A lot of attention has focused on ports and other infrastructure, as well as shortages of trucks and labor. Those are important bottlenecks that need further investments to be fixed, but they are symptomatic of a deeper problem.
What the global supply chain really suffers from — and what is behind most of the problems today — is a lack of technology. The current technology being used has left companies and supply chain providers with little cargo visibility, a lack of supply chain integration, and hardly any ability to anticipate and alleviate problems. Giving the supply chain its own “cloud moment,” where it is completely rethought and upgraded, will improve life, not just for businesses but also for their customers.
Global supply chains have long been complex, modular and siloed networks that focused on keeping up with capacity demands and optimizing for cost, efficiency and scale. They are designed to work in a certain way and can withstand known challenges, but when tested by unexpected events like a pandemic, they are incredibly fragile. They are built for a world in balance. And when imbalances occur, which unfortunately is often the case, they are simply not resilient enough to withstand disruptions and delays. The pandemic has accelerated and magnified the challenges that already existed.
Today, logistics professionals across all types of companies need to work through a myriad of different suppliers, platforms, systems and solutions to source and ship products to customers. Just think about the ecommerce growth we are currently seeing, and what that means for companies. A clothing company that was used to distributing merchandise to their stores in the past now has to be able to ship directly to customers across the globe or to one of their retail locations for same-day pickup, and then also prepare for the possible returns of orders.
Here’s how technology can help to ease these challenges.
Instead, these companies should be tapping into a global infrastructure solution that could meet their needs. It’s not so different from the cloud revolution a decade ago where companies realized that it was not good business to invest in building their own cloud, but rather partner with the global cloud providers that had the necessary scale.
Digitizing these interactions by creating a platform or infrastructure where they can be more easily processed will ensure that goods move more effectively through customs and across borders, and comply with regulations.
One of my biggest global customers recently told me, ‘I just don’t know where my stuff is right now.’ That’s not an infrastructure problem — that’s a data visibility problem.
The movement of goods is subject to many handovers, which can create structural weaknesses in the supply chain. Like in a relay race, they represent an opportunity for failure, mistakes or delays. To get to better outcomes, companies are leveraging digitization to integrate data, products and services, which will give them greater visibility.
By combining our tracking abilities with internet-enabled sensor devices, we’ve made it possible for our customers who are transporting bananas to monitor, adjust and get automatic alerts on the condition of their produce — including temperature, humidity and CO2 levels — from an app on their phone. The result is that bananas can travel farther and arrive in perfect condition so they will be ripe by the time you put them in your fruit bowl.
There is so much to be optimistic about integrating data, systems and technologies and applying them to tomorrow’s challenges. This will allow us to better connect and simplify the world’s supply chains, which will make life easier and more affordable for both companies and consumers.