Role of Technology in Reshaping the Future of Supply Chain Visibility WIN 2016 Intralogistics 4.0
Imagine you in Mumbai had to send Rs. 10 million to a vendor in Noida, a 1000kms away. But Imagine a world of Finance where that all had to be done manually. Starting in the form of cash being collected by the you in of Rs. 100 bills, to your local branch and then the bank sends it to its head state branch and so on.
Imagine if the bank would credit the amount only after the cash reached the Noida branch. You would be sitting glued to your phone to oversee this road trip through state borders, through RTO in transit checks and through belts of the country notorious for its hijackings and loots. Imagine the transit branches would sometimes switch off their phones for hours.
Now I want you to replace that Rs. 10 millions in Rs. 100 notes with cargo of Rs. 10 million in a 100 boxes. But without losing the pain and anxiety. That is the state of Logistics in India and has been for a few decades now.
I was recently introduced to a Transporter who was going through Due Diligence for raising private equity. The process had been on for 6 months with no sight of ending anytime soon. But the proprietor seemed optimistic and the PE seemed unsure.
The PE was not for analyzing their business vertical, the customer base or the operational acumen of the team. They were keen on the transporters readiness for the post GST generation but all whilst only on the data provided by its bank statements. The PE barely went through their MIS IT systems. It’s not like the Transporter did not have any technology elements for its stakeholders. It had plenty of technology tools.
We are now nowhere close to the ‘Uber for Logistics’ We are nowhere close to having complete visibility in the Supply Chain. But let me address the part of the Supply Chain that I have grown to know and admire. Line Haul for fleet operators is like a Road Trip from ZNMD or DCH without the fun. The first time the Proprietor or Owner took his ‘Delhi Patna Roadways’ trip he encountered Dhabas and Petrol Pumps. He met Road checks and Octroi posts. He saw nightly rest stops and figured the shortcuts around cities. He knew something was familiar about these roads as it reminded him of his early years and the yoke of his forefathers.
It’s been 20 years of these same Dhabas, Posts, Checks, Roads and yet there is not a software in the world that can optimize the Delhi to Patna route like he can. There is yet to be a solution that he can use early every morning and remove that frown from his forehead.
People building solutions for LSPs are from a world much outside of that of the LSP. The people building solutions for Supply Chains do not even recognize the basic financial ratios that govern them.
We live in a fragile world where we are willing to pay a premium to a MNC for the quality product that indirectly is built by the outsourced teams of Bangalore, Hyderabad and Chennai. We are more willing to become ‘Attached’ to a MNC than rather we speak within the community where we get battered with for our rates. We are more willing to lose millions in opportunities but save millions in IT.