Digital supply chain

Advances in digital technology are having a huge impact on the world around us and leading to big changes in customer behaviour. Nowadays customers are involved in social media and digitally responding and covering across a vast interconnected global community. This digital involvement is in a vast manner and covers globally. However many supply chains are not technically or digitally capable to handle this changed scenario. That's because they're structured in a very traditional and sequential way.

Let's take a look at how a typical company with a traditional supply chain would react to a sudden peak in demand. Imagine a celebrity post a picture of a bag on social media like Instagram creating excitement and generating a sudden demand for the product across the world. The bag manufacturers demand forecast was based on a backwards look at previous sales. So when their sales reports show their product has sold out unexpectedly they wake up and go into firefighting mode. The company adjusts its forecast to reflect the new level of demand and then realizes that they don't have the raw materials or the production capacity to make replacements. So they call their suppliers but they don't have the materials available. The bag (bank ?) manufacturer asks them to order new materials and utilizing expedite shipments which lead to additional costs. Finally, when the materials arrive and the products are produced they then have to be transported to the stores. This wasn't planned for in advance which means premium shipping costs. All in all, it has taken the company around four months to replenish their product with an additional incurred cost. Unfortunately, the customer just wasn't going to wait that long and in the meantime, they bought a similar product from a rival manufacturer. In the end, with the unplanned additional costs and the unsold products, the bag manufacturer made a loss out of the whole experience.

But it doesn't have to be like this, traditional supply chains must evolve interconnected smart and highly efficient supply chain ecosystems with layers to address custom solutions and digital operations. Companies who can set up and run customer solutions and digital operations ecosystems empower themselves to proactively manage and efficiently fulfil customer needs across multiple channels quickly identifying changes in demand and organizing their supply chain accordingly. In this way, they can turn their supply chain into a real competitive advantage and use it as an enabler for new digital business models.

Let's look at how a company with a digital supply chain would have reacted to a similar peak demand situation. The company's proactive sensing capability including social media tracking identifies a peak in demand early. The production plan is adjusted automatically thanks to a direct link between demand and manufacturing. At the same time, an updated demand plan is shared with all relevant suppliers who immediately include the new requirements in their material planning and adjust their manufacturing priorities accordingly.

Meanwhile, the customer can track the progress of the order keeping up-to-date on when it's being manufactured and when it will be delivered. And throughout the process, the supply chain transparency solution monitors relevant supply chain data from a variety of internal-external structured and unstructured sources, enabling proactive risk management for the last mile delivery to the customer. The company leverages an established flexible logistics network with a shared infrastructure. The result is that companies that leverage digital supply chain operations with the versatility and agility that's needed in the digital age. That means happy customers and flowing profits. Supply chains are extremely complex organisms and no company has succeeded in building one that's truly digital yet. The companies that get there first will gain a huge advantage in the race to industry 4.0 and will be able to influence the technical standards for the future of their industry.

How Technology is Changing the Future of Logistics

 

Hello everyone,

This is Vembu Raj T, pursuing my MBA second year in Amrita School of Business, Coimbatore. Todays my blog is on topic “How Technology is Changing the Future of Logistics”. From this blog we would know about the five big technological developments that are transforming the logistics industry 's future.

Technological evolution is pushing the boundaries and changing the way the world does business. Today, for instant access, we're used to everything being online and right at our fingertips. Is it possible to receive a package less than an hour after ordering? Now it is possible depending on where you live, via Amazon, the pioneer of fast-paced delivery services. Improved technology has also improved supply chain efficiency, minimizing costs and mistakes. These advances benefit all areas of the logistics industry: trucking transportation, international transportation (ocean and air), supply chain management, and shipment tracking.

Here are five big technological developments that are transforming the logistics industry 's future.

1.      Radio Frequency Identification (RFID):

A common labor-saving way for businesses to monitor their inventory is RFID technology, which has also been in use for a few years.  A tag or sensor is placed on the product and radio waves are sent out. The information is then received and processed by the organisation. Barcodes are similar to RFID tags, but the superior speed of information delivery and data processing of RFIDs is more attractive to companies and the way technology travels. Today, many companies are using RFID tags in their distribution warehouses to monitor containers. Other industries are already using RFID tags, such as the apparel industry and major theme parks.

2.      Automotive trucks and drones:

With trucks not too far behind, autonomous cars are already a reality. Embark and Uber have both used autonomous vehicles for long hauls, with Tesla launching a truck this year. Although it wasn't fully driverless, it is a major move in this revolutionary technology with a driver in the passenger seat to control the machine and has the ability to improve productivity in the distribution phase.

Amazon have revealed the future of drones, called Amazon Prime Air, bringing deliveries right to the door. Because of regulatory measures and related costs, drone deliveries are still a few years away, but the prospect of not having to sit around over a four-hour period waiting for a delivery is very tempting.

3.      Shipment Tracking Systems:

Customers previously booked orders, obtained an approximate arrival date, and then, unless they wanted to make a phone call, were left in the dark. Today, advancements in the Internet and software give consumers 24/7 access to shipping and tracking systems. Not only does this boost the customer experience, but it also saves the business time and money.

4.      Enhanced GPS Accuracy:

Completely gone are the days when before you left the house, you printed out instructions from the screen. Nearly everybody uses GPS today, whether it's built-in on their cars or mobile phones. Throughout the years, the precision of these instruments has improved dramatically, not only helping angry, lost drivers, but also enhancing the supply chain. The advanced GPS accuracy makes it possible to increase efficiency and satisfy customers by monitoring the positions of trucks and improving transportation through access to updated traffic data.

5.      Social Media:

The power of social media is optimizing the logistics industry and operations as a whole. These networks are becoming the fastest and most powerful way for businesses to connect with consumers, rapidly sharing urgent information, industry news, and customer responses. 59 percent of Americans who have a social media account believe, according to Hootsuite, that customer service via social media has made it easier to address questions and concerns.

DRONE SHIPPING

 Container ships transport more than 90 percent of all goods in the world and more than 4 trillion dollars worth of goods annually. But it can take over a month for those goods to sail from Beijing to New York. By land, trucks move nearly 71 percent of all freight tonnage. But the problem is, there are a shortage of truck drivers everywhere. So how do you speed up shipments while keeping personnel low?

The future of shipping looks very much unmanned. Anything that has high levels of customization, anything that's unpredictable, that could be done by air. Many startups believe the answer is autonomous flying cargo drones, that can carry heavy loads and fly long distances.

All around the world, millions of people are benefiting from drones already, and we're just at the tip of the iceberg. The global drone logistics and transportation market accounted for more than 24 million dollars in 2018, and that number is expected to grow to 1.6 billion dollars in 2027.

These drones could be the disruption needed in a global supply chain that has been largely unchanged since the 1950's. Getting large shipments of products across large distances is difficult. That's why Malcolm McLean created the shipping container in 1956. This standardized the shipping industry and allowed shipping to scale in ways that weren't possible before.

For a typical product that is being shipped from overseas and then received within the country, that would involve trucking, ocean freights, in some cases we are seeing the emergence of more rail being used as it's becoming a more reliable mode of transportation. But now, with programs like Amazon's one-day shipping, consumers are looking for goods to get to them faster. That means the standard shipping methods – ships and trucks – have to be re-evaluated.

There is a seemingly high demand for things right away by consumers and that just keeps growing and people become increasingly impossible over time. What it seems like is the supply chains, which are wildly complex, are built around the timeliness of air freight. But the cost per item for air freight is significantly more expensive, when compared to sea and ground shipping.

Air freight is actually a mode of transportation that has increased dramatically. It's still a small percentage of all freight being moved, but if you look at the percentage change over the years, air freight has been growing much more rapidly. I think a big reason for that is the growth of e-commerce. If you're living in a small village and you want to ship goods and be a part of a global economy, often your freight link is by road or rail and it takes quite some time for your goods to be transmitted around the world. So when we bring autonomy and scale into aviation, every community can be connected with the rest of the world through a airborne freight link.

But The main challenge is volume. You just can't lift as much weight into the air as you can floated along the sea, especially if you're trying to use battery powered vehicles like many of the smaller drones we see today. Current battery technology is incredibly heavy. Volans-i, a drone company that has been working in this space since 2015 created a hybrid vehicle that uses electric power to take off vertically, then standard fuel to fly off horizontally. So, if you build an all-electric vehicle, you have an 85 percent mass fraction on the batteries. So that means you can carry 15 percent the rest of the weight in payload, which doesn't really make sense for cargo delivery. The more volume you carry, the cheaper shipping becomes, even if that means traveling longer distances. Going in from Shanghai as an example, to the United States might take about 28 days by ship, whereas by airplane it'll only take 14 hours. But still, ships are cheaper.

Companies like Volans-i have already started making deliveries in places like the Bahamas, a particularly difficult area for deliveries because of the large distances between islands. The company's goal is to alleviate the shipping strains of high need, expensive shipping, like when a specific part needs replacing on a production line, and it needs to be replaced quickly since time is money.

Other companies are trying to lighten the load of the ever critical last-mile delivery. That's the portion of the shipping process that gets the product from its last warehouse or shipping hub to your door, and trying to hasten the delivery of medical supplies and samples for testing.

Zipline has been delivering supplies in Rwanda since 2016, Ghana since April of 2019 and is expanding its service to the U.S. this year. UPS has teamed up with drone startup Matternet to quickly ship medical supplies from a North Carolina hospital to labs for testing. I think we can use this type of system to massively improve health care in the country.

Autonomy brings a whole new set of public concerns, just as we've seen with self-driving cars, because the public has grown to appreciate the safety and the assurance of being able to fly from one place to another. The regulators are hesitant to permit new technologies from entering the airspace until they are really proven satisfactorily. Another big concern when it comes to automation is jobs. There would be this whole workforce needed to be able to manage this drone network.

This technology could help alleviate some of the worker shortages that the shipping industry is facing. I think that there is a great opportunity here with unmanned cargo aircraft to start proving out some of the technologies in a lower-risk environment without people on board, and these same technologies can eventually be introduced to the aircraft that we will use for flying around cities to and from work.

Future Logistics 2 : Urban Air Mobility -Get Ready to fly

UAM: The Challenges and Possibilities

Hi, I’m Priyanka Sunil- A final year MBA student from Amrita School Of Business majoring in Operations and Marketing. Welcome to my progressive learning space for Logistics and Supply Chain Management.

As a kid, I was always fascinated by flying cars and always wished I was able to fly one during my lifetime. I remember watching Bruce Willis in the movie The Fifth element flying his cute yellow cab through the sky in the 23^rd Century New York City.

For decades the fantasy of flying cars projected through comics, science fiction stories, television shows, and movies have captivated us.

By 2030, the urban population will be 60 percent of the world population. It is expected that this significant population growth will create a real need for innovative mobility options as ground infrastructure becomes increasingly overcrowded. A solution could be to provide people with a safe, sustainable, and convenient solution that leverages the airspace above towns

Urban air mobility (UAM) is an  aviation concept for on-demand and automatic passenger or cargo-carrying air transport systems usually operated without a pilot. This new programs, while reducing congestion, would offer new ways for people to travel across cities and metropolitan centers.

 

So where is your flying car?

Many start-ups and tech giants have started investing in the innovative technologies needed to make this dream a reality. Enabled by vertical-takeoff and -landing (VTOL) systems, electric propulsion, and advanced flight-control capabilities, these vehicles could eventually reach price points rivaling today’s taxi services. Airbus and Hyundai are among the few companies that have their own UAM divisions.

The companies should plan now to make this a reality as the timelines for designing and constructing these are really long. If they hold back until air-mobility solutions are ready to hit the skies, their drones will be the aerial equivalent of a bridge to nowhere: expensive technologic marvels that serve no purpose.

Physical Infrastructure to address the market

Flying vehicles need places to take off, land, receive maintenance, charge batteries, and refuel their tanks and park to offer sustainable service. This is further complicated by the fact that the demand to fly is different during different times of the day.

The physical infrastructure will be a major determinant of the size of the addressable market, as the only possible trips are between VTOL ports. Flying-vehicle transport could follow a pattern similar to that seen in today's helicopter market, where there is a limited number of potential destinations. The location of the infrastructure will determine the level of market conversion. If a landing spot is too far from its origin or destination, the customer may not save enough time to make sense of a trip to the UAM.

Illustrating the Infrastructure Network design

·       Vertihubs-Conceptualized as stand-alone buildings built-in central, high-traffic areas

·       Vertibases- To be located in medium-traffic areas like  suburbs, or at major work or retail locations

·       Vertipads- Typically located in suburban or rural locations

Pic: MCKinsey & Company

On the government side, there appears to be growing interest in infrastructure as well, with some public agencies investing in developing air-mobility infrastructure for drone use cases. They are also figuring out possibilities to integrate these systems with the existing air traffic management system.

Safety, convenience and sustainability

·       Many are electric vertical take-off and landing (eVTOL) aircraft designed for quiet, emission-free operation and energy conservation

·       Most manufacturers transfer the mechanical complexity as much as possible to the software to improve safety

·       The infrastructure will need to include takeoff and land points that are close to where people live and work

·       Riders will use an app to book their air taxi and will be able to browse flights based on route or time and integrate your personal electronic presence and devices with the buildings and infrastructure you have to move through.

Air-mobility solutions could transform commutes, package delivery and other mundane tasks into ways that seemed impossible just a few years ago. By making distant suburbs a viable option for urban workers, eVTOLs could help reduce pollution and alleviate the housing congestion in urban areas. Rapid delivery of the drone could speed up the already steep e-commerce spike and boost the bottom line at many companies. And air mobility's overall economic benefits could be immense, as new applications increase efficiency and productivity. First, however, companies, governments, and other stakeholders need to take careful steps to create an environment that allows for these societal benefits. Just as with any new industry, much is uncertain, but the potential for gains is also great.

Get Ready To FLY .....!!!!!

Reference

https://www.airbus.com/innovation/zero-emission/urban-air-mobility.html

https://www.honeywell.com/en-us/newsroom/news/2019/01/what-is-urban-air-mobility

https://www.mckinsey.com/industries/automotive-and-assembly/our-insights/to-take-off-flying-vehicles-first-need-places-to-land?cid=other-eml-alt-mip-mck&hlkid=bd756ecece11481ca3b5702705582e0c&hctky=12024655&hdpid=6b6acce2-37ab-4754-a105-af775901c0d2