Content starts here
Top Trends Affecting the Freight and Logistics Industry in 2008
The transportation industry, both passenger and freight, is in the midst of a major transformation due to the rapidly changing demands of the global marketplace. Consolidation, globalization and ever increasing service level requirements are demanding that companies become more agile and work smarter in order to be competitive in the New Year.
As companies begin to create 2008 plans, EDS has highlighted its top technology trends affecting the freight and logistics industry.
- Requirement for Supply Chain End-to-End Visibility
As much of the global manufacturing base moves offshore and the demand for just-in-time inventories rise, the need for tracking information has increased exponentially. At the same time, transportation companies are facing increasing costs associated with the movement of goods, and fuel and labor costs are rising rapidly. Technology is the key to holding down supply chain costs by helping to reduce inventory in the pipeline. It is important to have the right level of connectivity, and the software and data have to coexist and cross communicate real-time. - Cargo and Port Security
U.S. Homeland Security officials have warned that the next terrorist attack could be launched through the country's cargo and port systems. A variety of edge technologies can allow officials to track what is being sent, where it is going and how it got there. In addition to the port system, RFID tags can help monitor freight trucks as they carry cargo across state lines. - Consolidation Continues
As the business landscape across the transportation space continues to change, mergers and acquisitions are becoming an everyday occurrence. In the freight, logistics and rail marketplace this is driven by customer demand for end-to-end service and visibility from a single carrier. Technology can ensure that merging companies' solutions are compatible and complementary to allow for a smooth transition. - Agility – Now
As transportation companies transform, it's imperative that technology becomes more efficient. Companies want to reduce dependency and spend on legacy system maintenance costs, so they may redirect their IT spend to prepare for the future. This goal is especially true for freight, logistics and rail companies, where maintenance costs are increasing rapidly. The preferred supplier is going to be the agile supplier who adheres to service oriented architectures and industry standards and has flexibility to react quickly and provide seamless connectivity. - Promises of a Fully Integrated Supply Chain
Today's companies are beginning to integrate pipelines horizontally across the entire supply chain. Although the potential is large, the challenges are many. If companies can synchronize raw materials, labor, production, shipping and distribution requirements, the industry stands to save billions of dollars. - Outsourcing to Improve Functionality
As fuel, labor, insurance and capital costs continue to climb, the transportation industry is challenged with saving money while ensuring high levels of customer service. These facts, coupled with IT growing in complexity and importance, are leading transportation companies to look at outsourcing functions and standardizing business processes as a means to both reduce costs and improve functionality. - Growth of IT in the Supply Chain
Over the past 20 years, the cost of transportation in the US has fallen from over 15 percent of total gross domestic products to well under 10 percent today. While transportation itself has become more efficient, the majority of savings has been in inventory reduction. As product life cycles shorten, the need for IT in transportation is growing at an exponential rate.
Implementing mission critical applications that provide visibility into your companies supply chain is vital to the success of your company. At EDS, we have more than 9,000 people serving our transportation clients – providing business strategy that evolves and shapes the future of the travel and transportation industries. Our robust client list includes domestic and international air carriers as well as airports, airport ground handling agencies, travel and hospitality companies, freight and distribution businesses and government agencies. Contact us today to help you kick off a successful 2008.