In the logistics sector, many processes are still not very automated or are handled in an analog way. However, there are more and more innovative solutions for digitizing processes and making them more efficient. The exchange of information and documents relating to transported goods from the first warehouse to the end customer is just one example of this. This article takes a look at various options.
The state of digitalization in the transport industry
To what extent are the possibilities of digitalization already being used in the transport industry? A number of studies from recent years provide a clear insight into this.
Pent-up demand in the division
It is clear that the logistics industry urgently needs to catch up in this area. This is illustrated by a study conducted by Bitkom, the German information and telecommunications industry association, in 2019.
Previous studies have also revealed this fact. Especially in comparison with other industries, the transport sector does not score particularly well in terms of digitalization. Employees in the transport sector are also often poorly trained in this area. This fact also becomes clear when looking at individual areas that can be digitized in the sector.
According to the Bitkom study, the use of drones, the digitalization of freight documents and data analysis are at the bottom of the list. However, a significant increase in efficiency could be achieved with the last two points in particular.
Reasons for the reluctance
These circumstances are surprising as, according to the Bitkom study, many of those surveyed do recognize the benefits of digital opportunities. These include, among others:
- Faster and more efficient transportation
- Damage minimization
- Cost reduction
All of these factors are central to the transportation industry and can make a decisive difference to the competition, thus increasing a company’s turnover and market position.
However, many companies also assume that digitalization will incur high costs. On the one hand, this applies to the investment in the area, i.e. in the technology. In addition, companies shy away from the costs of the data protection associated with digitalization.
As a result, only very few companies in the transport industry have planned extensive investments and correspondingly sufficient budgets for digitalization.
Digitization of bureaucracy – more efficient handling of freight documents
Freight documents are indispensable in the transportation industry. Companies are required by law to be able to present them during inspections. They are particularly important for road transportation, but they also play a role in other areas.
Previous legislation and scope
The legal framework is set both by regulations at European level and by national requirements in various countries. In reality, this means that every driver carries a whole stack of such documents with them on their journey. Among other things, these contain information about
- Type of load
- Weight
- Destination
For companies and their drivers, this means a lot of bureaucracy, which costs time and therefore limits efficiency. Digitization can simplify many things in this area, as the information can be accessed and processed at the touch of a button.
Source: stock.adobe.com © Roman (symbolic image)
Legislative change at EU level
For a long time, there was a legal obligation to submit them in paper form. A first step towards change was sealed in August 2020. Since then, the regulation on electronic freight transport information has been in force at EU level. This creates the legal basis for the digitalization of the sector.
This is to be implemented by the middle of 2024, by which time the EU member states will have to equip themselves with the appropriate technical capabilities. Companies will then be able to submit freight documents digitally and authorities will be obliged to accept them. Details such as the prescribed format of the data should also be regulated by this time. Currently, documents still have to be carried in written form.
Something also happened in Germany in September 2021. On this date, a law on the electronic consignment note was confirmed by the Federal Council and can come into force. A corresponding open source application is being developed for this purpose. The two laws are a clear sign that the issue of digitizing bureaucracy in the transport industry is being taken seriously by politicians.
Why the digitalization of freight documents should be implemented as soon as possible
For many reasons, it can make sense for transport companies to start digitizing freight documents as soon as possible. The technical possibilities for this are already being made available by providers.
On the one hand, this eliminates a great deal of internal effort and makes the corresponding processes more efficient. This contributes to increased performance, significantly faster loading processes and therefore possibly higher turnover for the company.
In addition, early digitalization allows processes to settle in without time pressure. Such a major change often requires time to eliminate initial shortcomings and provide employees with sufficient training.
In addition, sustainability benefits can already be achieved by saving paper at an internal level. This gives the transport company the opportunity to reach customers who attach great importance to this with appropriate communication via marketing.
Tracking and cargo information through digital options
Another of the many options for using digitalization in the transport industry is cargo tracking. This is currently used somewhat more extensively by the options under consideration.
With appropriate systems, it is always possible to track the current location of a particular shipment in real time, both within the company and from the customer’s side.
Tracking technology and various possible applications
The technology used for this is called RFID. The abbreviation stands for Radio-Frequency Identification, which in German means radio frequency identification .
Such systems are currently mainly used internally. This gives the company the opportunity to identify weak points and problems immediately and react quickly or eliminate the problem. In this way, companies can significantly increase their efficiency.
Slowly but surely, there are developments in this regard in the transportation industry that go beyond the company’s internal variants. For example, partners and customers can also track corresponding loads such as containers and be informed of delays and other changes to the original plan at any time.
This has great added value, for example, when raw materials or parts for production are delivered. The recipient can plan more effectively. However, the transportation industry is currently still lagging a little behind some other sectors in this area.
An ideal example of an area in which this technology is already commonplace is the delivery of parcels and letters. In this sector, many providers allow end consumers to track the location of their shipment using a corresponding number that is provided when the shipment is posted.
Further information in the context of tracking
Incidentally, in addition to simply tracking the cargo, various systems can also provide information about the condition of the freight and indicate which external circumstances may influence or change it. This makes it possible to identify problems such as damage or to monitor and document the cold chain seamlessly.
In addition, identifying potential hazards can ensure that damage is prevented. Lessons can then be learned from any mistakes – so there is an opportunity to bring about improvements in order to avoid them in the future.
Digitalization in the warehouse of transport companies – Warehouse Management Systems
Source: stock.adobe.com © panuwat
In the warehouse of a transport company, there are also opportunities to benefit from digital applications in day-to-day business. The digitalization of the transport industry is currently well advanced in this area. The majority of companies use corresponding options in their day-to-day operations.
Various warehouse management systems are used here. These play a major role in ensuring that the warehouse space can be used more efficiently. Among other things, capacity utilization plays a major role here.
In this way, stock shortages can be reduced. At the same time, the systems make it possible to optimize the planning of processes. This leads to less time being spent – the company can therefore achieve more and thus generate higher sales.
At the same time, such a system can reduce the number of workers required for the warehouse and increase productivity. As a result, the company can save on personnel costs.
In addition, the systems enable warehouse management that works with far less paper. In addition to the benefits for sustainability, this makes it easier to maintain a constant overview. The risk of various errors and organizational problems is reduced.
Artificial intelligence in the transportation industry
Another aspect that can have many advantages for the transportation industry is artificial intelligence. However, it is currently only used by a small proportion of companies in the sector.
AI for the organization
The great advantage of artificial intelligence is that it is capable of learning. It can draw conclusions from previous events and adapt accordingly to achieve the best possible result for the company.
In the transport industry, this primarily enables the efficient use of all journeys. AI can anticipate orders based on data analysis and thus further reduce or completely avoid empty runs.
On the one hand, such systems can be used internally in a company to make the best possible use of all resources. In addition, there are already a number of start-ups that specialize in bringing companies and clients together with the help of AI applications.
Artificial intelligence manages work processes
Source: stock.adobe.com © scharfsinn86 (symbolic image)
AI can take on other tasks in the transportation industry. These include, for example, loading and unloading transport vehicles. Robot technology and smaller autonomous vehicles are used for this purpose.
The latter are also used in warehouses. This support saves time during loading and unloading, which also leads to increased efficiency in day-to-day operations. Furthermore, AI can be used to calculate how a truck should be optimally loaded in order to make the best possible use of the available space in the vehicle with the goods to be transported.
Ultimately, AI can also be used during journeys. Looking into the future, it can be assumed that autonomous driving could be usable for trucks in everyday life from a certain point onwards. Currently, AI is mainly used for minor details such as lane corrections or recognizing obstacles in a blind spot. The corresponding assistance systems thus ensure greater safety.
Conclusion
The transport industry has some catching up to do when it comes to digitalization. The possibilities are very diverse, useful and efficiency-enhancing. From improved organization and simplification of bureaucracy to avoiding accidents and taking over loading and unloading tasks, there is hardly anything that cannot be implemented in the transport industry through digital possibilities.
