Most industries have been undergoing a process of business digitalization in the last few years.
The transport and logistics industry is no exception to this development. Being one of the fastest-growing industries worldwide, it needs to adjust more than ever from long-established practices to face the challenges of international trade.
Therefore, the digital transformation through the value chain is unstoppable and much-needed.
Digital trends in the logistics industry are no longer a choice but a certain future. Digitalization Vs. Digitization Vs. Digital Transformation Definition of Digitization Digitization is defined as the conversion of any data into digital format. Digitization converts any analog signal into a digital format.
Example: Scanning a document and converting it into a digital formation, such as a PDF file. Recording a presentation in an audio or video format converts and store it in digital format.
Definition of Digitalization Digitalization is defined as transforming any business into a digital format. The processes in industry are converted into digital form by using the digital methods and technologies in the firm. The business process relies on digital tools.
Example: The data is collected over the Internet is converted into business leads by digital tools.
Definition of Digital Transformation Digital transformation is described as an organization embracing digital technologies and cultural change on a much larger scale. Digital transformation meaning is an integration of organizational reform with digital technology.
Example : Artificial Intelligent-based applications, Employee using Digital tools.
In this article, we would like to outline ten concrete reasons why digitalization is the future of every logistics company within the value chain.
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The future is digitalization Cost and time efficiency through automation End-to-end visibility - Real-time tracking The promising chance of interoperability through digitalization The Internet of Things(IoT) Digitalization as a basic requirement for blockchain Business optimization through data analytics Optimization of internal operations Time and cost efficiency through data comparison - QUOTING Customer Satisfaction
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The future is digitalization The world became digital - a truth not only for logistics but for all parts of life.
Why do logistics companies need digital transformation? Due to the numerous stakeholders in different countries within the supply chain, the digital transformation of businesses and operations is vital.
Even though digitalization is not the objective of the business itself, it is needed to enable more transparent and efficient solutions.
According to a Forbes Insights survey , 65 percent of logistics companies recognize switching to the digital business model to survive in the digital age.
Also Read - How To Choose The Correct Freight Management Software For Your Business?
Cost and time efficiency through automation Time is one of the most valuable goods in the logistics industry. Every step and process has to be timed perfectly to guarantee an on-time delivery without any disruption within the supply chain.
Very short shipping times let shippers struggle to meet their delivery goals. Delays often cause extra costs like detention and demurrage charges. The very complex operations overall in the maritime supply chain can be enhanced by automation through digitalization.
The use of very limited human resources can be optimized by the automation of back-office operations such as emails or faxes or making calls to track freight, get rates, or get the paperwork done.
With Freightify rate management system which can reduce your time for generating an inquiry from 15 minutes to 15 seconds , with greater transparency and speed for both your team and the customers.
With digitalization, not only does time efficiency increase notably, but the error ratio also drops significantly.
End-to-End visibility - real-time tracking Track and Trace vessels by Getting their Latest Milestone Location - Freightify Digitalization does not make back-office operations more efficient but also allows a flexible reaction of disruption within the supply chain.
In this context, real-time tracking helps to understand possible delays and therefore to plan accurate ETAs, which can be given to customers.
This results in happy customers and also reduces customer service call-ins from unsatisfied clients due to delays.
Another important advantage of end-to-end visibility is dynamic routing. Through permanent data sharing, it is possible to avoid upcoming delays through route optimization. This saves time in case of disruptions like a maritime bottleneck due to port congestion or blank sailing.
Receiving constant updates of the route and the ETA, shippers, and forwarders can re-route the shipment to ensure on-time delivery and customer satisfaction.
The promising chances of interoperability through digitalization Digitalization helps companies not only to streamline data flowing through their operations but also gain data-based insights that can help with improving efficiencies.
Interoperability means the active exchange of data between different parties. This interaction would take the logistics industry and operations to a new, more transparent, efficient, and sustainable level. It would allow true end-to-end visibility and capture efficiencies that were never tapped before due to the absence of interoperable systems.
Interoperability is still a vision of the future because it is only possible if stakeholders follow data standards to ensure cross-company data interaction.
The Internet of Things (IoT) Source - pixabay.com An important requirement for end-to-end visibility within the supply chain is to have IoT devices at nodal points across the value chain.
These devices help the company to enable real-time tracking of their containers, measure the temperature and humidity to ensure quality standards of sensitive goods, and be able to comprehend any problem or disruption in the shipping process.
This stresses the importance of the adaption of digital systems in the future.
Digitalization as a basic requirement for Blockchain Blockchain is one of the greatest developments in the digital age.
For the maritime industry, this would mean more visibility into the network and helping eliminate unnecessary intermediaries from within the supply chain. It can reduce bottlenecks and clerical order, while smart contracts would increase transparency.
To leverage blockchain technology, digitalization is key. Coupled with big data and artificial intelligence, blockchain can bring extraordinary gains in the context of supply chain interoperability.
Business optimization through data analytics Most logistics stakeholders would agree to the benefits of storing data arising from operations. However, data is often just siloed without any purpose or use. Data is only useful when it is used.
For making data utilitarian, it is critical to ensure the collected data is streamlined - for instance, data should be digitized to be accessible.
Optimization of Internal Operations The logistics industry, and especially the maritime industry, rely on complex operations between numerous stakeholders. The need for fast and on-time delivery forces companies to adapt their often outdated business operations to the digital era.
Companies are often lacking inefficient back-office operations and visibility within the company. Teams don't have the needed transparency to operate in a fast and efficient way. The cutthroat competition within the market of logistics providers is increasing the pressure for all involved companies to optimize time, costs, and operations. The maritime bottlenecks due to the pandemic are especially hard to cope with for companies that don’t have enough cohesion within their operations.
Time and cost efficiency through data comparison - quoting One of the greatest achievements of digitalization is the time and cost-efficiency for the company using the new technology. Back-office operations can be automated and monitored with the same software and be accessible from any place in the world for all team members.
One advantage for the inside operations of the company is that data is available for all members of all the departments in the organization.
White-labeled solutions like that of Freightify, guarantees you the best rates in real-time and increases your time efficiency by almost 450 times - reducing your quoting time to less than 30 seconds instead of 4 hours!
Customer satisfaction Since the advent of Amazon within e-commerce, customer expectations have reached a completely new level. End-to-end visibility through real-time tracking lets customers be part of a new consumer experience.
Furthermore, Amazon changed the industry with its incomparable flexible delivery options and efficiency to ramp up fulfillment to meet customer needs.
As the retail consumer increasingly tilts towards the digital experience, digitalization within logistics becomes crucial for companies to sustain their position in the market and stay competitive in the future.
Conclusion There are many reasons why digitalization became an integral part of a successful business. The main advantage is the efficiency gain.
Automating back-office operations enables companies to track and monitor complex business activities with relative ease. The increased time and cost efficiencies allow workers to focus the business and not on time-consuming paperwork or redundant tasks.
Digitalization also brings in data streamlining, optimizing internal and external operations, and ensuring they meet customer and business goals. In essence, digitalization is a helpful tool that gets the best out of the company and assures its lasting success.Schedule a personalized demo
FAQ 1. What Is Digital Transformation? Digital Transformation uses digital technologies in business processes such as sales, marketing, and customer services. Logistics adapted from an old traditional business process into the new age of digital trends. The digital trends in logistics created a massive impact on the industry because the logistics industry was entirely dependent on the manual process before.
2. What are the benefits of digital transformation in logistics? Automation of the inventory control process as part of the overall supply chain. Lowering transportation costs in the supply chain. A greater level of transparency in logistical operations. Better customer service. Logistics and supply chain management becomes efficient and consistent. A more significant number of opportunities to make decisions in real-time is possible. 
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