Logistic companies, participants in road freight transportation, already use digital tools to automate business processes and communications with the shipper and carrier. But often it is not efficient enough because data transfers between individual systems are still manual. How can freight logistics switch to work in a single digital field quickly and with minimal investments?
Since the mid-2010s, excitement has begun in the global logistics market around the topic of uberization of road cargo transportation, by analogy with the successful uberization of the taxi service. Russia did not lag behind the global trend: for several years we have so-called “digital forwarders”: Deliver, GroozGo, Monopoly Online, OBOZ, Fura, etc. They invested huge funds for digitalization and automation of their activities. Many of them, until now, have not yet made a profit, just because of high R&D costs.
The vast majority of “classic” freight forwarders working in the Russian freight market evidently have neither large investors, nor ambitions to become IT companies. They just want to perform their work and get a return from it. Nevertheless, today each of them is able to use digital solutions with minimal attachments to improve the efficiency of business processes. That’s how it happens.
Which processes can be automated
It would seem that we live in a world of mobility, cloud services, Big Data analysis, intelligent transport systems, remote communications – these technologies and concepts have long been available and common. But why then the logicians of the forwarding company still negotiate with the performer by phone or collect information about orders from many disparate sources – electronic letters, messengers, and chats? We highlight nine logistics business processes where digital technologies can be used.
The calculation of the cost of transportation is necessary, for example, with the participation of the forwarding agent in bidding at major shippers. It allows you to determine a certain lower boundary as a limit where it is appropriate to bargain. Special analytical algorithms embedded in logistics systems can produce a calculation of average order price depending on direction, type of transport, features of cargo and many other indicators.
Automated bidding on various online transportation management platforms – e.g. Transporeon or ATI.SU – becomes possible thanks to robotization technologies. After determining the lower price, the forwarder may adjust the bot to lower the bid and stop at the right time.
The selection of the order executor, when the order has already been received, can be digitalized by several ways: for example, arranging an auction on your own site within the framework of the freight exchange or automatically forwarding the order to a certain carrier that has contractual relations with the forwarding agent.
Finding new carriers and constantly replenishing the pool of trusted partners can cause difficulties for freight forwarder employees if they are doing this manually. Some apply parsing – collecting open information from available web resources using various software tools. But it is much easier and more efficient to implement search within the single platform – freight exchange. All information you need has already been collected there, and there are a number of auxiliary tools for search settings.
Safety and testing of carriers for reliability – this task is remains relevant as cases of fraud, and thefts of goods still happen. It is worth checking all new carriers, and also track changes in information about old ones, such as owner change or a sharp drop in activity. Digital forwarding agents have scoring systems that aim to determine reliability of potential performer in a few minutes.
Electronic document management simplifies and speeds up greatly documents exchange between participants in logistics processes. For example, we enable customers both to use an electronic signature and to apply legally significant document flow without electronic signature, as well as to create and fill automatically document templates. In the future we intend to become an operator of transportation documents – we are working on support for electronic bill of lading and machine-readable powers of attorney.
Tracking the transportation process is a continuation of the safety topic. GPS tracking systems and mobile driver applications allow forwarding agent to answer “inconvenient” customers’ questions like “Where is my cargo/container?” or “When will the truck come?” adequately and in time.
Customer’s personal account on logistics platform is his personal section in the web application, where the customer can place goods, track order statuses, exchange additional information with the forwarding agent, and use electronic document control.
Generating reports and analytics – the ability to use structured reported data accumulated in the company for evaluation of process efficiency, bottlenecks, forecasting, and optimization.
All data in a single digital field
All the scenarios described above can be implemented separately: for example, creating a mobile application with GPS tracking, which will be used by logicians. But this approach is not optimal. Look how information flow and transfer of documents in the chain of participants of road transportation take place now. Even if the shipper and forwarding agent are connected by a certain digital channel – for example, a logistics platform where auctions are held, – often the forwarding agent’s logist enters data manually into adjacent systems, and communicates with the carrier in the messenger or by e-mail. The carrier’s logicians interact with drivers by phone.
There are too many human processes and too many different digital channels in such a mechanism. Therefore, at ATI.SU we have been promoting for a long time the concept of a single digital field. With the help of the ecosystem of logistics services we can form an information chain between participants in road transportation, where along its entire length data is transmitted digitally. This will enable the logistics to control the processes externally and intervene only at the moment when there is an emergency situation.
Within a single digital field, information is entered into the system once only at any part of the chain and applies to all processes in it. Other digital channels are not used. To save time, it is important to let only trusted participants join this digital field – that is, they must be checked in advance.
In a single digital field, all processes become faster and transparent, each of them can be quickly analyzed. Their effectiveness raises and the “human factor” is largely excluded – for example, typos when copying manually from one system to another. All this results in lower freight forwarder costs.
The concept of a single digital field, or a single digital landscape, is a trend, a feature not only of the road freight market. It is used in many areas of IT, business, public services: a vivid example is portal of public services, where services are collected for a variety of interaction areas of officials with citizens operating once personal data is entered into the system.
We invite freight forwarders to develop along a similar path. In Russia there are several logistics digital platforms that provide convenient services for users in “one window” mode. Therefore, today a forwarders do not need huge investments to become “digital”. But even with small investments in “digital,” they get huge effect.
By Sviatoslav Wilde, Founder and Director of the Freight Exchange ATI.SU