Digitalization in logistics is the only way forward

Digitalization is no longer a buzzword. It is an integral part of our reality, right from shopping online to virtual meetings, OTT content and NFT markets. The digital ecosystem is here to dominate. In my own house, we’ve become used to getting our groceries at the click of a button rather than negotiating with a vendor in the sweltering heat. The rapid evolution of the metaverse, NFTs, cloud, 5G, internet of things, and the development of digital durables, which are replacing their older analogue counterparts, have increased the quantity of data being generated, stored, and analyzed exponentially, making us netizens.

Prasad Dhumal, VP- IT, DHL Express India

A recent McKinsey report states that automation will be among the top agenda for the logistics industry due to the increasing demand from online retailers, a shortage of labour, and technological advances. Digital processes and tools have made their way into the logistics space. Warmed by the e-commerce boom, the logistics industry has started to feel the impact as the average consumer becomes more digitally savvy. They demand efficient, accurate, and responsive service to their needs and expect multiple delivery options from logistics players with the ability to track and trace their parcels in real-time. These are no more good-to-haves, but must-haves!

Digitalization is here to stay

With businesses expanding their presence online, there is an increasing demand for fulfilment and warehousing services in the supply chain. Innovations like automated parcel sorting systems not only help in removing the need for manual parcel sortation but also provide insightful information on the parcel’s weight and dimensions. Application programming interfaces (API) integration into major e-commerce marketplaces provides e-commerce sellers with a seamless experience from order capturing and fulfilment to last-mile delivery. Digitalization in express logistics also helps logistics players deliver better and quality service to their customers.

Other emerging trends in the industry like artificial intelligence, machine learning, big data and cloud technology have proven their value in optimizing last-mile delivery. These tools help logistics players to drive efficiency in the supply chain and cut costs by minimizing human intervention and increased visibility. Due to the pandemic, logistics players have also shifted their focus towards safety, hygiene, and sustainable business models. In line with this, convenient options such as contactless deliveries and drone deliveries are also on the rise as these give stakeholders peace of mind when they can track everything at the click of a button. In addition, contactless deliveries are smoother and help to reduce carbon emissions.

The logistics industry is about speed, efficiency, and accuracy – all of which can be fostered by digitalization. Digitizing processes such as the tracking, invoicing, and collection of payments greatly improves the overall experience for customers as well as sellers. More payment options can be offered, and there are no paper invoices or receipts to lose. Not to forget, going paperless also reduces carbon footprint and is great for a sustainable business.

The future is online

The enhanced use of technologies such as data science and automation will certainly facilitate ease of operations in the express logistics industry. In contrast to the common misconception of a job reduction, technological advancements will help drive human intervention in strategy and problem-solving. In the competitive world, logistics players need to understand and implement technology to drive demand and capture opportunities. From where we stand, the next five years will only evolve to see an enormous increase in digitization within the logistics industry. The only way forward is to adapt!

Author: Prasad Dhumal, VP- IT, DHL Express India