As is the case in any other industry, digital transformation in the transportation and logistics industry is primarily intended to help companies use technology to remain competitive in a challenging market while continuously improving the customer experience. Digital transformation is challenging the industry and challenging manual processes associated with outdated systems. Integrating existing technology capabilities is proving relatively difficult in many places. The reasons for this are manifold. An overview.
Status quo
The status quo is a familiar one in the transportation and logistics industry as well as in other industries. In 2021, countless processes continue to rely on paper-based documents and outdated systems, leading to delays throughout the supply chain and a lack of efficiency. The waybill, for example, remains one of the most important documents in the entire supply chain, whether maritime, air or land. As proof of receipt of goods and for transportation, respectively as a document of ownership of the goods, the waybill is still a paper document in transit between transport and logistics companies and at the same time of a mandatory nature for them to even be allowed to release the transported cargo upon delivery. Other documents, such as customs declarations and declarations, very quickly become an impediment when processed manually, for example when the delivered goods involve several individual items, and the result is delays in delivery.
Furthermore, the Internet of Things (IoT) technologies that have been coming along with the digital transformation for several years, for example around autonomous driving on the ground and delivery drones in the air, have not yet been able to fully prove themselves. While on-board trackers have been significantly improved, especially in the GPS area, and technologies such as sensors to detect the driver’s state of drowsiness are already being used, fully autonomous driving in the transport and logistics industry is still a pipe dream. The same is true for deliveries in the air by drone: although Amazon received its approval for package deliveries with the whirring things a few months ago, the Prime Air fleet is still in the test phase for the time being and is not yet ready to be able to carry out package deliveries in a big way.
Problems
So far, some of the biggest problems in the transportation and logistics industry have to do with the huge volume of paper documents associated with outdated systems and their manual capture and processing. Not only does this leave highly skilled professionals doing manual, repetitive, low-value, and often error-prone work, but it also leaves valuable data about past delivery histories sitting unused somewhere, such as in filing cabinets, turning it from the goldmine that the data could be for future decision-making into mere dust catchers.
Solution approaches
Accordingly, one of the solution approaches for integrating digital transformation in the transportation and logistics industry is data collection, processing and analysis. The fact that this means, in other words, that these processes must be automated and that skilled workers must finally be relieved of manual work hardly needs further explanation. The automation of processes such as data capture and processing is done with intelligent, AI-based OCR (Optical Character Recognition), which makes it possible to make use of all extracted relevant data in real-time. The valuable insights that the OCR software uncovers can be used by the transport and logistics industry for process optimization. Another essential factor for successful digital transformation in the transport and logistics industry can also be blockchain, as described in more detail in this article. Blockchain offers significant advantages primarily with regard to the safety and transparency of food throughout the supply chain.
Especially in times of the worldwide COVID-19 pandemic and with numerous lockdowns around the globe, it becomes clear once again how essential a well-functioning transport and logistics industry is, which will keep innovations around digital transformation on the go in the future.
