Advent of Digital in Logistics Industry

Advent of digital in Logistics industry

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Submitted to: Prof. Jaydeep Mukherjee

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Group 8

Anurag Dang 17P187

Madhur Vashist 17P203

Sarvagya Kala 17P223

Vipul Gupta 17P235

Contents

Logistics Industry: Introduction        2

Technological Innovations in Logistics        2

Consumer behaviour and Impact: Overview        5

Behaviour of B2B customers and Implications        6

Behaviour of B2C Customer and Implications        6

Experience        6

Speed        6

Agility        6

Pricing        6

Security and Privacy        6

The evolution of business models for logistics industry        7

Different Logistics Business Models        7

B2B Logistics        7

Companies causing disruptions in the B2B logistics domain        8

B2C Business        8

E-commerce retail logistics activities        9

Companies causing disruptions in the B2C logistics domain        10

Evolution of Marketing strategy and implementation        10

Spotlight on Indian Logistics industry        10

Technology to the Rescue        11

Platform based solution        11

Spotlight on Rivigo        11

Possible developments in near future        12

Industry Outlook        13

References        15

Logistics Industry: Introduction

Logistics is concerned with effective and well-organized movement of semi-finished or finished goods from one point to another and from manufacturers/businesses to the consumers through the distributors and retailers. The Council of Logistics Management (CLM) defines logistics as:

“The process of planning, implementing, and controlling the efficient, cost-effective flow and storage of raw materials, in-process inventory, finished goods, and related information and financials from point of origin to point of consumption for the purpose of conforming to customer requirements.”

Logistics include the following: freight transportation, warehousing, material handling, packaging, inventory control, order processing, marketing, forecasting, and customer service. Hence, logistics is that part of supply chain that plans, implements, and controls effective flow and storage of goods, services, and related information from origin to consumption point in order to meet consumer demands. Logistics market is very huge and it contributes to all 3 sectors of the economy: Agriculture, Manufacturing and Service. Logistics is estimated to be around US$ 4 Trillion worldwide. North America is the leader in the global market, with a share of $ 4 Trillion, India on the other hand has a logistics market of about $250bn.

Logistics has seen several new advancements due to the introduction of Industry 4.0 and Industrial Internet. Logistics has also been tremendously been impacted by social media sites like Facebook, Google, Twitter, etc. and also Mobile Phones and Cloud computing has had a huge impact on logistics. There has been a tremendous impact on the consumer side of logistics in terms of home delivery, product returns and order cancellations due to the big data analytics and e-commerce. Resource shortages is having an influence on logistics costs in a big way. Big impact has been there on logistics due to the emission of greenhouse gases, carbon trading, etc. The developments in Internet of things in particular, sensors for monitoring the health of equipment in critical network industries such as power and airline transport is changing the maintenance process from scheduled to predictive maintenance. The availability of 3D printing is changing the way spare part logistics is organized. While these developments increase the technology analytics contents in logistics operations, they reduce the downtime of equipment and trucks, inventory requirements and also the energy intensity in operations.

Technological Innovations in Logistics

There have been several innovations in logistics due to technology. Internet of Things, Mobile, Augmented Realty, Social Media, Cloud Storage and Computing are some technological developments which have improved the efficiency of logistics operations. Though globally present, they are not present in India but India can easily adopt these in their supply chains.

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Figure: New technologies in logistics

As age-old processes begin to shift to meet the demands of the internet age, logisticians and executives alike should understand the ways that these seven technologies are beginning to transform the industry.

1. Automation

Automation uses data-driven software which helps in improving efficiency in machines, offers a variety of solutions for the logistics industry which include advancing package labeling to streamlining warehouse sorting systems.

2. Robotics

Robots are planned to perform numerous jobs at once, making their applications in the logistics industry nearly endless. This is mostly true of e-commerce operations, which require an intensified level of speed and productivity to see the rapid growth of online sales. Amazon raised the bar in 2012 when it acquired a monopoly on Kiva robots, starting what Bloomberg calls a “robots arm race”. The robots, which accomplish “one-click” orders in less than 15 minutes — a task that naturally takes humans 60-75 minutes to complete — have reduced the company’s operating expenses by up to 20 percent. To stay competitive, other companies are now racing to fill their warehouses with similar models.

3. Wearable technology

Wearable technology has become a normal “must have” in the logistics industry. A success story is German Logistics Company DHL, which carried out a pilot project at its warehouse in Bergen op Zoom to assess the ability of wearable technology to surge speed and decrease human error in warehouse order picking processes. Results of the pilot established that smart glasses like Google Glass improved efficiency by 25 percent, and also significantly increased employee satisfaction.