DISRUPTION IN LOGISTICS - By Aku Happo
←
→
Page content transcription
If your browser does not render page correctly, please read the page content below
DISRUPTION IN LOGISTICS
- By Aku Happo
Big Bang Technology
Disruption and its game changing role
• “Big bang disruptors” are immensely innovative products or services that are better, cheaper, customized and more intricately
interwoven with other products and services than the existing offerings in the market
• Big bang disruptors are fuelled by “exponential technologies”, which means that a product or service will become cheaper and
better faster than traditional offerings but will as a result have shorter life cycles
• These disruptions are occurring in varied sectors such as transportation, manufacturing, education, financial services, health
care, etc. with increasing frequency and greater impacts
• Their rapid pace of adoption is due to the fact that customers nowadays are more digital and more aware of market information
Rogers’ Bell curve Vs Big Bang Disruption Curve
Rogers’ Bell curve
Big Bang Disruption Curve
*Downes, L. and Nunes, P. (2014), “Big Bang Disruption: Strategy in the Age of Devastating Innovation” 2
Disruptors
Examples across various sectors
DISRUPTORS
3
Factors for Disruption
Three ingredients of success
Technology
• The combination of the right type of technologies with the correct business model at
the right time will result in a Big Bang Disruptor Business
• Many companies have brought to the market innovative products or services but have Model Timing
as swiftly disappeared as they had penetrated it; this is because technology is
constantly changing and companies must adapt and transform themselves in order to
stay ahead of the curve
Social Network Timeline
• Facebook became the king of online social networking due to the smart combination of innovative features, strategic decision-
making, and most importantly the correct timing of launch, which enabled it to propel itself ahead of its predecessors and
become the most popular social network within 4 years of its launch
• Facebook’s success was eminent from the fact that its “Like” button became so popular that people started using it even
outside Facebook
Computerized CompuServe Six Degrees Friendster MySpace Hi5 Orkut Facebook
Bulletin Board (CBBS)
First dial-up system
1978 1979 1997 2002 2003 2003 2004 2004
February September May July August January February
4
Disruptors in Logistics
An indicative list but not exhaustive!
1 Innovative Delivery Solutions 4 Autonomous/Semi-autonomous Vehicles
• In order to meet soaring consumer expectations • Technological advances such as sensors, GPS,
delivery solutions need to be faster, cheaper, radar, etc. have helped develop vehicles that can
convenient and more focused on last mile L be driven without human input
• Firms therefore are now offering same day • Such autonomous vehicles will deeply affect and
delivery, delivery to parcel lockers or car boot, O eventually change how we move around in the
fresh grocery delivery, etc. city, how our products get delivered, etc.
G
2 Internet of Things (IoT) 5 Unmanned Aerial Vehicles (UAVs)
• IoT is a network of Internet-connected sensors I • UAVs are no longer sci-fi and are already very
attached to objects such as computers, vehicles, commonly used in military operations,
appliances, wearables, etc. S medical/aid work, etc.
• Logistics sector has widely adopted IoT • Although large-scale commercial deployment is
employing it in warehousing, freight T still some years away, UAVs promise new
management, package delivery, etc. opportunities for logistics players
I
3 Big Data
C
6 3D Printing
• Massive amount of data generated from devices • 3D printing will revolutionize the way products
such as smartphones, webcams, social networks, are designed, produced, and delivered to
credit card swipes, etc. is called Big Data
S consumers
• This data needs to be processed, interpreted, • It is expected to impact the logistics sector
and analysed to produce insights that will be of significantly especially cargo & freight businesses
business value and last mile delivery
5
Innovative Delivery Solutions (1/2)
Driving factors
• Growth of digital consumers and global ecommerce has changed the way parcels are delivered in the last mile segment of
supply chain
• Consumers’ demand for convenient, fast, and efficient delivery has pushed the logistics sector to innovate and bring new
delivery models such as delivery to parcel locker/car boot, same day/same hour delivery, drive-through pickup, etc.
• These new models’ cost structure varies from that of traditional players; they are more technology-enabled, utilizes excess
capacity, can scale their operations rapidly & effectively, and are often offered at extremely low prices
Start-ups offering New Delivery Cost Differential Consumer Preferences
Models in last mile*
+ €4 1 Lesser cost
2 Greater speed (same day, same
hour)
3 More flexible delivery options
(parcel locker, car boot,
+ €1,5
Sunday/evening delivery, etc.)
€0,7 4 Transparent and visibility (at exactly
what time the package will be
delivered, hidden costs, etc.)
Postal Uber Parcel
Players lockers 5 Digital (real-time tracking, online
payments, etc.)
*Jonathan Wichman 6
Innovative Delivery Solutions (2/2)
Use cases
A Improved Parcel Locker – Cleveron PackRobot B Car Boot Delivery - Volvo
• Cleveron has introduced PackRobot, a new innovative • Volvo now offers its customers the option of getting their
parcel locker, that uses advanced Internet of Things (IoT) parcels delivered to the boot of their car (currently
technologies available in only two cities – Gothenburg & Stockholm)
• PackRobot features • This gives customers an option of turning their car into a e-
can accommodate more parcels as compared to other commerce delivery point and reduce failed deliveries
parcel lockers • Also offers insurance for the packages kept in the car as a
cost per parcel is relatively lesser as compared to added feature
traditional parcel lockers
has a patented 3D lift system that picks and deposits
A temporary Digital Key is
Order online and select your
generated for the delivery
parcels in a specific slot car as shipping address
person to access the car boot
has an adjustable internal climate
control that can be used indoors
as well as outdoors
takes photographs of all parcels
for added security
Once the drop is made the
provides an App for smartphone You get a delivery
Digital Key expires
and smartwatch users notification on your mobile
automatically
7
Internet of Things (1/2)
Understanding connected “things”
• Internet of Things (IoT) is wired/wireless Internet-enabled connections between physical objects
• It is a part of a larger concept known as “Internet of Everything” (IoE) that includes connections between machines, people,
process, and data
• The capabilities of IoT include monitoring, measuring, controlling, automating, optimizing, and learning
• Big data plays a large role in understanding and analysing the data generated from all these connected devices and develop
insights that enable business growth
• Logistics players are embracing IoT technology at a rapid pace due to increasing consumer demand for IoT-enabled solutions
and the rise of 5G networks, mobile computing, wireless communication, and big data analytics
Estimated number of
connected objects in the 15 B
world in 2015*
Estimated number of
connected objects in the 50 B
world in 2020*
Currently IoT activity is focused on
manufacturing, transportation and
logistics, smart city, etc. However it is
predicted by the IDC that within the next
five year all industries will use IoT.
*Cisco: The Internet of Things (2011) 8Internet of Things (2/2)
Use cases
A Sensors in Mail Boxes – B Smart Labels – C Flexible Delivery D Automatic
Postybell SemProM Replenishment and
Anticipatory Shipping
• Proximity sensor is placed • Increasing use of RFID* or • IoT allows change of • Sensors in a refrigerator
inside mail box that other sensory tags on delivery address at the can track the stored
detects motion when products will enable them last moment products’ expiration date,
letters are delivered and to be monitored using a • Customer can get detect low supplies and
then sends an alert to the NFC smart label information when exactly order them online
owner’s mobile via GSM • These NFC smart labels will their tagged parcels are automatically without any
wherever they are (even help gauge the arriving and whether a human intervention
when they are not in temperature or humidity of change of delivery • Similarly, sensors detect
town) consumable items, quality address is required; low supplies of a retailer
• It has an advantage over of pharmaceutical subsequently diverting and automatically order
other similar devices that products, etc. the parcel to an for replenishment at the
run via Bluetooth or Wi- • DHL along with other alternative address if distribution centre to cut
Fi technologies that partners is working on a unavailable down lead time and avoid
restrict notification to a research project, going out-of-stock
short distance SemProM, to make smart • Amazon has patented the
labels or digital product concept of “anticipatory
memory of a product shipping” and has
• These labels can store launched Amazon Dash
product information service to cater to this
throughout its lifecycle segment of ecommerce
*RFID: Radio-frequency identification 9Big Data (1/2)
Interpreting business information
• Every company already generates a huge amount of data that needs to be refined and processed in order to be of greater
business value
• Companies have to embrace data analysis as a part of all decision-making to bring more transparency and innovation
• Logistics sector will be hugely impacted by the technological advancements of Big Data, by improving products and services,
increasing operational efficiency, enhancing stock management, optimising delivery routes, managing risks, etc.
Characteristics of Big Data – Four V’s*
Volume 2.5 Quintillion bytes
Amount of of data is generated
every day
1 data
Each month has 30 B
Variety Facebook shares and 4 B+
Forms of data hours of YouTube video
2 watching
New York Stock Exchange
Velocity
collects 1 TB trade
Speed of data information during each
processing
3 session
Veracity US economy looses $3.1 T
Uncertainty of a year due to poor data
quality
4 data
*IBM 10Big Data (2/2)
Use cases
Real-time Route Optimization – DHL SmartTruck A Strategic Network Planning – T-Systems TelematicOne B
• DHL has developed an “intelligent” pickup and delivery • This manufacturer-independent cloud-based portal offers
vehicle, SmartTruck, that uses real-time GPS systems and freight forwarders real-time data on the flow of goods to
local traffic data to calculate the ideal route to deliver optimize their logistics processes
packages and also allow last-minute pickups • Its features include cargo data monitoring, integration of
• Big Data techniques help analyse the real-time data collected telematics systems, targeted data transfer, Arrival Control
from various sources, taking into account geographical and App to monitor estimated time of arrival, etc.
environmental factors, and dynamically re-route vehicles on
the go
• It helps reduce cost as well as CO2 emissions
Last mile crowdshipping – DHL MyWays C Market Intelligence – DHL Geovista D
• In this delivery model, parcels are delivered by common • It is a geo marketing tool targeted at small and medium-sized
people (crowd) on their regular way of commute enterprises (SMEs) that provides analysis and assessment of
• Users of DHL MyWays can register a parcel that is to be complicated geo data
delivered on the App; which will then be available for other • Users can prepare scientific model-based sales forecast,
city residents who are willing to deliver it for a delivery fee analyse local competitors, generate a digital map showing
• Crowd-based delivery requires real-time matching of the business-location factors in the particular area being
potential delivery people with the delivery requests and studied and get a detailed report of the complete analysis
monitoring of a large number of moving delivery people, • This model has also received the Postal Technology
which is where Big Data technologies such as complex event International Award 2012 – Retail Innovation of the Year for
processing and geocorrelation comes into play filling a void in geomarketing
11Autonomous/Semi-autonomous Vehicles (1/2)
City planning, benefits and challenges
Degree of Automation*
No Automation; All functions are
More than one Car can drive
human driver One function is automated;
function is itself; no human
controls all automated driver can do
automated driver is present
functions other activities
City Planning Requirements for
Autonomous Vehicle Adoption
Benefits
• Increased road safety; automation can cut down road accidents
Planning of city infrastructure (roads, bridges, traffic signals, • Reduction in traffic; autonomous vehicles can drive closer
parking, etc. together, at higher speeds, take less crowded roads, etc.
Building digital communication infrastructure (linking vehicles • Driver can utilize the time spent in car for productive work
with the environment via wireless networks, sensors, etc.) • Lesser or more efficient fuel use and reduction in pollution
Developing new leadership roles (who will monitor and take • Can be used by everyone (old, young and differently abled)
decisions regarding the symbiosis between the autonomous
vehicles and the city) Challenges
Interpreting collected data and employing the insights • Correct interpretation of data by technology is required; also
Data security failure/malfunctioning of sensors needs to be addressed
• Public scepticism against driver-less car
Google’s Autonomous car has driven • Shift of damage liability from driver/car owner to manufacturer
more than 1,6 M Km on US road • Privacy issues – there are no existing regulations on who will
without meeting with any accident manage the generated data
(2016)** • No existing insurance regulation for autonomous vehicles
*National Highway Traffic Safety Administration (NHTSA), USA 12
**Source: GoogleAutonomous/Semi-autonomous Vehicles (2/2)
Use cases
A Support Vehicles for Deliveries C Loading Parcel Lockers
• When a delivery man cannot find a parking spot near the • Special attachments can be added to autonomous vehicles
delivery location he has to walk from the parked car to the to enable them to pick-up and deliver letters and parcels
address thus increasing the time taken to make each into parcel lockers thus replacing traditional delivery man
delivery. An autonomous vehicle in this case can assist the
deliveries by going to the delivery man once the package has
been delivered D Self-driving Parcel Locker
• Also once the vehicle is empty, a second filled car can
autonomously reach the delivery man thus cutting down the
time taken to go back to the parcel centre to reload • An incredible use of autonomous vehicles is to develop a
self-driving or autonomous parcel locker that is mobile and
moves around the city instead of being placed in one place
B Autonomous Shared Car
• An autonomous shopping vehicle can assist in delivering E Self-driving Parcel
ecommerce goods on a shared-asset basis
• Volvo is testing a similar idea with its Volvo on Call App that • In another futuristic use of autonomous vehicles, parcels
allows it to access the trunk of a car and deposit parcels for themselves could be made autonomous with electronic
the owner (also discussed under Innovative Delivery locks and GPS-enabled such that then can unload
Solutions) themselves from the delivery van, drive to the delivery
address, and deposit contents safely
13Unmanned Aerial Vehicles (UAVs) (1/2)
Classification, benefits and challenges
Classification
Unmanned Helicopter Multicopter Fixed Wing Tilt Wing
• VTOL* • Low weight • Long range • VTOL
• Easy manoeuvrability • Easy launch • Endurance • Easy manoeuvrability
• Can carry heavier packages • Inexpensive • Larger space requirement • Heavy weight hauls
• Expensive • Light weight hauls for horizontal take-off • Long range
• Requires higher maintenance • Cannot withstand high • Limited manoeuvrability • Complex & expensive tech
winds due to light weight
• Improved speed of delivery Regulatory hurdles
• Lower cost (eventually when adopted on a mass • Current legislative environment does not allow
scale; current trial runs are expensive) commercial use of UAVs
• Better customer service • Reasons behind the ban of UAVs are it may go rogue
• Improved operational productivity (out of control) tracking/landing which will be a
• Enable enhancement of current logistics network difficult task, it may fall due to technical glitches, it
• Cut down traffic and carbon emissions may hinder with other airspace users (e.g.,
helicopters), etc.
Privacy concerns
• Cameras and sensors attached to an UAV may track a
person’s movement without authorisation
*VTOL: Vertical take-off and landing 14Unmanned Aerial Vehicles (UAVs) (2/2)
Use cases
Last Mile Delivery
A Infrastructure Surveillance B Rural/Remote Location C
– BP Delivery
Amazon • In a futuristic vision logistics Posti
• Amazon Prime Air seeks to deliver companies can deploy UAVs to • Posti launched a trail run to deliver
packages within 30 minutes of monitor their assets such as parcels across a distance of 4 Km
ordering warehouses, pipelines, etc. between mainland Helsinki and a
• For successful UAV delivery, the • BP (one of the 6 companies to get a nearby island Suomenlinna using a
packages must be 2.5 Kg (max) and licence in USA) uses semi- UAV in 2015
delivery address to be within 16 Km autonomous UAVs to inspect its • Although the test was considered
oilfield in Alaska that has harsh to be a success, some hindrances
Workhorse Group (formerly AMP weather conditions making human acting against safe delivery were
Electric Vehicles) monitoring either difficult or highly strong winds, need for constant
• The company has coupled their time-consuming and costly line of sight while operating, etc.
delivery trucks with UAV in order to • These UAVs weigh approximately 7
deliver items that fall out of their Kg, can fly for 3.5 hours, can Google
main delivery route withstand winds up to 48 Kmph, • Google’s Project Wing has tested
• The UAVs will take off from the have high resolution cameras for UAV delivery in Queensland,
trucks with the package and return photographs and videos, and light Australia
to the truck (wherever it is as it is on detection equipment to collect 3D
the go) after a successful delivery images
153D Printing (1/2)
Introduction, benefits and challenges
Global 3D Printing
• Also known as Additive Manufacturing (AM)
$4 B Market in 2014**
• It uses a digital model to produce a 3D object putting
Estimated Global 3D
consecutive layers of material together $49,1 B Printing Market in 2025**
• Industries adopting this technology include medicine,
aviation & aerospace, manufacturing and automotive; Estimated Market Share Split
personal 3D printing is lead by hobbyists 34:32:33 between North America,
• An industrial grade machine costs around $80.000 while Europe & Asia in 2025**
personal 3D printers are more affordable with its average
price being $1.124 (2012)* • Increased product availability and customization
• Lower cost (eventually when adopted on a mass scale;
current prototypes are expensive)
BENEFITS
Impact on Postal Sector • Logistics players can take part in new market segments
like “digital warehouse”
• Postal companies can offer space in their fulfilment centres to • Bring production nearer to high cost of labour nations
companies manufacturing 3D products so that they can set-up • No resource wastage and reduced carbon emissions
printing centres
• This will allow them to print products and put them in the • Unanswered product liability issues – when everyone
distribution network faster is a manufacturer who will take liability of
• Alternately, growth of personal 3D printing will result in reduced defective/malfunctioning products
CHALLENGES
deliveries of finished products while increasing shipping of 3D • No clear rules regarding the ownership of intellectual
printing materials such as plastics, metals, liquid resins, etc. property (IP) rights to a particular 3D product design
• Consumer 3D printers need to be cheaper, faster, and
make higher quality products for faster adoption
*Wohlers Report (2013) 16
**Smithers Pira (2015): The Future of 3D Printing to 20203D Printing (2/2)
Use cases
A Bring Production Closer to Consumers C Postal Operators’ 3D Printing Services
• 3D printing reduces costs of maintaining a supply chain by La Poste – France
bring production closer to the consumption centre • La Poste has opened 3D printing services at seven post
• Products manufactured via 3D printing machine will use offices where consumers can print their own designs
locally produced components thus reducing long-distance • The company has also made customized packing for fragile
shipping and increasing last-mile delivery or unusually shaped products
• Storing of spare-part sand components will become obsolete
SingPost – Singapore
as users will be able to download the object’s design from a
central database and 3D print it thus reducing the cost of
• Singapore post in partnership with 3D Matters offers 3D
printing service at its post offices where customers can print
maintaining a warehouse
prototypes or custom designed objects
Integration with Supply Chain – Royal Mail - UK
B Amazon and UPS • In 2014, Royal Mail in partnership with iMakr launched a
• Amazon has filed a patent application in the US to 3D print trial to 3D print custom objects as well as designs from a
products in a mobile delivery truck to cut down on inventory catalogue at a delivery office
maintenance costs and deliver faster to consumers • The company now offers 3D printed items via its online shop
• UPS now offers 3D printing services at some of its retail Swiss Post
stores printing prototypes, product parts, custom • Swiss Post in collaboration with My3DWorld launched a 3D
accessories, etc. printing Roadshow in 2014 throughout Switzerland where
3D printing supplies and hardware were showcased
17Discussion and Questions
18References (1/2)
• https://www.accenture.com/us-en/insight-outlook-big-bang-disruption-innovators-disaster.aspx
• https://hbr.org/2013/03/big-bang-disruption/#
• http://www.cnbc.com/2015/05/12/cnbc-disruptor-50.html
• https://www.accenture.com/t20150914T032007__w__/us-en/_acnmedia/Accenture/Conversion-
Assets/DotCom/Documents/Global/PDF/Dualpub_21/Accenture-Big-Bang-Disruption-In-The-Postal-Industry.pdf
• http://www.digitaltrends.com/features/the-history-of-social-networking/
• http://mashable.com/2012/05/17/companies-before-facebook/#GFURvORfzPqw
• https://www.accenture.com/_acnmedia/Accenture/Conversion-Assets/DotCom/Documents/Global/PDF/Dualpub_23/Accenture-Adding-
Value-to-Parcel-Delivery-V2.pdf
• http://jonathanwichmann.com/my-lists/list-the-most-promising-start-ups-in-logistics/
• http://www.cleveron.eu/products/packrobot/
• https://incardelivery.volvocars.com/#/
• http://www.dpdhl.com/content/dam/dpdhl/presse/pdf/2015/DHLTrendReport_Internet_of_things.pdf
• http://www.robomq.io/images/IoTMiddlewareL.png
• https://www.cisco.com/web/about/ac79/docs/innov/IoT_IBSG_0411FINAL.pdf
• http://www.semprom.org/semprom_engl/
• http://www.gadgetreview.com/postybell-should-you-kickstart-it
• http://techcrunch.com/2014/01/18/amazon-pre-ships/
• http://www.ibmbigdatahub.com/sites/default/files/styles/xlarge-scaled/public/infographic_image/4-Vs-of-big-data.jpg?itok=4syrvSLX
• http://www.delivering-tomorrow.de/wp-content/uploads/2015/08/CSI_Studie_BIG_DATA_FINAL-ONLINE.pdf
• http://www.dummies.com/how-to/content/the-4-vs-of-big-data.html
• http://www.dpdhl.com/en/logistics_around_us/from_our_divisions/dhl_smarttrucks.html
• http://connectedcar.telekom-dienste.de/en/node/53
• http://www.t-systems.de/news-media/white-papers/1219360_2/blobBinary/WhitePaper_Big-Data-Logistics.pdf
• https://www.myways.com/
• http://www.dhl.com/en/press/releases/releases_2014/logistics/dhl_uses_big_data_for_risk_mitigation_in_logistics.html#.Vqz5ArIrLIU
19References (2/2)
• http://www.dpdhl.com/en/media_relations/press_releases/2012/deutsche_post_geovista_standortcheck_wins_international_award_poste
xpo.html
• http://www.dhl.com/content/dam/downloads/g0/about_us/logistics_insights/dhl_self_driving_vehicles.pdf
• https://www.google.com/selfdrivingcar/
• http://www.rand.org/content/dam/rand/pubs/research_reports/RR400/RR443-1/RAND_RR443-1.pdf
• http://www.atkinsglobal.com/~/media/Files/A/Atkins-Corporate/uk-and-europe/uk-thought-
leadership/reports/CAV_A4_digital_250915_FINAL.pdf
• https://www.move-forward.com/news/details/how-should-cities-prepare-for-connected-and-autonomous-vehicles/
• http://www.dhl.com/content/dam/downloads/g0/about_us/logistics_insights/DHL_TrendReport_UAV.pdf
• http://www.amazon.com/b?node=8037720011
• http://wvxu.org/post/post-office-might-be-next-electric-truckdrone-customer-loveland-company#stream/0
• http://www.bp.com/en/global/corporate/bp-magazine/innovations/drones-provide-bp-eyes-in-the-skies.html
• http://yle.fi/uutiset/posti_to_trial_package_deliveries_via_helicopter_drones/8252978
• http://www.psfk.com/2016/01/posti-drone-mail-delivery-postal-service-sharper-shape.html
• http://www.abc.net.au/news/2014-08-29/google-project-wing-drone-delivery-test-warwick-queensland/5707034
• https://www.uspsoig.gov/sites/default/files/document-library-files/2015/rarc-wp-14-
011_if_it_prints_it_ships_3d_printing_and_the_postal_service_0.pdf
• http://www.smitherspira.com/news/2015/june/3d-print-market-expected-to-reach-$49b-by-2025
• http://documents.aeb.com/brochures/en/aeb-white-paper-3d-printing.pdf
• http://www.dhl.com/content/dam/downloads/g0/about_us/logistics_insights/DHL_Logistics-TrendRadar_2014.pdf
• http://3dprinting.com/what-is-3d-printing/
• https://www.uspsoig.gov/sites/default/files/document-library-files/2015/RARC-WP-16-001.pdf
• http://documents.aeb.com/brochures/en/aeb-white-paper-3d-printing.pdf
• http://www.theguardian.com/technology/2014/dec/09/royal-mail-launches-3d-printing-service
• http://www.3ders.org/articles/20141004-singapore-post-launches-3d-printing-service-at-new-concept-post-office-in-suntec-city.html
• http://3dprintingindustry.com/2014/11/13/swiss-post-3d-printing/
20Thank You!
aku.happo@proventuri.eu
+358 40 562 7065
@Aku Happo
21You can also read
