Although digitalization, data transparency and innovation are important for the transport and logistics sector to maintain added value, research has shown that more than a third of companies are not or not sufficiently prepared for this change (Emerce, June 2017). The fact that digital developments in the transport sector would provide an above average profit is well known, but in the past, the start of new initiatives have been found to be difficult. Regulations, but also established carriers and shippers are among the obstacles in the way of major innovations (ABN-AMRO).
Advantages of digital transformation
Companies in the transport and logistics sector are increasingly dependent on digital information. Many activities in these sectors depend on the timely availability of information. It is this sector, especially, that can benefit from digital transformation. Cost reduction, as well as improvements in customer service and system efficiency are some of these benefits (ABN AMRO, 2016). In addition, digital transformation ensures that agility – the ability to use IT to make business adjustments at a rapid pace, to adapt to market developments – increases. Being too late to respond – or not responding at all – to market changes has caused financial or reputational damage to companies in the past (Logistics, 2016).
Willingness to invest
The willingness to invest in digital transformation is huge; 90 percent of companies also have sufficient financial resources. Companies want to continue their development in order to remain competitive and to grow. Technologies such as Big Data and Analytics, Enterprise Resource Planning and the Internet of Things are indispensable for digital transformation. Research has shown that the main drivers for digital transformation are: efficiency of internal processes, accelerating innovation, and growth opportunities in emerging markets (Emerce, 2017, IFS, 2017).
Not sufficiently prepared
However, research shows that more than 1 in 3 logistics companies are not or not sufficiently prepared for digital transformation. Companies often see the importance of digital transformation but have trouble with the implementation. This is mainly due to the lack of digitally talented employees within these companies.
New technologies are essential, but the right talents are needed for a successful transformation. Talent is missing especially in the areas of Business Intelligence, Cybersecurity, AI, Big Data / Analytics and the Cloud. In addition, it appears that in many companies there is resistance to change by employees (Emerce, 2017, IFS, 2017).
Aside from the human side of things being a barrier to successful digital transformation, practical and technical aspects also form an obstacle. For example, many companies are worried about security and there are often a lack of proper organizational or management structures (Emerce, 2017, IFS, 2017).
LSS, Logistics Software Solutions, takes full advantage of the opportunities offered by logistics ICT. We guarantee added value for your services. Would you like to discuss the benefits of digitalization, but also hurdles within your organization, with one of our employees? Contact us by calling +31 (0) 88 1050300.