Current Challenges in the Transportation & Logistics Industry

Strategy | Brian Estep |
22 March 2022

This Transportation & Logistics (T&L) Insights series is based on research by Levvel, who joined the Endava family in 2021. The team surveyed over 500 US-based companies who procure transportation and logistics services internally and externally to get their views on their challenges, needs, and use of digital technology solutions.

While companies often perceive technology innovation to mean things like high-end robotics, artificial intelligence, and fully autonomous vehicles, there are many elements in the supply chain that can be modernized without requiring great effort or cost, while still providing the competitive edge T&L companies are looking for. In this series, we will present current industry challenges and how digital technology can help reduce friction, enhance efficiency, and provide a better experience for businesses and their customers.

THE BIGGEST CHALLENGES: SPEED AND DELIVERY TIMES

The transportation industry is under tremendous pressure. Companies have to move goods from point A to point B in the face of unpredictable conditions. However, some of these challenges can be remedied with automation upgrades capable of improving both speed and efficiency while contending with staffing challenges and the increasing demand for goods.

The Levvel survey showed that companies are racing to get goods delivered to gain a competitive advantage while still trying to hold on to legacy systems. A lack of automation in the transportation industry can make weather and traffic prediction and route planning difficult, leading to higher fuel costs and a loss of skilled staff. However, companies don’t have to automate their entire fleets to reap the benefits of automation. Before investing in the autonomous fleets of the future, there are a series of smaller steps they can take that provide immediate relief and a satisfactory ROI.

According to 70% of the companies that participated in the survey, speed and accurate estimated times of delivery (ETD) are currently their main challenges. The most precious commodity in the transportation industry is time, so it makes sense that automation tools addressing issues related to time on the road will show the most promise in helping companies achieve their logistics goals.

But there are challenges to implementing automation tools such as cargo tracking and routing software. Our research found that the main barriers to meeting speed and prediction requirements are:

Poor traffic predictions
Cost of fuel
Poor weather predictions
The cost of fleet maintenance
A lack of skilled drivers
Poor routing strategies

Luckily, many – if not all – of these can be addressed with automation strategies.

WHAT TRANSPORTATION COMPANIES CAN DO TO ADDRESS THESE CHALLENGES

Companies need to implement technology that automates the delivery of information when it comes to cargo location. Our research found that those using legacy methods, like phone calls, are more likely to experience challenges.

For example, if a warehouse doesn’t prepare for a delivery until they receive a phone call from a driver to get an estimated time of arrival (ETA), there’s little chance they’ll be fully prepared to unload and move the cargo into storage efficiently once it arrives. This holds up the driver and any subsequent shipments that need to go out through the same cargo bay, in addition to causing confusion on the warehouse floor.

However, if automation technology such as a global navigation satellite system (GNSS) is used to track that same cargo, no one has to remember to make a call, wait around to receive it, or wonder when it’s going to arrive. The system can accurately predict ETAs, even in light of traffic and weather concerns.

It’s no surprise that Levvel’s data revealed that companies utilizing GNSS are the least concerned with real-time tracking of cargo.

WHY TRANSPORTATION TRACKING WORKS

Implementing real-time cargo tracking allows warehouse and distribution center managers on either side of a delivery to accomplish a number of things to increase their efficiency, including:

Automatically redirect drivers to faster, safer routes, which saves fuel costs and possibly fleet maintenance costs
Accurately predict the estimated time of departure/destination to allow for coordinated scheduling within the supply chain
Identify high- and low-performing employees, track the performance of warehouse/distribution center workers, and identify places for improvement

Automation does not have to involve immense upfront costs. While there is an initial investment in any new technology, the benefits to the transportation and logistics industry clearly outweigh the price tag by helping companies become more efficient and conserve material and human resources.

Read our other Transportation & Logistics Insights articles to learn more about how technology can help alleviate industry challenges.

Brian Estep

EVP North America & Global TMTR Lead

Brian is one of the founders of Velocity Partners. Following their merger with Endava in 2018, he took on the role of Head of Sales, TMTR. With extensive experience in technology, starting in 2000, and a bachelor’s degree in computer science, Brian has deep knowledge of software systems and lean/agile processes, which allows him to truly understand the needs of customers and design the best solutions for them alongside his team.

All Categories

From This Author

09 August 2022

hi, I’m Brian Estep
14 June 2022

The Future of Supply Chain: What’s Next?
31 May 2022

The Future of Autonomous Vehicles in T&L
17 May 2022

Advantages of a Yard Management System
03 May 2022

Physical Automation in the T&L Industry