Path to Growth: Technology Enabled Logistics in India - N. Viswanadham INSA Senior Scientist
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Acatech Project
Path to Growth: Technology Enabled
Logistics in India
N. Viswanadham
INSA Senior Scientist
Computer Science and Automation
Indian Institute of Science, Bangalore
India Logistics Project N. Viswanadham
Contents
Logistics and E-logistics
E-Logistics Innovations
Logistics in India
New Governance Model: Orchestration
Conclusions:Strategies at National, Vertical &
Firm levels
India Logistics Project N. Viswanadham
Logistics and E-logistics
India Logistics Project N. Viswanadham
Business Logistics- CLM Definition
“The process of planning, implementing & controlling
the efficient, cost-effective flow and storage of raw
materials, in-process inventory, finished goods, and
related information and financials from point of origin
to point of consumption for the purpose of conforming
to customer requirements.”
• Includes Inbound, Outbound, & Service logistics
CLM - Council of Logistics Management -Adopted 1984
N.ViswanadhamE-Logistics
E-Logistics is a dynamic set of Sensor (IOT), Computing
(Cloud), Communication (Internet, Mobile) & Collaborative
technologies that transform key logistical processes to be
customer centric, by sharing data, knowledge & information
with the supply chain partners and enable synchronization of
events and right decision making.
Companies deliver customer-configured products and value
added services faster than competition
India Logistics Project N. ViswanadhamTypes of Life Cycle based Logistics
Inbound logistics: Moving components from suppliers to
production
Manufacturing logistics: Parts moving Machine to machine on
the factory floor
Outbound logistics: Moving finished products from production
line to the Retailer via Wholesalers
Retail Logistics: Goods delivery to the consumer by retailer
Service logistics: Moving used goods to service stations (MRO)
Reverse logistics:Movement of used goods for reuse, recycling,
remanufacturing, refurbishing
Spare part logistics: Storage of Spare parts from manufacturers
and suppliers
N.ViswanadhamE-Logistics Innovations
India Logistics Project N. ViswanadhamTechnological Advances:Internet of
Things,..
IoT technologies can be categorized into Tagging things,
Sensing things and Embedded things .
– The tagging things provide item identification, things can be
connected to the databases.
– The sensing things enable us to measure and detect changes in the
physical status of our environment.
– The embedded things yield information about the status of the
embedding object.
Cloud Computing
SMAC technologies
Cyber Physical Systems
India Logistics Project N. ViswanadhamSocial Media for Logistics
FedEx and UPS use Face book and Twitter to deal with
customer issues and complaints.
3PL’s post Truck loads on Twitter to find carriers to carry
loads & Trucking companies are posting carrier locations
looking for loads.
Companies use Google maps to track goods, trucks, etc.
Logistics companies are posting educational and informative
content to attract customers to their websites.
Logistics companies are creating social communities around
their core services, bringing clients and employees together
into a virtual conversation.
India Logistics Project N. ViswanadhamTechnology Innovations in Logistics Types
Manufacturing logistics: Automation & Agent based controllers
Inbound logistics : Trucks are equipped with radio transmitters
and GPSs and goods are tagged with sensors.
Retailers watch shoppers from entry to exit in store for buying
to happen. Recommender Systems market products to
customers based on their browsing, searches, earlier purchases,
etc. Multi channel delivery at customer convenience
Service logistics : Time table maintenance to predictive
analytics.
– Aircrafts and Turbines can predict failure weeks in advance using IOT
information.
– 3D printing is enabling availability of service parts as per the original
design at the exact time required.
N.ViswanadhamGenpact: Control Tower for Penske
Genpact Orchestrates the logistical services of Penske
Genpact BPO workers in India and Mexico
– Check the customer’s credit status and arrange necessary permits.
– Assign Trucks and Drivers based on driver’s choice and also the
maintenance record of the truck
– If the truck gets stuck at a weigh station for permits, the BPO staff
transmit the necessary documentation .
– After the trip, the driver’s log is shipped to a Genpact facility
Penske processes lot of info: numerical, text, voice, past
records of 15K trucks and equal number of drivers
Supply Chain Control Tower is now industry best practice
India Logistics Project N. ViswanadhamRetailing: Disruptive Changes
Retailers watch the shoppers in the store, where they go, in
what order and understand how all these map to actual sales.
Recommender Systems suggest to consumers products based
on their browsing, searches and earlier purchases
– Netflix uses recommender system for each subscriber.
– Target predicted pregnancy in a Teen based on her buying patterns.
Focus shift from Sales & Marketing to Predictive Analytics
using Industry Knowledge, Consumer preferences,
Connections with the Stakeholders , Social media analytics
Privacy is at stake ???
India Logistics Project N. ViswanadhamOn Line Retail Logistics
In India, Flipkart, Amazon, Ebay.in, Snapdeal, Shopclues,
Myntra, Yebhi, Tradus, Pepperfry Homeshop18 are creating
online retailing wave.
Online food&grocery stores: BigBasket.com, ZopNow.com,
EkStop.com and LocalBanya.com are launching their own
brands for fruits, vegetables, rice and pulses priced to compete.
DHL is launching e-Fulfillment centres in 2014 in Delhi,
Bangalore and Mumbai catering to e-commerce and SMEs.
Blue Dart Express is planning to invest in multiple delivery
options including cash on delivery and set up warehouses.
N. Viswanadham, V.Vinod Kumar & R. Gaonkar, Optimal retail order fulfillment strategies, Proc of the 4 th
Asian Control Conference, Sept. 2002, 1502-1507
India Logistics Project N. ViswanadhamUber for Logistics is Happening in Asia
Gogovan and Easyvan provide a peer-to-peer app that
connects van drivers with individuals or businesses who need
their Goods shipped quickly
Rio Tinto’s driverless trucks moved 100 million tonnes
Trucking firms use data from new sensors—monitoring fuel
levels, location and capacity, driver behaviour, etc. in their
optimization. The goal is to improve the company’s route
network, lower fuel cost, and decrease the of accidents
Uber Isn’t a Car Service. It’s the Future of Logistics
India Logistics Project N. ViswanadhamTechnology plays a Major Role
Technology enables Move from
– Internet to E-commerce,
– Product manufacture to delivering customer desired products
– Logistics to E-logistics
New technologies emerge not from new discoveries but from
the recombination of existing technologies into new systems.
New developments Co-evolve on demand with innovations in
resources, supply chains, Institutions and delivery
mechanisms.
India Logistics Project N. ViswanadhamLogistics In India
India Logistics Project N. ViswanadhamIndian Freight Transport Industry
Roads carry around 60% of the total freight transport volume.
1000 Trillion ton km by road & 675 Trillion ton km by rail
The Indian truck market is dominated low-cost trucks
manufactured by local manufacturers.
Only 10% of Indian truck operators own fleet of more than
25 trucks, and 1-2 %own between 200 -1,000 trucks.
80 % of truck operators own less than 10 trucks. Majority of
them are owner-drivers with a single truck.
The Indian transport industry is organized by transport
middlemen or goods booking agents for the small truck
operators or owner-drivers.
N.ViswanadhamManufacturing Clusters in Indian States
N.ViswanadhamLogistics Performance in India
Indian Infrastructure is poor as compared to developed
and developing countries and is rated 54 /160 in 2014.
The underlying Institutional problems
– Poor Hard and Soft Infrastructure
– Blind imitation of the infrastructure growth of developed
countries rather than following market requirements
– Low Technology Penetration in inter-organizational
management processes such as trade documentation
– Responsibility Fragmentation among government agencies
– Lack of 3PLs, Research and Talent in logistics
– Concentration on low cost labour ignoring ICT
N.ViswanadhamNew Governance Model:
Orchestration
India Logistics Project N. ViswanadhamCustoms , Export & Delivery Quality, WTO, FTAs, Trade
Inter-state Regulators Social , Green Issues facilitation
INSTITUTIONS
Logistics & IT Infrastructure:
Service Providers, Roads , Ports,
GPS Tracking Airports, Rail
DELIVERY SERVICE
INFRASTRUCTURE
Inbound, Outbound
RESOURCES
LOGISTICS Universities, R & D
Reverse & Service
Skill Training
Logistics ECOSYSTEM
Finance & Insurance
Logistics Parks, E-commerce
SEZs, Freight
Corridors
Soft Infrastructure,
LOGISTICS SERVICES IOT, Traceability,
Vertical Based Social media
Cross Docks Skilled Warehouses Carriers
MRO Manpower Trucks, Trains,
Supply Hubs Cold storage
ShipsThe Logistics Mall India Logistics Project N. Viswanadham
Orchestrator Business Model
Planning, Coordination and Overall Responsibility
Orders
Orchestrator End Customer
Payment
Plans
Material Flow
Operational
Status
Supplier 3PL Contract Mfg 3PL
Supplier 3PL Contract Mfg 3PL
Execution
N.ViswanadhamStrategies at National , Vertical & Firm levels
National Level: Readiness
– Physical infrastructure is only a third of the logistics requirement for
efficiency. How much of the physical infrastructure is essential and can
the ICT replace or substitute some of these.
– Develop high speed rail freight network with cross docking and
distribution facilities along the path of goods flow.
– Develop soft infrastructure, Initiate research programs
– Plant locations are now at the forks and not at the hubs creating
outbound logistics (Finished Goods) problem. Needs relook
Industry Level: Standardization, Sustainable Business Models
– Food and groceries is 59.5% of the retail sector and 48 % of
household expenditure. Improve the food supply chain & logistics.
– The truck market, where majority of operators are owner-drivers with a
single truck should be organized as logistics mall social network.
Firm level
– Social relationships, Risk mitigation, Governance
India Logistics Project N. ViswanadhamLead
Logistics
Provider
• Connecting to
competencies
• Industry Knowledge
• Connections with
stake holders: Govts.
• Data mining &
Predictive analytics
• Talent
India Logistics Project N. ViswanadhamIndia Logistics Project N. Viswanadham
N. Viswanadham, Sai Sailaja, Abhijeet Kumar and R. Vijay, On the future
path of goods movement, ISB Insight magazine, September 2008, pp 34-36
India Logistics Project N. ViswanadhamIndia Logistics Project N. Viswanadham
My papers
N. Viswanadham and Roshan Gaonkar, Understanding E-Supply Chains – Design and
the Future Trends, October 2001.
N. Viswanadham and Roshan Gaonkar, Leveraging Logistics to enhance
competitiveness of Indian economy, October 2003, Prepared for CII.
N. Viswanadham & M Puvaneswari , The India Logistics Report, June 2004
N Viswanadham, Can India be the Food supplier for the world?, December 2005. (A
very frequently cited report and was reprinted several times by the magazines), Retail
BiZ May 2009
N. Viswanadham, Sai Sailaja, Abhijeet Kumar and R. Vijay, On the future
path of goods movement, ISB Insight magazine, September 2008, pp 34-36
Overcoming India’s Planning Challenges, Supply chain risk in India, Supply chain
strategy, MIT Centre for Transportation and Logistics, Vol. 5, No5, May 2009
N.Viswanadham, Supply chain becoming highly technology intensive, OEM Update,
March 2014, pp28-29
N. Viswanadham, V.Vinod Kumar & R. Gaonkar, Optimal retail order
fulfillment strategies, Proc of the 4th Asian Control Conference, Sept. 2002,
1502-1507.
India Logistics Project N. ViswanadhamPath to Growth: Technology Enabled
Logistics in India
1. Introduction
2. Logistics
3. Economic Relevance of Logistics
4. Types of Logistics
5. Logistics Service Providers
6. Recent Technological Innovations in Logistics
– Social Media for Logistics
7. Status of Indian Logistics Infrastructure
8 Industry Clusters in India
India Logistics Project N. ViswanadhamContents-2
9. Ecosystem Framework
9.1 Logistics Network Risk
9.1.1 Risk Response Strategies
10. Inbound Logistics Ecosystem
11. Innovations in the Indian Logistics
12. Possible Trends for the Indian Logistics
13. Governance of the Logistics Network
14. Mathematical Models
15. Indian Retail Industry
16. Urbanization and Logistics
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