Logistics: Crisis-proof Thanks to Digitization

23.07.2020 by Ümit Günes

Man in suit typing on his tablet

German logistics enterprises have a reputation for being global leaders. But tech company outsiders like Flexport or Convoy are intensifying the competition. So how are logistics specialists to hold their own?

Where is my shipment and what condition is it in? Will it reach its destination on schedule? At Quehenberger a glance at the computer is all that is needed to keep an eye on supply chains. The Dormagen-based logistics provider has equipped its containers with a tracking solution. Shipment & Asset Monitoring – from Telekom – monitors temperature and humidity in the containers by means of networked sensors that also register any shock or manipulation of the closing mechanisms. The system relays the readings via the mobile network to the Cloud, where the data is processed. As soon as predefined levels are exceeded the solution sounds the alarm. So no container can stand around unnoticed for days, temperature-sensitive medications are well protected in transit and thieves stand no chance of being able to heist valuable freight unnoticed. And should problems occur, the responsible supply chain manager can initiate counter-measures immediately and notify the customer.

German Logistics Leads the World

In logistics German companies lead the world. Three of the world’s ten largest logistics enterprises are based in Germany. But tech companies like Flexport, Convoy and Manbang are attacking the industry. So what can logistics specialists do to defend their position in the global market? The consequences of the coronavirus crisis have definitely made it clear that digitization strengthens the logistics providers’ defenses decisively even when global crises like the latest pandemic lay world-encompassing value chains low and bring production to a standstill. The effect of bottlenecks like the one that hit medical protective equipment is that in the future shorter and less complex supply chains limited to Europe might gain in significance to ensure supplies. That is the conclusion reached in the Smarter Logistics Trendbook, published in July 2020. Quehenberger demonstrates that where logisticians kicked off corporate digital change in time they are now reaping the benefits of their digitization work. If you manage your supply chain digitally you will enjoy a competitive edge not just now but above all in the medium and long term.

News Processes Need Data

The indispensable precondition for the digital transformation of supply chain management (SCM) is that data from all companies in the supply chain must be transparent and available across the board. All relevant players and data can be connected with each other via technically open platforms. Companies can thereby prevent data silos, create transparency and put in place the precondition for a positive customer experience and optimal value creation. Disruptions are easier to predict by means of digital supply chain risk management (SCR) and the consequences are easier to estimate. Might a shipment of Galia melons no longer be saleable because it has been subjected to a sharp shock in transit on board a container ship? Automatically and in real time everybody who is involved receives an alarm notification: from the farmer in Israel via the sea freight shipping agent in Hamburg and the trucking company in Bremen to the purchasing and marketing department of the recipient – a supermarket in Cologne. Once the cargo is discharged the forwarder can check directly whether the fruit is still saleable and, if necessary, order without delay a replacement consignment from the producer.

What is Customer Experience Management?

Customer experience management (CEM) measures online and offline the satisfaction and loyalty of customers combined with the task of improving them continuously and in the event of difficulties taking countermeasures at an early stage. That is how companies manage and optimize their reputations. The objectives are the highest possible level of customer satisfaction and close customer loyalty to brands and products across all touchpoints on the customer journey: from the initial search for information, ratings and feedback via choice and purchase to the consumer experience (customer experience, CX) of a product or service and communication as a brand ambassador.

More Efficient, Wider Operating Margin, Good for the Environment

Automation ensures that companies are able to compete. Speedier, simplified processes boost efficiency and improve the operating margin. Regress issues are clarified faster as a result of the unambiguous data situation and customer experience management (CEM) is improved too. A further benefit of the digitized supply chain is its greater energy efficiency. Fewer empty runs, energy-saving storage facilities and less waste enable logistics enterprises to reduce their CO2 emissions. They are high in the industry and the EU member-states are sure to intervene and regulate in the future. Customers, in contrast, are delighted. Sustainable business models tell a convincing tale and retain customers in the long term. Eco-friendly business models go easy not only on nature but also on the wallet.

Specific Hints on Implementation

Open platforms and interfaces are available to develop the SCM solution. The Smarter Logistics e-book lists three action areas on which the industry must now focus:

React now with a radical customer alignment (Customer Relationship Management, CRM) and digitize the customer experience (CX) Establish a crisis-proof supply chain with end-to-end digitization
Eine krisenfeste Supply Chain mit Ende-zu-Ende-Digitalisierung realisieren
Become agile and actively support your employees on the pathway to the digital future of work

What is Customer Relationship Management?

A company’s customer relationship management (CRM) is the care and management of the customer relationship. CRM is a strategic alignment that influences practically all processes that have anything to do with the customers. The strategic focus is not on a product or service that the company would like to sell but on the customer and on customer service.

How are companies to set about digitizing and automating their logistics? The Smarter Logistics Trendbook lists many more examples of logistical innovations that demonstrate successful deployment of digital solutions. To help you develop your digitization strategy the e-book offers practical advice and approaches to different measures and a likely implementation time frame.

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Ümit Günes

Marketing Manager IoT

Having been with Telekom since 2008, Ümit possesses a comprehensive understanding of various facets of the Internet of Things. He has a keen interest in the digital transformation of the business world. On this blog, he shares insights into the latest developments and trends in the IoT sector that provide genuine value to customers.