FROM MAGAZINE: The future looks bright, exciting, digital and sustainable

Our world is constantly undergoing change. Take a look around – technology is transforming the way we live, do business, transact and interact. Just like any other industry, the logistics space is also facing a new era of unprecedented change as digitalisation and customer expectations evolve simultaneously. From connected warehouses to autonomous last-mile delivery services, new technologies are enabling efficiency optimisations and new operating models. And while the push towards digitalisation continues, what remains equally critical is the need to remain sustainable. By understanding how sustainability in logistics measures impact production and benefit companies, shippers and logistics players can work towards a better, sustainable tomorrow.

In 1956, Malcom McLean developed the modern intermodal shipping container. A decade later, FedEx’s Frederick W Smith introduced the concept of next-day logistics. Fast forward to today, the ecommerce giant Amazon is driving even more aggressive changes conditioning consumers to expect same-day delivery.

As the delivery times get shorter, new logistics concepts are forming shape. Robotics is gaining importance through the supply chain while automation is poised to reshape logistics. DHL has developed a parcel copter that enables fast and flexible sending and receipt of parcels in geographically demanding locations. Rolls-Royce is developing connected drone container ships and several players are developing self-driving and connected cars. Connected wearable devices are revolutionising the way people such as logistics employees interact with their environment. Goods on shelves are indicated by a Google glass, scanned and booked automatically. Enabling technologies such as sensors, IoT, data analytics, and robotics are being deployed into specialized applications for the logistic sector. For example, vehicle telematics and self-driving technologies initially developed for passenger vehicles are now finding applications in the trucking sector to solve for the growing pain point of an increasing shortage of truck drivers.

While various such innovations have been taking the logistics industry by storm worldwide, poor infrastructure has been holding back the growth of Africa’s logistics markets. However, there is hope, from both foreign investment and home-grown solutions.

New areas of digital commerce and services are being developed to unlock the supply chain logistics nightmare in many parts of Africa. For instance, companies such as Zipline are using drone technology to deliver critical medication to remote areas. In Nigeria, digital start-up Kobo360 has developed an app that revolutionises cargo delivery by making sure that everyone in the supply chain is connected to ensure the safety and accountability of cargo in transit.

Kenya-based Astral Aerial Solution has recently sealed a deal with Japanese drone manufacturer Yamaha Motor Company to provide last mile air cargo delivery and crop spraying solutions in Kenya. Astral Aviation also deploys larger drones for multi-purpose cargo and humanitarian use cases. The company’s Flyox cargo drone is used for varied deliveries – right from spraying crops to doing postal deliveries to transport oil and gas mining equipment. The service uses five-kilogramme drones and a personal post office box – the AirBox – which is placed outside the house or business. Mail, courier and online shopping deliveries can be delivered to the AirBox and the recipient receives a notification.

Another interesting technology application was developed by Imperial Logistics company, Resolve. The uLima app provides farmers in Africa with access to crop libraries, livestock libraries, real-time localised weather information with weather alerts and the latest market price information by crop, grade and country. A key feature is the tailor-made crop calendar for each farmer, which offers step-by-step assistance from pre-planting to post-harvest. This app also provides access to smallholder farmer forums, enabling the sharing of knowledge across various crop categories. The app is also expected to help farmers increase their yields so that they are better able to respond to the increasing demand for food across the continent while at the same time enhancing their livelihoods.

Although Africa is still a developing continent, it has come a long way during the fourth industrial revolution. African logistics companies have now begun adapting to enterprise resource planning (ERP), warehouse management system (WMS) and transportation management system (TMS) with Internet of Things (IoT)-empowered mobile devices intended to track inventory data, equipment and vehicles. Enterprises can give their physical assets a digital touch, transportation and logistics warehouses can capture and share their information over the cloud, guaranteeing they have the correct items in the right place at the right time. With mobile scanners, computers and RFID systems alone, companies are gaining visibility into their assets and better streamline tasks to keep their fleet moving. Thus, Industry 4.0 is presenting a massive opportunity to leapfrog African countries’ productive economies into a wholly new space.

Technologies such as blockchain are yet to be introduced full force into supply chains in Africa but is creating buzz with its numerous possibilities. At a high-level standpoint, blockchain is a record-keeping method that allows companies to safely and easily conduct business online. It acts as a digital ledger that records the movement of goods from one location to another throughout the whole supply chain. Sustainability-wise, blockchain impacts all three factors. This technology holds employees and, ultimately, businesses accountable through its tamper resistant ledger. It would also help companies reduce their environmental footprint by reducing the need for paper documents. Lastly, organizations can profit from blockchain by analyzing which processes need improvement.

Logistics sustainability and driving efficiency
The logistics industry itself is not just responsible for ensuring that the right product reaches the right place at the right time. It is also responsible for its own environmental impact. Hence, the industry must transform itself into one that is increasingly carbon efficient. Many vehicles run on fossil fuels; however, implementing a “green” solution to today’s fleet could mean the difference between a low and high carbon footprint. Combining it with green technology is a way forward for the continent to benefit at all levels.

A number of African countries are already positioning themselves to harness this opportunity. Both Rwanda and Ethiopia, for example, have placed green economic development and sustainability at the heart of their national economic development strategies and plans. More recently, Kenya has committed to actualising a 100 percent transition to green energy by 2020. Other African countries would do well to follow these nations’ examples.

While there are a few negative implications innovative technology may introduce, there are far more advantageous possibilities that supply chains can capitalise on. Drones, additive manufacturing, and blockchain (to only name a few!) when integrated into supply chains can help increase productivity, adjust processes, and reduce operational costs.

Economic diversification and development on the continent could benefit considerably from harnessing the opportunities emerging in the green technology and fourth industrial revolution spaces. This will shift them onto a significantly new economic growth and developmental trajectory. It will also go a long way towards ensuring that as emerging African economies develop, they will do so in a manner that doesn’t worsen climate change and environmental degradation.

Way forward
The logistics sector in Africa has seen a lot of changes over the years and we are likely to see more changes as the sector moves in line with market dynamics and expectations, allowing it to improve its services for business growth and enhance customer experience. With more environmental protection and open connectivity, the application of such innovative technologies will, for sure, change how we see logistics and supply chain. Also, with the help of such technologies, Africa’s smart future is just a stone’s throw away. These will aid in bringing sustainability and interconnectivity to African cities and beyond, propelling them to new heights.

This story was originally published in Logistics Update Africa's September - October 2019 issue.