retailers and consumers providing last mile delivery services Comparison of Adoption between India and Developed Markets (N. America & Europe) Technology India Developed Markets Autonomous Vehicles Low Low-Moderate Device & Apps High High Augmented Reality Low High Growth in Adoption Low Moderate High 14

15 Freight Forwarding Critical Need for Dynamic Information Flow Drives Adoption Freight Forwarding Service Providers deal with multiple stakeholders such as shippers, carriers and third-party vendors, all of whom need access to dynamic shipment information to ensure optimized transactions. Therefore, freight forwarders need to stay abreast technology advancements. Big data and Analytics Access to information and solution systems via multiple devices and mobile devices due to Cloud Computing drives adoption Enhanced demand forecasting and inventory optimization mechanisms using predictive modeling drives adoption of Analytics Cloud Computing Freight Forwarding Devices and Apps Demand for supply chain visibility drive the implementation of shipment identification and tracking devices Availability of integrated solutions to capture and display data from the devices adds to the growth of adoption rates Comparison of Adoption Rates between India and Developed Markets (N. America & Europe) Technology India Developed Markets Cloud Computing Low-Moderate Moderate-High Big Data & Analytics Low-Moderate Moderate-High Devices & Apps Moderate-High Moderate-High Growth in Adoption Low Moderate High 15

16 Story Board Where are We? What are the Game Changing Technologies? Which Areas of Logistics are the Technologies Changing? How are the Technologies Changing the Areas of Logistics? Last word Predictions!

17 Last Word Predictions Solutions that offer flexibility of use, enhance the visibility of the supply chain will be the need of the industry. devices and apps feature as the most import technology disruptor in the field of logistics followed by Big Data & Analytics and Cloud Computing. E-Commerce boom will only increase the demand for performance of Logistics Service Providers in delivery timelines, volumes and cost. Last-mile delivery will be the focus of this demand. In India currently, Warehouse Automation is the most under-utilized category of technology development. Local material handling and robotics manufacturers are equipped to provide high quality warehouse automation support. Gradual adoption is driven by demand from e-commerce fulfillment centers. 17

18 Thank You Gopal R Global VP, Transportation & Logistics Practice rgopal@frost.com 210 BT Building Dubai Internet City, Dubai UAE Tel: Fax: Jahnavi Gokulakrishnan Senior Research Analyst, Transportation & Logistics Practice jahnavig@frost.com ASV HANSA, No.53, Greams Road, Thousand Lights, Chennai India Tel: Fax: "We Accelerate Growth"

19 Transportation & Logistics Consulting Capabilities Supply Chain Services Freight, Infrastructure and Facilities Maritime Rail & Urban Transportation Contract Logistics Services Transportation Air Ocean Infrastructure Equipment Solutions & Systems Aftermarket & Supply Chain Technologies Land Services Support Services Forwarding, Express and Support Services Best Practices Customer Assessment Technology Benchmarking Addressing Trends & Issues Types of Engagements Growth Strategy Competitive Benchmarking Customer Satisfaction Surveys Process Improvement & Audits Business Planning Market Opportunity Analysis Growth Coaching & Workshops Product / Service Concept Testing 19