Technological maturity in logistics processes

In what degree of technological maturity is your company?

It is common these days to hear the words logistics and technology in the same sentence. The second is intervening so much in the business that there are almost no companies that can avoid it, but there are still some.

The following article aims to clarify and establish a positioning parameter for companies that feel they should advance in the technification of their logistics operations, but do not know where to start.

There are 4 stages according to the integration of technologies in each one:

  1. Intuitive
  2. Computerized
  3. Integrated
  4. Avant-garde

Level 1. Intuitive:

As the name implies, companies at this level do not have computer systems that allow them to make rational decisions. They are managed by the experience of their directors and by subjective perceptions of the situation. The information is stored in spreadsheets and does not reflect the reality of the business, is a mere record that is sometimes completed only by tax obligations.

Distribution of chaotic warehouses, without documentation or planning. Archaic equipment. No connectivity with other areas of the company.

Level 2. Computerized:

At this level we will find management software (ERP), inventory control software and distributed applications to meet the needs of each area. The drawback at this level is the communication and information flow between the different sectors of the company.

The available infrastructure consists of some simple shelves which allows to organize a little better the warehouse, but it does not assure the optimal use of all the spaces and resources. Systems can be found that notify the lack or non-existence of products to the corresponding area. Barcodes are used to identify products individually.

Second level companies lose business opportunities due to their lack of efficiency and depend on partners or third parties to carry out some operations.

Level 3. Integrated:

At this level are many companies that have already perceived the need to technify their warehouse in order not to lose competitiveness. There is an EMS (WMS) that allows optimizing the use of resources (time and space) in a dynamic way, that is, providing a quick response to business needs and including all actors in the supply chain.

The infrastructure is much more advanced than in the previous ones, we can see voice picking systems, pick to light, robotic picking carousel, RFID technology.

The third level is characterized by the quality of the information, the KPIs are defined according to the business objectives and are used for decision making.

The degree of customer satisfaction is very high, accelerating the ROI. This means that the work done to improve the logistics operations of the company is perceived by the customer as an added value, which translates directly into conversion and loyalty of the customer.

Level 4. Avant-garde.

Level with a great volume of work. Availability of the latest technologies. Artificial Intelligence and Machine Learning to plan and optimize operations. Assistance to manual operations with Augmented Reality, highly robotized installations, demand simulations and assistance in strategic planning with Business Intelligence and Big Data.

At this level are the forerunners of breakthroughs that move towards the lower levels. It is also the most competitive level, where permanence and profits depend on the speed of adaptation to changes.

Fourth level companies determine the rules of the game and impose increasingly demanding challenges on their competitors.

The first step to propose an improvement is to know where the starting point is, so we urge you to evaluate your company and then identify the way forward.

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