For each of our markets we have considered the business imperatives, business trends, and the impact that emerging technologies and solutions may have in addressing these.
Imperatives
ONGOING CONCERN ABOUT SAFETY AND SECURITY INCIDENTS
In recent times, security incidents have been observed across all areas of transportation. And, because of the guerrilla nature of many of these incidents, security measures have changed their focus away from logistics hubs, for example, to parking places near highways. More safety and security legislation exists on a European level, where EU customs impose Authorised Economic Operator (AEO) certification requirements on transportation firms. In this way, ‘green lanes’ within the (international) supply chain are established where inspected and approved freight can be transported without further delay or queuing for additional inspections.
BUSINESS RESULTS ARE UNDER HIGH PRESSURE OWING TO STRUCTURAL OVER-CAPACITY
As a result of reduced cargo volumes, road, air, and sea transportation capacity exceeds market needs. The effect of this is that tariffs for cargo shipments are far below profitable levels and as a consequence this leads to changes in the market. Full service airlines are faced with difficult business conditions. Airlines have to reconsider their business model and should make a major effort in transforming their business in order to be more flexible in costs and introducing new products and services which are more tailored to today’s customer requirements.
AUTHORISED ECONOMIC OPERATOR IS ON ITS WAY BUT CERTIFICATION DOES NOT MATCH EXPECTATIONS
European customs legislation concerning horizontal inspection of freight at import and export points has intensified with the Authorised Economic Operator concept. Better co-operation between private and public parties in the cargo supply chain should be established but EU studies show that, even though logistics parties are starting with self-assessments and certification processes, the number of certified parties are fewer than expected because of a lack of incentive and a competitive need to do so. Large companies, having the capability to implement this concept, will gain competitive strength above those companies who haven’t. Smaller companies should co-operate within their communities to bundle implementation effort to bring them to the same level.
LOGISTICS SECTOR FACES A LACK OF INTEREST IN FUTURE LABOUR
Forecasts show that within the next few years the logistics sector will need additional employees. Investigations show that the image of the logistics sector in terms of employability is weak amongst the labour force of the future. Making the sector more attractive by introducing technology, new labour contracts and education facilities would improve the attractiveness.
Business trends
Asset monitoring enables maintenance to be both preventative and
reactive. Assets include both mobile and fixed assets, as well as
workers needing to be kept safe and well. Monitoring will ensure assets
last longer, are able to cope with higher demands, and have a lower
environmental impact. Monitoring needs to be in real-time and be
cost-effective.
Market confidence demands transport suppliers demonstrate a commitment
to safety measures for incident prevention and to combat threats from
terrorism. This is as much about raising awareness as it is about
investment.
Capacity planning is vital with this growing demand. Since it is likely
that the flow of goods from Asia to Europe will grow extensively, more
and more attention is paid to multiple modes of land transport where
both capacity and support of technology must be developed hand-in-hand.
Congestion on the roads is increasing and it needs to be managed.
Multi-modal capabilities are key to develop for forwarders in order to
meet sustainability requirements and to deliver on time. Barge / short
sea and rail transport are most likely modalities with high growth
potential rather than road transport.
The increase in air traffic requires new airport infrastructures to be
built (for example at Heathrow and Charles de Gaulle) to give the
ability to host larger cargo carriers (A380), as well as enhanced
efficiency in air traffic control operations.
Controlling the impact of transport on the environment will become more
important as it will dictate public funding allocation, which mode of
transport a customer may choose, as well as an operator’s image and
sustainability. However, increasing oil prices is still seen as the
major business driver for exploring smarter modes of transport (for
example, City Cargo), alternative energy sources, and new technology for
aircraft, and lorry engines.
The potential cost savings are the main driver behind any Green
initiatives, but this may change if and when tougher legislation on
carbon emissions and waste, with their associated penalties, are brought
in.
Consolidation is driving a lot of M&A activities with many
consolidated companies looking to become the leading European transport
supplier. Indeed, countries such as the Netherlands are seeing local
companies being acquired and below-average organic growth rates in local
transport firms. With the number of home carriers declining, there is a
focus on smart freight handling.
Impact technologies
Radio-frequency identification (RFID) seems to be at a point
of breakthrough. The number of applications within the supply chain for
sea and air freight is growing. Technologies, such as sensor networks and mesh networks, will give a real-time view of congestion.
Tying these in with Global Positioning Systems (GPS) and Interactive
Virtual Assistants (IVAs) will enable intelligent re-routing in the
future.
Remote workers and customers will benefit greatly from the new mobile
solutions, giving them vital remote access to information from
anywhere and on any mobile device. These can also streamline ticketing
and enhance the traveller’s experience throughout their journey. There
may be initial resistance to mobile application downloads as users are
nervous about installing them on their phones. As confidence grows, so
will uptake.
The agile business will require real-time access to content information
from any location through Enterprise Content Management (ECM).
This can ensure faster design review by engineers to meet strict
deadlines, enhanced safety through ensuring controlled documents are
read, and minimised downtime through ensuring correct versions of design
documents are used when ordering spare parts.
As our climate changes, asset maintenance schedules will need to be
remodelled to take into account new extremes. Climate Change
Modelling will be key to giving organisations the necessary
foresight to prepare for change.
Anti-terror and anti-sabotage initiatives will require Identity and
Access Management (IAM), which can be achieved through role
management and information risk dashboards. Biometrics will pay a key
part in this.
Passengers of airlines will be subject of further security measures by
means of automated body scans. Equipment in this area is further
enhanced and implementation of this equipment at airports are already in
place in many areas.
At the same time, similar solutions to improve aircraft security from
the freight site are in progress. Airports need to establish secure
cargo areas, and enhanced scan equipment is under development and
pilots are running on the world’s most innovative airports such as
Amsterdam School.
Wireless technologies such as 3G and WiMAx will operate in
parallel to bring data to remote workers. Technology selection at any
location is likely to be based first on availability and value.
Integrating Geographic Information Systems (GIS) with other tools
such as Business Intelligence (BI) or ECM will enable users to
quickly find location-based knowledge, content, or intelligence. In
addition, Geolocalisation Systems would enable assets to be
tracked and located — essential for fleet management.
Remote workers will use wearable computing devices to enable them
to access information without the device impeding their work.
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