Digital Documentation is Markedly Simplifying Cargo Movement
Picture this: A global freight forwarder receives numerous e-mails – invoices, packing lists, shipping instructions, and others – from hundreds of shippers on a common mailbox. It applies a manual and painstaking process for classifying these e-mails, feeding data into the system, and tracking queries. This spirals into a host of problems, including missed turnaround time, ineffective capacity planning, increased costs, and poor customer experience, to name a few.
A major hindrance to the uninterrupted flow of goods around the world is complicated, slow, and error-ridden documentation. The realization that quick, accurate, and easy flow of information is vital for global trade is now driving shipping and logistics companies towards digitization, albeit somewhat belatedly.
The sector that started making tentative and sluggish moves towards digitizing its manual, paper-intensive processes a few years back is now getting more sure-footed in its efforts. Disruptions as a result of the COVID-19 pandemic have served as a reality check for shipping and logistics organizations, and provided the much-needed thrust to transform billing and documentation processes. This transformation is taking place on the back of the increasing mainstreaming of digital technologies such as Robotic Process Automation (RPA), Artificial Intelligence (AI) and Machine Learning (ML), and Internet of Things (IoT).
Digital adoption has picked up pace in recent times. Digital transformation in the transportation and logistics market is expected to reach USD 145.28 billion by 2025.1
The Need to Adapt to a Changing and Disrupted Environment
The pandemic has underscored the interdependence of nations and set in motion the restructuring of the global logistics market that is projected to grow to USD 12,975.64 billion by 2027, registering a Compound Annual Growth Rate (CAGR) of ~6 percent from 2020 to 2027.2 However, to achieve such growth prospects, shipping and logistics companies need to address a number of challenges. The top immediate challenges include frequent volume fluctuations and uncertainties, and long-term concerns are shifts in supply chain strategies and globalization patterns, and changes in consumption and spending habits.
The traditional analog system of spreadsheets and clipboards is grossly inadequate in meeting these fast-changing needs of today. Such systems are inefficient and tedious, particularly for cross-border transportation that requires extensive documentation.
The movement of goods relies on a number of physical documents, including Bill of Lading (BoL), consignment notes, invoices, packing lists, and shipping instructions. These documents limit transparent communication among suppliers, logistics providers, regulatory agencies, retailers, and buyers. The use of physical documents has a direct impact on the flow of information, flexibility, efficiency, timely decisions, and delivery tracking. Papers alone cost the supply chain industry more than USD 3 billion every year.3
Manual data entry is believed to be the cheapest way to process shipment documents. However, there is a high risk of inaccuracy and inconsistency associated with this traditional practice. Even the smallest of errors in the data can derail the whole process and add to operational costs. According to a Gartner study, organizations believe poor data contributes to an average of USD 15 million per year in financial loss.4
When there is a crisis that disrupts the value chain, the paper-based process can add to shipment delays, especially for cross-country documentation. Without visibility into the value chain, companies are also unable to monitor, proactively identify problem areas and put an emergency plan in place.
In the wake of the pandemic, consumer behavior has drastically changed with an accelerated shift towards e-commerce. Traditional documentation practices become ineffective in keeping up with customers’ new demands. Now customers expect same-day or next-day delivery. Shipping and logistics players must be able to meet these new market expectations.
Digitization is Clearly the Way Forward
Organizations that leverage digital technologies have shown greater preparedness in the face of change and uncertainty.
Automation drives accuracy in shipment documentation, reduction in manual work, elimination of human errors, and better management of prices and inventory. Companies that have digitized their supply chains and operations can anticipate efficiency gains of 4.1 percent annually and revenue growth of 2.9 percent a year.5
Companies can employ data-driven insights from digitized processes to make better and timely business decisions and mitigate risks. Predictive analytics helps in forecasting outcomes and trends, and enables companies to adapt quickly and effectively to evolving situations. A key differentiator of a digital supply chain is its ability to provide end-to-end visibility. Companies can track the movement of goods effectively and provide users real-time updates on a shipment.
Innovative Technologies Are Revolutionizing Document Processing
Business growth and resilience for shipping and logistics companies will hinge on streamlined, agile, and efficient billing and documentation processes that leverage the following technologies:
Machine Learning: Enables the system to identify trends from historical data to validate documents with very high accuracy
AI: Enables the interpretation of real-time information that helps in in accurate contextualization of data
Blockchain: Facilitates the safe recording of data vis-à-vis the goods being shipped among different players in the value chain, and makes the approval process quick and transparent. Blockchain makes it safe to share sensitive data, thus boosting trust
RPA: Automates high-volume, repetitive, and time-consuming tasks. RPA tools can work in conjunction with other technologies that help solving coordination gaps between document processing platform and client Transportation Management System (TMS)
Agile & Holistic Digitization Suites Are the Need of the Hour
All stakeholders in the shipment journey – be they 3PLs, brokers, trucking companies, or Non-vessel Operating Common Carriers (NVOCCs) – today seek end-to-end digitization of the documentation process. Solutions that harness the combined prowess of technologies such as AI, ML, RPA, cloud, and analytics to deliver on the imperatives of automation, integrated visibility, and cybersecurity are in great demand. For instance, a leading shipping company leveraged WNS Malkom, a proprietary digital shipment and document platform, to drive intelligent automation across the BoL process.
As enterprises look to deploy the right platform to digitize their documentation process, it’s paramount they factor in some key aspects, including:
Foundational pillars of ML, big data analytics, cloud integration, and deep domain knowledge
Ability to combine e-mail management and intelligent digitization powered by AI and ML
End-to-end workflow management providing real-time status of every transaction
Integrated dashboard management enabling real-time visibility into different processrelated Key Performance Indicators (KPIs)
Robust underlying cloud architecture – Amazon Web Services (AWS), for instance – for heightened security from cyber threats
Pay-as-you-go model for easy scaling up and down as the business demands
Seamless integration with a company’s Enterprise Resource Planning (ERP) system via Application Programming Interface (API), or through robotic automation / partner middleware
In a highly volatile and regulated sector that requires extensive documentation, shipping and logistics companies can significantly ease the burden with digitized processes. Digital transformation will enable them to do away with the inadequacies associated with manual interventions, and improve their operational agility and resilience.
Know more about WNS’ digital documentation platform for the shipping and logistics industry