Tech, trade, talent, transportation to dominate 2019, says DHL’s Sureddin

Toward the end of 2018, DHL Supply Chain said it was going to invest US$300 million into the acceleration of the development of cutting-edge technologies, such as robotics, at the majority of its North American facilities. Some of the technologies discussed include blockchain and the platooning of vehicles, among many others, but the integrator also identified four categories of trends that it expects will have the greatest impact on operations in North America in the coming year.

To elucidate, Air Cargo World spoke with Scott Sureddin, CEO of DHL Supply Chain, North America, about the company’s ability to manage what he calls the four “T’s” — technology, trade, talent and transportation — which, he added, will define how well supply chain organizations can meet customer expectations in the coming year.

Q: What do you think will be the dominant technological advance this year for supply chains?

Scott Sureddin: We have finally seen robotic technology reach maturity. Robots are already proving their value in select warehouse applications, but the technology is expected to reach a tipping point in 2019. The DHL Supply Chain distribution network is an example of the leap robotics could make. DHL’s November 2018 announcement to expand use of select emerging technologies by 2020 includes a heavy focus on robotics based on strong results from initial trials.

Q: In what areas will robots have the greatest impact?

While order picking is a key focus of robotic development, the technology is expected to have an impact that extends beyond e-commerce fulfillment. The ability of the current generation of robots to work alongside humans while performing low-value tasks that increase overall warehouse productivity is applicable across a broad range of industries and warehouse tasks. But these will not be “plug-and-play” robots—it will require integration into the current systems for each client. At DHL, we’ve taken a multi-vendor strategy to robotics that allows us to select the best technology for each application while using our scale to support multiple emerging solutions. This will ultimately help broaden the range of solutions available to the entire industry.

Q: Regarding trade, how will uncertainty over protectionism affect the overall industry?

In today’s interconnected supply chains, new tariffs and renegotiated trade agreements can have ripple effects that can paralyze an entire supply chain in the form of delays at the Mexico border, for example. This makes proactive supply chain planning more important than ever. Designing supply chains with the ability to flex to circumvent natural disasters or quickly re-configure to accommodate changes in costs or material availability have become critical to maintaining high service levels.

Q: What are some of the ways to ensure flexibility can be achieved?

Technology is providing a solution on this front as well. Sophisticated supply chain modeling allows what-if scenarios to be performed to quickly identify the best response to sudden changes in costs, transportation routes or material availability. In addition, cloud-based risk management solutions are using the power of big data analytics to identify potential supply chain disruptions and proactively reposition orders and inventory to maintain service levels.

Q: How can logistics companies find and retain the right people to handle increased demand?

While the talent gap is still a major challenge, solutions are starting to emerge. In addition to using robotics to increase productivity, we’ve automated every step of the recruiting process, from online applications to pre-hire testing to onboarding, to increase the quantity and quality of applicants for hourly positions. DHL Supply Chain is also working closely with a number of universities and colleges to promote the career opportunities available in supply chain management. It’s a very competitive marketplace, and that’s a good thing.

Q: In what ways will technology improve transportation issues?

Cloud-based Transportation Management Systems are extending the value of data analytics to smaller enterprises, providing the insight to optimize resources. In addition, increased use of the “internet of things” in the form of fleet management systems allows data from truck operations to improve utilization and reduce downtime. But the biggest opportunity is in the emergence of digital freight platforms that create online marketplaces. Increased complexity will be a real challenge this year, but new digital tools are maturing to point where you will see widespread adoption. This could allow the industry to take significant steps forward in terms of speed and productivity, while effectively managing the challenges created by talent and tariffs. That makes 2019 a very exciting year in the continuing evolution of the industry.