2022 brings unique challenges as the industrial sector continues to navigate a broken supply chain. How a company implements and executes logistical management strategies directly impacts business success. Logistics and supply chain management remains a vital piece of every manufacturing operation, but also stands to see some of the most dramatic benefits from digital transformation.
Benefits of Digitally Transformed Logistics Management
The supply chain continues to face mounting challenges like slowdowns, labor shortages, congested ports and container backlogs. At the same time, the sector is experiencing a wholesale makeover. Broadly speak, manufacturers are embracing digital transformation in the post-pandemic world. It has become a top priority in an environment when the pressures of a broken supply chain continue to shape 2022.
Optimizing logistical processes requires companies to review each step in the supply chain process (such as sourcing, procurement, conversion) and coordination with channel partners (i.e. suppliers, intermediaries, third party services, and customers) and discover opportunities for automation and heightened efficiency.
Despite the massive effort that optimizations demand, the benefits are a business that can leverage digital tools to respond to unforeseen circumstances and overall value from reduced costs. Supply chain transparency can enable businesses to communicate with channel partners more effectively, reducing waste from errors and an overall reduction of transportation costs. Internally, these same processes can offer enhanced inventory organization, heightened safety standards for workers and improved delivery times.
What is Logistics Management?
Logistics management is a significant link in the supply chain process responsible for all levels of operational planning, implementation and execution such as controlling the flow and reverse flow of goods, storage of goods, services, and related information from the point of origin to the point of consumption. Relevant activities can include inbound and outbound transportation management, fleet management, warehousing, materials handling, order fulfillment, logistics network design, project management, inventory management, supply/demand planning, and management of third party logistics services providers.
Depending on the product, the logistical functions can connect throughout the supply chain may include sourcing and procurement of raw materials, production planning and scheduling, packaging and assembly, and customer service. Any efforts to optimize logistics management must address business processes shipping, deliver and supply chain
5 Ways to Avoid Supply Chain Disruption with Optimized Logistics Management
If the benefits of digital transformation aren’t reason enough to search our digital transformation the difficulties of navigating the modern supply chain certainly are.
More than ever, businesses across the supply chain need to quickly adapt to an ever changing landscape. While any single optimization effort cannot completely circumnavigate supply chain slowdowns, what is clear is that companies who fail to take transformation efforts will lag behind competitors.
Here are the top 5 ways to optimize logistics management:
Maximize Automation with Tech Solutions
Several technologies are dramatically changing logistical processes, offering tools that enable wide scale automations, effective forecasting, reduced costs, and real-time responsivity to changes in the supply chain. A few examples are:
- The Industrial Internet of Things (IIoT): These internet connected sensors create enhanced visibility across operations, informing real time decision making, endpoint computing, and supporting data analytics that inform actionable insights.
- Blockchain (Distributed Ledger System): originally developed to support bitcoin, blockchains are being leveraged for logistics because of value in processing transactions without third party review. Because each block validates all prior data in the chain, this tool can virtually eliminate transactional errors associated with (docking, entry, (shares new entries with stakeholders)
- Forecast Software: Maintaining an appropriate stock level for is necessary to ensure demand is met appropriately, but large quantities of a slow moving resources can lead to slow downs or waste. An AI driven forecast software streamline stock management by tracking production cycles in order to create informed replenishment and stock planning.
- Artificial Intelligence (AI): The applications of AI within logistics management are wide reaching. In particular, effective AI implementations are effective for route mapping at all stages and specifically for the purpose of speeding up delivery turnarounds.
Anti-idling and emission reduction regulations have led many companies to focus on the reducing carbon emissions. Similarly, public perceptions of climate change are driving transformation, and businesses should start considering how their management efforts can be made green. These optimization efforts often require significant investments in the short term, they ultimately lead to cost effective management strategies in long term.
Some sustainability strategies include adopting route and load optimization for last mile logistics, procedures to track and report emissions, utilizing alternative fuels, upgrading engines for emission compliance and better mileage. Further efforts require a holistic approach for discovering and eliminating inefficiencies across the supply chain. The benefits of this not only include cost reductions from reduced emissions and public perception, but again include substantial savings over time.
Shared Visbility (SV)
As business ecosystems become more digitized SV across the supply network become more of a reality. A strong SV network gives everyone access to the necessary logistics data in order to make decisions that benefit the entire ecosystem. As this visibility becomes more standardized, new actors can be added or removed as needed, while ensuring the quality and dependability real-time data across digital channels.
This is a wide scale change occurring throughout the global supply chain. Participating in this system requires that actors throughout the SV ecosystem implement and maintain digital tools that can automated the relay of real-time information. Still, the potential for SV systems to mitigate the complexity of business ecosystems promises a fluid, uncompromising view of supply chain information that can enable businesses to act with agility when responding to disruptions.
Set & Measure KPI’s
Optimizations are inherently incremental and improvement needs to be defined along clear measurable progress. Setting and reviewing KPI’s can show when optimization of a logistics plan have proven successful.
In particular, KPI measurements can assist in optimizing middle mile efforts. Capacity crunches and driver shortages that have become common throughout the industry. However, supply chain visibility, route optimization, and connected driver management can alleviate these pain points to a degree. To see real benefits from these areas, each of these initiatives should be evaluated consistently and operations should be revised accordingly.
Meet Customer Demand
Slowdowns due to external concerns are in many cases unavoidable, but how companies manage customer service can have a meaningful impact on logistical processes.
Real-time updates enable companies to easily monitor and manage deliveries allowing them to offer customers updates on where packages are located, when they will arrive, and how to manage unexpected delays. Over 55% of retailers say that order tracking across all touchpoints has improved the customer experience.
Optimize Logistics Management with Stefanini Smart Manufacturing Capabilities
Supply chain disruptions are an inevitable challenge for logistics management, but the right digital solutions can help your business respond to disruption with agility. Stefanini is ready to bring the latest and best digital tools needed to optimize your operation.
Our team of experts will examine your processes and use their knowledge to find the technology that meets the unique concerns of any production line. Ready to get started? Contact us today to speak with an expert!