Digitisation of supply chains and artificial intelligence are necessary if clearing and forwarding companies want to remain competitive and relevant in an increasingly crowded and disrupted marketplace.Forwarders have been struggling to develop a clear Unique Selling Proposition (USP) for at least 15 years, according to Henrik Lund, Q loudX partner and digital transformation specialist.Disruption has come from the emergence of digital agents.Writing in the Port of Barcelona newsletter, researcher Xavier Lluch and Prof Joan Carles Suarl of the University of Barcelona state that newcomer digital freight forwarders have very different business models to traditional ones as they have been able to start from a clean slate. For existing freight forwarders, “the necessary evolution must be quite radical”. A parallel can be drawn with what has happened to travel agents. “Do you remember the last time you went to a travel agency?“For a long time, the value of the freight forwarder has resided in their ability to gather knowledge and information about a multitude of connected services and their reaction to transport incidents.“But the evolution of information systems and the progressive improvement of transport quality and standardisation radically change their function,” they write. Lund believes that the transition can be more gradual. “We believe that digital transformation initiatives can be started with small investments and without changing your whole IT environment. “In many cases, we recommend a hybrid solution, extending the current infrastructure with the cloud. This makes most organisations more agile in the way they think of innovation and the way they find ways to improve operational efficiencies and productivity, both in sales and operations,” he says.Managers will have to adapt their strategies and business models to enjoy the full benefits of the digital shift.Gartner Research has found that 80% of companies base their strategic planning cycles on an annual calendar. The risk is that a strategy may be outdated by unforeseen developments during the year, but the company will not have the resources to re-evaluate and pivot quickly. “Supply chain leaders must regularly identify trends that impact their business and present opportunities to grow and gain an advantage over competitors,” says Tom Enright, VP analyst, Gartner. “Adaptive strategic planning is an always-on activity to navigate and succeed through any turn, in any version of the future.”Investments need to be adaptive, along with strategy. One step toward achieving an adaptive investment approach is capability funding. Supply chain leaders allocate blocks of funds to several initiatives. This enables them to remain f lexible in directing additional funds to initiatives when priorities change. A second option is to mimic the approach that venture capital firms use when assessing whether to fund early-stage start-ups. Success with a prototype or trial is the basis for developing more accurate estimates on how much further funding is needed.We believe that digital transformation initiatives can be started with small investments and without changing your whole IT environment. – Henrik Lund“
