The Digital Direction of Supply Chain and Logistics

Transformation has accelerated across sectors, and the supply chain and logistics industries aren’t immune to these developments. The decline in brick-and-mortar and adjacent growth of online shopping — fuelled in part by the Covid-19 pandemic — has led to major players such as Amazon and Alibaba pushing their logistics capabilities to become faster, more efficient, and more versatile. And, to go above and beyond when it comes to meeting customer expectations. Expectations, it would seem, center around hyper convenience and ultra-fast fulfillment.

Transformational models: digital-first

What does transformation mean? How is it achieved? What changes for IT functions? And most importantly, what exactly do we mean by ‘digital first’? Simply put, to go digital-first means approaching any new opportunity or strategy with the aim that the solution should be as digital as possible. It is to imagine as much of the service being created as possible being used by customers in digital form. Digital-first refers to the practice of putting emphasis on a business model that prioritizes digital processes internally and digital offerings externally.

But it isn’t just about creating new offerings. Reduction of costs, which includes warehouse optimization via digital methods, omnichannel delivery and fulfillment, and the need to meet constantly shifting consumer demands are named as primary priorities for 65% of surveyed supply chain executives when asked about updating their business models.

Industry 4.0: the fourth industrial revolution

In recent years, a fourth industrial revolution has emerged. Industry 4.0 is one of the biggest disruptors to traditional freight and logistics, transforming the way in which the industry continues to operate. It focuses heavily on interconnectivity, automation, machine learning, and real-time data. Sometimes simply referred to as ‘smart manufacturing’, it combines physical production and operations with intelligent digital technology, machine learning, and big data to create a more connected ecosystem.

Overall, business leaders that embrace Industry 4.0 are better positioned to trim costs, increase profit, and drive growth by optimizing all aspects of operations through the power of real-time insights.

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