Logistics 5.0: the future reimagined

Instead of complaining about the state of our economy, logistics professionals should prepare for the future and seize the opportunities that will come our way. So says DEVLYN NAIDOO…

“The future belongs to those who prepare for it today.” While writing this piece, I could not help but think of the plethora of negative remarks that are made about the state of our economy and the country’s problems – a fiscal quagmire, an ageing transport infrastructure and poorly performing ports. Be that as it may, there is a solution for every challenge. Rather than focusing on the problem, we should look at the solution: there is a new tomorrow, and it begins today.

There are two types of people in business: pessimists and the optimists. Pessimists often highlight challenges, predicting a “doom and gloom” trajectory, while optimists resolve to find appropriate solutions to address these challenges. The current international trade landscape presents limitless possibilities that invariably translate into lucrative benefits for all stakeholders involved, for example, numerous employment and entrepreneurship opportunities for unemployed citizens. South Africa is home to eight ports, with the port of Durban being the ninth-largest in the world and the busiest in Africa. It is the gateway to Africa in terms of intercontinental trade and we are therefore ideally located to leverage the opportunities available to us.

Logistics evolves at breakneck speed

The logistics industry has evolved from what some may consider a primitive model to a fast-paced and robust activity that is becoming increasingly complex. Greater access to markets and an increasing drive to promote growth in International Trade is leading to increased logistics participation and the establishment of more SMMEs in the transport and logistics sector. As predicted by the latest World Trade Organization (WTO), international trade volume is expected to increase by 8% in 2021 after falling 5,3% in 2020, a smaller decline than previously estimated. Change is inevitable and therefore businesses need to adapt to remain current, valid, authentic and sufficient. Newly established SMMEs, created at a time when innovation and technology are at unparalleled levels, prompt existing businesses to reinvent, redesign and rethink what seemed impossible.

Technology and innovation are increasingly considered key enablers of all types of businesses’ competitive advantage in various sectors, including logistics. In today’s competitive business environment, innovation and speed are the key factors for all business processes. Any business that ignores the value of current information technology will not be able to sustain itself in the current markets, as its business processes would be inefficient and ineffective. The logistics industry is considered a massive market and forms the largest industry worldwide, according to recent studies by practitioners and researchers.

We need to lead the way

South Africa ranked number 33 in the Logistics Performance Index in 2018, with Germany ranked at number one. This comes as no surprise seeing that Germany coined the term Industry 4.0, thus providing us with a clear indication that a picturesque landscape insofar as efficient and optimised logistics is concerned rests with those who take the lead in embracing and incorporating smart and future technological implementations into their everyday business. This directs us toward exploring the possibility of starting today. We do not have to wait for government. Instead, we should be proactive and lead the way.

The logistics industry is a people’s industry. This is as it should be, for importers and exporters who, in most instances, have never physically met are often connected through the trade transactions across millions of kilometres and are based in different geographical locations. Industry 5.0 will synergise artificial intelligence with a human interface, empowering people once more. Although it is expensive, it is without a doubt one of the greatest investments that will reveal long-term dividends of significant proportions.

Computing techniques hold promise

Human intelligence will work in an empowered way with cognitive computing and intelligent automation capabilities to enable hyper-personalisation. Computing techniques such as Machine Learning and Robotic Process Automation can help front-line employees to increase proficiency and deliver greater value to customers faster. For example, an expert employee can configure a complex order management process so a junior employee can handle the standard cases alone and trigger a request for help/training in less frequent but more challenging situations.

Technologies such as augmented reality, 5G mobile, “co-bots” (collaborating robots), automated drones, 5G, next-generation AI, working exoskeletons and more could come together to pair human vision, insights and creativity with the enhanced efficiency of technology – all with an eye toward creating a hyper-customised solution that adds more value to the customer. Consider a bicycle manufacturer able to leverage photo app data to more accurately size and price a tailor-made bike so it’s a perfect fit – and then route the production order to the best low-cost automated fabrication facility for the specified frame material and delivery location.

The future growth of our logistics industry will be driven by embracing technology and integrating this with 5IR technologies. In addition, the human element is essential in building trusted relationships and partnerships. After all, we are equipped with the power of emotion, passion and discretion, both as organisations and individuals.

Industry 5.0 technologies have already been developed. To survive and remain relevant, we must take the lead in embracing the new and it begins with you. No matter how small or how large the investment, the decision to invest in available 5IR technologies is essential. There is no doubt that it will indeed revolutionize your business. The future is now. Go on and claim it!