The biggest digitalisation challenges facing the transport industry

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Erkrath, Germany, 2019-07-26 – there is still a big gap between the amount of digitalisation available in larger transport and logistics companies and small to mid-sized ones. Logistic giants have been working digitally for years, but small and mid-sized transport companies often have trouble affording complex software solutions. What is required in order to keep up with market demands and trends, not to mention big industry names?

Basic digital services for the broader public combined with stable technological infrastructure are the prerequisites for participation in digital supply chain management. For transport chain participants, the most important steps involve digitalising individual phases in order to optimise the entire transport process. Here are three examples:

1.      eCMR: less administration and more control

Along with the transport order, the consignment note is the most important transport document. Known as the CMR, it will soon be available in electronic form as an eCMR. In the best case scenario, eCMRs will be automatically created and transferred from the warehouse - allowing road hauliers to access them on a smartphone or tablet. This significantly decreases the amount of bureaucracy required and provides an additional positive benefit. Delivery confirmation (PoD, proof of delivery) will also eventually be generated electronically, leading to a simplified digital process.

Whether or not this is actually beneficial for both the road haulier and the freight forwarder is questionable, as Dmitry Yatckevich from the Association of International Road Carriers, or BAMAP (http://bamap.org), explains. “The eCMR tests are under way, it’s true. But it still isn’t clear how best to handle the accompanying documents, like the packing list, certificates and specifications that still have to be provided on paper.” The biggest challenge according to Yatckevich is the realisation of a legally binding electronic signature. However, he believes that road hauliers are flexible enough to adjust to the new conditions in the future. 

2.      POD (proof of delivery): shorter payment periods and digital documentation

Proof of delivery will, in the future, be realised within the eCMR. Up until now, the documents were provided to the freight forwarder by the road haulier, and then sent via post to the transport customer. This creates additional shipping costs and work for the transport companies. Not only that, it slows the payment process. Payment is only made once proof of delivery has reached the transport customer. Which means that a freight forwarder may have to wait between one and three months for payment after a successful delivery. However, if proof of delivery is provided digitally, and therefore much faster, the payment process will also speed up. This makes income easier to plan, providing more financial leeway to the company. And of course, transaction data will be collected in connection with the eCMR, meaning that delivery routes will be monitored more closely and data can be sent in real time to the delivery location. According to Yatckevich, however, this raises more questions: “On the one hand, digitalisation of the POD will speed up receipt of payment for transport companies. On the other hand, this means that freight forwarding companies will have to pay invoices earlier, which could effect their planning.”

3.      Dynamic loading dock management:

Smart use of GPS data is responsible for advances in solving loading dock issues. Bringing together telematics data and time slot management can solve familiar congestion problems at loading docks. The transport service provider grants GPS tracking permission. This data is regularly compared to positional data from the truck, and the estimated arrival time (ETA) calculated from this information is sent to the loading dock operator. The operator is then able to work and plan using data in real time. This carefully calculated prediction shortens HGV driver’s waiting times or, in the best case scenario, eliminates them completely. The BAMAP representative considers this a major industry innovation: “The fact that there were entire seminars devoted to this subject at the transport logistic (4th-7th of June 2019) in Munich, which is the leading trade fair in the industry, shows how important solving loading dock issues is for all supply chain participants.

Conclusion:

The advancements listed above clearly demonstrate that efficiency is increasing in the transport business, in particular thanks to improved communication between all participants. The improvement is based on more than simple networking between parties; centralised communications are key: “Which is the principle behind TIMOCOM’s Smart Logistics System. We facilitate communication between participants and systems without taking on an executive role in in the actual process”, explains Philipp Schmidt, Portfolio Manager at TIMOCOM. To do this, TIMOCOM has to meet the needs of their customers. The goal is to help digitalise smaller companies to ensure that everyone, even the largest companies, can profit.