January 17, 2021

How to Digitize Your Logistics: Supply Chain Technology Trends 2021

Explore how leveraging technology can optimize your supply chain while keeping up with logistics trends in 2021

Leveraging Technology on a Single Platform for Visibility 

The supply chain landscape is composed of multiple touchpoints and personas where it continues to get more complex with triangular shipments for instance and other related factors. The more we can look from an industry perspective towards getting information on a common platform, leveraging technology for visibility, and allowing us to take action based on milestones is really where the industry needs to go next from an overall technology perspective.

There are many players within the industry to get a product from point A to point B. If it's an ocean container, it's going to be on water for a couple of weeks but there are other ancillary players who need access to data and information. That's why leveraging the technology in a common platform is key for businesses to be competitive and stay competitive as the landscape continues to change.

Softwares Communicating with Each Other: APIs

APIs having multiple systems or platforms being able to connect and talk to each other is one of the trends industry experts are starting to see, which is gaining more traction. Traditionally in the past, if you needed to understand where your container was, your means of doing that was either calling the steamship line, terminal or the port to figure out the container’s location and get details around the firm's code, whether or not the container was available.

There’s a lot of different startups and companies that have various APIs gathering this information that the steamship lines themselves or the carrier community do not have through API methods, more than traditional development or IT softwares, that would become an enabler to connect various platforms together to create that ecosystem.

Jack Chang, Managing Director, JUSDA USA is seeing a trend over the last few years where systems are all starting to talk to each other and people are gathering data from multiple different sources. He believes this allows the visibility to really start getting hold of "where's my freight, where's my shipment?" To really bring that smack dab in the center of everyone. 

Technology Trends and Relevance of Supply Chain Partners 

There should be a balance between technology trends and the need for execution and people, who are at the heart of the logistics of freight forwarding industry today. There are customers, importers, exporters and their supply chain partners, who lack some sophistication for technology. They're not able to set up an API or get electronic information. Even a spreadsheet at times is very difficult to pull. What you should be doing then or what industry experts are seeing from a trend perspective is more of a marketplace type of an environment where a lot of supply chain partners can go to a marketplace, a common area, if you will, to be able to see all of this aggregated information.

Jack Chang continues that they are encouraging importers and exporters to look more towards their supply chain partners and help them from a technology perspective. Even though you might only be able to provide a PDF, what is your supply chain partner doing with that PDF? Are they then taking that from a data perspective? Are they ingesting that into their platform? When they ingest it into their platform, are they capturing all of the data elements? For example, what's on your commercial invoice and are they just capturing what's needed for a customs entry? There could be a significant variance associated with that. As they bring that data into the platform, what are they doing to help streamline that process? Are they using artificial intelligence? Are they using machine learning? What are they doing to try and help their customers automate and ingest that information into the platform?

One of the key actions is taking data, turning that into information, and subsequently making that information available to everyone in the supply chain. Everyone should have equal footing, visibility, and access to that data at the part number, shipment, and PO level, but you need it down to the part number level. That’s where industry experts are seeing a lot of these technology trends and see the competitive organizations, customs brokers, carriers and freight forwarders embracing more of that overall marketplace. They’re going to allow a lot more of the transaction sets to funnel through them so companies and businesses have more of a one-stop shop on a go-forward landscape perspective. That's what they’re seeing across the board.

Q&A on Digitization 

Q1: Does it require a huge capital expenditure? How fast does this data need to be processed? Given that shipments are actually live and there might be the inability to build that infrastructure. 

A1: It really goes back to understanding the data, data needs, and the process triggers associated with that. In each company, you have your logistics, compliance, finance, and marketing teams, who all have different needs for data and information. It's understanding what all of those needs are and how you can best encapsulate that into your overall supply chain so that it can be shared with everybody and everybody has access to that information. Bernie Hart, VP Customs and Business Development, Flexport thinks that is one of the pieces that they continue to encourage clients to take a good look at. What is their internal reporting requirements? Don't just think about it from a supply chain execution, getting it from point A to point B.

Once it gets into the country, let's say it comes into the United States. What teams are then looking for data? What does your finance, marketing, sales teams need? What does your order fulfillment process need? What are those data elements required? Then take that and work backwards into your supply chain as to where you can gather that information. We're seeing a lot more companies especially mid-market and large companies that are looking for their supply chains to help them even from an accounting perspective.

What was the ship from and ship to location? What plant code actually provided this so that they can then take in that information on their side and be able to use it more fluidly without having to manipulate that data significantly on their side. There's so much information that is available and if you just start mapping that out and again, you can do it yourself or work with supply chain partners to help you map that out. But what we're seeing is more of a strategic partner relationship between the freight forwarder and the customs broker with their clients today to really help them map out that overall process, avoid some of the pitfalls we have all lived through from an overall industry perspective and try to make it better moving forward. 

Q2: The trend I see now is that we often already develop a digital front end, but that our back office often delivers manual work. How do you see that?

A2: You have the BPO process but you have the manual work that is just being offshored and you're really gaining the labor savings. Industry experts believe that the big trend with RPA is having the robotic process automation be able to capture the information. It’s being able to get their information into PDFs, documents, and being able to have those recognized, captured, and the ability to have those information then fed back into the system is where they see the trend going. Another relevant piece leading to competitiveness than just traditional back offices is getting rid of vulnerabilities of the back offices. The next trend is really looking at RPA and investing in the technology pieces with a partner.

Working with a partner and being able to get that back-office information as digitized as possible is very important. If you can't do it yourself, it would be good to work with a supply chain partner to help with that overall digitization. It gets passed back to your ERP or any information set you're using, whether it's homegrown. We have the technology, it exists now enabling that and it's really about process decomposition. What do you actually need? What are your bottlenecks? What is the information? Then work backwards from that and understand where you're not able to get that data today and then look for ways where you can get, digitize, and automate that data and information. It flows back to automatically close out your purchase order by way of example.

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