Even in the logistics sector, digitalisation offers numerous process optimisations and far more efficient coordination than in the past. But what exactly is behind the term “Digitalisation in logistics”? We explain it to you in our blog article.
The advantages that digital processes bring to logistics
Digital workflows have also revolutionised the logistics industry. Digital processes in logistics affect both internal company operations and external processes with customers and partners. Automations replace manual tasks that previously required a great deal of time and were prone to errors.
And here are the advantages of digitalisation in logistics at a glance:
- Reduction of transport costs
- Reduction of paper usage
- Faster processes and faster transport
- Support for employees in their daily work
- Minimisation of error rates
- Increase in quality
- Better service for customers
- Contribution to sustainability
- Competitive advantage
In the following, we break down what these advantages look like in detail.
How digitalisation improves logistics processes
Digitalisation improves logistics processes on many levels.
Reduction in transportation costs
Digital tools select the shortest delivery routes, currently available capacities, and information on weather and traffic conditions, making employees’ daily transport tasks easier. This not only shortens delivery times, but also enables customers to be served more quickly, increases satisfaction with logistics performance, and reduces transport costs in the medium to long term.
Reduction of paper usage
The days of printer jams are over. Invoices and orders are now sent digitally, allowing companies to save more paper. In addition, digital access makes employees’ daily work easier, whether in the office or on the road, using smartphones or digital cloud solutions.
Faster processes and faster transport
With automated processes, employees can quickly gain an accurate overview of inventory levels and delivery schedules. With digitalised inventory management and tracking, not only do internal workflows progress more quickly, the transport of goods also becomes faster.
Support for employees in their daily work
Departments communicate more quickly and efficiently with one another thanks to digital processes. Manual data entry is no longer necessary, giving employees more capacity in their daily work. With digital tracking systems that display inventory status in real time, they maintain oversight, optimise response times, and manage supply chains more easily. In addition, all employees have access to inventory and delivery processes, which reduces communication loops and therefore saves money.
Minimisation of error rates
Digitalisation in logistics processes helps reduce human error rates. Automated processes increase accuracy and thus minimise costly delays. This gives logistics companies the opportunity to operate much more agilely and flexibly in the market.
Increase in quality
As transparency and efficiency in logistics processes increase, quality also rises. It becomes possible to respond even better to customer needs and to implement quality improvements within logistics. This includes not only faster deliveries but also enhanced service. Customers receive accurate information about products to be delivered and those already delivered. Internally, digital tools support organisational and process mechanisms in warehouse and inventory management. Products that are no longer usable (e.g., past their expiry date) can also be quickly identified and sorted out.
Better service for customers
Thanks to digital processes, companies can inform their customers at the push of a button about the current location of their goods. In addition, automated messages via app or email help businesses create a transparent supply chain.
Contribution to sustainability
Last but not least, the reduction of paper usage and shorter transport routes help protect the environment. This aspect is currently especially important to many customers.
Competitive advantage
A company that has full transparency of its supply chain through the use of digital tools clearly has an advantage in the market. Only when a business manages its information in a modern way can it remain competitive in today’s environment.
These are the challenges of digitalisation for logistics companies
Of course, innovations are not for everyone, and this is why implementing digital processes presents real challenges for logistics companies.
For smaller companies in particular, it is often difficult to keep up with market demands. The pressure to innovate is increasing, and processes are becoming faster. However, every new process requires time. This is why acceptance from every employee is needed to ensure that digital workflows run smoothly.
To coordinate a large number of projects, a well-designed digital solution is necessary perhaps even a centralised one. It becomes difficult, for example, when data is only uploaded via apps but not stored and monitored in central locations. Missing master data can also lead to problems.
It also depends on how logistics companies approach their digital strategy. Does the company adapt to the existing digital processes, or is it the other way around? At FleetGO, we always adapt to the internal processes of our customers.
Last but not least, digital processes in the logistics industry require at least a basic understanding of technology from all employees. After all, technical devices need to be used correctly. Employee training helps increase acceptance of new digital implementations. This also ties into project resources: digital processes can only run smoothly when sufficient technical equipment (laptops, mobile devices, adequate server capacities) is available.
Here is a summary of the challenges posed by digital processes in the logistics industry:
- Pressure to innovate from the market
- Acceptance of digitalisation
- Simultaneous coordination of many projects
- Master data situation
- Adapting logistics processes to
- Digital processes or vice versa
- Employee know-how and affinity
- Lack of project resources
Digitalisation in logistics: why humans will never become redundant
Digitalisation in logistics: yes. Eliminating human work: no. The question of whether human labour will become redundant arises with every modern innovation. The discussion about replacing people or jobs is legitimate. However, fully automated processes will always require humans — either for developing and operating new digital tools and content, or simply because an app, for example, can only perform a limited range of tasks. In the end, people are always needed to move products from A to B. When problems occur, the expertise of an employee is required, and only a human mind is capable of proactive, forward-thinking decision-making.
Digital processes, however, simplify daily work and the execution of numerous tasks. They merely redefine the role of humans. Know-how and control remain with the employee.
How much digitalisation is necessary
Each company must decide for itself how much digitalisation is necessary. Current demands on logistics are increasing, both from customers and partners. As always in business management, this means weighing the required investment costs against the expected gains.
Which digital software and which digital tools make sense in logistics
There are various digital software solutions and tools that simplify all processes in logistics. Most providers specialise in one of these three types of software:
- Software for efficient warehouse management
- Tool for planning and controlling transports
- Telematics software for transparent and digital route planning
- At FleetGO, we offer you the complete all-in-one package with all three management systems
- TMS and TMS Enterprise
- WMS
- Driver App Enterprise
Examples of digitalisation in logistics
With our FleetGO route planning and telematics software, we recently managed a complex project for Transgourmet Germany. The company supplies hotels and restaurants, company canteens, schools and retirement homes with fresh fruit, vegetables and frozen goods. Every day, up to 800 trucks set off from 13 distribution centres across Germany. As a full-range supplier, Transgourmet handles a total of 35,000 different items, 15,000 of which are permanently in stock. For clients in the hospitality and catering sectors, 100% delivery reliability is essential. And that requires perfectly functioning digital processes.
With the implementation of:
- Optimised route planning
- Reduction of required distances and deployed trucks
- Maximum transparency
- Simple return processes
- Low error rate
We are part of the fundamentally modernised IT infrastructure of this major transport service provider. Are you interested in reading more success stories from FleetGO customers.
