Logistics: The Digitization Success Story

23.09.2020 by Ümit Günes
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Is there a success formula for digital transformation? The Smarter Logistics trendbook recommends to companies the McKinsey three horizons model for long-term sustainable growth.

Digital transformation of logistics? Why, yes! But which innovation models are best suited for SMBs? According to the Digital Pioneers in Small and Midrange Business study, that is the question which most preoccupies decision makers. Most companies polled (50%) rely on in-house digitization teams, but companies with external innovation hubs (32%) are more successful in the long term. Why? They work at a distance from day-to-day business and are thereby able to pursue innovation ideas more consistently. External teams work mainly in three areas:

  1. 1. Creating new customer experiences
  2. 2. Transforming the business model
  3. 3. Keeping external disruption at bay

Companies that use innovation hubs are in the end significantly more satisfied with the results of their digitization projects. And they benefit from the highest growth in value. So how do you set about digital transformation in detail? Innovation hubs provide support throughout the entire process with individual solutions for every industry. Deutsche Telekom experts, for example, help many well-known SMBs to optimize their supply chains by means of the Internet of Things (IoT).

Prioritize Innovations Meaningfully

The Smarter Logistics trendbook mentions a helpful way to classify and prioritize innovations. It refers to the McKinsey three horizons model. From a strategic viewpoint the model allocates different ideas and measures to three time windows, stating that for long-term growth all three horizons must be covered.

Illustration of the three Horizons Model


 

Hiring external digitization experts is in many cases the order of the day. They have an eye on both technical know-how and long-term trends.

Preferably Sustainable: Green IoT

Today, companies must develop a sustainability strategy and bear the environment in mind if they are to achieve lasting growth. Customers and business expect them to do so. According to a Forbes study 92 percent of respondents would tend to trust a company that supports social and ecological concerns. This is an area in which the Internet of Things (IoT) can make an important contribution. By using information from the IoT companies can go easy on resources and boost their efficiency. Better fleet management with fewer empty runs and low-congestion routes (Green Logistics), predictively maintained machines with a longer service life (Predictive Maintenance) or consignments equipped with sensors and connected with the cloud that are better protected from loss or spoilage (Smart Tracking) are all IoT solutions that have long demonstrated in practice what the technology can accomplish. They are ways in which Green IoT converts a cost factor into a genuine competitive advantage.


 

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Ümit Günes
Ümit Günes

Marketing Manager IoT

Ümit has been working at T-Systems since 2015 and knows a great deal about many facets of the Internet of Things. He is particularly interested in topics related to the digitalization of the business world. For the blog, he reports on new developments and trends in the IoT world that offer real added value for customers.