Prepare Now to Navigate the ‘Storm Clouds’ in Transportation Management

Editor’s Note: The following is an excerpt of a research report published recently, “Transportation Pulse Report 2024 – Prepare for Dark Clouds on the Horizon.” The research, conducted by Adelante SCM and commissioned by Transporeon, highlights several supply chain and logistics trends that will impact and transform the industry in the years ahead and why Automation, Real-time Insights, and Collaboration are more important than ever for companies to prepare and respond effectively. It includes data and insights from interviews conducted with industry executives at Transporeon Summit 2023 (including Essity, Etex, Girteka Logistics, IntegreTrans, Refresco, and ThyssenKrupp) and from more than 200 respondents to a web survey conducted with Indago research community members and Transporeon’s shipper and carrier community. Please visit the report page for more information about the research and to download the full report.

“Prepare your umbrella before it rains.” — Malay proverb

We’ve all been there: you’re out for a walk in the city or on a mountain trail hike, and even though the weather forecast called for a “chance of rain” later in the day, you decide not to pack the umbrella or rain jacket. Then the clouds darken, the thunder rumbles, and the rain pours down on you. “I should have packed the umbrella,” you tell yourself as you scramble to find shelter.

Unfortunately, by the time you hear the thunder, it’s almost always too late and/or too costly to respond effectively.

What does this have to do with supply chain and logistics?

It means that we need to start preparing now — prepare our umbrella, if you will — for an incoming “storm of trends,” such as Artificial Intelligence, labor constraints, sustainability, geopolitical risks, and cyberattacks, that will impact and transform the industry in the coming years. 

These industry trends underscore the importance of Automation, Real-time Insights, and Collaboration. We explored these topics with industry executives at Transporeon Summit 2023 and in a web survey we conducted with Indago research community members and Transporeon’s shipper and carrier community. Below are some of the key learnings.

Don’t Put Off Process Automation in Transportation

Automating business processes is not new. That is, after all, part of the reason why companies have been implementing enterprise software applications for decades. What’s different today, however, is that process automation is becoming a necessity, especially in supply chain and logistics, due to the labor constraints discussed earlier, as well as the growing complexity of operations and the ever-accelerating pace of business.

Today, automation is almost synonymous with robots. In warehousing, for example, we’re seeing the growing adoption of autonomous mobile robots. In a survey we conducted with members of the Indago supply chain research community in February 2023, we asked them, “When building the business case for investing in warehouse robots, what metrics would be most important in your Return-on-Investment (ROI) model?” The top two metrics were “Increase in labor productivity” and “Reduction in labor costs.”

It’s clear from the research, therefore, that for most companies, the tipping point for using warehouse robots will be driven by labor-related considerations (costs, availability, productivity, safety, etc).

Drones, driverless trucks, and delivery robots are other examples. Their adoption to date has not been as fast and broad as some had predicted, but progress continues to be made. In September 2023, for example, the Federal Aviation Authority (FAA) in the United States announced that it authorized two more companies, including UPS, to operate drones beyond visual line of sight and that it remains focused on developing standard rules to make beyond visual line of sight operations “routine, scalable and economically viable.”

Also in September 2023, Tyson Foods announced that it was deploying autonomous refrigerated box trucks to deliver products to its distribution and storage facilities in Arkansas. 

In short, although drones and driverless trucks are not crowding the skies and roads at the moment, they’re playing a role in select situations, nonetheless.

It’s important to recognize that robots don’t just come in hardware form. Arguably, the robots that are being used the most today in supply chain management are RPAs — that is, Robotic Process Automation. RPAs basically automate what are typically mundane and repetitive tasks and processes, like copy-and-paste tasks and moving files from one location to another. They’re not as glamorous as warehouse robots or drones, but they play a very important role freeing up labor and improving productivity.

If you work in transportation management, you know that despite advancements in technology, many companies still rely on emails, phone calls, faxes, spreadsheets, and paper documents to manage their transportation procurement, planning, tendering, booking, tracking, and settlement processes.

Simply put, too many shippers, carriers, and logistics service providers have put off automating their transportation processes for too long. Now that automation is becoming a necessity, where are the biggest opportunities in transportation management today?

For insights on that question and the rest of the research results, please download the research report.