Technology, a Backbone for Logistics across the Value Chain

Technology, a Backbone for Logistics across the Value Chain

By Muhammad Zahid, SVP, Business Excellence, Nestle China Limited [SWX: NESN]

Muhammad Zahid, SVP, Business Excellence, Nestle China Limited [SWX: NESN]

Logistics in any organization especially FMCG remains the most important part of the overall strategy. This is truly a reflection of an efficient route to market strategy in the organization. In general, lot of emphasis given to manufacturing footprint, to me Logistics/Distribution footprint is equally important part of the overall operations strategy in any organization.

Logistics owing to its nature rely heavily on the technological advancement. Technology is a vehicle to enhance supply chain competitiveness and performance by enhancing the overall effectiveness and efficiency of logistics system. Hence, choosing the right technology for various Logistics activities is very crucial to any business to gain competitive advantage in today’s competitive market. It plays a major role in success of value chain by enhancing the overall effectivity and efficiency of the logistics system. Information, communication and automation technologies have substantially increased speed of identification, data gathering, processing, analysis and transmission, with high level of accuracy and reliability.

In logistics, technology is hitting the market at an overwhelming rate and companies face difficulties to stay abreast with these changes. At the end, it is all about consumers. Technology should help what adds value to our consumers and customers.

Internet of Things (IoT) is the technology that makes monitoring and managing equipment so much easier. The statistics show that the IoT is going to change the logistics marketplace in the near future.

Artificial Intelligence (AI) does more than simply make products. It helps reduce costs and limit overhead.

Radio Frequency Identification helps track assets and inventory, reducing the number of goods that are lost or stolen during the Logistics process.

GPRS Fleet Management Tracking helps streamline the process and ensuring that vehicles are used in the most efficient manner.

Drone Logistics, still in the development stage and once ready will revolutionize the Logistics landscape

IT does play an important role for a sound Logistics. Some of the key tools in this regard are,

• Collaborative planning, forecasting and replenishment (CPRF)
• Web based collaboration
• Scheduling
•Collaborative replenishment and vendor managed inventory
• Logistics and warehouse management
• Distribution requirement planning (DRP)
• Automated inventory tracking system (AITS)

What technologies will have the biggest impact on logistics and supply chain management in the coming year is a key question to many companies. The experts agreed that few technologies in particular remain on the top of the agenda.

Mobile computing devices, whether in the form of smart phones or tablet computers, could have a more far-reaching impact on logistics than anyone ever imagined. With a tablet or smart phone in hand, managers no longer need to return to their desks to obtain essential operating data, they can pull up the information wherever they are, whether in the warehouse or on the road.

Prescriptive and predictive analytics, the manager can use the information to take any actions needed to keep the operation running smoothly. On the other hand, managers assess future risks.

Whatever technology we use in the logistics network, whatever route to market we decide for our business model, whatever advancement we may foresee in our logistics setup, things that will define the competitive edge for any company are, on shelf freshness/on-shelf availability/online availability and the product off take from the shelf.

The selection of right technology in our logistics should focus on all above winning points.

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