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Increasing supply chain resilience: where to start

Bastian Thöle
8 Sep 2022
capgemini-invent

Transport logistics steers the world’s flows of goods. Its reliable functioning is the foundation of our globalized economy. With the outbreak of the Corona pandemic in 2020, the logistics industry suddenly faced a host of never-before-seen challenges. Companies need to act now to increase supply chain resilience, become more sustainable and improve their market position for the future.

Due to the shutdown of manufacturing in China disruption rippled through the global supply chain. Cargo was backlogged at China’s major container ports, travel restrictions led to a shortage of truck drivers to pick up containers, and ocean carriers canceled or blanked sailings. The resulting shortage of components from China impacted manufacturing operations overseas. Major industries around the world, including automotive, electronics, pharmaceuticals, medical equipment and supplies, as well as consumer goods, were affected. Once again, the systemic relevance of the industry to our globalized world became clear but also showed the industry’s deficiencies.

In addition, companies are forced to become more sustainable, consume less energy and lower emissions. Effective CO2 emissions management in the logistics value chain consists of three main components: a suitable key performance indicator system, the timely monitoring of climate gas emissions and the design of supply chains according to climate targets, not only to targets like costs, performance and delivery time.

TMS will no longer be a differentiating asset

Digital transformation is key to master all these challenges and the first two decades of this millennium have been greatly shaped by the tremendous pace of technological innovation. As a consequence, new business models have emerged across all industries. Today’s logistics industry is not exempt from this dynamic development and I believe that the TMS will no longer be a differentiating asset. Instead, the ability to monetarize on innovative data-based business models will become a key success factor for logistics providers.

Achieving the goal in many small steps

But it is hard to decide where to start the transformation, which technologies to choose and how to orchestrate the process. Together with our clients, we successfully leveraged new technologies or implemented new business processes which significantly improved their market position and the resilience of their processes. We focused on five areas:

  1. transforming the core – to create one flexible IT system that manages all supply chain data, provides information internally as well as externally and interlinks processes to enable automation and the use of artificial intelligence
  2. use of Digital Twins – to design, simulate and validate scenarios and improve business processes
  3. dynamic pricing and rate management – to provide quotations instantly based on dynamic pricing algorithms and increae profitability
  4. CO2 emissions management – to implement sustainable supply chains and reduce costs at the same time
  5. CRM, NextGen selling – to ensure customer centric processes and exceptional customer experience, which increases sales and lowers costs

To help our clients make the right decisions and steer their company into the right direction, we have summarized the measures in a point of view. It provides examples of how we, jointly with our clients, have transformed processes and systems and describes the outcomes. Have a look at our point of view to get some inspiration and guidance!

If you like to know more about the technologies mentioned or discuss the challenges of your company, please contact me! I am looking forward to help you.

Autor

Bastian Thöle

Vice President, Head of Corporate Experience | Capgemini Invent

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