Top technological trends retooling and disrupting 21st century logistics: Part I

In the realm of business, a “disruptive technology” is generally considered to be a good thing because it is typically a catalyst for positive change and forward motion.

In the past five years, just about every country has begun a major overhaul of its shipping and logistics operations. With the unprecedented onset of the COVID-19 pandemic, these so-called disruptive technologies have been implemented hard and fast in a way that has left the industry racing to keep up with new and emerging operational changes.

Because there are so many opportunities to implement new technologies, it’s critical to know which will withstand the test of time and which are simply flashes in the pan that will fizzle out within the year. To help operators separate the winners from the rest of the pack, this post will outline four of the best, most successful logistics trends of this century.

1. Making Smarter Decisions With Artificial Intelligence

Artificial intelligence is certainly not a stand-in for human business intelligence, but it is no secret that AI has the potential to be an invaluable advantage for global logistics companies who embrace the technology completely.

Businesses should still appreciate the value of industry experience and intuition. Rather than seeking to determine whether human or machine intelligence is “better” from a business standpoint, true industry leaders should instead be looking for ways to foster a partnership between man and machine.

A prime example of this comes from Ray Dalio, the founder of Bridgewater Associates. In his mission to streamline his decision-making processes and make them more accurate, he began incorporating technology to help his company make better market investment decisions. This led him to develop and refine a set of highly efficient algorithms that allow for advanced, AI-assisted decision-making.

In his book Principles, Dalio explains that this immensely powerful tool was integral to the success and improvement of his company and his clients.

Logistics leaders should look to Bridgewater’s example and seek out new ways to intelligently apply artificial intelligence to the logistics chain.

2. Accelerated Adoption of Industry-wide Automation

Moving forward with automation is not a new idea by any means. Every aspect of the logistics chain has been steadily adopting more nuanced automation technologies for years. However, the introduction of COVID-19 has rapidly and dramatically changed the way that the logistics sector handles the flow of business.

Now, companies are pushing hard and fast for maximum automation. Those at the forefront are looking for ways to refine the tech that they have in place, and the businesses that were slower to adopt have now been forcibly shifted into high gear.

Automation cannot fully replace human efficiency and accuracy, however, the most successful companies are the ones that understand how to blend the operating proficiency of human workers with the enhanced capabilities of robotics and automated processes.

Instead of simply retrofitting old supply chain processes in the hopes of improving cargo flow, the optimal amount of success is found when operators adopt completely updated processes that reflect the new strengths of the updated tech at their disposal.

When it comes to cargo flow and success in automation, Long Beach Container Terminal, or LBCT, is a perfect example of automation done correctly. LBCT is a completely automated operation, and it makes full use of terminal modernization to measurably improve consistency and lower turnaround times for truckers.

In addition to better cargo flow, the new “pandemic economy” has greatly accelerated the implementation of contactless and digital customs procedures. Replacing the tedious and old-fashioned paperwork with more streamlined terminal check-ins and automated processes can markedly improve operational resilience and stability.

3. Exploration of Autonomous Vehicles and Alternative Fuels

Ultimately, being able to rely on autonomous vehicles would be a tremendous boon to operators. When it comes to freight movement and a better bottom line, automated trucking is the clear choice. Not only would it dramatically cut labor costs, which account for nearly 33 percent of all trucking operation costs in North America, but it would also address the looming issue of a major shortage of experienced drivers for long-haul trucking.

In regards to cost savings, when the International Transport Forum, or IFT, surveyed industry experts in 2019, they found that cost savings can be as high as 25 percent right away. It is also worth noting that self-driving trucks would give truck operators more flexibility in terms of scheduling because there would be no mandatory rest times required. Autonomous trucks can operate 24 hours a day, so even if fuel and maintenance costs are factored in, operators would be able to quickly make back their initial investment costs.

Self-driving trucks are also perfectly suited for the more difficult long-haul freight trips. This is especially true in North America due to the fact that a majority of the miles driven are done on major highways rather than heavily trafficked urban road systems.

Unfortunately, the downside to autonomous and manual truck driving is the environmental impact. In another study released by the IFT, they noted that carbon emissions are expected to increase up to 60 percent due to the fact that global freight demand is projected to triple in the next few decades.

The ideal solution to this would be alternative fuels. There is a strong push toward developing cleaner, more sustainable fuel sources such as ammonia, batteries, biofuel, fuel cells, hydrogen, liquefied natural gas, liquefied petroleum gas, methanol and wind.

4. Establishing Standardized Blockchain Technologies

Much like automation, adoption of blockchain technology has been slow and steady over the past several years. However, it is only recently that the industry is truly recognizing the value of using blockchain technology in the complex and often disparate arena of shipping.

Blockchain provides a distributed ledger for all parties that are a part of the chain, and the foundations of the technology are transparency, security and immutability all rolled into a single, streamlined digital process. When operators consider the fact that it is common for billions of dollars to be tied up in payment disputes across the transportation sector, it is easy to see the inherent value of relying more completely on blockchain technology.

Currently, the biggest names in global logistics are spearheading an initiative to establish a standardized blockchain application that will guarantee both the efficiency and the integrity of financial transactions within the logistics industry.

While there are still a number of challenges that these companies face, including cultural and technological hurdles in terms of implementation, there is definite progress happening.

The Best is Yet to Come

The trends outlined above are all vitally important to the continued success and forward motion of the global logistics sector. All of these innovations and advancements have already proven to be serious assets for operators who have implemented them, and COVID-19 has pushed the progression of the entire sector much more rapidly than anyone could have anticipated.

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