CIOs and Senior IT Executives from leading logistics providers joined other industry professionals in Austin, TX earlier this month for EFT’s North American Logistics CIO Forum, an event held annually to, “discuss the key technology issues impacting the logistics industry through in-depth presentations, interactive peer discussions, and unique networking opportunities.”
During the event, project44’s VP of Sales Engineering, Jason Kerner, participated in an interactive panel that covered the bright future of industry technology. For those who missed the panel, or simply want a recap, here are the highlights.
The Logistics Tech Revolution: Where we’re Headed and How to Get There
Moderator: Eric Johnson – American Shipper
Bart De Muynck – Research Director – Gartner, Tony Kreager – Marketing and API Specialist – FedEx, John Lebowitz – VP Supply Chain Operations – Stryker, Jason Kerner – VP Sales Engineering – project44
Automating the Full Shipment Lifecycle
At this point, it’s really no secret that the logistics industry is technologically behind other industries, even the ones it rubs shoulders with like manufacturing. Gartner’s Bart De Muynck went as far as to say logistics is roughly 20 years behind other industries, “In logistics, companies with high industry maturity have a relatively low maturity in general tech.” he stated.
What De Muynck is essentially saying is that, at least until recently, the most technologically advanced players in the logistics space still have a lot of room to advance. That being said, companies are becoming more and more aware of this, and they’re starting to realize how much spend can be reduced, and how much efficiency can be gained, by leveraging modern technology.
project44’s Jason Kerner explains how that’s possible, “There are two key points to look at right now,” he says, “Data and integration. The companies that adopt the quickest—with APIs, with IoT, with agile cloud deployments—they’re going to be in such a competitive advantage. The longer you wait, the more expensive that entry point is, and you’ll get to the point where you’re not going to be able to catch up.”
When you combine all of the components to which Kerner is referring, you’re able to automate your supply chain. To this point, the most widely adopted technology solutions in the industry have centered around data. Companies are able to collect a large amount of data, they’re just not quite sure what to do with it. They need to be leveraging that data for automation by way of API technology.
API Integration Strategies
FedEx’s Tony Kreager echoes a sentiment that is being heard by many supply chain partners across the industry, “Disruption happens because we’re obsessed with the customer experience.” He explains that FedEx’s customers want more information about things like tracking, rating, and other shipment details, “[They] want to take that information and pair it with pieces of information that [they’re] getting from other API endpoints, and deliver a much richer experience to [their] end consumers.”
The supply chain has become extremely complicated, and companies need more functional data. The only way that data becomes useful across the supply chain, however, is if all stakeholders receive the same high quality information in real-time. De Muynck refers to this as “supply chain convergence,” which essentially means collaboration.
Connectivity is a major differentiator. Linking transportation to things like inventory planning, demand planning, and replenishment planning is only possible if the different parts of the supply chain agree to collaborate and share information. That’s where true process automation becomes possible, but it relies on each stakeholder integrating with the right APIs.
“Everyone is still optimizing within their own four walls,” says De Muynck, “We have to have more collaboration.”
Build Vs. Buy
Many companies do no have API technology in place as of yet, but just about everyone is heading in that direction. This brings up the question of build vs. buy—should a company develop APIs in-house, or integrate with a third-party technology vendor. FedEx, for example, instituted an API Integrator Program earlier this year, which is extremely telling. FedEx is clearly large enough and has the resources to develop everything in-house, but they choose to leverage partnerships with modern technology companies like project44.
FedEx’s own API Specialist Tony Kreager explains that three major things factor into the build vs. buy decision, “Cost, resource time, and integration complexity.”
De Muynck adds, “It’s much more difficult to have the resources available. The rate of change is too high to manage [technology] in house, and secondly, to keep up.”
The buy instead of build argument has changed a lot in recent years, especially where logistics APIs are concerned. It goes back to what the panel talked about earlier with collaboration—you’re not just buying a product off the shelf anymore, you’re buying into a partnership. That means you’re working together to continually innovate the product, and you’re asking your technology partners to build things that directly benefit your needs. You’re getting continued support and integration assistance.
Collaboration is making the entire API development and integration process more simple, which is extremely important considering how quickly companies need to adopt new technology to avoid falling behind.
“There should be a sense of urgency,” says Kerner.”It’s not where the industry is going. It’s already there.”
Listen to the full panel here: