January 2019 | News | Global Logistics

Looking Forward to it

Tags: Global Logistics, Technology , Supply Chain

Here are seven global logistics trends that will impact freight forwarding in the next few years.

1. Environmental footprint and sustainable solutions will become top of mind. The transportation industry plays a big part in greenhouse gas contributions. Having a sustainable agenda and bringing insight and solutions to help shippers lower their ecological footprint will move from a "selling point" to a must in order to remain relevant. The increasing sustainability focus will drive development on emerging technologies, alternative fuels, alternative supply chains via increased 3D printing, and cradle-to-cradle thinking in product development.

2. Automation, robotization, and AI have a big impact on logistics. Automation, robotization, and artificial intelligence (AI) are receiving more traction and use cases. Everything that we can automate and digitalize will become automated and digitalized.

Robotics is a huge part of this trend with a large focus on machine learning. Robots are becoming more intelligent not only in terms of pattern recognition and performing tasks but also in learning from data, making decisions, and adapting independently.

The intelligence aspect of machine learning is an important tool for the transport industry as it heavily relies on predictability and efficient logistics flows. There is no doubt that the growth of automation, robotics, and AI will have a dramatic influence on the transport industry and change the very nature of freight forwarding.

3. The Internet of Things is a key enabler for improving logistics value chains. The Internet of Things is a major trend that allows for communication between devices that are connected to each other through small sensors of various kinds. In essence, everything that can be connected and would have a value of being connected will be connected.

The sensors will collect, store, and exchange data, and make intelligent conclusions to act upon—without human interaction. Today, we see connected road vehicles, pallets, and shipping containers across the globe using data to adapt vehicle parameters to different routes and increase uptime of entire fleets.

The Internet of Things will become a crucial tool for freight forwarders to better control logistics flows, discover possible issues at an early stage, and solve problems. It is a key enabler for improving the entire logistics chains precision, predictability, and transparency. It will also assist in supply planning and combating emission levels.

4. Electro-mobility largely contributes to greener transportation. The development of electric vehicles and powertrain systems will rapidly develop as we move away from oil-driven fuel and toward battery-driven fuel. As new regulations come into force in 2020, we can also expect an increase in the use of eco-friendly fuel for maritime transport.

Electro-mobility will largely contribute to reducing the environmental carbon footprint in the transport industry as well as helping freight forwarders guide customers in making smart and sustainable decisions for their supply chains.

5. Blockchain technology has the potential to revolutionize logistics. By storing blocks of information that are identical across its network, the blockchain cannot be controlled by a single entity and has no single point of failure. The information is public, accessible to anyone online, and easily verifiable.

This new technology will revolutionize logistics by increasing transparency for freight forwarders, minimizing information disruption between multiple parties, and eliminating intermediaries, resulting in simplified and highly reliable supply chains.

6. Urbanization and consumption will strain city logistics. In 2030, about 60 percent of the world population is expected to live in cities. This leaves us with a number of challenges. As the population shifts from rural to urban residency, the consumption in cities will increase—as will the logistics flow in and out of cities.

We will see an increased focus on how to efficiently manage urban freight distribution, congestion, and noise as well as environmental issues such as emissions and air pollution. Self-driving vehicles will also contribute to turning around city logistics and new transport alternatives such as drones will be used to meet increasing e-commerce. Development and maturity of 3D printing will allow goods to be produced much closer to the consumer.

7. Cognitive skills, insight, and innovation become more important. With automation, robotics, and AI on the move, companies will need different competence profiles compared to what they previously have been used to. Jobs are going from "follow instruction and execute" to "collaborative and cognitive" in their essence. Analytics and technology savviness will become key traits.

In the past, knowledge of facts was a strength. It still is, but going forward, finding facts are a button click away. Employees need to be increasingly savvy with interpreting, analyzing, and conceptualizing information and collaborate around it. This requires employees with highly agile capabilities and who have a mindset of curiosity and constant learning. It also puts significant new demands on the type of leadership and maturity employees possess.

To remain relevant in an environment with much more enlightened customers, freight forwarding companies will have to go beyond traditionally relationship-based sales to more insight and innovation-driven sales. Forwarders need to truly become partners in improving customers' logistics and supply chain solutions to earn their space. What brought us here is not what will keep us here.

—Johan Jemdahl, Greencarrier AB