Digitalization has been transforming the entire logistical ecosystem in recent times. It refers to implementing new technologies in a business that leads to reduced costs and improved business efficiency. With the advent of digitalization in today’s modern era, large enterprises can consider incorporating a digitalization strategy that has a digital twin. In other words, this would mean the digitalization of both logistical networks-road and rail of a business. This blog has listed why large enterprises must explore a digitalization strategy with a ‘Digital Twin.’, i.e., digitalization of rail and road ecosystems.

• Help use data for analysis

As a large enterprise, there is a high possibility that a large amount of data is generated daily within your organisation. However, interpreting this data in a traditional logistics setup is a challenging task. With a digitalization strategy for both road and rail, businesses can analyze the large amount of data and identify any trends. For example, in the case of road digitalization, trends may indicate that a certain number of trucks need to be allocated to fulfill the cargo requirements. Hence, a company can purchase more trucks, and more cargo can be assigned to the truck driver.

In the case of rail digitalization, businesses can capture data regarding the time taken to transport products from one city to another. Then, the products can be transported as per the schedule to avoid delivery delays.

• Expedites business processes

In a traditional logistics setup, coordination between stakeholders across the logistics network takes up time. Here, the need to speed up business processes comes into the picture. This is made possible through digital solutions for the logistics ecosystem. Tracking and analyzing the routes, automating transaction points like exit and entry gates, etc., document retrieval from government portals, etc., are techniques that help expedite business processes. Here, improved speed will help the business ensure that its customers are satisfied with the timely movement of products across locations.

• Helps reduce costs and improve profitability

In a logistics network, a business incurs costs regularly. For example, fuel costs, costs related to purchasing vehicles needed for transportation (trucks), etc., costs associated with rail transportation processes, etc., may be applicable for the business. Digitalizing all processes in the logistics network helps the company analyze and reduce unnecessary costs. For example, a business may feel that it operates more trucks than necessary. Reducing the number helps the company minimize fuel costs.

In the case of rail digitalization processes, a large enterprise may need to transport products to multiple cities from one starting point. Here, the requirement for multiple train journeys may arise. Hence, rail digitalization helps the business understand the number of train journeys and the best journey routes in various locations, which can help transport products in the best way.

Implementing both road and rail digitalization in a business will help the company lower costs to a higher extent rather than if they solely digitalize either road or rail logistical systems. This is because if the company uses a traditional system for road digitalization and a digital logistics system for rail digitalization, or vice-versa, high costs will still be incurred. In a traditional logistics setup, these can be in the form of high fuel costs due to following the wrong route, time costs related to delivery delays, etc.

• Improved routing

One of the most critical parts of an efficient logistical process is determining the best route. The best route is the one that helps minimize the time taken for logistical processes, for both road and rail digitalization, hence improving the speed of logistical operations.

In the case of road digitalization, let’s take the example of a scenario where a business may analyze that a certain route attracts a lot of traffic, leading to a significant loss of time and delivery delays on the road. Similarly, drivers may face challenges when a particular route is blocked, and the truck driver is confused about the route they should take to reach the end city. Here, the truck driver may receive suggestions regarding the alternate routes they can follow to ensure deliveries take place in a timely way. There are also high costs related to fuel (petrol, diesel, etc.) that are saved when the driver follows the best possible route.

In the scenario of railways, if multiple products need to be transported, then multiple rail journeys may need to occur for the product to reach the end destination. Therefore, railways digitalization helps analyze which trip helps products reach the endpoint in the least time.

• Improvement of logistical processes over time

Digital solutions for logistics help businesses improve their processes by identifying trends, understanding if timely deliveries are taking place, etc. Hence, identifying the problem in the current logistical ecosystem will help the company improve its processes over time, leading to better efficiency.

To sum it up…

There are many benefits your business can reap through the digitalization of your company’s logistical ecosystem. Are you ready to reap the benefits of a ‘digital twin’ or road+rail digitalization strategy?