onset of the pandemic, the logistics sector has faced labour shortages, cargo
capacity challenges, manufacturing slowdown, order delays, stuck shipments,
etc. There have also been demand and supply shocks in the past few months, as
the supply chains struggled through the pandemic.
UN estimates that more than 40% of food produced in India is wasted before it
reaches the consumer
issues have an impact on other sectors, especially food and essentials. The UN
estimates that more than 40% of food produced in India is wasted before it
reaches the consumer. The pandemic exacerbated these losses around the world,
as produce rotted in the farms, with no farm-hands to harvest or logistics to
transport it, especially when retail chains/stores had to shut down at the peak
of the pandemic.
has become essential to address the logistics industry's challenges to continue
the growth and survive shocks (pandemic, seasonal and otherwise).
Science Can Enable the Next Level for the Logistics Sector
Integrated National Logistics Grid
1.Create an Integrated National Logistics
Grid: The logistics sector in India spans more than 50,000 routes across 700+
districts, more than 10,000 manufacturing companies and 2 Lakh+ transporters,
plying ~1 crore commercial vehicles. These large data sets exist largely in
their silos with a manufacturer, transporter, or at location level with
brokers/agents, but rarely in an integrated manner that would permit a network
Organizing the data into usable, interoperable matrices and integrating these
into a national logistics grid will help create an information powerhouse that
can be mined for analytics and insights and value creation opportunities. This
first step itself will enable transparency and drive efficiencies by resolving
information asymmetry and democratizing the logistics sector.
2. Make Logistics Infrastructure Smart, at Scale
Logistics Infrastructure Smart, at Scale: Data science is also being used by
countries to create smart infrastructure at a scale which can drive a new level
of cost and value creation, especially in pandemic times when bottom-lines are
stressed. Physical logistics infrastructure including roads and warehouses are
being embedded with telematics/ sensors planned for the next level of
driverless trucks & drones, with driverless trucks moving non-stop over
long distances. Availability of real-time data & analytics to optimize the
demand-supply patterns constantly at scale is becoming a reality and creating
agile supply chains, which can be integrated
into the national logistics grid.
3.Integrate Demand-Supply Patterns into
the National Logistics Grid to Drive the Next Level of Efficiency &
Using the power of data and predictive
analytics capabilities, we can plan more accurately, improve operational
efficiency, automate processes and drive continuous innovation. Sophisticated
demand forecasting algorithms can help manage production schedules to avoid
customer impact. Uncertainty is one of the biggest challenges businesses face,
and data science and predictive analytics can help businesses manage it much
better. Historical data linked to seasonality, geographical variations and
other variables, embedded in the National Logistics Grid, can be mined to
reduce guesswork and ease out stress on the network in advance ensuring harmony
in logistics flows.
industry will rapidly organize in unprecedented ways
the logistics industry has been the dream of many for an upstart, and
governments have made earnest attempts. But like a black swan, perhaps this
industry will rapidly organize in unprecedented ways, as multiple powerful
forces for change are now aligning, starting with the Goods & Service Tax
(GST) reform which gave us a single national market, to the electronic e-way
bill, electronic tolls and multiple other initiatives, all with a common
denominator: they all move the logistics industry to digitize and enable
transparency while building the foundation for leveraging data science.
tipping point is now in sight
still be some distance from having an organized logistics industry, but the
process is well underway, and getting faster. The tipping point is now in
sight. We may not be there yet, but the speed at which Indian logistics will
move may surprise all of us in the coming years.