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Digital Logistics: From a trend to a norm

In the race to automate logistics, competition in automation is increasing and only continue to scale.

Wednesday, July 11, 2018

Microsoft has established a partnership with OOCL (Orient Overseas Container Line) to develop artificial intelligence (AI) in maritime transport in order to help  understand and better predict shipping patterns and variables. This partnership comes at a time when traditional players in the logistics sector have worked to streamline and automate processes with the hope of being more efficient and competitive. As these companies enter the digital logistics business, the automation of the supply chain is no longer a trend, the accepted norm.

For more information on digital logistics, “Inbound Logistics” collaborators spoke with Dan Stoll, who is a senior technical manager of Nintex, an intelligent process automation company. He spent the last 10 years of his career helping organizations turn manual processes into well-managed automated processes.

Speaking about the current state of digital logistics, before Microsoft enters the race, companies are already struggling to outdo each other in logistics. Walmart launched against Amazon with its acquisition of Parcela to make deliveries on the same day in New York, while the acquisition of Whole Foods by Amazon is making the grocery broker obsolete. Outside of the supply chain’s purchases and announcements, robots and artificial intelligence are also gaining strength.

Most notable of the latest announcements from Microsoft and Amazon is the fact that technology companies are not leaving any sector intact, including logistics. Microsoft’s partnership with OOCL details that the two are in an 18-month research phase, while “Send with Amazon” is open for business. Once Microsoft and OOCL leave the research phase, distributors face two powerful ones. Until then, distributors must increase their investment in data optimization and predictive analytics for the day with technology-driven services. It’s hard to compete with Amazon’s costs or Microsoft’s intelligence without any automation, since both are leading the charge in the innovation of the digital supply chain.

In the race to automate logistics, competition in automation is increasing and only continue to scale. Amazon puts pressure on FedEx, USPS and UPS, but now it is Microsoft that is opening fire. The providers of inherited shipments must adopt the new norm and review their long-term logistics processes. The transition is not quick or easy, but the reward is in the time saved by companies that can be spent on a problem of predictable or avoidable problems. Microsoft seems to be one of the first to deal with these problems head on. Depending on what happens with the Microsoft / OOCL agreement, with respect to the Seattle technology companies in a maritime war.

To remain relevant, a plan to automate is critical. If the logistics companies do not plan to automate by 2018, they are already behind schedule. Until “Shipping with Amazon” was announced earlier this year, automation was not a clear priority for providers of inherited shipments. A recent study found that 43% of respondents in the energy chain use automation to manage their businesses. But in the next few years, more than half of the respondents will want to implement even more automated processes. While the industry continues to advance in smart adoption and automation, logistics leaders can turn to third-party automation experts for help.

The lost packages, broken cargo and late deliveries are a fact in the actual status of the shipment. The announcement of Microsoft brings with it an interested party often forgotten in logistics: the customer. The Microsoft / OOCL partnership will address the needs of customers through technological advances and predictive analytics. The latest announcement should act as a catalyst not only to implement automation, but also to put it at the service of conversations.

Nowadays, it is increasingly common for companies to evolve quickly and rise to trends in a few months. In the 90’s it is necessary to spend a few years before changing the technology in televisions, cameras or in business processes. Today, things and processes become obsolete in a matter of months and the consumer changes to technology. Through DICEX we seek constant training to offer our clients and strategic partners the best service with the best technology in the market.

 

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