Harry Watts - Recap of the 2019 SHD Logistics Conference

My SHD Logistics Conference recap...

 

A last-minute substitution... Recently I was fortunate enough to be SEC Storage’s representative at the SHD Logistics Conference, an event we never miss due to the interesting content and discourse it consistently provides. The theme of the event, “Transforming Logistics through Technology”, is an essential daily consideration for us at SEC, and some of the topics, particularly the afternoon’s live panel were of specific interest.

 

The topic which the industry’s leading authorities would be debating was ‘why logistics has fallen behind other sectors in developing and implementing digital strategies’. This is a subject I have strong views on and regularly discuss it (usually animatedly) with colleagues, clients and others in my network. I was, therefore, thoroughly looking forward to stepping back and observing fresh insights from the relative safety of the British Museum’s comfortable auditorium seating. This plan, however, quickly unravelled when one of the panellists were forced to pull out last-minute, which, after a short chat with SHD’s editor Kirsty Adams, resulted in me being drafted in as a replacement.

 

Although not quite the relaxing afternoon I had expected, I was honoured to be stepping onto the stage in such illustrious company and at such a respected event. After a short introduction to our moderator, Natasha Tyrrell (Bearing Point), and my fellow panellists - Dominic Hebberd (Hermes), Jim Bowes (TPX Manifesto) and James Hyde (James & James Fulfilment) – I was on stage and ready for a fascinating debate that provided some key takeaways and insights that I hope interested the audience as much as they did me.

 

So for those of you who were not able to attend the event, I’ve put together a quick summary of the top 3 findings of our debate:

 

“Why is it that logistics operators have fallen behind others in developing and implementing digital strategies? And what, if anything, can be done to help establish a digital culture within our organisations?”

Takeaway 1 – Business must stop viewing Logistics as a cost-centre

 

The industry has only recently begun to emerge from the long-held view that Logistics is a cost-centre as opposed to value adding. Whilst industry professionals who are at the cutting-edge may understand how logistics, and by extension supporting digital projects, can help a company attain a competitive advantage, this view is not currently universally understood. Consequently, investment in large-scale change projects can sometimes be difficult to find, particularly if there are other places the business is looking at investing in.

 

By continuing to promote this message and refresh these outdated views, it will result in far greater buy-in of any investment project, digital strategies included.

Panel talk at the 2019 SHD Logistics Conference

Takeaway 2 – We must educate ourselves on the value of Digitalisation

 

In a similar vein, we must also be open to the possibilities and benefits that digital strategies can bring. In other sectors, such as Telecoms or Retail, there is an industry-wide, and top-down understanding that digitalisation brings with it huge benefits and opportunities.

 

The rise of Amazon may be a well-recognised example of this, however, at SEC we have witnessed and helped support this with our own customers. Domino’s Pizza, for example, has implemented real-time digital tracking of its orders that enables its customers to track their Pizza from “Dough to Door” and see accurate predictions of delivery times throughout. It’s not just useful for the customers, the availability of data enabled Domino’s Pizza to successfully deliver 535,000 pizzas in just one day during Christmas 2018.

 

For another of our customers, the digitalisation of their products’ volumetric attributes through their warehouse management system enabled us to design a solution that improved the utilisation of the cube in their warehouse by almost 70% and delay the need to move by almost a decade as well as significantly enhancing operational efficiencies.

Push-back racking system at Domino's Pizza in Milton Keynes

In both cases, the first step was that they understood that digitalisation could provide real value to their respective organisations. By educating our organisations and alerting them to the possibilities, we stand a much greater chance of encouraging investment in this area.

Takeaway 3 – We must stop fearing the ‘D-Word’

 

Throughout the debate, the theme that arose most frequently was fear. It was the view of the panel, that logisticians with management responsibility have developed a fear of digitalisation, which is manifested by consistently selecting to focus on the ‘safe’ analogue options that they know and trust.

 

This ‘fear’ is not uncommon when something new is introduced, and most supply chain specialists will be aware of the concept of the ‘product adoption’ curve which categorises consumers from the bold ‘innovators’ and ‘early adopters’ through to the more risk-averse ‘late majority’ and ‘laggards’. What is concerning is the length of the adoption cycle for digitalisation in our industry. Digitalisation has been possible for decades, however today we are still, on the whole, lagging behind and based upon our experience, we would argue that we are still in the Early Adoption phase.

Compare this with pallet shuttle systems for example, which only became commercially available in this decade – since then, shuttle sales have been growing at a tremendous rate, as take-up has been high. Why is it that we are prepared to trust a new technology that potentially could pose a risk to life, but are reticent to do the same for a technology that does not carry a physical threat?

 

In our experience, we have found that when introducing the concept of a shuttle to our clients we receive almost instant buy-in. This is because logisticians tend to trust mechanical handling systems – trucks – and view shuttles as a natural extension of this. However, when we start introducing digital strategies to accompany and integrate our solutions, buy-in can take a lot longer as there are many more barriers to overcome in the mind of the customer.

In conclusion, how do we overcome this fear? In general, fear is battled best, bit-by-bit. An arachnophobe is unlikely to be cured by being placed, ‘I’m a Celebrity’ style, into a spider-filled chamber. However, if they first have to stand in a room with one for a few seconds, then a minute…in time it is more likely that their fear will diminish. Similarly, if we encourage our own organisations to take on small, simple digitalisation projects we may just find that success breeds success and fear is replaced with possibility. 

 

The SHD Logistics Conference was a thought-provoking event and I was honoured to play a part in the panel discussion. I'm looking forward to the next one and hope to see you there!

Harry Watts - Commercial Director - Systems DivisionHarry Watts Exec MSc, MCILT, cESLOG  Harry Watts - LinkedIn

Commercial Director - Systems Division
 

With an undergraduate degree in Mathematics from the University of Warwick and a masters degree in Logistics from Cranfield University, Harry Watts is at the forefront of data analysis and simulation, enabling SEC Storage to provide intelligent, flexible and data-driven solutions for
its clients.