Autonomous vehicles disrupt supply chain management

Autonomous vehicles disrupt supply chain management


We are living through a period of
immense transformation in the logistics and packaging industries—a time where autonomous vehicles are on the cusp of ubiquity. And is it any surprise given the rapid pace of advances in the tech sector?

The tech industry is driving (pun intended) changes along the entire supply chain from the use of big data and analytics, to the streamlining of operations, to the introduction of technologies such as automation and self-driving vehicles. At the same time, consumers increasingly want their products delivered cheaper, faster and greener.

Will you be ready?

The movement toward using autonomous vehicles for business is quickly advancing, even if the news on consumer self-driving cars is mixed. From the warehouse to the customer’s house, the future is rapidly moving toward automation. And it is setting the stage for a major disruption to supply chain and logistics management.

The future of autonomous vehicles in the supply chain is now

In some ways, the question of whether or not autonomous vehicles are taking over the warehouse is a foregone conclusion. As MHI reports, “Driverless vehicles are coming but they’re already having a major impact inside distribution centers and warehouses as the front line of the supply chain changes forever.”

That sentiment is echoed by a PwC Global report titled “Shifting patterns: the future of the logistics industry.” The report notes that many of the advances in autonomous vehicle technology are coming from new entrants to the market as “major players from other industries” shake up the industry’s dynamics.

 

Autonomous vehicles are already on the road to full integration in the supply chain.

 

The main premise is that technology is only one of four, interrelated forces that will ultimately disrupt the transportation and logistics sectors—customer expectations, new entrants or startups, and high-level collaborations being the other three. We only have time the time to address one particular technology (autonomous vehicles) in this post, but we will follow up with additional blogs on other aspects of this report in the coming months.

Fortune 100 companies are already using autonomous vehicles

In 2016 Google was awarded a patent for a truck with a series of storage lockers on the back containing items ordered by customers. Dominos and Ford are teaming up to design the first driverless cars for pizza delivery. Technology will soon replace the pizza guy with a self-driving Ford Fusion. And companies like Nestle/XPO are feeling the need to innovate with vehicles, drones and more. The list goes on.

The takeaway: Self-driving or autonomous vehicles are the future, and that future is now.

So this thing is headed on down the road. The real question is: how can you and your customers benefit?

What does the future hold for the supply chain and logistics industries?

It’s immediately clear that industrial and retail customers will benefit from advanced logistics services and increased automation as they see costs and delivery times decrease. And retail customers will see greater choice with regard to last-mile delivery providers and lower costs as well.

According to PINC, one of the key ways that tech will disrupt the supply chain is by innovating the tiny, but lucrative space between the yard and the warehouse.

 

Human labor is still an essential part of the supply chain.

 

According the PwC report mentioned above, disruptions to the supply chain and logistics management will be more profound. Logistics companies will need to be able to meet the changing expectations of their customers in a rapidly transforming market by staying agile and flexible while developing a clear strategy that focuses on “digital fitness, cost efficiency, asset productivity, and innovation.”

“Capturing the full potential of the automated supply chain requires rethinking and transforming the mainstream logistics systems: from the fixed “collect in the evening and deliver in the morning” approach to a fluid system of continuous movement and supply. This requires flexibility and innovation at the operator level, as well as investments in technology and infrastructure.

Bottomline? Change is the new supply chain

There won’t be a realization of the future supply chain. It will be an evolving collaboration between manufacturers, operators, retailers and developers as well as policy-makers and citizens. Autonomous vehicles are a symptom of that evolution.

As everyone scrambles to utilize new advancements in tech, it will be essential for you to have knowledgeable partners, and a cool head to assess and implement the changes that work best for you and your organization.

John Moore – Founder

Packaging & Logistics Solutions (PLS)

http://plspackideas.com