Collaborative Logistics In India & Role of Technology - Ravi Begur (Mahindra Logistics)
Collaborative logistics management aims to reduce inefficiencies through collaboration between trading partners. Logistics costs can be lowered through economies of scale, scope, density, experience, and presence. Collaboration models include vertical collaboration between a shipper and receiver, horizontal collaboration between shippers or receivers, and logistics service provider (LSP) driven collaboration. The LSP collaboration model provides economies of scale through load consolidation and economies of scope through closed loop trips. Technology plays a key role by enabling transaction and optimization systems, interfacing with customer systems, tracking shipments, analyzing data, and designing warehouses. Moving forward, options include collaboration within one's own supply chain or with other organizations, though standardization, confidentiality, and cost
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Collaborative Logistics In India & Role of Technology - Ravi Begur (Mahindra Logistics)
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- 2. 2 Collaborative Logistics In India & Role of Technology
- 3. 3 Collaborative Logistics Management The objective of Collaborative Logistics Management is to reduce or eliminate inefficiencies in the logistics process (for example time, inventory, space, errors and distance) through collaboration, in order to bring benefit to all trading partners.
- 5. 5 Why Collaborate ? Parameters affecting Logistics Cost • Economy of scale – • Usage of larger and more resources which lead to a lower cost of operation. • Economy of scope – • Cheaper to operate two services in one single entity than it is to produce the services separately. • Economy of density – • Larger markets, which leads to more efficient utilization of resources. • Economy of experience – • Cost per item decreases when it is produced in greater amounts or staying for longer durations. • Economy of presences – • There is an economic value in being physically present or available.
- 6. 6 Collaboration Models Shipper Receiver LSP Shipper Traditional Supply Chain Vertical Collaboration Horizontal Collaboration LSP Driven Collaboration
- 7. 7 Why LSP Collaboration Model ? Parameters affecting Logistics Cost • Economy of scale – • Higher capacity vehicles due to load consolidation. • Economy of scope – • Closed loop trips (Faster Return Loads / Lesser Wait Times / Lesser Dead Runs). • Economy of density – • Larger markets, which leads to more efficient utilization of resources. • Economy of experience – • Sharing of Industry best practices & value engg. • Economy of presences – • Wider Geograhic presence due to multiple Customers.
- 8. 8 Role of Technology • Deployment of robust Logistics Execution Systems • Transaction Systems - TMS / WMS • Optimization Systems – Dynamic Route generation based on current and anticipated loads • Deployment of Middle ware for easy interface with multiple customer systems • Deployment of RFID technology for tracking consignments and avoiding data entries across chain • Constant analysis of route and load data using analytics to arrive at more closed loop routes for execution • Forecasting of vehicle capacity requirements based on product dispatch plan for the week • GPS tracking of vehicles to allow for generating closed loops dynamically. • Warehouse Layout Design changes and allocation of locations based on order mix patterns • Optimized travel path, MHE and storage space allocation • Improved Vehicle / Order TAT and Order fill rate Freight Exchange – Public or Private?
- 9. 9 Way Forward Options? • Collaboration with in One’s Supply Chain ? • Coopetition…..with other supply chains / organizations ? • If IT is the binder ….then how do we address these…..? • Standardization challenges • Confidentiality Issues • Cost sharing
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