In the world of logistics, where efficiency is of the highest importance and every click of the mouse sets off a chain reaction, lies a truth often overlooked by the everyday consumer: the complexity of the logistics and the technology behind it. I’m sure no one has missed how much e-commerce has totally transformed the business in the last 15 years. From traditionally almost purely business to business, the business-to-consumer market exploded while B2B still expanded. Even the consumer-to-consumer market is growing. The common enabler for all this is how technology has been incorporated into the logistics business, Logtech as many call it. 

How much do we even think about this complexity when clicking home our orders on our phones and expecting next-day delivery? (not to mention same-day delivery which some businesses offer)

From masses of paperwork and manual labor to automated picking robotics, the evolution of Logtech is quite inspiring. Over the past five years, I've been lucky to have been exposed to this field, working with cutting-edge technology and innovative solutions aimed at streamlining operations. If anything I’ve learned, it is that the area is huge, spanning from automated picking robotics large as a building with thousands of robots to the analysis of statistics to optimise efficiency. I’ve also learned that most times, it’s the simple digitalisation upgrade and low hanging fruit which give the most impact if you look at return of investment.

What is so complex you might wonder?

• You click, an order is placed in some system
• Robots collect the items in the warehouse
• Put them in a box (too large most times)
• Your address is stuck to the box
• Off it goes for transportation
• You get notifications about the transportation and delivery.

Simple as that, right?!

I initially also imagined a fully automated process, with robots handling every step of the way. However, reality proved to be somewhat different. While automation certainly plays a significant role, manual labor still reigns supreme in many aspects of logistics. Tasks like paperwork shuffling and manual picking may seem old-fashioned in our digital age, but they remain essential. E.g. even with automated picking robots, manual work is still the most common way to handle input/output from these auto-picking systems, being the bottleneck.

So why doesn’t everyone digitalise to remove manual work?

This is actually THE hot topic of most logistics companies today: Digitalise and automate, or get overrun by competitors. The dilemma is that everyone knows they need to take the next step and digitalise to survive in the future but they also know this will cost time, money, and not least process changes. Change is difficult. Old processes and routines have usually been there and optimised for many years. Not uncommon with 10-30-year-old processes in this business.

Now, logistics companies know that they need to invest a lot to change something that currently works, which they make a living on and gives them good revenue. Just not sure for how long. World-changing events like COVID-19 have further pushed and accelerated the need to perform this Logtech transformation. The volatile situation in the world over the last 5 years has also made a deep impact on the finances of the logistics business, making it hard for companies to justify big investments in changing their way of working.

There are as many ways to tackle this as there are logistics companies out there. If you ask a software guy like me, I’d say to keep it simple and find the low-hanging fruits first. Just to get started, because it’s crucial to take those first steps. Most times, starting is the biggest challenge and it’s not unusual that it’s because of trying to start too big.
The above is just a fraction of the challenges faced in logistics. Behind the scenes, logistics professionals struggle with a lot of challenges, each requiring innovative solutions to overcome.

Supply chain management stands at the forefront, where the balance of demand and supply dictates the flow of goods. Sustainability has emerged as a pressing concern, driving the need for eco- and social friendly practices throughout the supply chain. Accurately forecasting demand is another hurdle, as companies strive to optimize inventories and warehouse space while minimizing waste. Utilization and scheduling of both physical space and human resources present ongoing logistical puzzles to be solved. 

Another challenge is offering generous return possibilities to stand out in the crowd and compete for customers. Most companies don't have efficient support for this, leading to very high costs. Returns have become a customer’s right but actually complicate and break most logistics processes.

As we look deeper into logistics, and what it actually means to go through the process of ordering an item to its delivery, we uncover a world of complexity and innovation. From thousands of automated robots to the humble hands of workers shuffling paperwork and picking, every element plays a crucial role in ensuring the smooth flow of goods. Despite the challenges that lie ahead, the future of logistics shines bright with possibilities, driven by the relentless pursuit of efficiency and sustainability. 

So, the next time you click 'order',  take a moment to appreciate the intricate web of technology and human effort working tirelessly behind the scenes to bring your package home. And please, don’t be that person who breaks all of the above by deliberately ordering items and knowing you’ll return most of them.