Disrupted supply chains, restricted capacities, and staff shortages will continue to exacerbate logistical flows in 2022. This means that service providers will need to exhibit a high degree of flexibility if they are to respond rapidly to changes in the market environment.

Against this background, efficient, digitalized, and automated processes will play a vital role. Around the world, value creation networks are increasingly witnessing the deployment of digital twins, augmented reality, artificial intelligence (AI), cloud solutions, and sensor technology. That is because, for some time now, companies have not been alone in facing competition: their supply chains are also having to compete.

The big challenge, therefore, is to render all processes along the supply chain less susceptible to disruption. Technological suppliers like Ivanti Supply Chain are sensing business opportunities, for example, in the automation of warehouses. Owing to staff shortages, according to Ivanti manager Brandon Black, “Logistical enterprises will deploy automated solutions to slash induction times for new employees and quickly allow them to perform at their best.” This could be achieved by means of augmented reality applications, with new staff members who require training being instructed in the processes of a virtual working environment – an approach that is particularly suitable for such activities as packaging or picking.

There are also many possibilities as regards warehouse automation. To give one example, the Fraunhofer Institute for Material Flow and Logistics (IML) in Dortmund is developing autonomous containers (“LoadRunners”) that organize and control themselves in swarms using AI. Robots and software systems are also used to assist warehouse personnel with inventory planning, tracking and tracing, data entry, process optimization, and more. Ivanti manager Black believes that AI applications and robotics “will elevate warehouse operations to a whole new level in 2022 – automation tools can help to plug gaps caused by labor shortages, secure supply chains, and equip companies to face a future in which uncertainty is a key factor.”

At warehouses and logistical centers, software systems are supporting all processes, from inventory control to staff planning. For a recent study, IML teamed up with research and industry partners to explore which systems are being deployed, which are available on the market, which are being introduced at warehouse sites, and how these systems are impacting employees.

White paper on resource planning

Numerous software systems and tools are available to support human resources planning; the specialist software in this area is known as RPS (resource planning system). “Around 37 percent of warehouse sites are planning to implement an RPS in the next four years,” reveals Linda Maria Wings, research assistant at Fraunhofer IML.

The Institute has published a white paper entitled “RPS Study: Software-based Planning of Human Resources in the Warehouse.” The paper concluded that technology and software can be used to enhance productivity and the accuracy of planning. “Despite this, human beings remain pivotal in the warehouse on account of their individual qualifications, versatility, and all-round learning aptitude,” believes the IML.

Networking is essential

We can observe four megatrends in the logistical and transport industries that are either significant or highly important to companies in the sector: these are cloud computing and blockchain, data analysis and artificial intelligence, the Internet of things and cyber-physical systems, and robotics and automation. Such was the finding of a survey of around 100 businesses carried out by SCI Verkehr in Cologne at the end of last year. According to the assessment of SCI market experts, technology is finding its way into more and more companies and regarded as a less speculative approach than in previous years. Cloud computing and blockchain, for example, are coming to the fore in a time of ever-evolving IT processes, with almost three quarters of transport and logistical enterprises surveyed rating this trend as highly important.

It is also apparent that data (in any form) remains significant, given that networking via the Internet and exchanges of data are essential to nearly all business processes. Alongside the actual data exchanges, self-learning algorithms and the linking of real and virtual worlds are also critical to the optimization of processes. This year, technologies of this kind are likely to become more relevant, as they can make a significant difference to competitiveness.

In this case, competitiveness is defined by the added value it brings to operational practice rather than the availability of a particular technology or application. Many functions (like shipment tracking) have become standard and taken for granted; basic functions like these are common property, so developing them over and again is a waste.

Freely available functionality

The Open Logistics Foundation was established against this background on the initiative of the IML. The idea is to make available to the community specific hardware and software – itself a kind of mass commodity – so that it can be refined, enhanced, and expanded. Given that everyone in the community can use the hardware or software for specialist purposes, everyone will duly reap the benefits. The business models supported or derived from this approach reveal the actual innovative flair of a company.

The Open Logistics Foundation was established last year by Dachser, DB Schenker, Duisport, and Rhenus, with the BLG Logistics Group also participating. For small and mid-sized enterprises in particular, the hardware and software components made available this year through the initiative could well be of interest.

Strengthening supply chains

The quantity of data and information that has to be considered as part of many decision-making processes is immense. “Years of experience on the part of managers doesn’t help here,” says Ralf Düster, Management Board member of Bochum-based SCM software specialist Setlog. To achieve efficiency gains, companies should therefore automate processes further and exploit the advantages of artificial intelligence in the area of prescriptive analytics and autonomous agents. “Managers will introduce software technologies for supply chains to consolidate the resilience and competitiveness of their companies,” emphasizes Düster, who bases his prediction on dialogue with customers. Modern technologies can enable companies to move from planning to delivery at greater speed, remove buffers, and control processes efficiently. Despite the range of technical possibilities for managing supply chains now open to transport and logistical companies as well as supply chain managers, 2022 is set to be a difficult and unpredictable year. “Driver shortages, the sheer speed at which the Omicron variant is spreading, continuing port closures linked to covid outbreaks, and stringent border controls are all considered likely this year,” says Oleksii Kosenko, the person responsible for the carrier network at Fourkites, the US supply chain platform provider. Shipping and forwarding agents will come under greater pressure than ever to supply goods quickly and on time; technology will be vital to process control, as there will not be enough time for manual work.

Ready for data exchange

As far as data handling is concerned, Kosenko perceives another trend. “In 2021, more carriers than ever before exchanged data to improve their customer service in the face of driver shortages and port closures. The pattern will continue into this year as carriers recognize secure and private exchanges of real time visibility data as one way to set themselves apart from the competition.” This requirement will also be extended to customers, who need transparency across the supply chain. Given that goods recipients also have to respond quickly to disruptions and shortages, it must be clear to see which goods (and in what quantities) are at a port of departure or destination, at a warehouse, in cross docking, or in a railway carriage.

As the coronavirus pandemic enters its third year, logisticians and supply chain managers will face further challenges. Many experts believe that the myriad uncertainties of 2022 could serve to accelerate the pace of technology.