In an industry with so many variables, logistics providers are given the daunting task of providing customer-specific services on a mass scale. In order to stay competitive, businesses should turn to technology to gain the flexibility they need, says Simon Clark, Vice President Business Development, Europe for WiseTech Global.
To someone on the outside of the logistics industry, the supply chain process is simply thought of as moving cargo from A to B. In their minds, they think of nicely tessellating containers sitting snuggly on the deck of a ship, making their way across the world. It is taken for granted that goods can be ordered from the other side of the globe and dropped on doorsteps at the click of a button.
If only it was this simple. What most people don’t see are the incredibly intricate processes that go into moving that cargo from source to destination. It’s a complex web of interdependent processes that must coexist and cooperate in both the physical world and in the realms of data and electronic information.
The reality of logistics is far from one-size fits all. With so many demands placed upon the modern logistics operator, having the flexibility to meet an individual clients’ many requirements is essential to attract and retain business. But how can a business offer this level of service without losing productivity?
Standard vs custom
Create a standard operating procedure and you will create an efficient and effective way to help move that cargo from A to B. Standard process ensures all your operational staff are working in the same way, and you’ll be able to sell a neatly packaged service to multiple customers safe in the knowledge that it works.
But logistics is rarely a cookie-cutter experience and you’ll soon find that you’re missing out on potential business from new clients, or even existing clients, that require something a little different. And if an existing client looks to another logistics provider for a more customized service, they might well consider sending all of their business to that provider for convenience’s sake.
Many clients require operations that are tailored to meet their needs. This could be a physical-goods requirement, but will more likely be how their data, payments and orders are captured, automated, integrated and managed. By having a flexible operation, it’s possible to provide standard operating services to some customers while also offering client-specific services to others. However, the drawback to this highly customer-centric approach comes with the risk of lost time and productivity, along with the difficulty of creating and implementing unique processes each time you on-board a new client.
Keeping clients happy
A similar conflict can arise in KPI management and service-level agreements. Again, rolling out a standard process for measuring and managing these services will result in a blanket approach, catering for the many but perhaps excluding those more lucrative contracts.
While all your customers are valued, you may have some clients who you value more than others. There are many reasons for this: it could be a relationship forged over many years of business, it could be a well-known brand that adds prestige to your portfolio; the client may have links to other business or territories; or it may simply be a client with significant value. Whatever the case, you’ll want to give these clients special treatment: client-specific KPIs and reporting as well as a service-level agreement that’s above and beyond. Of course, this special treatment has to be balanced against the resources available for your other clients.
The same conundrum also applies to how your management information system (MIS) reports. While it may easily provide a standard set of information that meets the requirements for most of your clients, certain clients will require unique details particular to them, the type of project or even the type of cargo.
Flexibility through technology
Fortunately, simple yet sophisticated technology solutions are available so logistics providers don’t have to decide if they should take the route of offering standard-issue services or providing custom-made solutions—it’s possible to do both.
As ERP systems for the logistics industry become more sophisticated, the range of services a single logistics provider can offer has widened significantly. They can give a business the flexibility to predefine repetitive and routine processes while at the same time providing the sophistication to capture, manage and interpret customized data sets for those clients who require a little bit more.
Implementing automated processes for the majority of your business, allows you to spend more time looking for productive and innovative ways to add value to your service-level agreements, and provide a higher level of specialist services to the few customers with unique requirements.
Advanced logistics ERPs allow a business to create a well-thought-out and well-defined standard operating procedure that ensures quality and productivity, minimizes administration, and reduces errors and claims. Applied en masse to a customer base, the ERP can then be tweaked and adapted to meet the specific demands of special clients.
In terms of KPIs, having the ability to support a range of diverse requirements easily through flexible software helps to heighten and maintain client relationships. You can react to their needs swiftly and efficiently on a case-by-case basis.
An integrated and flexible software system that lets you adapt to the shifting needs of clients will also give you a platform to adapt to changes on an industry scale too.
Adapting to modern trends
Fuelled by advances in technology and new trends in business, logistics has had to adapt at a rapid rate. Conversely, advances in logistics technology have changed the nature of business itself, offering new ways to trade and enabling the rise of online shopping (eTailing) to take hold.
In fact, the high-demand and fast-turnover nature of eTailing has only been made possible with the dramatic increase in warehouse efficiency levels. Now, warehouses and distribution activities need to be flexible enough to cater for all types of product moving through the supply chain, over all modes of transport, and at rapid speed. Technology such as RF scanning and pick-by-voice have played a huge role in providing the highly productive logistics operations we have today.
By being flexible enough to incorporate these latest technological innovations across their operations, logistics providers won’t just be able to keep up with a changing industry, but will develop new processes that will drive the industry forward. As newer trends in technology such as mobile device leasing and real-time mobility come to the fore, the scope for specialized services will increase dramatically
The flexible future
As technology and ERPs lead the logistics industry into new realms of possibilities, logistics businesses will be placed under increasing demands to provide more flexible and more customer-specific services. However, for logistics providers with the foresight to adapt, it will be this very technology that provides the tools to move away from the one-size-fits-all approach—a flexible future where services can be customized for every client.
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