Logistics Providers Challenge to Guide Shippers through Technology Shift


    Technology has indeed changed all facets of business including the world of logistics. What was once considered a “physical distribution management” is now seen as equally digital and physical. This is due much in part to the rapid growth of e-commerce and mobile technology. According to Fab Brasca, vice president of solution strategy for JDA Software, the recent round of supply chain changes is all about “customer centricity.” Brasca explains that “Consumer behavior drives change.” This may sound like a simple idea, but observing customer centricity allows for complex supply chains such as carriers to create highly individualized lines of supply.

    As the software revolution meets the industrial revolution, Seth Bodnar, chief digital officer of GE Transportation, explained that sledgehammers are being put away for numerical digits and computers. There is great opportunity to merge information with operations via technology so that information can be used meaningfully to drive business. As a result, shippers are turning to third party logistics providers for help interpreting the data they have. As a whole, 19 percent of shippers are taking advantage of supply chain consultancy services. This is an increase of 8 percent from the year before. Additionally, nearly 75 percent of shippers said that real-time analytics would greatly help them to understand different shipping options they have.

    It’s clear that as technology continues to advance, utilizing data-driven reports will allow supply chains to grow even further and maximize their efforts. In fact, 81 percent of shippers explained that the consistent use of big data will become an essential competency for core supply chains in the very near future. As this trend continues and more dependence is placed on the role of observing consumer behaviors through data, more companies will have to hire hands to fulfill this position.

    GE Transportation has taken the logistics technology shift in stride

    Due to the rapid exposure of technology in the shipping industry, it will be necessary for leaders to work under circumstances where they might not have received prior training in. In order for shipping organizations to survive the huge influx of technology in a short period of time, workers must be willing to adapt quickly to new programs and procedures. GE Transportation has responded to this increase in the usage of technology by shipping companies by transitioning themselves from big iron suppliers for locomotives to a provider of much different equipment: software and data services that can help rail shippers to better manage their freight networks. GE Transportation explained that greater rail and supply efficiency could further reduce the need for their largest selling product, the locomotive, which brings in the vast majority of earnings for the corporation. However, Bodnar explained that selling trains and making the most money is not the ultimate goal of GE Transportation. Their ultimate goal, on the other hand, is to use analytics and statistics to help drive shipping efficiency for logistics companies. Beyond just managing trains, Bodnar explained that this objective includes the usage of apps and other software programs that will allow shippers to manage themselves better through more visibility.