With the advent of new technologies and alarmed by the bottlenecks exploded by the pandemic, the supply chain industry is eagerly looking out to rope in technology for business excellence as well as sustainability.
According to the World Economic Forum (WEF, 2016), digitization in logistics could grow up to 1.5tn US$ in value by 2025. However, the logistics and supply chain sector has remained rather slow in adapting to technology and undergoing DX compared to the media, telecom, banking and retail sectors.
Learning from the Best Players
McKinsey research points out a few essential strategic moves of the players that could be worth emulation.
What did they do differently
Research shows that their growth strategies tend to focus on four directions:
These strategies may be a little out of league for SMBs, but they must be born in mind and used effectively. During the last economic cycle, the logistics outperformers focused primarily on two of those four: investing more deeply in their core businesses by:
Learning for one of the finest companies Kuehne + Nagel International, for example, sought to strengthen its core business in logistics services by expanding its IT capabilities early and more comprehensively than its peers.
It developed:
Biggest Area of Value Creation: Process Automation
There is an underlying scepticism with digital transformation on many accounts, but there is a need as well. Here are the areas of value creation that address the fears as well as aspirations. Here are immediate value adds:
Areas of value creation:
The Strategy for 20212 and Beyond
Companies need to reset their strategies for a digital world. They require a strategic view of where they want to go—and how to adapt their business strategy and competitive advantage accordingly. Though it is difficult to deploy technology, that is the way to survive in the new normal.
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