As a customer, I have been conditioned to place an order on my device of choice and expect to get the delivery to my doorstep in the next 48 hours (or less). Sounds easy! Why? Because todays customer is more informed, connected, and demanding.
The rise of e-commerce has accelerated the pace of business and manufacturing and changed the way customers think about the world. This puts even greater demands on the logistics required to sustainably and rapidly “deliver on the promise” of instant shipping.
Logistical Challenges of Logistics
As supply chains have become global and companies look to focus on their core competencies, the logistics of managing these supply chains have become complex, with numerous carriers, freight forwarders, customs, and border controls between a shipper and customers. This has resulted in high integration costs, expensive peer-to-peer communications, and poor visibility and control across the supply chain.
Logistics is a highly variable market, and sourcing capacity to meet these increasing demands is often inefficient. At the same time, there is a widespread problem with underutilized assets. Logistics managers scramble to cut trucking costs, which requires more transparent and streamlined logistics communication.
To future-proof their operations, businesses must invest in their supply chains, as well as in technology that can connect the disparate parts of their business, deliver on the promise of transparency, and improve the customer experience.
Value of Collaboration Across a Logistics Network
The process of tendering a load from a shipper to a carrier has changed very little over decades. While new technologies have emerged to better digitize the many contracts and rate agreements that shippers and carriers have in place, visibility into the market prices or availability of trucks has remained elusive, and shippers still often pay higher prices to cover their freight needs.
The key to success is to create a central place to connect and service members of your logistics network. A common platform where shippers, freight forwarders, carriers, and other logistics partners can easily onboard, collaborate, exchange logistics information, and share insights.
The value of a network is amplified by the members and partners connected to this network. Once everybody involved has improved visibility and access to all relevant network members, everybody wins.
- Shippers get more choice of carrier options, which enables them to exceed service levels and reduce costs.
- Carriers can improve their utilization and profitability through improved visibility and collaboration. They can better manage their time and better optimize their trips.
- Customers get improved service at a reduced cost.
Why Collaboration is a Win-Win for Shippers and Carriers
A great example of this is the partnership that SAP has announced with Uber Freight. Uber Freight gives shippers direct access to rates from its digital carrier network, providing real-time quotes with guaranteed capacity directly into the logistics business network, simplifying load management and execution.
Customers have transparent pricing, access to a dense carrier network, and always-on availability from the nationwide, digitally-enabled carriers already on the Uber Freight’s platform. In addition to unlocking this carrier capacity, Uber Freight gives shippers the ability to further automate the supply chain and better control transportation management.
By directly utilizing real-time rates, shippers can save time and money on both freight costs and operational costs to manage it. The platform also lets shippers build their business rules directly to routing guide logic and automate their workflow to meet their goals.
Delivering on the Promise Means Going the Extra Mile for the Customer
We are entering a new freight era powered by intelligent data enabling real-time decision making for both shippers and carriers. To stay competitive, organizations need to maximize daily work time, see more market data, make informed decisions about their operations, and ultimately grow their businesses in smart, strategic ways.
An automated logistics network delivers more opportunities to drivers and shippers — less time needed to find and secure loads and more time to spend getting goods to market. And enabling shippers to tap into unused capacity can help to reduce the 200 million tons in emissions generated per year by underutilized trucks.
Only then can you improve customer service, sustainably.
Richard Howells is vice president of Awareness and Thought Leadership for Digital Supply Chain at SAP.