"I think it's time that our markets, and the business world, start to really recognize the backbone is the operators and logistics infrastructure humans and strategists. That's who's really driving the future economy." —Gary Vaynerchuck
Our global supply chain makes the world's economy turn. In essence, we're all a spoke in one wheel. Regardless of your market, product, or job title, logistics touches your business. Thus, everyone in business must think deeply about their logistics strategy.
On one hand, every business has different logistics needs. But on the other hand, strategic logistics fundamentals bind us all. Beyond that, technological advances continue to iterate on the core fundamentals of logistics. These new advances can provide businesses with strategic advantages.
We'll touch on the fundamentals in this article. But we'll focus on the best new technological tools driving change in the logistics industry. Consider this a logistics strategy checklist. Hopefully we can help you create a high-performance logistics strategy.
Here's our checklist:
- Route optimization
- eBOLs and the contactless freight movement
- The paperless office
- Process automation
- Integrating your tech stack (TMS, WMS, telematics)
Certainly there are many nuanced elements to a high-powered logistics strategy. But the goal today is simple: let's identify the best ways tech is changing logistics.
Now for a musical interlude.
When the Moon Hits Your Eye, That's Logistics!
It's been over a decade since UPS came out with the iconic 2011 ad campaign, "That's Logistics." It was a pretty brilliant marketing campaign for the entire logistics industry. If you recall, UPS rewrote the lyrics of "That's Amore." And through a series of television ads, that catchy jingle stuck in everyone's head. (I apologize if this article causes that ditty to bubble into your headspace again whenever someone says the word "logistics"!)
But it's worth noting how UPS declared that logistics is the backbone of modern business in its 30-second ads. That's significant because I believe those ads introduced many in the general public to the entire concept of logistics.
I'm speculating here, but before the "That's Logistics" jingle, I think a lot of folks thought products got made up North by elves and got delivered to loading docks and chimneys by reindeer and sleigh. In essence, "That's Logistics" allowed many people to grasp this thing we describe as the integrated global network of suppliers, manufacturers, retailers, carriers, and customers.
That said, let's get under the tree and unwrap the present state of logistics strategy!
First of All, What's the Definition of "Logistics Strategy"? (In Other Words, What Never Changes?)
A logistics strategy is the planning process for the movement of materials and goods throughout a product's supply chain (ideally in the most efficient way). The goal is to drive profit and deliver customer delight.
The goal of a logistics strategist has never changed:
- Deliver the goods.
- Make a profit.
- Keep the customer (happy).
Get those three things done, and you'll be good to go. End of story. Roll credits.
If only it were that easy, right? Fortunately, the tips and technological tools in our checklist can help. I'm all-in on tech.
The Tech of Modern Logistics
Like it or not, tech has changed—and will keep changing—the logistics game. The modern logistics strategy must include tech. So it's vital to introduce the right tech and make it your strategic backbone. That sink-or-swim moment is closer than you might realize.
Thus, we'll really focus on tech in this list. Here's the bottom line: There's software available that can form a backbone and logistics strategy for you out of the box. Let's investigate!
1. Route Optimization (Not Your Father's GPS)
Modern route optimization tools are not only real time but also predictive. Route optimization streamlines a delivery by removing potential backtracking. Modern cloud-based GPS software can connect fleet managers, drivers, and a delivery truck's telematics. You can chart routes for optimal refueling, accident avoidance, and usage of drivers' hours of service (HOS).
Route optimization is especially critical for final mile deliveries and LTL freight. Optimized routes can reduce wasted mileage. Keep those profits in your pocket.
2. Electronic Bills of Lading (eBOLs)
The introduction of eBOLs became critical to success during the COVID-19 pandemic. Logistics eBOL software suppliers probably saved a number of lives.
There's an inherent safety factor built in to the eBOL concept. Drivers, dock workers, and office managers simply don't need to interact physically and share germs. In short, contactless freight powered by eBOLs helps establish a more resilient and safe supply chain.
Of course, eBOLs are incredibly efficient for drivers and the back office alike. There's no more walking around for signatures, fax machines, and copiers. Instead, eBOLs connect shippers, carriers, drivers, and customers with the simplicity of an app.
3. The Paperless Office
The paperless office is a forward-looking logistics strategy that goes hand in hand with contactless freight. The common element between the two is the digitization of data.
Yes, physical paperwork is the old standby form of communication. But in reality, it's inadequate and inefficient. Paper requires storage, filing cabinets, and cardboard boxes. Retrieving paperwork from endless files is daunting. Half the reason people fear getting audited is the chaos of the physical paper involved.
In essence, communication is the first principle. So improve communication methods! We already see it happening. Many companies have already created digitized documents and paperless offices by working with a company like Vector.
4. Process Automation
Another improved logistics strategy includes automating documentation and processes. Again, digitized documents can streamline workflows. Automation is the key.
No, we aren't talking about autonomous trucks. We also aren't talking about robots on the manufacturing floor. Those are certainly elements that will be part of the future supply chain. Instead, the automation we're describing is simpler, but it could nevertheless pay dividends in myriad ways.
As noted above, digitized documents create a contactless, paperless environment. But the absence of physical paper doesn't mean the documents are gone. Instead with software like Vector's, those eBOLs, proof of delivery forms, trip sheets, pick sheets, and pictures are all housed in the cloud.
And like many technological features we've become accustomed to, Vector leads to greater levels of automation. The most attractive example of what a software platform like Vector can do is automate billing. When you think about logistics strategy, have you considered how quickly you get paid? Can efficiencies in the invoicing realm improve your overall business performance? If you're unsure, just ask your CFO.
5. Integrating Your Tech Stack (TMS, WMS, Telematics, and So On)
In reality, any logistics strategy discussion should involve a holistic approach. The global supply chain is highly integrated. Likewise, businesses can and should make every attempt to integrate their in-house tech stack.
The modern logistics tech stack features several systems. It seems as if we add more each year! To name a few, these include:
- Transportation management system (TMS)
- Warehouse management system (WMS)
- Data management system (DMS)
- Truck telematics systems
- Customer relationship management (CRM)
- Enterprise resource planning (ERP)
- Email system
- Customer supplier network systems
As you can imagine, the list goes on. The best way to manage your multiple systems is to integrate. Simply put, when you add any element of technology, make sure it speaks the same language as your existing tech stack.
In Summary, It's About Strategy and Tactics
“Strategy without tactics is the slowest route to victory. Tactics without strategy is the noise before defeat.” —Sun Tzu, The Art of War
If we understand Sun Tzu, then we realize the fastest route to victory involves strategy and tactics. In other words, we need a grand plan and some methods to get us there. And if we understand Gary Vaynerchuck, we're the ones charting the future of the economy.
In short, you can gain the advantage with tech like Vector's. Partner with companies that are already changing the game of logistics strategy. Put another way, deliver the goods, make a profit, and keep the customer (happy).
This post was written by Brian Deines. Brian believes that every day is a referendum on a brand’s relevance, and he’s excited to bring that kind of thinking to the world of modern manufacturing and logistics. He deploys a full-stack of business development, sales, and marketing tools built through years of work in the logistics, packaging, and tier-1 part supply industries serving a customer base comprised of Fortune 1000 OEMs.