Rise of e-commerce and increased domestic consumption are likely to pave the way for robust growth of the logistics industry in future. In conversation with Rakesh Rao, Transworld Technologies CEO Vikram Puri explains why fleet tracking systems are important for logistics sector and how telematics is transforming business operations.

 

What is the current status of the logistics industry in India? 

Logistics is viewed as the foundation of the economy as it guarantees proficient and financially savvy stream of merchandise and other business parts rely upon it. Logistics industry in India is evolving rapidly. It is the interplay of infrastructure, innovation and new kinds of specialist organisations, which characterizes whether the logistics business will have the capacity to enable its clients to decrease their expenses and add value.

 

Despite weak response, the logistics industry continues to witness growth owing to the progress in retail, e-commerce and manufacturing sectors. Logistics industry is expected to reach over $ 2 billion by 2019. Rise of e-commerce logistics and increased domestic consumption will pave the way for the industry to grow further in future. 

 

With the promise of steady growth and improvement, the service oriented logistics industry is ready to expand exponentially in the next few years. Indian logistics is hamstrung by legacy equipment, operations style and a lack of IT, exacerbated by a general distrust and slow adoption of new technology. Logsitics in India is still, quite literally, driven by legacy transport and labour.

 

How do you cater to logistics sector?

Transworld is an Indian technology inventor and innovator company. We have created the Mobile Eye, a smart edge computing IoT device and coupled it with a complete cloud based M2M IoT platform called FleetView.

 

A combination of the Mobile Eye with various periphrals like cameras, sensors etc and FleetView with its big data capability provides an enterprise class visibility and safety measurement solution right across supply chains.

 

 

Why are fleet tracking systems important for logistics sector?

Visibility is everything – you cannot manage what you don't measure. Fleet and logisitics companies in India have long assumed that they are doing the best possible under the circumstances but the use of visibility solutions like track and trace, fleet and warehouse management systems are an eye-opener.

 

Supply chain visibility systems make all operations transparent, across the supply chain, pin-pointing areas that need attention and improvement. At this nascent stage, the benefits are huge, largely because of an already inefficient baseline, especially in the transport and fleet part of the industry. Big gaps in operations and efficiency become instantly visible, forcing even the most distrustful businesses to acknowledge and adopt the technology more extensively.

 

Once implemented, the systems start capturing and serving up data in usable form. That data helps fleet owners to execute cost saving methods and processes based upon improved vehicle use and driving habits and increase revenue by plugging and eliminating duplication and time loss, optimising loads and routes, as well as increasing general people productivity levels.

 

Are you seeing a rise in use of telematics among fleet operators in India?

Telematics is clearly seeing increasing adoption across the country, albeit in the form of basic track and trace, rather than the holy grail of optimised supply chain management. Companies, especially fleets, are taking tentative baby steps due to lack of a choice and availability of enterprise class solutions that need little or no IT infrastructure and low investment.

 

What are the factors driving the demand for telematics?

In a word, it would be costs. That is the biggest driver in any business and the Indian logistics sector is no exception. It is extremely cost conscious and buying decisions are driven by both need and fear – the need to constantly be more competitive just to survive, countered by their fear of investment in a technology they believe isn't easy to understand or implement in their organisations.

 

There is also a push from their customers, the manufacturers of the goods they store and transport, to increasingly implement technology that gives them (their customers) clear visibility in an otherwise opaque operation. Manufacturers are realising that transit losses and inventory, transport costs and warehousing need increasing control and management, even for their 3PL vendors.

 

How is fleet management telematics transforming business operations?

Any business operation is about management and optimisation. A good fleet management system provides actionable business intelligence and predictive lead indicators that directly impact the business. It is a tool that allows transparent and repeatable actions that give consistent results across the breadth of the entire supply chain, for every stakeholder.

 

Simple actionables can range from just expediting the repair / service of a vehicle to rewarding drivers transparently. All of these actions and indicators save time and money, if acted upon timely.

 

Are telematics cost-effective even for small fleet operators? 

The only way to measure cost-effectiveness of any system is to compute its return on investment.A solution may be high priced but yet more cost effective than a cheaper one that does not deliver significant value. 

 

A good way for small fleet operators to measure their returns are to see if they are able to earn the same freight revenues with fewer vehicles ie identify the vehicles that are now visibly not in use and compare freights earned. Idle and downtime are a big drag on profitability for small fleet operators.

 

Will rise in 3PLs segment led to further increase in demand for telematics?

Without question, a rise in the 3PL business segment will increase demand for telematics significantly. Third party logistics (3PL) companies have mainly large corporate manufacturers or new age businesses as their customers – all of them demand integrated and up to the minute technology and data.

 

What are the challenges faced in incorporating telematics in a vehicle or in a fleet?

Clearly, technology resistance is a big factor, followed by lack of faith in the ability of their own companies to adapt to new systems. Perceived complexity and costs are other major reasons that need to be addressed.

 

Training, investment ability and past experience closely follow as ancillary challenges. In many areas, Internet connectivity and the cost of it, was another issue that is fast changing because of the proliferation of cellular data services. 

 

Technology is redefining every element of global supply operations, from manufacturing to shipping, warehousing, competition, collaboration and customer expectation management. With so many technologies competing for management attention and investment, defining a clear digital strategy to help drive business efficiencies is crucial for future competitive survival.

 

How are new manufacturing trends such as Industry 4.0, IoT, etc changing the way the goods are transported?

Industry 4.0 has finally started to emerge as a real driving force shaping the future of the global supply chain. Just like the case for most enterprises, transport segment organisations are confronting significant change, driven by programming interruption and the effects of new innovations on supply chains all around, making a quick move in procedures to suit the basics of Industry 4.0. 

 

In spite of the fact that robotisation and digitization of assembling is now commonplace, the down to earth uses of these innovations are as a rule essentially acknowledged over the vehicle and logistic sector. This is driving digitization and combination of vertical and flat supply chains, digitization of item and administration contributions and the advancement of new computerised plans of action and delivery methodology.

 

What are your plans to further tap the automotive industry in India?

Interchangeability and adaptability is the mantra – making the solution more of a “one size will work for all” will be succeeded by ‘one system can cusomised by all’. Fleet managers and supply chains are already asking analytics level access to data warehouse or curated data cubes.

 

We intend to make FleetView and the Mobile Eye even more modular and adaptable, allowing us to remain flexible enough to absorb new devices, platforms, sensors and technologies. CAN, OBD and retrofit sensors are already available and going forward, we intent to expand the selection. Fuel, tyre and service management will form a key part of the enterprise business proposition.

 

We will, however, always stay focused on our core strengths – driver behaviour, road safety and the enterprise.