The Advancement of Technology in Logistics and Supply Chain

I have been lucky enough to see huge advancements in technology over the last twenty-five years in my career. With the rapid advancement in technology, industries have also had to advance, evolve and improve or be left behind.

I started my first position for an airfreight import department in the early 1990's. I worked on a dumb terminal, in other words – a very simple green and black display with an RSI inducing keyboard. This was enough to carry out simple tasks such as track our house airway bill numbers, provide proof of delivery information and generate invoices.

A telex machine sat in a dark corner with a fax machine next to it and a well-used photocopier (that only worked when set to dark) sat at the other end of the office. Dot matrix printers chatted and buzzed and they printed out invoices and customs entries on carbon copy, accordion-looking, continuous feed paper.

Many shipping agents in the early nineties that did not evolve with the technology quickly fell behind and were bought up and absorbed by the larger shipping agents. 

So what did all this technology provide? Information. Not just Information – near instant and accurate information. As soon as a shipment left the USA destined for the UK the AWB was entered on the computer system. No more waiting on different times zones, fax (or post!) copy paperwork; we had near instant data on the screen. Customers needed to be kept up-to-date to be able to plan and schedule, so instantly available and accurate information was a valuable commodity. 

So what’s so important about information?

Information is the key ‘flow’ in the supply chain, without it the supply chain stalls. Information flows both upstream and downstream in a supply chain. The quicker you can share information in a supply chain the more efficient it is and the quicker it is able to move.

Without accurate information flowing in the logistics and supply chain industry nothing physically moves! Notice I say accurate information. You soon realise how important accuracy is when a shipment you were expecting ends up in Birmingham, Alabama (BHM) rather than Birmingham, England (BHX), one wrong character in the airport code equates to a 4220-mile detour…

Even with our wonderful computer terminals in the 1990's we still had issues:

• Gathering information from other companies was slow. You often had to play telephone tag with an airline or customer until you eventually get hold of them.
• Information storage was still mostly paper-based. For example: Customs commodity codes were looked up in three large folders I could barely lift onto my desk and were laboriously updated each month.
• Processes were still mostly manual. HM Customs still required customs entries to be presented with original documents within 1.5 hours.  
• A lot of paperwork was generated. Invoices, statements, airway bills, customs entries, purchase orders, banking, delivery instructions were all paperwork often required in duplicate or triplicate. 

When communicating with customers and companies at the time, they too seemed to face similar issues of manual warehousing procedures and high volumes of paperwork.

So what’s changed in the last 25 years?

The big change, which is obvious to us all, is the Internet and modern multitasking computer systems. Communication and information exchange is now quicker than ever. Services like Internet tracking are now taken for granted. Email and messaging services are now normally better than trying to catch someone on the phone. With website or phone app tracking you literally have instant information at your fingertips. You can track sea freight container vessels and courier vehicles, in real time by monitoring their GPS tracker from a website. Completing AWBs, Customs tariff codes, export licence applications, Registered Exporter system, BACs payments – all available to be completed online.

With the interconnectivity and the wealth of information the Internet provides the floodgates have opened for development. If anything we have moved into an era of having too much information and often struggle to process it. Companies now invest in computer integration solutions such as Internet of things (IoT) and Business Intelligence (BI) systems to manage, process and display the high volume of information available.

Computer software systems such as Enterprise Resource Planned (ERP) can collect information from throughout the company to monitor productions schedules, material purchases and inventory.

Warehousing has advanced dramatically with the implementation of Inventory Management and whole Warehouse Management Systems (WMS). These can track historical demands for products, calculate re-order quantities, track stock location and enable rapid picking, packing and shipping of orders to customers. Labelling technologies such as barcoding, QR codes or Radio frequency Identification (RFID) can help eliminate picking error and allows accurate tracking of goods. At the far end at the spectrum we already have large warehouses with automated storage/retrieval systems (AS/RS) and automated pick-by-robot systems.

There has been much advancement with Customs procedures too, which are moving away from the high volumes of paperwork they once were. The CHIEF (Customs Handling of Import and Export Freight) is in the process of being replaced by the more modern CDS (Customs Declaration Service) system. Customs entries clear quicker and don’t always need to be presented (see my Customs Routes article here). Anyone in accounts would also be aware that VAT (tax) in the UK went digital this year (see details here). Practically all customs documents and procedures are now available digitally or completed online. 

So is there room for further advancement?

Yes! procedures are evolving and changing all the time. Only recently it was announced ATA Carnets are evolving to become digital or eATA (see the news story here). This will not only increase security against tampering but will also allow the carnet to be transmitted electronically. Further advancements in electronic banking and block chain technology are being utilised in international shipping all the time to speed up information exchange and payments at each stage. This will greatly improve processes such as letter of credit (LC) shipments (see the news story here). Ultimately, the more information that can be digitally transmitted along the supply chain the more efficiently physical goods will be able to move.

What technology advancements have impacted your industry?

Disclaimer: The views and opinions expressed in my LinkedIn profile, posts and articles represent my own views and opinions and not those of any of my current or previous employers. I write my articles in my own free time to try and benefit others - if this is useful or interesting to you please feel free to click like and share.