Consistently reducing and optimizing costs without increasing logistics risk can only be achieved by intelligently combining industry-specific analytics frameworks, the right technology tools and logistics processes engineered for effectiveness as well as greater efficiency.
3. Enabling Technology
Technology in the absence of deep understanding of processes may not be effective in optimizing logistics costs. Simply upgrading the software, without better processes, may actually make the problem worse as employees try to make old processes work with new tools rather than using the tools to support more effective standardized global processes. The selection of technology therefore must be driven by the tool’s potential to:
- Simplify processes (reduce hand-offs, approvals, automate process steps);
- Expedite exception handling (reduce the number of exceptions, auto-resolve commonly occurring exceptions);
- Reduce systems/applications complexity (standard interface, fewer middleware applications required, better workflows).
New Challenges, New Approach
Global logistics networks are an integrated, evolving creation. If a business wants to create a best-in-class network, it needs to develop a deep understanding of the risks and costs associated with multiple logistics partners, geographies, products and technology tools. At the same time, an organization cannot depend on process or technology alone to provide the end-to-end improvements that drive true cost savings.
Consistently reducing and optimizing costs without increasing logistics risk can only be achieved by intelligently combining industry-specific analytics frameworks, the right technology tools and logistics processes engineered for effectiveness as well as greater efficiency.
Suresh Iyer is vice president and global practice leader for Engineering & Supply Chain Services at Genpact, where he is responsible for strategy development, new capability acquisition and execution. Advait Rahalkar is assistant vice president with the Supply Chain Practice at Genpact, where he builds solutions for supply chain management.
