I’m coming to you live from Naples, FL at the 2019 Descartes Evolution Conference. This was my third time attending the event and as always, it did not disappoint. This year marked the largest conference yet, with more than 650 attendees; in fact, it has outgrown its old location in West Palm Beach and from the looks of it, may need a bigger home next year. Yesterday’s sessions were about the big picture, while today’s sessions will allow me to listen to Descartes customers tell their stories. The big theme of yesterday was transforming the customer experience. I’ll have more at a later date on the customer case studies, but this article will focus on the big trends around supply chain management and their impact on the customer experience.
Descartes Global Logistics Network
During his keynote speech, Descartes CEO Ed Ryan discussed the foundation that is Descartes: the Global Logistics Network. The network connects carriers (ocean, air, ground, and rail transportation companies), shippers (retailers, manufacturers & distributors, and service providers), governments (customs agencies, regulatory bodies, and other agencies & associations), and intermediaries (customs brokers, freight brokers, forwarders/3PLs/NVOCCs, and payment agencies). Currently, Descartes has 20,000+ customers worldwide on the network, which processes 18.6+ billion transactions per year, and has grown 21 percent. On top of the network are Descartes’ value-added services: Routing, Mobile, & Telematics, Transportation Management, Customs and Regulatory Compliance, Broker & Forwarder Enterprise Systems, and Global Trade Content. These solutions all tie into the larger network.
Technology Trends
Ed Ryan also highlighted some of the emerging technology trends that are disrupting the supply chain industry. These are all trends that have been around in some form or another for a few years. Ryan pointed out that some of these applications are becoming mission critical for transforming both the supply chain and customer experience, while others are, in his opinion, not there yet.
For example, at the leading edge of transformation are the Internet of Things (IoT), Artificial Intelligence (AI), Cloud Computing, Information Security, and APIs. From a Descartes standpoint, IoT is a major driver. Ryan pointed out that IoT has become commonplace for most companies, especially at a base level (think Bluetooth headphones). From a TMS standpoint, IoT is all about tracking assets. Companies can use location data of their assets, whether that is a truck, ship, or even a specific container, to better serve their customers. A late or early truck means Descartes’ Route Planner can change the routes and inform customers of delays or a potential early arrival, which can help customers make more informed decisions.
AI is continuing to play a bigger role in helping customers make better and more targeted decisions. Two examples that Ryan gave were for the company’s routing solutions and MacroPoint. Within the routing solutions, AI has been used for years to determine how quickly a person can do their job. From a MacroPoint standpoint, AI is helping to give customers more accurate ETAs when a driver is still a few days away. They know how fast the driver drives, when he/she drives, and as he/she gets closer, the data will be better. For the customer, this is important as they need to know when the driver will arrive, so they know whether they need to keep a dock door open or schedule another truck to take that spot.
Cloud Computing, Information Security, and APIs are also becoming a bigger piece of the supply chain puzzle. As cloud computing is continuing to gain traction Descartes is moving more data to the cloud. While the company still operates their own data centers, more is being migrated to the cloud for scalability. In a session on technology, Ken Wood, Executive Vice President of Product Management at Descartes noted that cloud technology is becoming a fundamental technology enabler for the company. This adds a layer of security and accessibility.
Looking at the information security component, Ryan pointed out that companies today face hundreds or thousands of hacking attempts on a daily basis. As a result, Descartes has a full-time team dedicated to keeping its network safe from malicious activity. In the aforementioned technology session, Raimond Diederik, Executive Vice President of Product Management at Descartes noted that the full-time team is not an extension of IT. Instead, information security is in the forefront of their mind and is part of everything that Descartes does, including roadmaps, R&D, and corporate risk analysis.
APIs were the final technology trend Ryan pointed out. Before, when customers wanted to pull information and send it to their customers, it was done in the Descartes application which could cause integration issues. Now, the advancement of APIs allows customers to extract info and disseminate it to their customers in their own application.
Transforming the Customer Experience
I sat in on a session moderated by Chris JonesExecutive Vice President of Marketing & Services at Descartes, featuring Mark Parsons, Managing Director at BC Sands and Len James, CFO at John S. James Co. Chris Jones highlighted the 3 Rs of supply chain as developed by the late supply chain pioneer Donald Bowersox: Responsiveness, Reliability, and Relationship. Responsiveness is getting the customer; Reliability is keeping the customer; and Relationship is owning the customer. These all play a big part in the customer experience, especially as it relates to supply chain. Mark Parsons pointed out that retaining customers and getting new customers is the key to staying in business. To do this, you need that “WOW Factor.” And that comes down to not just delivering on your customer promise but going above and beyond. For BC Sands, this means sending notifications via SMS about the delivery status of an order. And if it is going to be late, getting ahead of the problem so customers can plan accordingly. As Parsons said, “the perception becomes that we have our s**t together, which keeps customers happy and coming back.”
Len James pointed out two major effects that have created ripples in the supply chain: the Amazon Effect and the Uber Effect. James said that “it used to be you can have things good, cheap, or fast; now you need to do all three. This is the Amazon Effect and it can take a toll on the business.” During a session on the vision for TMS, Brian Hodgson, Senior Vice President of Industry Solutions at Descartes expanded on the Amazon Effect. He asserted that Amazon is constantly innovating its delivery solutions. First there was free shipping, then Amazon Prime, then Prime Now, then big and bulky deliveries with set-up and installation, and finally, Prime Day, which allows customers to choose the day of the week they want all their packages bundled and delivered. This makes managing expectations and constantly delivering on-time more important. The Uber Effect is where everyone wants to know exactly where the truck is in real-time, and when it will arrive. Advanced visibility into trucks and containers becomes a core part of the supply chain.
Final Thoughts
Day one at Descartes Evolution did not disappoint. We have been covering disruptive technologies at Logistics Viewpoints, and it is always good to see the market take the same interest. Descartes CEO Ed Ryan pointed to a few significant technologies that are changing the supply chain landscape, notably IoT, AI, Cloud Computing, Information Security, and APIs. There are other trends that came up, but as Ryan indicated, he sees them as less impactful in the near-term, namely drones, autonomous trucks, and blockchain. However, he did go on to say that blockchain has its place and Descartes is running some pilots. But, from a digital ledger standpoint , especially for something like a bill of lading for example, it is simply too expensive and unnecessary from an encryption standpoint. And while autonomous trucks are still a ways off, the self-driving features will help trucks to be more safe in the next 10 years. From a technology standpoint, these trends are key drivers for transforming the customer experience. And as unlikely as it may sound, the supply chain may have the biggest impact on the overall customer experience. After all, if the customer doesn’t get what they want, when they want it, and how they want
Good Post. Really informative!!