“And so, this technology will make your operations much more efficient!” How many times have you heard this from software vendors, consultants, and the like? Today, we hear claims of new technology bandied about regularly, and each and every time we hear that the latest technology is going to revolutionize, change, improve and solve the problems of an organization. Despite all the hype, it is rare that it does solve the problems. Even more unlikely is that the advent of a new technology will be the savior of the company.
If all these technology claims were true, then logistics would not be struggling to contain costs, the whole trade process would be simple and the world we work in would be much less exciting. Gartner publishes a great life cycle graph of technology hype — a cycle where something is created, interest is garnered and hype grows, interest wanes and it drops to a low point as the technology is evolved, and then the practical value-add or real usefulness starts to grow much later. The important part is much later in its life cycle.
The hype for new technologies convinces companies to buy into them in order to be leaders. Unfortunately, they do not derive value for many years, by which time they are disillusioned and either reject all new technology, which is not a good viewpoint, or have spent so much money trying to extract value from the technology they cannot invest in something new for quite a while.
You say you will never do that? Some decades back, Walmart had a high degree of belief that RFID was going to solve inventory problems and ensure speedy checkout for individual items. Unfortunately, the automated checkout and instant inventory did not materialize as the RFID tag does have limitations around metals and liquids. RFID is useful, but not for the widespread use that was initially hyped and envisaged.
The IoT revolution was the hot topic a few years ago. Yet today simple home technologies are still not fully integrated, and these are simple devices. These do not have the complexity of multiple devices, from multiple countries, and multiple manufacturers talking to each other in multiple environments. In fact, the home devices only work with the later development of the new protocols (Z wave and so on), which enable devices to communicate freely with lower data needs in a local area. Blockchain is the latest focus, but the inviolate record keeping does nothing better than a normal, professionally managed logistics system, other than prevent some of the problems of records being overridden.
While there have been no reports of data in logistics companies being manipulated for financial benefit, the access to documents and progressive steps of blockchain may hold value in the future. The problem is that every step in a logistics move has at least one separate document. For an international move this involves some 25 entities, 35 documents and hundreds of trade regulations, all of which must be integrated. Blockchain does not simplify all these, nor does it standardize them. It does offer better visibility and perhaps efficiency, but the whole process needs improvement before the real value of blockchain can be utilized to its full potential.
In many cases the technology has potential, but enabling technology and standards need to evolve and be married to process improvements before they can be used effectively. This is true for most of technology. Today, there is no large global company that can claim to have full data from all its routes with real-time data, other than the courier companies who use their own planes, transport and technology from start to finish. Perhaps Amazon with its systems will manage to get all the customs brokerage and local transport to give real-time data, not just the final POD, but that is still to happen globally. But they have taken many years to get there, it is not a new technology but a new process supported by technology.
And then there is the technology or methodology which gets repacked as a new technology. Forwarding keeps selling control towers. This concept is where a central control point is added, which supposedly deals with the exceptions for movements. This concept is decades old, and is a simple concept of dealing with movement exceptions using a person who is skilled at solving problems. Logistics companies should do that as a matter of course, not as a special capability for the customers who are sophisticated enough to demand the service. The definition of a professional logistician is one who understands the process from origin to final consumer and can make it as efficient and effective as is feasible. If the logistics companies offer the service of logistics, then the personnel in operations should have this capability. Skills and capability are essential for professional logistics.
Nevertheless, technology is going to alter our business. The earlier argument endorses staying away from the bleeding edge of technology, but there is every reason to use the leading edge. Let me give an example. Augmented reality with a virtual reality headset, which can see what high-definition cameras are viewing, is a proven technology today. The days of sending equipment and technical specialists to remote locations to inspect a pressure vessel is no longer necessary.
Those of you who have done this work, understand the issues of bringing specialized equipment into (and out of) places where roads and infrastructure are poor. It is a waste of specialist time and money. Three-dimensional cameras set up around the vessel will produce high-resolution pictures to remote specialists who can zoom in and out, inspect and visually determine any and all imperfections. This is at the very least the equivalent or better of clambering around a vessel in remote locations.
A future use might even be at a fatal freeway accident. The roadway may be closed for hours while multiple investigators come to the site to try to determine what happened. While not in use yet, imagine a situation where the investigation is done with high-definition 3-D cameras. All the data is recorded, and accident specialists can review and zoom in and out to record every detail and piece of evidence. Once the imaging is completed, the road can be reopened without these specialists having to travel to the site.
For many years, voice-picking was the most efficient method for a picker to receive commands. Via a headset, they were instructed, and they confirmed actions via a microphone. In play today is the next generation using smart glasses. The image of where to go is shown on the glasses. But this adds much more than picking. While it allows each item selected to be scanned from a storage location to a transfer cart, it can give a 3-D picture of the item to be selected so as to ensure the correct item is chosen. Someone can be routed on the most efficient path by advanced algorithms, they can see what has to be selected, and the technology then confirms the selection. There are even carts which follow the person around automatically, without the selector having to expend effort.
Technology has a valuable place, but it is not a panacea. If your processes do not support the same methods as the technology, then you have to change the way a company works before you use the technology. If this overrides the long-term way the company operates, then you can forget a fast and simple change management process. No one overrides ingrained methods in months. This is a long-term process, where the reasons for and the steps of change are clearly explained, understood and accepted — or at least not rejected — to alter the “way things are done around here” and to approximate the technology process. Then technology will help the people to be able to do their jobs.
“The alternative is a culture that resists new technology. The technology is used, but a “subterranean” process also exists where the old records are maintained, often with more enthusiasm, out of sight of the executives. And what that means is the software is used only to the extent that it doesn’t cause problems. Significant inefficiency of paper and/or other systems exists, which local workers utilize to the exclusion of the new technology.
Technology will not solve behavioral problems, nor solve lack of knowledge nor bring a slick new process which undoes all of the culture of the company. The company must accomplish change with a continual set of steps to undo the historical method, implement a new and more effective method, and then embed a more efficient process.
What does this article endorse? When you can find a valuable technology to use, embrace it! But approach the technology as leading edge, not bleeding edge. Let someone else waste time and money on the bleeding-edge stuff while you alter the culture to accept the leading edge. The company must be in a position to use the technological solution to make its processes effective without resentment or resistance. That means the culture of the company and its processes must be in place, ready to accept a new technology, from the get-go. And above all, if you are contemplating a technology, be skeptical and test the solution widely in your company with input from multiple levels. You may be surprised where lack of enthusiasm — opposition in truth — will come from. Enjoy the leading-edge technology which supports your culture, or suffer on the bleeding edge.
John Vogt is president of WWBC, a strategy and supply chain operations improvement company.
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