Digitalization of E-Commerce and Logistics

By Peter Dressler, Senior Director of Logistics, Infineon Technologies

E-commerce and logistics are two sectors in the current enterprise setting that must work hand-in-hand to ensure that all processes from stocking products, handling orders, and delivering them to customers is performed with the utmost efficiency and accuracy. With new online product vendors entering the market space every day, one vital issue that has become imperative for these firms is in deciding on the right delivery partners that have proven operations in serving the modern world.

As consumer demands increase, the drive to meet their requirements is getting harder, and the e-commerce players must deploy state-of-the-art digital wares in order to have business sustainability and stable growth.

E-Commerce, Logistics and Technology

If you are currently in the e-commerce space, over the next few years, it will become hard to survive without the support of technology, or without having knowledge of the business operations that require automation. At the end of the day, it is a question of not only the size of a company but also the complexity. You have to look into e-commerce over the last ten years, and understand how much they are currently investing in growth.

"For major B2B companies similar to us that think of this kind of discussion, logistics providers must have a regular agreement from their side, meaning they have to come up with proposals and other quotes to give us better support."

In terms of advancements in the online product market space, technology deployments is the most solid and concrete area of investment to make it happen. The adoption of the applications and devices can help companies easily obtain patterns of data in regards to the topics that they are trying to research currently. In the current scenario, however, most e-commerce vendors are out of time and money because not a lot of grounds can be covered to ensure proper logistics with only a little bit of operational space, a nice roof above it and some product stocking shelves in there. Firms still have some areas to work toward responsibly, in order to have a high turnaround and reach for high mountain tops in terms of their delivery standards. They must make sure that the current investments in sales and marketing in regards to the customer experience can also improve the logistics experience.

For me, the decision-maker is the one who is making the purchase decision, either the person at home or the person in the purchasing department of a company, and they are getting younger and younger. The fact that the new generations are coming in fast and are used to a similar approach in their private lives is making way for questions such as where is my shipment, when will it come and can you redirect and update it to my home but deliver it maybe to my car. Firms must pay extra attention to these kinds of topics that will be coming down the road, maybe not today, maybe not tomorrow, but in the next couple of years. And certainly if companies continue not looking into a plan with regards to that kind of topic as a vision about how to go down that path, probably they will have a problem over the next few years.

The Transformation of Logistics

At Infineon, we still have some talks with our logistics partners about performance and quality issues. But most of the firms they open up the idea to the optimization roadmap, and what kind of additional capabilities will be required to make it happen to sustain the element of going into a more digital-sphere oriented approach.

For major B2B companies similar to us that think of this kind of discussions, logistics providers must have a regular agreement from their side, meaning they have to come up with proposals and other quotes to give us better support, either the visibility for the way the automation is done or the method of performing the different kinds of possibilities, which not only makes life easier for them but also for us to establish a turnaround.

Best Practices for Digital Metamorphosis

Since logistics companies have been doing a lot of mergers for the last five to ten years, the larger ones have significant problems to provide sort of a consistent type of approach across different regions. So you want to make sure if you are choosing for the global provider, it also allows getting global shares in the business to come up with a few ways how they want to get the structure aligned, on the other side how to get interfacing aligned with their sides on the report. So this is currently one of the key discussions that happen here. Some enterprises are already way ahead, and others still have to catch up, but some of the companies have also had disasters over the last five years.

How to make sure that you could have done differently on your side?

E-commerce vendors depend on the service that a logistics provider is leveraging to them, and want to get closer and closer. Therefore, at meetings, the discussions concerning the integration of customers’ topics such as why they still have a lot of paper, can't the operations be performed in such a way that they are using your IT system, and we are using our IT system, and with interfacing, all these kind of discussions. But at the end of the day, the key element is if paper is less utilized, firms can avoid committing errors because they do not have to fill out anything anymore. They can rely on one data that is set for all partners in the supply chain, and these are the different topics that you need to catch upon.

Eliminating Technology Barriers

The key element is as simple as having a vision and a roadmap on your side. If you don't have something like that, then you cannot convince anybody that is following you. So you need to have a clear path. You need to have a vision that you want to go to and then maybe discuss a little during the first part of the year about the second phase and how the whole topic can become a reality. But if you don't have that vision, if you don't have this technology roadmap on your side, if you don't have a plan of what you want to do across the regions and your staff, you have a big problem when you try to convince the in house stakeholders. For me, it is not just convincing the board from the inside, but also convincing our logistics providers.

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