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Driving Digital CX Transformation within Transportation and Logistics Part 2

Brent Bice, Director, Business Development
#customer experience | Posted

This is part 2 of a blog series about the importance of digital customer experience for the Transportation and Logistics industry, and how organizations can get started building a digital experience strategy. Check out part 1.

Planning Your Long-term Digital Customer Experience Roadmap

First movers expect to gain significant benefits from their more advanced digital capabilities and greater levels of investment. They are far more likely to be forecasting both revenue gains of more than 30% and cost reduction of more than 30% at the same time, according to PwC research. They’re more likely to expect efficiency gains too. Put these all together and you have an enormous impact and almost insurmountable competitive advantage. In an increasingly cost-competitive market, no industrial company can afford to lose out in operational efficiency against their market peers and expect their partners to follow suit. The next two to three years will be crucial for companies looking to catch up. Most will be making significant investments in their digital experience platform.

Creating a long-term digital roadmap and culture begins with:

  • understanding your current digital maturity.

  • gathering feedback from employees, stakeholders, partners and customers.

  • defining internal/external capabilities.

  • identifying KPIs and feedback loops.

  • gaining buy-in from your C-level suite.

  • creating pilot programs and developing “tracer-bullets”.

  • actively planning and selecting the best digital ecosystem for your needs.

  • fostering a culture of continuous learning, improvement, transparency and agility.

While the learning curve can be steep, partnering with businesses that specialize in digital transformation will speed your adoption, inject a health dose of digital expertise into your culture and reduce the pain of driving organizational change. Even leaders like GE have relied on strategic hires and partnerships to transform their culture, resulting in innovative product offerings like IBM’s Watson and GE’s Predix that provide asset connectivity, edge technologies, analytics and machine learning, big data processing, and asset-centric digital twins.

Driving Organizational Change

Although most senior executives in manufacturing, T&L and  3PL organizations believe that Industry 4.0 initiatives will reduce costs and increase revenue growth, more than half cite lack of digital culture and the right training as the number one impediment. Tying for second place (38%) in the list of organizational challenges are unresolved questions around data security and privacy in connection with the use of external data and high financial investment requirements. The third concern is lack of a clear digital operations vision and support/leadership from top management.

Market leaders understand the value of digitizing their vertical and horizontal value chains. Digital disrupters within the 3PL market are creating opportunities and delivering SaaS offerings that are challenging 3PLs and freight brokers alike. Early adopters are changing the dynamics of their cultures to align business goals with the needs of their customers.

Organizational change and creating a digital culture may sound daunting, but it is mandatory to stay relevant and competitive in today’s growing digital economy.  Furthermore, the underlying principles of a digital culture should be familiar to anyone within manufacturing and logistics. After all, they were borrowed from lean manufacturing and the Kaizen approach to continuous improvement, made famous by Toyota in the 1990s. Today, Apple, Johnson and Johnson, Amazon, Walmart and other leaders are:

  • strategically hiring key executive leadership to drive their digital vision from the top-down.

  • partnering with digital agencies/consultants to help guide their long-term digital roadmap.

  • running agile (kanban/scrum) management processes as a part of their digital culture.

  • adopting digital consulting, support and training programs for continuous innovation.

  • integrating streamlined digital workflow management into their delivery processes.

  • embracing secure, API-driven connections to reduce silos, create transparency and interoperability and offer seamless customer experiences.

  • utilizing cloud infrastructures to host core solutions.

  • measuring change through key performance indicators (KPIs).

Improving Speed, Agility and Payoff

Industry leaders and early adopters are already embracing digital, investing in Industry 4.0 and realizing both above-average digital revenues and operational savings. Their plans for the next five years are even more ambitious and far-reaching, with digital products and services paving the way for disruptive business models.

GE and Siemens, for example, are already rushing to solidify themselves as platform providers. Each has developed a cloud-based system for connecting machines and devices from a variety of companies, facilitating transactions, operations and logistics, and collecting and analyzing data.

Amazon is leveraging robotics and automation to scale productivity and autonomous vehicles to reduce operating costs.

Change can be daunting , but hiring digitally savvy leadership, creating strategic partnerships and embracing a digital culture creates transparency, speed to market, resource efficiencies and the ability to pivot quickly. Digital cultures embrace technology and rely on key analytic insights and incremental improvements to drive change. Often running in two to four week ‘sprints’, smart teams are focused on customer experience, identifying improvements in their value chain, building minimum viable products and receiving feedback early and often. All of which create positive impacts through their entire organization.

As competitors spin their wheels planning, under delivering and over analyzing, teams who adopt this approach will be  focused on improving customer experiences, creating operational efficiencies, increasing revenue, measuring improvements and possibly developing new, disruptive digital solutions as product offerings that will propel your business into the future.

 

3PLs who can delight today’s customers will be poised to increase both their market share and profitability.

 

The race is on! For those of you who are contemplating change, it’s not too late, but the gap between winners and losers is widening.  

We’d love to learn how your organization is preparing for and embracing digital transformation. Reach out if your having challenges. We’ve been there and are happy to listen, learn and help.

Brent Bice

Brent Bice

Director, Business Development