Global supply chains and trade networks are becoming more complex as a result of shifting patterns within the logistics industry, including changing demands of vendors and customers.
In reality, not all businesses are able to navigate these tumultuous changes, and some head south as a result. Only companies that digitally transform and reshape their processes remain competitive and maintain their industry leadership.
Global supply chain services provider APL Logistics is one such case in point. After its legal separation from its parent company, Neptune Orient Lines in May 2015, APL Logistics realized that existing processes were slowing down business operations and customer engagement.
Apart from paying for unused capacity, the lack of disaster recovery services and slow internal app development, it also realized that it needed a holistic single platform that could encompass bulk planning, scalability and faster deployment of business applications.
We spoke to May Chew, Chief Information Officer at APL Logistics, about the company’s experience in its transformational cloud journey.
The shipping industry across the Asia Pacific region has witnessed a decline over the last few years. In the midst of such setbacks, how could industry leaders turn them into opportunities?
Chew: It is evident that the shipping industry across APAC has witnessed a decline, with a third of shipping losses occurring in the South China, Indochina, Indonesia and Philippines maritime region over the last decade. This figure has also risen by 25% annually.
Despite these setbacks, the global logistics industry reached a value of US$1.171 billion in 2017, with the APAC region accounting for the largest market share.
ASEAN also continues to thrive as a logistics hub, with member countries signing transport facilitation agreements such as the ASEAN Single Shipping Market (ASSM) to ensure that the movement of goods across the region is accelerated and with increased transparency.
Recognizing the need to focus on customers’ changing demands for cheaper and faster supply chain processes, we believe that industry leaders can turn to technology to efficiently manage transportation activity across their global supply chain.
The use of cloud technology is one way for shipping organizations to streamline their service offerings across multiple platforms that are both flexible and scalable. This will help to address customer needs and ensure faster delivery of services, especially since cloud is becoming a major influence within the technological environment of our business.
At APL Logistics, we’ve implemented cloud business applications such as Oracle Transportation Management (OTM) on top of our Oracle cloud platform, to automate our processes for more efficient logistics operations. Our organization is thus able to focus on providing quality services and give our customers greater confidence in doing business with us.
How have some major paradigm shifts in the logistics and supply chain sector impacted the way business is done at APL Logistics?
Chew: Today, no matter which industry you are in, customers want things fast and at their convenience.
In the logistics and supply chain sector, we are experiencing such customer demands as well.
To meet and address this shift in customer demand, we need to rely on data, which is the currency that all organizations are employing to achieve their ambitions.
We are well aware that data analytics play an integral role in this sector. As industry leaders base their decisions on data analytics to refine their business strategies, APL Logistics is no exception.
With competitors entering the market with emerging technologies such as artificial intelligence (AI) and machine learning, our organization has to keep pace with these emerging trends as we know how that these technologies collectively deliver disruptive outcomes.
Since 2010, it is heartening to know that by deploying OTM, we created ShipmentOptimizer, a customer-facing automated shipment planning system that allowed us to automate complex planning phases for more efficient shipment services.
This has given us the capabilities to maintain our edge over competitors to remain consistent in addressing the changing demands by customers and vendors.
Last year, we joined the Blockchain in Transport Alliance (BiTA). This move allows us to explore the innovative uses of blockchain technology within the supply chain because we recognize the importance and future of this emerging technology.
We believe that, as an industry, the logistics and supply chain sector must align to develop standards in order to get us closer to reaping the benefits that the blockchain movement has to offer.
Why is the cloud integral to APLL’s digital transformation strategy?
Chew: The cloud shaped and fortified our systems with a robust database infrastructure as soon as we embark on our digital transformation journey.
It has enabled us to maintain our competitive advantage in the market as we optimize our logistics network.
We are equipped with capabilities such as a logistics dashboard, which delivers visibility into transportation data and metrics, giving us a clearer picture to make decisions.
How does APLL intend to further leverage the cloud as you navigate uncharted waters in the future? What other technologies and innovations would you consider deploying as part of this strategy?
Chew: As customers’ and vendors’ demands continue to evolve, we foresee that demands will become increasingly complex.
By utilizing and leveraging the cloud, we strive to collaborate even more closely with customers and vendors in the supply chain to ensure that exceptions in any shipment requests are managed with ease.
Apart from joining BiTA last year to build upon our blockchain technology capabilities, we are collaborating with CargoSmart and Oracle on a blockchain prototype to improve the process of complex shipping documentation.
For instance, with CargoSmart’s Carrier Invoice Financing, we can now manage our invoices efficiently while have easy access to carriers’ Bill of Lading in our shipping blockchain network.
The cloud has also played a pivotal role in providing us with a platform and applications to securely manage ‘exception checking’ where we are able to trace duplicate billing, verify shipped containers and compare invoice amounts with past repeated shipments. This has allowed us to process invoices in a more timely and accurate manner to minimize disputes and documentation discrepancies.
Further to this, APL Logistics has taken it upon itself to provide sustainable supply chain solutions for our customers. We have implemented fuel efficient and exhaust technologies for our vehicles in China as part of our efforts towards reducing the carbon footprint of our transport operations. This has come to fruition as we have recently been awarded the Green Freight Asia (GFA) certifications earlier this year.
We believe that this is testament to our role as a sustainable supply chain provider, and at the same time assuring our customers that goods are shipped efficiently with less impact on our environment.