In 2020, the Covid crisis brought logistics to the forefront of the media scene. And the events that occurred at the beginning of 2021 such as Brexit or the blockage of the Suez Canal show us that global logistics is, more than ever, at the heart of the challenges of our global system. They also raise the challenges it still faces.
Real-time visibility more necessary than ever
Even if the international Supply Chain is used to unforeseen events – natural disasters, seasonal epidemics, localized strikes, etc. – the Covid crisis has highlighted the vulnerability of international supply chains. Indeed, the coronavirus crisis had the particularity of affecting the entire planet and highlighted a strong interdependence of systems and an opacity of logistics flows.
According to a study published by Gartner(1) in May 2020, only 21% of Supply Chain leaders considered their Supply Chain to be very resilient. In a context of tension, the location of raw materials, production goods or finished products in real time is essential. It allows us to react to the most unexpected situations and to be agile in the face of market fluctuations and delivery methods. This issue is even greater in the case of highly seasonal or perishable products. Real-time visibility is essential to better manage your flows and respond to unforeseen events.
With increased delays at logistics terminals, detention costs and demurrage exploded in 2020. And they risk reaching exceptional amounts in 2021 in view of the latest news. This spectacular increase has been a source of tension in the maritime freight sector. While detention and demurrage costs constitute a real black box for shippers, real-time visibility makes it possible to monitor them and better anticipate these logistical costs.
This need for visibility responds as much to an operational constraint as to the desire to improve customer satisfaction. While it was already a central subject before the health crisis, real-time monitoring has today transformed into a requirement, with levels of expectations similar to those encountered in B-to-C.
From a shadow function, logistics is becoming a central strategic function. Uncertain and poorly managed, it can be a cause of frustration and a source of colossal costs. Transparent and predictable thanks to real-time visibility, it becomes an opportunity to invest in with returns on investment amounting to millions of euros.
Data integrity at the heart of real-time visibility issues
The crisis we are currently going through and the events of the beginning of the year have not only highlighted the lack of digitalization in the logistics sector. They also undermined digitalization strategies that were unsuitable for the real expectations of operational teams. Having data in the cloud is not enough to make it more reliable and more intelligible. Communicating an ETA* is one thing, ensuring that it is reliable is another! Data, even more than digitalization, is the key success factor in the implementation of real-time Supply Chain visibility tools.
Indeed, real-time visibility is based on two pillars: accessibility and data quality. It is imperative today to consolidate these foundations to build the future of the Supply Chain. With increasingly complex logistics processes, involving multiple players organized in silos, collecting reliable and readable data, at each stage of the flow, from end to end, is the challenge addressed by real time visibility solutions.
Each logistics provider having its own IT system, developing interfaces to automatically retrieve data, whatever the IT system (ERP, TMS, etc.), and whatever the communication protocol (EDI, API, etc.), is essential . However, the data collected is often incomplete and unstructured and does not allow all flows to be traced. Indeed, each logistics actor interprets the events and stages of its flow differently and assigns them a unique name. To ensure that they cover the entirety of logistics flows, all this data must therefore be reprocessed and standardized. This is the first challenge that Wakeo managed to overcome.
Towards a predictive and collaborative Supply Chain
We have created an intelligent system capable of ingesting and normalizing this data in real time with a unique level of quality. Then, our intelligence engine cross-references this data and makes predictions about the arrival times of the goods. The proprietary algorithms that we have developed, based on artificial intelligence techniques, notably machine learning, make it possible, from a multiplicity of sources of information and hypotheses, to predict the ETA* with great reliability. .
Providing real-time information is a first step to making the best decisions at the right time; the next step will be to anticipate and collaborate to be even more agile. According to a study by Orange Business Services(2), 83% of the executives interviewed said they needed more speed and agility to respond to current challenges.
Having the same level of information to limit friction and optimize operations then becomes essential. Our APIs make it possible to automatically power all existing systems (ERP, TMS, MRP, etc.) with reliable real-time ETA for all types of transport (maritime, air, road and rail) at all levels of the organization. For example, this allowed the Air Liquide teams to benefit from an anticipation period of 8 days and to reduce emergency cases of 75%. Partnerships with players such as SAP also enable complementarities to be activated. For example, ETA recalculated in real time can automatically be updated in SAP solutions. The ETA is thus integrated down to the article, at the finest level of granularity. This allows inventory levels to be updated in real time and with a high level of certainty. By creating a comprehensive and reliable data architecture, real-time visibility becomes a powerful tool to anticipate and optimize operations in an automated manner.
The vision of a connected and transparent Supply Chain also opens up the prospects of a more collaborative and flexible Supply Chain. Better real-time visibility coupled with transparency and information sharing between all players in the supply chain will ultimately make it possible to better anticipate and coordinate logistics flows and processes. For example, logistics strategies such as nearshoring, which we are hearing more about lately to secure inventory levels, will require greater flexibility in logistics flows to ensure storage and handling costs are kept under control.
Certainly, the logistics sector is currently undergoing transformation and major developments have facilitated logistics processes, but we are still far from the ideal of a reliable, transparent and predictive Supply Chain. In the future, the players who will stand out and be competitive are those who have been able to measure and take advantage of the advantages of a Supply Chain that relies on a real-time visibility solution. such as Wakeo.
