Improving operational efficiency in the logistics and supply chain industry (2023)
The logistics industry is facing many operational challenges and inefficiencies. In this blog, we examine how automation technologies can help.
With 51% of third-party logistics companies growing 2022 order volume by 25% and with 48% struggling to find and retain workers, technology adoption has become a logical path for 3PLs seeking to scale their business and drive profitability. Extensive Warehouse Benchmark Report, 2022
The logistics and supply chain sector is only just recovering from the effects of the COVID-19 pandemic, and this challenge has been replaced by a multitude of others. The ongoing effects of a global economic downturn, inflation, and restricted warehouse space have added additional complexities to logistics operations and supply chain management.
What’s more, labor shortages have been prevalent as companies struggle to find and retain essential skilled workers. This demanding environment has triggered an ever more urgent adoption of innovative technologies. No longer able to rely on manual labor, the industry has found the answer in automation and process orchestration solutions.
Logistics and supply chains need to transform
The aforementioned challenges, combined with the emergence of new technologies, mean the logistics industry must now strive to find the right equilibrium between human workers and machines. Digital automation and orchestration can transform logistics operations, relieve the pressure on manual workers, and streamline processes such as order management and vendor sourcing. As such, the utilization of these technologies is helping businesses to tackle the current shortfall in labor and radically improve supply chain efficiency.
However, it is imperative that companies look to the future and reimagine the role of their human workforce in higher-value roles. Businesses that invest both in new software and the upskilling of their employees will see the greatest improvement in logistics efficiency. Adding a process orchestration software to your tech stack, which always keeps a human in the loop, is the ideal solution.
Improving operational efficiency in logistics
Increase the operational efficiency of your logistics company or department with these key digital transformation tactics.
Tactic 1: Source to pay
The process of sourcing the right goods, procuring, and paying for them can be a lengthy business. This can be further hampered by outdated software and manual procedures. Using an end-to-end automation solution coordinates all the various tasks involved in this process in one place. Supplier information, contract negotiations, and financial transactions can all be managed in a single workflow. Plus, processing time and manual errors are significantly reduced.
Tactic 2: Clearance processes
Clearance processes are time-consuming tasks for logistics companies, involving many steps including the preparation of documents, payment of fees, and securing clearance release from customs. Workflow management software can assist with all of this by automating various tasks, enabling you to track the status of shipments, and alerting you when action is required. Manual work is significantly reduced, and the clearance process is expedited.
Tactic 3: Task coordination
The logistics sector is heavily reliant upon rotational shift patterns, with many companies working around the clock. Effectively coordinating these shifts is essential to ensure adequate staffing levels, particularly during busy periods, but it can be exceedingly complicated. This is where a process automation tool can be transformative for your operations. By automating this process, you can reform work allocation, ensure peak times are handled more efficiently, and reduce operation delays and backlogs.
Tactic 4: Meet service level agreements (SLAs)
Logistics companies have many contractual agreements to abide by, from correct order fulfillment to expected delivery times. An orchestration software solution makes achieving these service-level agreements much simpler. Automating much of your order management procedures ensures much higher processing speed and diminishes errors. Order fulfillment is quicker and more accurate, and real-time order tracking gives you transparency on deliveries and allows you to address any issues swiftly.
Tactic 5: Invoice processing
Logistics companies handle a large number of invoices, and these are often still processed manually. This has a significant impact on operational efficiency, as it is a poor use of employees' time and has a high risk of human error. An invoice management solution can automate this process for you, resulting in far fewer errors, faster processing, and timely payment. This is beneficial for your relationship with both customers and suppliers.
Tactic 6: Integrating new technology and legacy systems
The complex nature of logistics means that a single software solution is not enough to keep up with the competition. It is essential to build a tech stack that addresses your specific needs and that of your customers. But the inherent challenge in this is incompatibility. When incorporating new technologies into your legacy systems, you must ensure everything will work together seamlessly. Make sure you choose a technology-agnostic platform that will wrap around your current tech stack.
Tactic 7: Intelligent automation
Utilizing automation technologies is an essential step in improving efficiency in supply chains and logistics, but selecting the correct technologies to automate the right processes can be a daunting task. When you’re making this choice, it is wise to bear in mind that while bot technologies are excellent for automating repetitive and rule-based tasks, they are still subject to exceptions, and human decision-making remains essential in many areas. Ensure the balance between humans and technology is maintained by adopting a process automation platform that always maintains human involvement wherever necessary.
Logistics supply chain orchestration solutions:
Enate is an end-to-end workflow platform designed to enhance operational efficiency in the logistics sector. Identify automation opportunities and effectively assign tasks to the appropriate resources, whether it be human workers or automated bots. You can streamline your operations, achieve better workflow management, and strike the right balance between human workers and technology.