A positive outcome of the COVID-19 pandemic for the logistics and supply chain industry has been that the sector has gained its long-due importance in the country. While it was earlier seen as a mere support service, it is now being considered a significant sector. CARGOTALK discovers how supply chain leaders can minimise risk and maximise opportunities.
Kalpana Lohumi
Kushal Nahata, CEO & Co-founder, FarEye
Year 2021 will be a defining year for the supply chain and logistics industry. Industries across retail, manufacturing, food chains, grocery businesses, post and parcel companies, and pharmaceutical firms will ensure greater focus on supply chain resilience and last-mile operations. Some trends that emerged in 2020, like contactless deliveries, curb-side pick-ups, ensuring supply chain resilience, and bringing inventory closer to customers, will continue to influence the way businesses define their logistics goals and drive customer service. But, others that will be equally significant are direct-to-consumer deliveries, autonomous supply chain and logistics, loop optimisation, environmental sustainability and order consolidation.
In order to minimise risks and build resilient logistics operations, delivery stakeholders would need to increase focus on predictive intelligence, automation, real-time transportation visibility, and customer experience. Embracing digital tools that enable real-time dynamic routing, scale deliveries, boost driver productivity and reduce delivery turnaround time will be the smart way forward to build robust logistics operations. Machine learning and predictive intelligence can be of immense help when it comes to ensuring scaling delivery operations. Leveraging these disruptive technologies, businesses can quickly and intelligently outsource delivery to the nearest third-party delivery providers to ensure rapid scale. It can also optimise delivery routes depending on the number of orders placed from a particular location.
Abhishek Bansal, Co-founder and CEO, Shadowfax Technologies
The pandemic and the lockdown which lasted for a major part of 2020 proved to be a major challenge for most businesses, including the logistics and supply chain sector. The logistics sector performed remarkably and contributed to keeping the supply chain for essential items functional, despite roadblocks. Further, the challenges faced by the sector during the pandemic have highlighted the urgent need for a robust infrastructure that can not only withstand the unexpected disruptions of this scale but is also agile enough to help adapt and bounce back to efficiency. Also, supply chains make up an essential aspect of most businesses today. As the year has progressed, we have seen exciting trends in the industry take shape. Some of these trends include adoption of technology such as big data and AI. Also, sustainability and omni-channel marketing have emerged as differentiators. The application of technology has grown beyond stock taking, orders and delivery. It has grown into other aspects like security and risk management, process automation, and customer service as well.
Leading a supply chain in this age of constant disruption – both large and small – means managing several priorities while watching for emerging risks and opportunities. But the real challenge is staying focused on things that matter most to long-term business success. The COVID-19 pandemic has disrupted nearly every part of supply chain, from supply upstream to inbound and outbound logistics to demand planning and estimating. Now businesses are beginning to consider plans to build resilience in the medium term and adjust to a ‘new normal’ beyond the pandemic. As a leader, I would say in times like these, try to build in as much operating resilience as possible, including by setting up an operations war room.
Sanjay Bhatia, CEO, Freightwalla
Year 2020 has shown us the importance of digitisation, and we will see massive adoption of it in 2021. Companies are digitally transforming the management of their supply chains by piloting and applying technologies such as robotic process automation, Machine Learning and Blockchain to traditional supply chain management activities. The industry has learned lessons from the past, and the pandemic gave acceleration to digital transformation, especially in India. Digitising the shipping and logistics sector, a leap towards the initiative will bring transparency, reduce cost, and better cost management. It should also include implementing smart single-window clearance for smooth processing of shipments or approvals. Such initiatives will prepare us to tackle any untoward incidences in the future, like the current pandemic.
Krishna Khandelwal, Chief Business Officer, Locus
The COVID-19 pandemic has pushed supply chain leaders to rethink their strategies. Supply chains in 2021 will become more reactive than predictive. With growing dynamism in demand, there isn’t another way out, and supply chains have to be agile in order to cater to the changing needs. We also believe that companies will be more open to technology solutions and be more willing to experiment on their network design overall, given the emergence of new fulfilment models and increasing market expectations. More importantly, green logistics will become a mainstay. Right from environmental-friendly packaging to the use of electric vehicles, companies will do their best to combat the environmental impact of logistics.
To minimise risk and maximise opportunity, one has to spark a digital transformation in their organisation. Businesses need to integrate data analytics and supply chains to provide much better traceability and predictability. Companies can no longer work with the age-old pen & paper method. Leaders need to use the power of Big Data and Artificial Intelligence to revolutionise the supply chain.
Mradul K, VP, Global Sales and Strategy LogiNext
The pandemic has definitely accelerated logistics automation, and we are going to see a lot of innovations in supply chain visibility and tracking, and driver safety and compliance trends. Year 2021 will also be the year where we focus on delivering solutions that improve the customer experience, and increased visibility on that front. Additionally, a key focus area will also be that of total consolidation, which is a strategic imperative where leaders need to rethink their entire delivery operations with the simple goal of – do more (and make more) with less.
If there’s one thing that 2020 taught supply chain leaders, it is the importance of visibility and track-ability of supply chains along with a seamless customer experience. Knowing where equipment or material is, what are the exact ETAs, where exactly the drivers are, ensuring driver safety and maintaining SLAs, sustainability – all this is possible if one invests in technology and plans out a seamless supply chain keeping the next decade and possible disruptions in mind.
Vikash Khatri, Founder, Aviral Consulting
Some of the key areas where pace of change will be transformative will be risk management, agility, use of data analytics and automation. We will see thrust on building resilience and implementation of risk management strategy to incorporate more flexibility and agility to react and adapt quickly in case of any disruption. In the new scenario, a complete relook is required on most counts of supply chain like vendor mix, geography mix, inventory mix, outsourcing mix, etc., which will be the need of the hour. Role of supply chain leaders is quite complex in the modern era. Leaders are expected to deliver a fine balance between cost, quality and service levels across network along with profitability and sustainability. In such a situation, one of the challenging tasks is to identify weak and vulnerable links in the chain. Many of these weak links may be controllable while some may be non-controllable as well. So, supply chain leaders must go for ‘logistics audit’ and ‘risk audit’ to identify improvement areas and vulnerable areas in their supply chain. Objective of these audits is to examine competitiveness and robustness of logistics operations, efficiency and cost structure.
Trends set to shake up the space:
- The pandemic has catalysed automation and AI adoption across industries. Going by its proved utility, this trend will only get stronger in the coming year.
- An agile supply chain makes it easier for businesses to navigate disruption within the marketplace and helps adapt to changing market and customer needs.
- Cloud technology is allowing the easy storage of huge amounts of data. There is no need for even physical servers or hard drives. Logistics service benefactors can easily access whatever information they need in almost no time.
- Achieving operational efficiencies in the logistic framework and identifying improvement opportunities is becoming easier because of Big Data Analytics.
- If India accepts documentation over a Blockchain platform, it will help eliminate all the unnecessary printing, scanning and emailing, and multiple rounds of back and forth, resulting in improved time and process efficiency.
- Exporters still struggle with poor inventory management, lack of container space and transportation, among others. A transition towards smart demand-supply management is expected.
- A crucial component of green logistics is the usage of electric vehicles across all legs of the supply chain. We will see the use of electric vehicles increasing, especially in the last-mile operations
of firms. - A change is expected in upstream and downstream supply chain network. On upstream procurement, global sourcing will get realigned to new sources and we will also see more thrust on onshore procurement in order to mitigate various geo-political risks.
- On the downstream, emergence of omni-channel will be on a fast pace. These omni-channel warehouses will be relatively small in size and closer to consumption markets for faster turnaround.
