At the outset of the COVID-19 pandemic, many consumers probably didn’t notice any major differences in their ability to buy products and receive shipments from brick-and-mortar suppliers. Now, even if you order from an eCommerce giant, such as Amazon, many of the perks you’ve come to expect from them (e.g., free two-day shipping and availability of all products) are no longer guaranteed. Amazon has prioritized shipments of medical supplies and household items, which impacted sellers of non-essential products.
What consumers should be aware of is that logistics companies are working tirelessly to ensure orders are filled and customer satisfaction is achieved. However, maintaining a business as usual approach in spite of the disruptions caused by the coronavirus outbreak has proven to be very challenging. The current COVID-19 pandemic continues to have devastating economic impacts, and the global supply chain and its logistics providers are not immune. This is affecting the industry’s ability to ensure that the consumer pipeline is filled. This is especially true for industries including industrial, pharmaceuticals, automotive, metals, and electronics.
This upending of large swaths of pan-industry supply chains has given logistics experts pause. They are starting to prioritize finding solutions to making their supply chains more agile and resilient. One way of achieving this is through automation – due to the burden of backlogged issues and requests, automation can help by answering the less urgent requests, freeing up employee time to properly handle urgent matters.
Addressing Vulnerabilities in Global Supply Chains with Technology
The focus now is on addressing the disruptions in the supply chain and meeting customer needs. However, business leaders also must consider how to react to these unpredictable situations in the future. They must be prepared for the next potential disruption. A report from the Institute for Business Value (IBV) highlighted that the coronavirus pandemic has revealed vulnerabilities in global supply chains that caused unanticipated chaos. Also, the situation made companies realize that they need more resilient and smarter systems based on automation, AI, and blockchain technologies – with some exploring drone delivery and autonomous vehicles for package and material handlings.
This calls enterprises to:
- Strengthen their supply chain networks with real-time insights and decisive action in order to enable better interconnectedness and responsiveness within an organization’s ecosystem.
- Be prepared for times when materials are not easily accessible to prevent major supply chain performance failure.
- Root your systems in advanced technologies to maintain business continuity and reduce vulnerabilities amid disruption.
Employing Technology to Leverage Emerging Patterns
There is no question that COVID-19 has caused significant and long-lasting disruption to the global economy as a whole. By now, companies realize that they will need to change their operating models to stay afloat and maintain their business longevity. Once they begin shifting to that new model, they should accelerate their digitalization to support their supply chain and make it more resilient and agile. That needs to start right away, with organizations using technologies like IoT, AI, blockchain-based track-and-trace solutions, mobile apps, automation, data science, and other tools to improve their supply chain and logistics management. These technologies can help them quickly identify patterns in supply and demand, allowing them to find opportunities amid the crisis and its dynamic business challenges.
Organizations must see this as an opportunity to strengthen their supply chains and logistics processes by tapping into demand patterns at both global and local levels. Doing so will enable better collaboration with third-party logistics partners and a greater understanding of how to manage fulfillment constraints while meeting consumer needs.
Planning for Future Disruptions Similar to COVID-19 Crisis
Since the pandemic has exposed flaws and cracks in the system, businesses must take what they have learned and insulate as much of their supply chain from disruptions such as these in the future. Many of the solutions and processes implemented today should become permanent to help organizations evolve to emerge stronger. Investing in things such as hyper-automation, offloads some of the time-intensive, manual tasks, allowing employees to focus on core work that’s more valuable and purposeful for them. Technology can help companies emerge better-positioned to meet customer needs, which is critical in times of unavoidable, unpredictable disruption.
With AI handling data collection and analysis, personnel can focus on work that cannot be automated and focus more on what the company needs in order to maintain business continuity. Also, companies should consider better risk management of supply chains through the utilization of hybrid cloud and analysis of externally-collected data. That will allow for less reactive decision-making and more careful planning. Ultimately, they should begin to integrate their teams around intelligent workflows to realign the entire business, making it more able to respond quickly to changing demand signals.
Tech Solutions that Logistics Professionals Should Implement to Cope with the Coronavirus Crisis
To improve the efficiency of logistics processes and the safety of drivers during the pandemic (and beyond), logistics and supply chain leaders should implement some of these technology initiatives.
- Vehicle routing and scheduling technology
Rerouting can apply to product delivery in all delivery stages. OTR (Over-the-road) drivers transporting critical products may be rerouted from their original plan to deliver the goods to a distribution center and go directly to a store instead. Also, there sometimes is a need to redeploy and reroute products from middle-mile drivers that may be over-the-road, handing it off to another driver for final-mile delivery. Amid the COVID-19 outbreak, enabling flexibility in rerouting and redeploying shipments is becoming essential to business survival. Utilizing tech solutions that enable things like geofences and heat maps can help businesses and truckload freight carriers to understand high-risk locations and empower them with proactive, real-time alerts on delivery times.
- Telematic technology
Companies should implement telematics solutions in their fleets to reduce costs and ensure better driver safety. Longer hours increase the risk of fatigued driving, and telematics technology can help mitigate the risk. Companies can address the issue by reviewing hours worked and adjusting the schedule (e.g., initiating a shipment handover with another driver). Advanced solutions also collect valuable data on closed rest stops and reroute drivers to alternative locations.
- Monitoring and locating critical shipments moving through the supply chain
Since many essential products (e.g., healthcare products, paper products, cleaning supplies, etc.) have been depleted due to all of the panic buying, the risk of theft while in transit may be increased in some areas. Products can get stolen and sold for a higher price due to panic buying. Supply chain and logistics leaders should consider placing sensors on trailers or products to be able to monitor and locate them. Sensors will track the movement of the shipment on the road and send alerts for issues or deviations.
- Virtual practices
To prevent infections from the coronavirus, logistics and supply chain leaders need to prioritize facilitating interactions between drivers and personnel at pick-up/delivery points through technology. The time savings and efficiency achieved through these methods could benefit the supply chain even after the impact of the COVID-19 pandemic. Routine procedures such as paperwork signings or gate check-ins can move to the cloud via a SaaS solution.
Technology can help the logistics sector and trucking industry cope with the current crisis by enabling driver-facility communication, performance reporting, appointment scheduling, issue management, identifying/booking the right provider, and many other tasks.
Technology Helps Companies Act Proactively and Stay Coordinated
As the supply chain teams struggle to cope with the global pandemic, most of them have been trying to keep up with press releases and the news about evolving response measures. At the same time, they’ve been working to secure components and raw materials to protect supply lines. Despite these efforts, the truth is that vital information is often inaccessible or unavailable across their local, regional, or global teams. As a result, the response to supply chain disruptions have been uncoordinated and reactive, resulting in the negative impact of the crisis hitting many companies full force.
On the other hand, a minority of companies in North America that had mapped out their supply networks before the pandemic emerged as better prepared for the disruption. Network mapping has provided them better visibility into their supply chain structure, and they have the right information within minutes of a potential issue. They know exactly which products, parts, sites, and suppliers are at risk, which enables them to react quickly to secure constrained inventory and capacity at alternate sites.
Being able to adjust plans easily and quickly using technology based on your supply chain requirements could prove a significant differentiator for your company in the future. By embracing a crisis management plan that involves digital transformation and teaming up with a third-party logistics solutions provider, you gain insights and access to ready to deploy technologies that can help you improve your logistics processes and delivery.
And it is not just a short-term investment, but a great opportunity to win over the long-haul. The changes we see in both global and regional markets won’t disappear when the coronavirus pandemic is over, as we will prepare for what many call the “new normal.” Consumer behavior in North America is changing, and how logistics companies are responding now can either lead to their success or demise. To survive the economic downturn and disruption, you need to rely on the right technology, be proactive, and take steps to ensure preparedness amid the COVID-19 pandemic and future events like it.