Logistics Beyond Tomorrow: 5 Trends Dictating Direction
The future of logistics will be highly dependent on technology to support the increasing demands for effective logistics management. Economic and environmental concerns and the continued globalization of the supply chain are also logistics trends shaping our industry. Here are the top five trends that will dictate the future of logistics management.
The biggest influencer on the future of logistics management will be technology, as new technology is the foundation for many of the other trends. From self-driving vehicles to wearable computers that automatically track inventory and post transactions, gains in efficiency will be won with advanced technology. Additionally, radio-frequency identification will become more pervasive because of its ability to process transactions without manual intervention.
In 2017, e-commerce grew at a rate of 16.2 percent year over year, according to the U.S. Census Bureau. That makes last-mile delivery methods a big part of the future of logistics management. Drones, central pickup locations, secure lockers and “Uber”-like delivery operations are just some of the possible solutions in play.
Though technology has a way of making the world seem smaller, supply chains are actually expanding. Very few companies can grow or source successfully in just one country, making real-time visibility and communication a logistics management imperative. We will continue to see companies expand their global capabilities and offerings as they enter into new markets throughout the globe.
- Outward-Facing Supply Chains
Not too long ago, supply chains were focused on optimizing results for a single company, and keeping production and shipping throughput rates high. Companies today have recognized that it doesn’t pay to optimize just a single link in the supply chain network: The entire network must be optimized to benefit every customer, supplier, and producer — or the solution will lose efficiency.
This is the need that logistics managers are addressing when they ask for “end‑to‑end visibility,” but true outward-facing supply chains will soon demand more than just visibility. Simulations that optimize inventory locations to reduce total inventory investment across all nodes are starting to emerge, and key industries are looking to suppliers to think strategically about risk management. Analytics that address global economic, political and social trends to accurately predict demand will become commonplace, and multi-enterprise planning systems that link easily to multiple enterprise resource planning and software configuration management systems are just over the horizon.
- Robotics and AI
One of the most expensive parts of the entire logistics management process is manual picking and packing. Logistics management is already looking at robotic picking and packing to reduce costs while improving efficiency. Coupled with artificial intelligence (AI), robotics will increase accuracy while reducing order cycle times, helping to improve customer satisfaction.
Automated storage and retrieval systems, automated guided vehicles, along with robotics and AI, will change the inside of the warehouse, reducing headcount and costs and helping to streamline the supply chain.
- Environmental Concerns
Customers today want to do business with companies that reflect their own values. One of the strongest values driving current consumer behavior is a dedication to the environment. Companies that institute a “green” strategy will become a growing trend. In logistics management, this will take the form of reusable pallets, the ability to recycle products and packaging and work with SmartWay providers. Customers will also be looking for delivery methods with less environmental impact, such as electric and battery-powered delivery vehicles, consolidations for fewer stops and fewer trucks, and conversions to reduce carbon emissions.
Logistics trends will center around these five areas, which will drive changes in the future of logistics management. Selecting a 3PL that has the ability to adapt to these trends will be essential to stay competitive.
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Senior Director of Logistics Operations