Experts say that supply chains must move from adoption to digital transformation if they want to improve efficiencies, operations and take their businesses to scale.
For the North American transportation supply chain and logistics industry, last year saw a widespread adoption of digital technologies. Predictive analytics proved beneficial to providing end-to-end visibility of supply chains, and ensuring efficiency with on-demand deliveries. When applied to operations, cloud-based technologies helped businesses scale, improved workflow productivity and created opportunities for competitive differentiation. Furthermore, robotic and automation armed warehouses with optimized levels of productivity and improved customer service.
Although the adoption of emerging technologies created solutions for transportation supply chains, the industry still faces many significant challenges. The increase in consumer demand for immediacy and personalization, in conjunction with pressures of the nationwide labour shortage, requires more than digital adoption. To further improve operational efficiencies, reduce costs and create opportunity for bottom line profits, supply chains must move from adoption to digital transformation.
According to Supply Chain Management Review,
Digital transformation is perhaps best explained as the implementation of new technologies to accelerate operations, sales and customer service, back office productivity and, ultimately, the growth of the business from end-to-end.
Whether the customer is a shipper, retail wholesaler or vendors, the goal of digital transformation is to ultimately improve the customer experience.
This week Morai Logistics provides an overview of what digital transformation looks like in transportation supply chains. The benefits moving from evolving from simply adopting digital technology to a comprehensive and whole-scale transformation will also be reinforced.
Digital Transformation of Supply Chains
There are many industries across the world recognizing the need to digitally transform. North America ranks at the top of the global market. By 2022, global statistics forecasts that spending on ‘the technologies and service that enable digital transformation’ will reach USD 1.97 trillion. However, in a study on the adoption of digital transformation within five major sectors, supply chains reported the ‘lowest level of digitization’.
Although digital transformation is considered to be a main focus for many, the truth is, this process fails more than it succeeds. According to the found of Supply Chain Insights, there are four common mistakes businesses make:
- Disconnect with vision and strategy on implementing digital transformation
- Transformation process does not include ownership from the business
- Focus is not on meeting the needs of the customer market
- Lack of partnership with innovative technology companies
Let’s address mistake number one: disconnect with vision and strategy. Before a supply chain executes digital transformation, they must understand the trends shaping the need to transform.
Universal Need for Digital Transformation
There are many reasons why digital transformation can improve the end to end profits of an organization. They may change depending on the industry. For supply chain and logistics, the following three reasons why adoption should move to transformation.
Customer Experience
Today, customer experience is at the top of the board when it comes to strategic priority. From social media to online buying, to smartphones, consumers have the power to connect anywhere at any time. This has changed the buyer’s journey significantly. Consumers expect a heightened level of transparency and personalized and engaging experiences.
Employee Support
The current capacity crunch and nationwide driver shortage, also requires organizations to look at employee fulfillment. Integrating digital tools throughout the supply chain, will promote efficient methods of productivity and communication. This can have an incredible impact on performance and empowerment, while also giving more time to focus on ‘streamlined decision-making’.
Strategic Insights
The implementation of technologies throughout all facets of a supply chain can help generate large data sets, known as Big Data. Online interactions between shipper and supplier can generate unceasing amounts of data. However, without appropriate tools to translate these numbers into valuable insight, meeting the needs of either party becomes challenging. Therefore, digital transformation ensures that innovative technology solutions are in place to provide strategic data that will ultimately achieve success.
The integration of technologies and the digitization of supply chain and logistics will continue to transform the industry in 2019.
Last year, changes in global markets and the boom in e-commerce increased consumer spending and expectations significantly. According to Statista, 21.1 % of supply chain executives found visibility to be the top challenge facing supply chains in 2018. In second place, 19.7% of respondents believe fluctuations in consumer demand was the most significant obstacle. The industry responded with the integration of innovative emerging platforms such as artificial intelligence (AI), predictive analytics, cloud technology and machine learning. This also led to the development of data-driven and predictive solutions that enabled companies to focus on providing personalized, customer-centric experiences.
At the beginning of last year, Morai Logistics discussed the Fourth Industrial Revolution known as Industry 4.0. The need for digital integration and adoption has indeed shifted from being an attractive add-on to a necessity to survive in changing markets. Despite hesitation to risk, change and integration, digital transformation is being progressively adopted by many industries, especially in supply chain and logistics. According to expert forecasts on future trends in supply chain management,
…over the next five years about 80% believe ‘digital supply chain’ will be the leading industry model
Indeed the last year has seen incredible resilience from transportation supply chains against the disruption caused by digitization. However, what trends will be at the top of the list this year?
This article reviews 4 supply chain and logistics trends of 2019.
1. Capacity Crunch
In March of 2018, Morai Logistics discussed the nationwide truck shortage and its effects on deliveries and rates. This year, the diver shortage will continue to require third party logistics (3PL) providers to improve their services. They provide shippers with solutions through ‘network connections, competitive volume rates and ongoing integration of information technology’.
2. Transportation Regulations
Another industry trend hat will carry over from 2018 and cause turbulence, is electronic logging devices (ELDs). Despite being introduced into the industry back in 2012, ELDs were officially mandated in 2017. Although this is a positive move to monitor the health of drivers, it has remained a top stressor for the industry.
3. Digitization
As mentioned above, digitization will continue to impact the transportation supply chain industry this year. The adoption of technologies, apps and emerging platforms in response to consumer demand will become necessary to compete with changing markets. Data analytics will be a major player this year as companies will have to assess ‘supplier risk, tariff risk, logistics costs or manufacturing costs’. In addition, AI and machine learning will be two significant technologies of 2019.
According to Forbes, machine learning will impact the following areas:
- Warehouse management systems
- Robotic vision systems
- Supply chain planning
- Supply chain visibility
4. Warehousing
According to Deloitte, by the end of 2018, ‘online sales of consumer products were project to increase 350%’. The dollar value of would equate to ‘USD$36 billion’. With over 2.14 billion people expected to shop online by 2021, the ecommerce market is significantly impacting consumer demand. This increase in expectations on service and delivery will require warehouses to focus on direct-to-consumer fulfillment.
What does this look like? Experts see a widespread adoption of automation and adaptable and scalable solutions such as robotics and drones. This will be highly important for the retail industry. Furthermore, improved strategies on ‘design and location’ of warehousing will ensure products are within range of consumers to guarantee fast delivery. The added pressure to expand, innovate and adopt new technologies will also have a significant impact on the labour force. Wages are expected to increase across supply chains, which should motivate companies to create ‘employee engagement programs’.
The above supply chain and logistics trends are four of many that will shape the industry this year. In order to develop solutions geared toward improving the customer experience and combating consumer demand, technology will continue to play a significant role in 2019.
Experts recommend supply chain orchestration as an effective solution to help organizations deliver positive customer experiences.
When it relates to personalization, 76% of customers expect companies to understand their needs and expectations. Findings also indicate that 67% of customers have switched vendors to seek ‘a more customer-like experience’. Customer expectation is a significant driver to the way organizations operate. Providing both convenience and speed is crucial to building a customer-centric business and building long term relationships with those customers.
Logistics are learning to adapt to the demands of customers, and organizations are seeking the most effective solutions to remain competitive. Supply chain orchestration (SCO) has been connected to providing a positive customer experience. According to supply chain experts,
SCO enables you to make informed, conscious choices about how to serve your customers better.
Orchestration benefits ecommerce markets in particular because it increases a customer’s accessibility to a larger variety of products and services. Therefore, customers are provided with a wider variety of delivery options due to an expansive ‘network of operators and carriers’. In addition, SCO also provides a variety of benefits that help close the gaps when it comes to visibility and efficiency.
This article uncovers the foundation of supply chain orchestration and how supply chains can leverage it to better the customer experience.
Supply Chain Orchestration Foundations
To understand how supply chain orchestration improves the customer experience, it’s important to first understand the need for SCO. As mentioned above, consumer demand is changing dramatically in response to a variety of factors including a significant increase in accessibility. For instance, customers who shop online are becoming increasingly expectant of fast delivery, personalized customer experience and order fulfillment.
A poor experience can influence a customer’s intent to re-purchase. Research found that 67% of customers would stop buying from a company if a competitor offered a better experience. Omni-channel touch points and visibility must be a core focus to organizations who cater to different generations and demographics. To ensure all consumer demands are being met, a seamless supply chain operation must be implemented.
According to Supply Chain 247,
Successful SCO is based on the right blend of elements for end-to-end oversight and control, but at the root, it is driven by a desire to put the customer first.
The goal is to create a supply chain network that takes into consideration both the bottom line and customer experience.
The Benefits of SCO
By implementing SCO, you will provide a variety of benefits to improving customer satisfaction in a cost-effective way. Inbound Logistics identifies a number of trends supply chain orchestration can provide.
1. Increase Visibility
Personalization is only successful when an organization can understand the needs of their customers and deliver. SCO enables organizations to take a holistic look at their entire supply chain. Thus, they’re able to optimize their processes to delivers ‘the maximum volume of on-time, in-full orders’.
2. Optimize Inventory
An increase in orders requires organizations to ensure warehouses and inventories are abundantly stocked and ready for delivery. Therefore, experts suggest streamlining their networks which includes ‘warehouses, 3PLs, suppliers, and in-transit stock’.
3. Maintain Efficiency
As supply chains strive to meet increased demands, they become complex. This complexity may sometimes hinder the customer experience. According to their findings, Inbound Logistics found 95% of global companies agreed that discrepancies had increased. Implanting SCO would help create better processes that stimulate progression through the coordination of the right ‘internal and external systems.’
Organizations should continue to focus on creating innovative and creative ways to improve the customer experience. This is primarily important today because of the incredible level of accessibility online shoppers have. Based on the above information, supply chain orchestration proves to be an effective way to ensure a positive customer journey. Therefore, organizations should continue to look at ways such as SCO to optimize their supply chains.
From meeting consumer demands to building credible and corporately responsible brands, Supply Chain Sustainability (SCS) is integral to an organizations success.
In addition to achieving transparency, flexibility and speed, supply chains must also consider sustainability as a top priority. SCS encompasses the economic, social, legal and most importantly, environmental features of a supply chain. It helps reduce an organization’s carbon footprint, and also ‘builds brand awareness, mitigates risk and develops long-term profit opportunities’.
As Omni-channel transportation relies on a variety of transportation methods that release emissions, skeptics may argue that it’s very challenging for a holistic supply chain model. However, statistically “almost 90% of CEOs believe that sustainability is important to their companies success.”
This eBook by Morai Logistics, takes a comprehensive look at supply chains sustainability and identifies the benefits it provides organizations.
Integrating Sustainability Into Logistics and Supply Chain
That’s it for us this week! If you liked this blog post, why not subscribe to our blog? Interested in what we do as a 3rd party logistics provider? Then don’t hesitate to check out our services (as expressed above, we are very pro finding you the lowest total cost!). We’re also in the twittersphere, so give us a follow to get the latest logistics and supply chain news.
To compete in today’s digital marketplace, supply chains must build a framework that prioritizes visibility, supplier diversity, technology and the customer experience.
Survey results from ‘623 supply chain professionals across 17 countries’, concluded that one of the top industry challenges was ‘facing global competition’. Over the last two decades, the competitive landscape of supply chain and logistics has changed considerably. The process of transporting product from A to B has transformed over the years.
The definition of ‘supply chain’ has also shifted over time. This correlates to the advancement of technology. According to Supply Chain Dive,
Because of its novelty and rapid changes in the world market, supply chain remains a controversial term – shifting per the user’s needs.
Morai Logistics recognizes the current shift facing supply chains today. A rise in ecommerce has enabled consumers to purchase products anywhere at any time, which has created a need for immediacy. Consumer demand has also increased expectations relating to lower shipping rates, faster on-time delivery and complete transparency. Supply chains must be predictive, preventative and proactive to ensure that transactions run efficiently and effectively.
However, technology also helps develop advanced tools that enable third party logistic providers (3PL) to gain a competitive edge. This blog post discusses how technology can be the driver of change to your supply chain, and how companies can gain competitive advantage.
Visibility
Statistics reveal that in 2017, ‘full supply chain visibility’ became the 3rd ‘most important strategic priority’. When it comes to supply chains, consumers place great importance on transparency. For instance, online shoppers like companies that offer updates on their transactions and shipments. They want to be involved in every step of the shipment lifecycle, and receive open communication and real-time responsive. Technology provides an unceasing transmission of insight in the form of big data. Numbers can translate valuable information that can guide companies to better predict inefficiencies. Advanced analytics help supply chains achieve visibility.
Customer-Centric Approach
On August 9th, 2018, Morai Logistics released an eBook entitled Customer Service: A Long Term Strategy for Future Supply Chains. Prioritizing the customer is extremely important because supply chains directly impact when and how products are transported. Statistics also reveal that 75% of businesses considered ‘services as more important than price’. According to Forbes,
Customer-centricity is the most desired business outcome of supply chain digitization.
As mentioned above, visibility plays a significant role in creating a supply chain that focuses on the needs and demands of shippers and suppliers. In addition, technology solutions can help deploy a customer-centric strategy by offering personalized customer experiences.
Technology – Centric Approach
As mentioned above, technology has been directly linked to improving the customer experience, in addition to overall efficiency. Adopting emerging platforms will enable supply chains to leverage advanced analytics, and also improve productivity through forecasting and inventory management.
Global research icon, Gartner, states that 65% of supply chain professionals believe that ‘adopting and investing in emerging technologies’ is a competitive advantage. Furthermore, ‘90% of companies’ that are ‘operating at stages four or five maturity levels outperform their peers’. These statistics confirm that to be an industry leader in this global market, supply chains must adopt technology.
Supplier Diversity
If you want to obtain competitive advantage, incorporate a supplier diversity program into your supply chain operations. According to Supplier Diversity Canada, including ‘under-represented businesses in a company’s supply chain’, you lead as an organization that values corporate social responsibility. Companies establish credibility and promote a customer-centric model by reflecting ‘their existing/targeted customer base’.
For supply chain and logistics companies to stay competitive in today’s global market place, they must learn to adapt. By prioritizing customer-centric models, visibility, supplier diversity and technology, they increase their advantage, which ultimately benefits their bottom-line.
Supply Chain must implement strategic, innovative and customer-centric models to compete in today’s global market.
As the fundamental network that helps distribute product from point A to B, supply chains play an important role in an organization’s ability to deliver efficiently and effectively. Today, supply chains are facing a variety of challenges as a result of increasing consumer demands, complexity and unpredictability. Industry experts believe that an optimized end-to-end supply chain that is executed using a customer-centric model, can help address these challenges.
This infographic outlines the challenges facing supply chains in 2018. It further outlines how these distribution networks can optimize their processes to deliver efficiently and effectively.
How to Create an Optimized Supply Chain
That’s it for us this week! If you liked this blog post, why not subscribe to our blog? Interested in our 3rd party logistics services? If so, don’t hesitate to check out our services . We’re also in the twittersphere, so give us a follow to get the latest logistics and supply chain news.
Prescriptive analytics is a decision making model that can help supply chains meet the increasing demands that have resulted from the revolution of technology.
Now more than ever, the supply chain and logistics industry is under pressure to meet the unprecedented growing demands of consumers. In addition, they also must meet demands with efficiency and immediacy, while offering competitive rates and network opportunities. The impact of emerging technologies on transportation supply chains is a point of interest to a variety of industry leaders. It requires actionable initiatives that specifically analyze innovative ways for supply chains to improve their bottom line and transform to effective digital supply networks (DSNs).
Prescriptive Analytics is a critical approach toward helping supply chains achieve this transformation. Gartner Inc.defines this technology as:
A form of advanced analytics which examines data or content to answer the question “What should be done?” or “What can we do to make _______ happen?
This form of algorithmic decision making, enables companies to visualize actions that improve operations and capitalize profits. This blog post dives deeper into understanding the function and benefits of prescriptive analytics in supply chain management.
Prescriptive Versus Predictive Analytics
Advanced analytics can be described as being either descriptive, predictive or prescriptive. Their meaning can be broken down into fundamental questions that help businesses achieve an objective.
In April, Morai Logistics discussed the imperative need for supply chains to improve transparency. We describe predictive analytics as a recommended technology that provides organizations with the technology to forecast and achieve real-time visibility. Joined by Artificial Intelligence and Machine Learning, this suite of tools help many industries such as retail, healthcare and transportation. What’s does prescriptive analytics bring to the table?
According to Digital Journal, the global prescriptive analytics market serves numerous markets including healthcare, information technology & communications, manufacturing, government and defences, and of course transportation and logistics. They share the following insight into the growth of this market:
Prescriptive analytics market accounted for USD 1.20 billion growing at a CAGR of 30.95% during the forecast period of 2017 to 2024.
In comparison to forecasting with predictive analytics, prescriptive analytics identifies how ‘business processes should evolve or be modified’. It’s an algorithmic decision making model that analyses data in order to take action. Applying this level of analysis can help any business understand how to effectively use their ‘resources, costs and capabilities’.
Benefits for Supply Chains
Transportation and logistics is a market segment that should utilize prescriptive analytics. However, their integration is comparatively slower to other industries despite feeling the pressure of consumer demand the most. Although there is a growing need for new and improved processes, many industry leaders fear the unknown of integrating a new technology tool. Supply Chain Management Review states that implementing prescriptive analytics is ‘a crucial analytics approach’. They further reinforce the following outcomes below as beneficial to improving supply chain management.
- Create ‘visibility between the supply chain and finance’.
- Provides managers with advanced platforms that help base decisions on fact-based scenarios.
- Integration of predictive benefits such as cost reductions, forecasting and end-to-end visibility.
- Create a prepared, informed and confident workforce.
Advanced analytics is a critical tool that should be integrated into any organization looking to achieve profit growth. Supply chains must continue to embrace technologies in order to meet customer demands, while creating a competitive advantage in changing markets. Predictive analytics is important because it helps supply chains understand future risks, challenges and outcomes. However, prescriptive analytics leverages data to devise action that will improve efficiency, immediacy and their bottom line.
Mobile based solutions provide added value to supply chain management operations by improving efficiency, speed and accuracy.
The benefit of technology will continue to be a topic of discussion in the supply chain and logistics industry. In recent months, Morai Logistics has discussed the positive impact machine learning, Artificial Intelligence and predictive analytics will have on real-time efficiencies. The mobile supply chain has also gained considerable attention as companies and third party logistics providers seek ways to improve the end-to-end experience.
There is an overall added value of transparency and efficiency that comes from an increase in connectivity. Therefore, the integration of mobile-based solutions has been implemented by many industries including transportation supply chain management.
According to Business Wire, the North American Supply Chain Analytics Market is expected to grow by 15.5% CAGR between 2017 and 2023. The data acquired from emerging technology such as mobile-based solutions, is a response to the following challenges:
- Poor supply chain visibility
- Inefficient supplier networks
- Warehousing cost
- Incorrect forecasts
This article defines mobile supply chains and dentifies current mobile based applications gaining considerable attention.
Mobile Supply Chains
Supply chain technology provider, Datex defines mobile computers as “automated data collection (ADC) devices”. The company further describes their design as being:
…compact, lightweight and with durable construction or use in extreme temperatures and environments encountered frequently both in and out of the warehouse.
From a user perspective, these applications provide real-time processing and also more data accuracy in comparison to manual entry. Their implementation is a movement from traditional forms of paper trail to efficient methods that provide a variety of benefits. Logistics Viewpoints outlines the following top reasons to implement mobile based solutions into supply chains:
A. Improved Processes
From shippers to third party logistics providers, the implementation of mobile applications helps improve the entire shipment lifecycle. Last week, Morai Logistics discussed how consolidation tools improve cold chains. The use of tablets or RFID handhelds, offer multiple users across the same organization, accessibility to a platform that contains all important information. This helps supply chains run smoothly and creates efficient communication verticals.
B. Enhanced Delivery
Research states that ‘a mobility solution allows you to manage all of the on-road processes for a successful delivery and pick up of all freight’. In addition, it provides a platform for drivers to locate details about delivery specifications and in helps facilitate ‘driver-specific actions’.
C. Customer Satisfaction
As ecommerce platforms and mobile technology make allow customers to make immediate buying decisions, their expectations and demands also increase. Ultimately, efficient and faster supply chains improve the customer experience, which is another benefit provided by mobile applications. They help to remove the barriers that impact shipment visibility, which is a challenge facing supply chains in changing markets.
Let’s take a look at a mobile based solution making headway today.
Mobile Applications
Oracle Corporation creates and delivers innovative technologies that help businesses around the world advance their processes. In an effort to help improve supply chains, they have created Oracle® Mobile Supply Chain Applications (MSCA).
In relation to the benefits listed above, these applications also help ‘improve visibility, productivity and accuracy’. They integrate into a variety of devices and software systems, offers personalization and provides real-time insight and data processing. This program has been designed to help optimize supply chains that don’t require an ‘extensive warehouse management system’.
As the demand for efficiency, speed and immediacy continues to increase, supply chains will continue to rely on advanced technology. The emergence of mobile based solutions is not a recent industry trend, however, it is still gaining considerable attention. The added value applications such as MSCA provide companies looking to improve the end-to-end experience is significant.
This post highlights three strategic areas which many companies overlooked in 2017; strategy, security & interaction, and how to best achieve improvements in these areas.
It’s the second week of January. This means that roughly 30% of people have already stumbled on their New Year’s Resolutions. While many of these resolutions are weight, money or relationship related, for us in the supply chain industry, we have different priorities.
Our goal as supply chain specialists is to get the right items to the right places at the right time. Moreover, we need to be aware of the delicate balance that can be easily disrupted in logistics.
2017 has been an interesting year. Specifically in the major technological, economic and market-driven shifts. This means that being successful in 2018 will require adjustments.
For this reason in today’s blog post, we’ve highlighted some important developments in the world of supply chains and how to best tackle these new challenges.
Paying More Attention to Demand
Given the name of the field ‘supply chain & logistics’, a person could be forgiven for thinking all we’re concerned about is supply. However, supply and demand are intricately tied, which is why it exists after all.
After all, globalization, international business markets, marketing spend, weather, etc. makes demand difficult to quantify and predict. But, that doesn’t mean it isn’t possible.
On this topic, Jeff Metersky, VP of customer success strategy at LLamasoft, writes:
Supply chain professionals should absolutely strive to better understand demand; after all, demand is one of the most important factors impacting your overall supply chain design. You need to make sure your business has a solid grasp on future demand to ensure sufficient capacities are in place and products are deployed appropriately.
Metersky says that properly predicting demand starts by asking yourself these important questions:
- Do you have challenges getting internal approval of or buy-in for strategic supply chain initiatives due to lack of visibility into long-term future demand?
- Are you able to provide insights into company management about how evolving demand trends might impact your supply chain?
- Are you able to model the long-term impact of demand based on internal company strategic decisions (new product design, current product life cycles, expansion into new markets)?
- Do you have a solid understanding of and ability to quantify the factors driving changes in demand over the long term?
- Do you need more reliable long-term demand projections to support strategic decisions about changes in your network design?
Improving Data Security
Many high-profile cyber attacks happened in 2017. They took a heavy cost on both the global economy and consumer confidence. To get ahead this year, organizations need to take advantage of emerging trends in technology and cyberspace to better handle high-risk security risks.
The Information Security Forum recommends that businesses focus on the following security topics in 2018:
- Crime-As-A-Service (CaaS)
- Expands Tools and Services
- The Internet of Things (IoT) Adds Unmanaged Risks
- Supply Chain Remains the Weakest Link in Risk Management
- Regulation Adds to Complexity of Critical Asset Management
- Unmet Board Expectations Exposed by Major Incidents
Take a look here for a comprehensive explanation of each security topic.
Improving Our Everyday Interactions with Other People
This one may seem like a no-brainer, but saying things like “please” and “thank you” tends to get lost once peak time rolls around. While supply chain & logistics continues to be a hot industry, that doesn’t mean that it’s zero-sum with manners. Striving towards being more personable is something we should all aim for in 2018. Whether it be with clients or coworkers.
2018 represents an opportunity to deep dive and find ways to improve the way we do things. Whether those improvements be strategic, technological or just a commitment to being more kind. Properly laying out and adhering to goals is what matters. Let’s be part of that 10% who achieve their resolution.
If you liked this blog post, why not subscribe to our blog? Interested in our 3rd party logistics services? If so, don’t hesitate to check out our services . We’re also in the twittersphere, so give us a follow to get the latest logistics and supply chain news.
Will Robots be Friend or Foe to Today’s Workers? Many publications condemn how automation will affect workers, but recent studies show it to be a benefit.
Twenty years ago, the big scare for many workers was that their job would move overseas. There were several stories during the 1990s and early 2000s of companies moving their operations to places like India and China. A combination of new IT technology and data technology allowed businesses to seek further efficiencies in labour costs abroad. While these actions were beneficial for those businesses, it cost many workers their jobs.
Offshoring still greatly affects industries such as manufacturing and bookkeeping. But, the rising wages in formerly off-shoring havens (China and India) has started to curb the trend. Growing political pressure and security concerns are also leading to a rise in re-shoring and near-shoring.
The scare of waking up one day and discovering your employer has moved overseas is no longer as acute for many North American workers. However, that doesn’t mean their employment is secured thanks to automation.
How Will the ‘Robot Apocalypse’ Affect Workers?
Automation has only been in warehouses for a few years and is still in the prototype phase for several industries, like shipping & transportation. However, that hasn’t stopped some publications from calling it a ‘robot apocalypse’ for workers.
For example:
- The Huffington Post covered a study last year that estimated that automation will cost the Canadian economy 7.5 million jobs in the next decade.
- In the world of transportation, warehousing and logistics, Citigroup estimates that up to 80% of jobs in these industries could be at risk.
- The Brookfield Institute for Innovation and Ryerson University say that automation will affect 42% of all Canadian jobs.
- Meanwhile, The Guardian has a headline reading “Robots will eliminate 6% of all US jobs by 2021.”
These publications are not wrong or misleading. Many industries will have to change fundamentally. This also means several jobs will either change drastically or be eliminated.
Automation Can Mean a New Beginning for Many Workers
Automation isn’t a losing zero-sum game for North American workers. For example, those on the warehouse floor have a new friend. Robots are being designed to work with staff, not replace them. These ‘collaborative robots’ are being developed to help people work more productively, efficiently and most importantly, safely.
In the retail world, an industry greatly affected by automation, new opportunities are appearing for workers thanks to e-commerce.
For example, Wall Street Journal writer Greg Ip writes in his article:
The brick-and-mortar retail swoon has been accompanied by a less headline-grabbing e-commerce boom that has created more jobs in the U.S. than traditional stores have cut. Those jobs, in turn, pay better, because its workers are so much more productive […] Throughout history, automation commonly creates more, and better-paying, jobs than it destroys. The reason: Companies don’t use automation simply to produce the same thing more cheaply. Instead, they find ways to offer entirely new, improved products. As customers flock to these new offerings, companies have to hire more people
The fear of losing one’s job because of outside factors is an old one for many people. Whether it be because of downsizing, outsourcing or automation, it can negatively impact a person’s life all the same. The total net gain or loss of automation is impossible to predict at this early stage, but the opportunities the technology presents for worker and consumer alike are exciting.
If you liked this blog post, why not subscribe to our blog? If you’re interested in what we do as a 3rd party logistics provider, don’t hesitate to check out our services (as expressed above, we are very pro finding you the lowest total cost!). We’re also in the twittersphere, so give us a follow to get the latest logistics and supply chain news.