Saturday, July 11, 2015

The Game Is Changing….Technology

Last week I wrote that we were entering a new and different world when it comes to doing business. There are fundamental changes occurring that are forcing transportation and logistics service providers to adapt or else. One of the most significant game changers is technology. For those of us old enough to remember what it was like doing business before computers and cell phones, today’s information and communication capabilities are truly amazing. I have been fortunate enough to sort of ride along on the wave of technological advancements and I cannot imagine doing business the way we used to.

Back in the mid-60’s, Gordon Moore, co-founder of Intel, wrote a paper stating that essentially computing power would double every 2 years. It became known as Moore’s Law and has turned out to be a fairly accurate prediction. Some even say that the “doubling cycle” is only 18 months. There are various opinions regarding how long this exponential explosion can go on. In theory, at some point, we reach diminishing returns. But certainly, in my adult lifetime, Moore’s Law seems to hold true. As a result, I think it’s fair to say that we humans are now trying to catch up to technology. What can be done with technology is way out there, just waiting for application and adaptation. If you can imagine it, it’s possible. In fact, it’s likely to become reality within your lifetime. At some point, the discussion turns to ethical considerations about the creation, development and maintenance of life forms. I’m not going there. Just read Mary Shelley’s Frankenstein.

Interestingly enough, the way technology is being used these days in managing the supply chain can be somewhat “Frankenstein-ish.” And when you hear the horror stories associated with “system conversions” or “new installs”, there is a tendency to step back and say maybe we’re trying to do too much with technology and let’s just get “back to the basics”. Sorry, you can’t go back. The basics are on the move and you better keep pace. As noted above, we humans are trying to catch up to technology. No question, sometimes application design is poor, training is lacking and implementation/execution fails. But it’s the human element that is failing here, not the technology.

I would say that most transportation and logistics companies would do well to stay close to the leading edge when it comes to technology. But, let other industries or companies with deep pockets do the pioneering. This is still a fragmented, low-margin business and the only thing worse than expensive new technology is expensive new technology that doesn’t deliver . The key is to constantly examine every function in your business and figure out how you can do it better. Don’t think technology first. Think process and improvement and how you can do it better. If it takes technology to get there, then determine if is it economically feasible and do you have the people who can and will use it? Technology is not the end all. But if you fail to take advantage of what’s out there, you will lose the game.

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