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Supply Chain Insights

Technology Trends Paving the Way for a Greener T&L Industry

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Michael Dyson, VP of Sales, APAC at SOTI

It’s well known that the Transportation and Logistics (T&L) industry is a significant contributor to global and economic performance. With much of our day-to-day activities dependent on the ability to trade and transport goods and services across the globe, the T&L sector has never been as important as it is today.

The trade-off, however, is that all this activity equates to a substantial contribution to greenhouse gas emissions, environmental degradation and climate change overall. As a result, there is now a growing push for T&L businesses to transform and integrate environmentally sound initiatives into operations, so they are better positioned for a more sustainable and resilient future. The key, T&L businesses need to proactively invest in the latest technology to streamline operations and match the high demand in a way that also works to reduce the carbon footprint.

There is now considerable pressure on the industry, and incentives from within it, to make the industry more environmentally sustainable. The road-freight sector is responsible for over 24% of CO2 emissions worldwide. If countries are to meet their commitments under the Paris Climate Agreement, they need the road-freight sector to become more sustainable.

To meet these pressures, the sector must identify the current sustainability gaps and prioritise investments in technology that help to fill them. If T&L businesses combine mobile and IoT technology with an integrated business-critical mobile strategy, they will undoubtably see not only gains in performance, but a more sustainable means of operating.

Better visibility makes for greener operations

Over the past decade, sustainability has been a hot topic in the T&L industry with more businesses looking at the environmental benefits of new technology. From making operations more efficient to using more sustainable resources, being environmentally-conscious remains a core focus. Something of particular interest within the industry is the use of Internet of Things (IoT) solutions such as telematics.

Telematics combines the use of Information Communications Technology (ICT) to monitor a wide range of information relating to an individual vehicle or an entire fleet. Telematics systems gather data including vehicle location, driver behaviour, engine diagnostics and vehicle activity, and visualise this data on software platforms that help fleet operators manage their resources.

The use of telematics is quickly growing in popularity due to the positive impact it has on operations. Not only do these IoT solutions work to streamline industry processes to save costs, they also allow businesses to easily comply with new regulations.

Aside from this, telematics offers many environmental benefits for T&L businesses wanting to reduce their carbon footprint by enabling operators to monitor their vehicle’s performance and save costs, reduce travel times and switch to more energy efficient fuel options.

With a multitude of other operational benefits, the tremendous potential telematics can have towards making the world a cleaner and safer environment goes far beyond just fleet owners, operators and drivers, but to the supply chain at large. The data collected through telematics is extremely valuable for identifying trends and making improvements to operations to better initiate sustainable practices.

Reducing the carbon footprint of transportation

With the impacts of COVID-19 and the accelerated demand for T&L services, the pressures on the sector have been immense. However, it will be the businesses that choose to innovate their operations with technology designed to efficiently move goods in a smarter, more sustainable way that will see themselves remain competitive in a greener future.

Advanced solutions such as telematics and IoT technology work to support the reduction of carbon emissions and lead the industry into a greener future by optimising the overall flow of logistics, which naturally helps to reduce emissions. These technologies track vehicle and individual driver information to support improved vehicle performance and driver behaviour, thereby reducing the overall consumption of fuel and outward emissions.

With the integration of technology solutions, T&L businesses can not only improve sustainability standards from the get-go but make an evaluation on how to react to any other detrimental impacts current operations are having on the environment to make further, longer-term improvements.

Efficiency is the key to T&L sustainability

In SOTI’s latest report on the T&L industry, 76% of Australian T&L businesses agree that mobile-first technology will play an important role in last-mile delivery over the next five years. A further 50% said that mobile-first technology used to increase the speed of the delivery process and improve the visibility for customers to track their orders will improve operational efficiencies significantly.

With the many advantages that come as a result of investing in and deploying technology, the most business-critical outcome from a T&L operator’s perspective is the improvements to productivity and efficiency. The use of technology, including mobile-first technology, to automate operational tasks such as record keeping, toll paying and delivery logistics, for example, allow T&L drivers to operate in a more productive and efficient way. And while this is the priority for T&L businesses making investments in technology, another big motivation is becoming more sustainable.

The fact is technology investments that improve visibility, efficiencies, productivity and accuracy are also likely to increase a T&L business’ sustainability credentials. That’s because it means T&L drivers are completing tasks correctly the first-time round, and the business is making assessments and changes to operations such as using data insights to deliver more orders to the same place at the same time or calibrating quicker route options.

Transport modes have also seen several advances which work to proactively reduce carbon emissions. From larger vehicles, aircrafts and vessels to the broadening use of automated guided vehicles, transport modes will continue to change in the future to address issues of efficiency and sustainability.

Larger means of transport are fast becoming a greener approach to transporting goods, with larger vehicles being a way of not only compensating for rising transportation costs but revolutionising the potential for goods to be transported in a more sustainable way – such as compiling many goods on the same vehicle that all need to go to the same place. Moreover, innovative modes of transport such as autonomous and self-controlled systems may also be the frontrunners when it comes to the changing face of transport in the future.

With the current challenges facing the world today, there are many changes that can help better position the T&L industry to operate on a greener level. With the proactive use of technology to optimise industry operations, the T&L sector can start on an innovative path towards a sustainable future.

With an increased shift toward mobile and IoT technology in the T&L industry, there is also a need for businesses to have an advanced mobile-first strategy in place ensuring that all devices are centrally connected, secure and properly integrated into operations. For T&L businesses looking to adopt new technology to recalibrate their sustainability credentials, IoT management solutions and secure mobility management solutions offer an integrated solution to manage and maintain the security of all mobile devices and connected peripherals within operations.

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Supply Chain

bp and Uber sign Global Strategic Delivery Partnership

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  • bp and Uber sign a new global strategic convenience partnership aiming to make more than 3,000 retail locations available on Uber Eats by 2025.
  • The partnership extends current local arrangements in Australia, New Zealand, Poland, South Africa and the west coast of US, adding the UK and eastern US in 2022 and with plans to launch in other European markets from 2023.

Today, bp (NYSE: BP) and Uber Technologies, Inc. (NYSE: UBER) are announcing a new global strategic convenience delivery partnership, extending their existing local arrangements to reach more consumers across the world. Together, the partners will offer a huge range of quality convenience products, including fresh and prepared ranges, from select retail locations.

bp is the first convenience retailer to team up with Uber Eats on a global level and aims to have more than 3,000 retail locations available on the delivery platform over the next three years. The partnership supports bp’s goal of growing its access to customers and expanding its delivery footprint, in response to soaring demand for food, groceries and everyday essentials brought to the door.

The new partnership covers retail sites in Australia, New Zealand, Poland, South Africa and the west coast of US. Sites in the UK and eastern US will be added to the app for the first time this year, with plans to launch in other European markets from 2023.

“We’re thrilled to team up with Uber Eats globally giving us the opportunity to reach many more consumers online in addition to those who currently visit our retail sites. We’ve seen how the pandemic has accelerated customer demand for delivered convenience and this partnership will allow us to scale up quickly on the Uber platform. And for the first time, we will be able to offer delivery options to existing customers on our own BPme app by the end of 2023,” said Emma Delaney, executive vice president customers & products, bp.

With 20,500 bp retail sites across the world and 550 million customers living within 20 minutes of a bp retail site, the partners see enormous opportunities for growth. bp sites offer a range of products tailored to local markets which may include hot and cold drinks, food-for-now options as well as staple groceries, fresh produce and ready meals, plus wine, beer and flowers.

  • In the UK, customers will be able to access a range of Wild Bean Café, and other branded food and products via Uber Eats – with the first 120 sites due live on the platform by the end of June.
  • In the US, the offer will be made available to bp’s network of independently owned retail locations to support the growth of their businesses. The goal is to make it easy for these partners to sign up to the Uber Eats platform and access benefits based on bp’s scale.

bp will benefit from Uber’s global brand and operations footprint, best-in-class technology for dispatching orders, and more than 4.4 million drivers and couriers on the platform worldwide.

As part of the agreement, Uber Eats and bp will work to introduce delivery options onto bp’s own app, BPme – initially planned to be available in the UK, US and Australia by the end of 2023 – powered by Uber Direct. This new offer will allow bp to directly connect its customers to delivery riders, making Uber Eats the trusted partner in fulfilling these orders. Since 2019, bp has seen a three-fold increase in users of the BPme app, with 16 million active loyalty users worldwide.

“With more than 20,500 locations around the world, bp’s reach is enormous—making them critical partners as we pursue our ambitions of helping consumers across the world get what they need delivered to their doorsteps,” said Pierre Dimitri Gore-Coty, Uber’s SVP of Global Delivery. “We are proud to support this next phase of the company’s convenience growth through this delivery partnership and look forward to deeper collaboration in the future.”

bp and Uber already work together in mobility with bp providing electric vehicle charging for Uber’s ride-hail drivers. The companies will explore other areas for future cooperation in convenience, including opportunities to utilize low carbon delivery methods to fulfill orders from bp sites.

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Supply Chain Insights

Officeworks to own and control Distribution Network.

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Officeworks invests in supply chain capabilities, will own and run it’s distribution centre.

Officeworks has changed its supply chain strategy in the wake of COVID-19 issues, with a view to owning and controlling a network of distribution centres across the country.

“When I joined we had a different strategy around our supply chain,” Officeworks managing director Sarah Hunter told The Australian, referring to the company’s previous outsourcing strategy.

“So we’ve worked really hard now to build our supply chain capability. We were in the process of outsourcing it, we are now in the process of building that capability.

Officeworks recently opened Australia’s first solar-powered robotic distribution centre in Derrimut, Victoria.

“We started in Victoria, and we have had approval to build, now board approval to invest, and we are building a new, similar (distribution centre) operation in Western Australia. That’s exciting,” she said.

“Looking at our capital expenditure three, four, or five years ago it’s a material step up in our investment in our supply chain.

“Most importantly for us as a business is that every team member who worked at the old facility has been completely retrained,” she said. “We have 120 team members who are now fully trained in how to work in an automated state-of-the-art environment.”

The need to control its own distribution became clear during the pandemic.

By December, Officeworks saw 46 per cent of its business come from online, including click and collect. Now it needs to move to retain this growth at a cost effective scale.

“We have created a facility that’s not only more productive, it’s going to enable our online business to grow in Victoria and into NSW at the rate that we expect our online business will grow.

“So now we have the capacity, the cost per pick is materially lower because it’s much more productive. It’s a win-win scenario for us. We’ve kept everyone employed with really great job security. We’ve scaled them up to work in the supply chain of the future.

“And on top of that, we now have the capacity for growth in Victoria that frankly we were struggling with through COVID.”

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Business Continuity

Skills shortage puts SAP projects on hold

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Business demand creates double whammy on recruitment pressure

Skills-related issues have hit a quarter of SAP users, in some cases putting projects on hold, according to a survey of companies in the Americas.

Research released by the Americas’ SAP Users’ Group (ASUG) shows that 26 per cent of organisations see skills in supporting, developing, and upgrading SAP systems as their number one challenge in working with the technology.

A quarter of users loyal to the German vendor said skills problems were holding up projects.

Geoff Scott, ASUG CEO, told a webinar last week that the combination of skills shortages in businesses and their technology teams created a vicious cycle of driving the demand for new tools and technologies.

“Business functions come and say, ‘Hey, I need to have all these things done.’ And technology teams say, ‘Well, I don’t have the same skills I used to have.’ And I think it creates a major disruption inside many of our member companies,” he said.

Skills were also a major issue for SAP users looking either to migrate to or support S/4HANA, the latest version of the tech giant’s ERP software based on an in-memory database.

“We are going to feel the pinch of that skill gap. My word of caution is that as you think about moving to S/4 if you have not already, the ability for you to plan that migration may hit some turbulence related to skill gaps with your external partners. That’s something that you absolutely positively should consider,” he said.

While technology issues were the greatest concern in the research overall, broken down, only integration problems were more cited than staff turnover and maintaining knowledgeable staff.

Of those with integration problems, 28 per cent said they were causing data errors to spread, 17 per cent said they were affecting the compatibility between SAP and other applications, and 17 per cent said it meant they were unable to keep up with new technologies.

One respondent said: “Changes made in SAP and Salesforce that do not get reflected in the other system are causing data inconsistencies.”

Overall, the majority of SAP users were increasing their spending on the technology. Fifty-two per cent said they were increasing spending, up from 46 per cent last year.

However, the proportion of users saying they were cutting spending on SAP also rose from 5 per cent last year to 8 per cent in 2022. The number of organisations making the same level of investment fell, according to the ASUG research.

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