Stop focusing on the symptoms — solve problems
Over the past few years, ever since I started working on Evertracker, an Internet of Things (IoT) platform and artificial intelligence (AI) for logistics, I’ve been learning that many logistics companies are still trying to fight symptoms instead of solving crucial problems.
To gain a competitive advantage and reach sustainable growth, a compelling and far-seeing business strategy is needed. Whereas many years ago, markets changed slowly, which allowed companies to adapt to new circumstances, now new technologies force entire industries to rethink their business model, sometimes even overnight. Digitisation leads to constant changes, stronger competition and advantages for those who are the first and the most flexible. Big is not better anymore; it’s more important to be fast und flexible.
Whereas many years ago processes and operations were the keys to success, today emerging technologies are becoming the most important factor. Whereas some years ago software was used to optimise some workflows and get some more transparency, today, automated applications are managing processes and operations autonomously. Constant development and release cycles, sometimes several times per week, play into the speed and flexibility. Users don’t have to wait for months before they get access to new technologies or features. They are getting a constant increase in quality and optimisation.
These industry changes are having an immediate impact on consumers, who are feeling the benefits of new technologies more strongly than ever before, especially when referring to logistics. Start-ups are rushing onto the market and focusing on technology and rethinking traditional approaches. They are fast and flexible. Technologies and business models pivot on a daily base. What was new today will be out of date tomorrow. Overnight, new business models can occur and others will not succeed. The current and ever-increasing speed of the changing environment doesn’t allow companies to form a long-term strategy and wait until one particular technology or business model stands out. Thus, traditional companies are forced to focus on technologies on new markets and on problem solving.
Logistics is still in a holding pattern
Every industry suffers from consumer volatility. It is easy to change the supplier; it’s simple to switch from one provider to another. The logistics industry in particular is suffering and will continue to do so even more in the next few years. Consumers order from the supplier that offers the best service, but most of the service is not provided by the supplier but the forwarder. So, the company with the best supply chain wins the battle.
Nevertheless, most of the logistics companies are still in a holding pattern when it comes to new technology. It seems that they don’t understand what it really means that technology is changing the market, although there is no time to waste. The dramatic problem of not being certain what the future will look like makes them afraid of these uncertainties.
Immediate cost reduction instead of sustainable growth
Most logistics companies expect an immediate cost reduction when investing in new technologies. Only a few that I’ve talked to seem to understand that new technologies means you have to invest first.
Focusing on cost reduction won’t make your company ready for the future. Implementing software solutions or new technologies in general with the goal of reducing operational costs means that you’re not rethinking operations and processes as such.
If you invest in a traditional GPS-based track-and-trace solution to get more transparency but your competitor is investing in process automation by using smart positioning sensors, they’ll also have full transparency and with it a technology that lets them automate processes, such as order management, pick-ups or asset allocation. The new technology will allow them to grow by controlling the value chain.
Betting on traditional and long-lasting software solutions will solve all your symptoms and give you more transparency and insights, but it won’t allow you to focus on future industry development.
IoT and AI will allow you to focus on your problems
I, and we at Evertracker, strongly believe that everyone must rethink their approaches to almost everything on a daily basis. I now recommend that you rethink your approach to industry 4.0, technologies, processes and your industry. IoT and AI provide the same features that traditional software solutions do, but they can also provide an intellectual concept that will allow you to focus on new opportunities and value creation.
What IoT offers
IoT provides a solution that lets you manage hundreds or thousands of devices simultaneously, individually and automatically. You don’t have to configure devices or settings for proper functionality. Smart IoT reduces costs and battery consumption. You can therefore integrate a monitoring tool that constantly gathers data without changing your internal processes.
With Evertracker, you can monitor movable assets, calculate maintenance cycles and see the reality.
IoT empowers users by letting them focus on the data instead of the usage of the hardware.
What Artificial intelligence adds
However, at the end of the day, IoT can only provide data analytics and can’t meet the goal of achieving full process automation alone. This is what AI provides. You can utilise the gathered data by understanding the normal and detecting deviations.
As soon as your software, such as the one from Evertracker, understands your processes, you can automate them.
The combination of AI and IoT
At Evertracker, we combine these two technologies, enabling our clients to get full transparency through IoT sensors, and automate processes along the entire value chain by implementing artificial intelligence. This will bring you the needed level of individualisation and flexibility.
Rethink your current vision of digitisation
You should start to rethink your digitisation approach. Investing into well-functioning but traditional software technologies will only solve symptoms by reducing costs, or they will just make you a little bit more efficient. Remember, track-and-trace solutions can only bring you analytics from the past or complicated monitoring; traditional order management solutions only reduce paper work.
If you plan to automate processes to invest into the future of your business, you should start thinking about process automation and predictive analytics.
This is true for almost all features, software solutions and mobile applications, you must find a solution that has the potential to bring intelligences and full transparency into your processes.
Don’t get me wrong, you must also find solutions to resolve the symptoms, but I strongly believe that you should start today with considering solutions that will let you maintain your market position or open up new revenue streams for you. Don’t waste time and money on the past; invest in the future.
Don’t focus mainly on cost reduction; focus on process optimisation. Automated software solutions help you increase the utilisation of your assets. Whereas the only benefit of traditional track-and-trace solutions is the detection of lost or stolen assets, our customers increase utilisation and optimise the allocation of their movable assets, which leads to the reduction of operational costs and can create new revenue streams.
Conclusion
You should start rethinking your approach towards new technologies. Your competitors and new players might also be in a holding pattern today, but at some point, they will roll up the market. If you don’t want to be the first one to do so, you should be prepared at least for others to do so.
You can be certain that many of your competitors are putting all their efforts on process automation by implementing IoT and AI. This lets them manage all business processes simultaneously. They are highly flexible and can put their customers even more clearly in focus.
Successful companies prove that automating and rethinking processes are relevant for sustainable growth, especially in fast-changing industries.
And there is no industry that is facing such crucial changes as logistics is. Traditional companies were successful over many years and have learned to manage their processes perfectly, but now new players are entering the market, and new processes are necessary to satisfy their customers. The companies that are investing in new technologies are a step ahead of the market.
As I wrote in my previous article, we can all be certain that technologies will change the way we interact with parcel deliveries, but it’s questionable if there will ever be a one-fits-all solution. I believe that each individual expects a personalized delivery, which can only be achieved if companies are automating processes.
