OUTLOOK
TECHNOLOGY:
EMBRACE OR PERISH
FOR LOGISTICS SERVICE PROVIDERS
We are witnessing unprecedented events in the industry, which include disruptions in regulations – GST; affordable technology – hardware, network and software; emergence of new age logistics service providers; and ever evolving customer needs. In such fast-changing global economy, the one that quickly adapts to changes and embrace technology would be the clear winner. In this new normal, embracing technology and automation is no longer an option. It’s embrace or perish reality for existing service providers, cautions Manish Saigal, MD, Alvarez & Marsal (A&M).
T
ools and processes for service industry are dependent on maturity and complexity of customer industry, margin pressures for customers and disruptions in the business models of the customers. Lately, logistics service providers have been challenged by disruptions and changes in the customer industry, which include emergence of B2C channel – ecommerce, omni-channel;
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changing mix of goods to be transported – more SKUs, style codes with more complex supply chain needs; scale of operations at a completely different level for contract logistics companies; and expectation of significant efficiency improvement from transportation & storage. Logistics industry has reacted to this new normal with emergence of new business models by new entrants and embracement
of new technology by forward looking incumbents. It’s clear that participants, which ignore this reality will struggle to sustain in future. Technology in logistics can broadly be classified into following categories: ● Automation in storage and handling ● Technology to procure and manage long distance movement ● Technology to streamline inbound