How digital transformation in logistics drives innovation - Hindustan Times

How digital transformation in logistics drives innovation

ByHindustan Times
Jan 23, 2024 10:09 PM IST

This article is authored by Abhishek Chakraborty, executive director, DTDC Express Ltd.

Digitisation has altered the way we buy and sell products and services. New ideas, technologies, and practices have emerged, impacting industries across geographies. The traditional logistics industry is one such domain that is getting transformed by this wave of digitisation.


Earlier driven by hundreds of siloed processes, the logistics industry now is actively embracing innovative technologies to streamline operations, enhance efficiency, and meet the ever-growing customer expectations. From real-time tracking to predictive analytics, many technologies are reshaping how goods are transported, warehoused, and delivered.

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Advanced technologies like the Internet of Things (IoT) for real-time tracking, blockchain for enhanced transparency, and Artificial Intelligence (AI) and Machine Learning (ML) for data analysis and decision-making are making processes more robust and streamlined. The use of autonomous vehicles, robotics, and automation are also revolutionising warehouse operations, while predictive analytics and cloud computing optimise supply chain management. Furthermore, emerging technologies like 3D printing and augmented reality (AR) are also making an impact.

Players in the logistics and supply chain domain are actively experimenting with these new technologies to enhance their efficiency. By leveraging technologies like Robotic Process Automation (RPA) and AI-powered chatbots, logistics companies are automating tasks and speeding up processes for customers. Furthermore, by investing in cutting-edge infrastructure like automated sorting technology companies are able to handle over 30,000 parcels per hour, operate 24/7, optimise space, and reduce operational costs. Additionally, innovative solutions like Butler systems for order pick and pack processes use advanced automation, including computer vision, to enhance warehouse operations. These systems automate order fulfilment by using robotic units to navigate shelves, pick items, and pack them for delivery, significantly speeding up processing time and minimising errors with less human intervention.

Notably, on the customer front technologies like generative AI, advanced Natural Language Processing (NLP) models, and customer service bots have also evolved to offer more human-like interactions. These technologies enable personalised and engaging conversations with customers, as AI-driven bots dynamically generate context-aware responses, mimicking human communication.

Rich NLP models empower virtual assistants and chatbots in the logistics sector to comprehend complex queries, provide detailed information, and handle nuanced conversations. This evolution results in efficient problem resolution and improved customer satisfaction. The integration of generative AI and advanced NLP models enhances data analytics within logistics, providing deeper insights into data patterns and facilitating predictive tools.

With more and more e-commerce platforms coming up, logistics providers must also modernise their processes through automation and technological advancements to meet the rapid demands and comprehensive logistical requirements. Logistics companies must now also gear up to address platform evolutions such as ONDC which is the government’s latest initiative.

While digitisation brings opportunity it also brings a vast database of customer information that needs to be processed and protected all the time. Hence, robust data privacy measures and threat protection becomes essential. Data privacy involves responsibly collecting, processing, and storing data while following strict privacy rules. At the same time, threat protection means using cybersecurity measures to prevent unauthorised access, breaches, and cyber threats. A crucial part of this is regularly improving security. Ongoing assessments, updates, and employee training contribute to a strong and adaptable security system. By giving priority to data privacy and having strong threat protection, logistics organisations can strengthen their digital infrastructure. This helps build trust and reduce risks in the ever-changing world of technology.

Logistics companies today must follow ethical standards to safeguard their clients' data integrity and security. They must prioritise strong data security measures, including encryption, secure application access, single sign-on, zero-trust network access, data leakage prevention, email security, identity and access management, attack surface management, and security monitoring. Additionally, to protect customer privacy, companies have introduced data masking for sensitive information like mobile numbers.

As we look toward the future, the logistics industry in India is undergoing a remarkable transformation. A surge in demand, coupled with technological innovations, has propelled the sector's growth. The industry is forecasted to achieve a market size of 30 trillion in financial year 2027, growing at a Compounded Annual Growth Rate (CAGR) of 11%.

Though private players are preparing themselves to bank on this growth, the government agencies are also devising new ways to boost logistics in the country. The PM Gati Shakti and Bharat Mala Pariyojna initiatives by the Indian government are not only focused on addressing current challenges but also incorporate a vision for scalability in the logistics sector. With an emphasis on infrastructure development and governance solutions, these efforts are strategically designed to pave the way for scalable logistics services. Furthermore, the National Logistics Policy (NLP) 2022 aims to ease the movement of goods and boost the trade sector in our economy.

Technology, innovation and intent by industry leaders are helping to boost the logistics sector in India. With advancements in IoT, blockchain, AI, and cloud computing, logistics companies are embracing an era of unprecedented efficiency and customer-centricity. Going forward we can expect more innovations like drone deliveries, RPA, and Q commerce becoming more scalable and taking the lead in logistics growth.

This article is authored by Abhishek Chakraborty, executive director, DTDC Express Ltd.

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