Discover best practices in automation of logistics processes

7 minutes to read

The automation of logistical processes is a need that is increasingly influencing the competitiveness of modern companies. If the first versions of the Industrial Revolution made it possible to replace artisanal processes with industrial ones, now it is time to take an even more important step towards agility and efficiency.

As a result, the companies, which invest in logistics automation resources, are able to achieve significant results in gains, such as lower costs, increased productivity and reduced delivery times.

Thinking about these benefits, we present, throughout this article, some of the ways in which this strategy is able to optimize your company’s practices. Check it out and have a good reading!

The concept of automation of logistics processes

Basically, the automation of logistic processes is a set of procedures performed with the adoption of measures and technological resources, which are implemented to replace manual work and controls with automation solutions. As examples of the systems used to promote this modernization of logistics processes, we can mention:

  • VMI – Vendor Managed Inventory: for inventory management by the supplier, which allows for continuous replenishment;
  • SCM – Supply Chain Management: which allows the management of the supply chain;
  • Transportation management systems.

Thus, the concept of automation of logistics processes refers to all technological resources available in a transport management system or TMS (English acronym for Transportation Management System).

Automation, therefore, is related to the reduction of manual tasks in freight processing and the acquisition of better transport options. In addition, you can get automatic notifications and real-time updates of shipping information.

The importance of automation

The logistics sector is fundamental in supporting the process of purchasing and receiving goods. From this point of view, the contribution it offers to agility, efficiency and quality, for example, is decisive for the competitiveness of the business as a whole.

Obviously, there are variations in the level of importance according to the nature of each activity and sector. The logistics of major events, for example, have a different relevance than what occurs in industries or distributors, but all of these enterprises are facing very similar challenges.

With the digital transformation process being increasingly accelerated by a series of situations, organizations need to adapt and prepare themselves with the automation of processes and the qualification of people, who increasingly need to assume a more strategic and less operational performance.

The benefits of automation in logistics

The first and most important benefit is to guarantee operational efficiency, which is a competitive requirement. This is because companies might necessarily be more competitive if they were efficient, since competition can offer an equivalent condition, but they are certainly less competitive if they do not offer minimal operational efficiency.

Team motivation

The simple organization of the processes and the improvement of the work structure are already factors that contribute to the improvement of motivation. After all, it is better to work in these conditions, since the results are easier to demonstrate and this influences the self-esteem of everyone involved.

However, there is also a great stimulus, such as the reduction of repetitive tasks. Automation takes on many standardized activities and allows everyone to focus on more strategic assignments. Thus, everyone feels more useful and valued.

Reduction of deadlines

Many companies have gained prominence in the market for the ability to deliver almost immediately. In addition to reducing storage costs, this agility minimizes the need for fixed assets in stock. This makes many customers prefer companies that deliver faster, even if they need to pay a slightly higher price for their products.

High return on investment

ROI, which stands for RETURN ON INVESTMENT analysis, is very fast and representative in automation, especially when it involves decreasing the amount needed to maintain inventory. After all, this amount enters the cash register at the end of the sales cycle and can often cover the total investment made in automation.

Elimination of errors

The automation features of logistical processes (such as product integration through its management system, access to the address book, automatic storage, entry of fuel and accessory fees, etc.) ensure that you never have to worry about entering the wrong data.

The occurrence of human failures tends to increase transportation costs, generating highly uncomfortable situations, such as having to pay twice for a single shipment or a higher amount due to the incorrect classification of a commodity.

Resource savings

To avoid rising transport costs, automation in a TMS makes it easier for users to execute policies that offer immediate freight savings. This means that the system is built with a state-of-the-art application architecture, able to receive and process fees from live operators over the Internet.

It is not about “theoretical” reductions, but an effective ROI, based on dynamic access to tariffs and costs, in real time.

When you have multiple carriers to choose from, you can set criteria based on cost, transit time and security, making the best choice for each specific shipment and saving money in the short and long term.

Better customer service

How much does it cost for your business to lose a customer? The automation of logistics processes provides accurate supplier monitoring, with automatic surveys, adequate insurance and freight accounting built according to your customized specifications.

This way, by receiving automatic notifications, both you and your customer know exactly how much the freight will cost and when the product will reach its final destination.

Access to data and real-time analysis

When accessing data and reports in real time, your decision-making process is favored with accurate information about patterns and histories.

For example, it is possible to discover that, 80% of the time, you chose carrier “A” because it had lower costs, but that it delays 20% of deliveries, generating a stigma of poor customer service for your business.

Allowing the creation of such a negative image of the company just to save on transportation costs can damage its long-term results, making it more difficult to attract new customers and increasing the chances of losing current ones.

Thus, access to valuable data, at your fingertips with the automation of logistical processes, simplifies the evaluation of the total cost of your decisions in order to avoid future inefficiencies.

Centralized information

Much of the gains in access to data and the application of analytical intelligence come from centralization. Note that we are referring to the storage, treatment and dissemination of information, but not necessarily the decision.

This means that the data is integrated and compared on a central basis, but can be accessed by several units and professionals, through various devices, such as tablets and smartphones, and for 24 hours.

Thus, we conclude with the finding that the automation of logistics processes contributes to a more organic and fluid operation, guaranteeing a dynamic more aligned with the digital transformation and with the whole scenario of change that companies are currently subjected to – with all its surprises, crises and challenges. With logistics automation, your enterprise can prepare and react better in any situation.

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The VMI Portal is a portal of news and information on systems of collaboration between suppliers and customers, which is growing continuously. The idea is to promote and disseminate the concepts of Supply Chain Management (SCM) and Vendor Managed Inventory (VMI), among other topics.

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