In our current e-commerce driven world, freight is no longer an afterthought. It’s a core component of your customer service experience and - at up to 10% of a product’s cost - a key contributor to your bottom line. When it’s done well, it can be a key differentiator, but when it’s done poorly, customers are quick to move on.
Today, businesses are looking for ways that technology can help them to compete in a fast-changing world. Embracing integration and automation in your logistics and warehouse management allows you to streamline workflows to save your staff time, reduce your costs and optimise your entire end-to-end freight processes.
It sounds good in theory, but what does it actually look like in practice? First, let’s establish what we’re referring to when we talk about integration and automation.
Put simply, integration is the connection of two or more systems to allow the platforms to work together. Allowing data to flow between multiple systems such as your ERP, eCommerce, accounting or warehouse software and logistics management solution means greater visibility of the data you have, and more efficiencies and consistencies in how it is used.
Automation allows you to scale your freight and logistics operations without adding staff by reducing manual intervention. Whether you embrace end-to-end automation or simply apply it to a few key high-volume processes, the benefits of this technology to your business are compelling.
While the two concepts clearly go hand-in-hand, each has a distinct role to play. Integrating your systems is the critical first step in laying the foundations to support automated workflows.
We can see these two different levels when you look at the order and consignment processes:
The order level
Integration of your systems kick-starts the flow of data between platforms that allows you to see all information about the customer, the sender, the receiver and everything else that may be associated with the order.
At this level, the consideration is how the data is to be treated once it comes across. For example, is it a pallet, is it a box, is it dangerous goods, how is it packed? Any of these considerations can be used as a trigger to automate the next step in the process. When you think about the potentially thousands of orders you receive a day, the resources you’re saving by removing human intervention is significant.
Let’s look at the four powerful ways that integration and automation are used.
Warehouses are labour intensive, and are frequently overlooked for efficiency gains. They often have the oldest technology, and have their workforce completing repetitive and manual tasks. All too common, staff are performing low-value data entry and re-entry. By integrating your platforms and establishing some rules up front - such as triggering a label to print on finalising an order in your ERP - your staff can enter data once and see it flow through to other systems along the logistics lifecycle, minimising human error and maximising efficiency.
Take Freight People’s Cario solution for example. You can directly link the transport management system into numerous platforms - including Shopify, WooCommerce, Magento, SAP, NetSuite, MYOB, and Xero - and have your data flow from its capture during the initial order right through to the point of dispatch without manually re-entering any information. In addition, a lot of the decisions along that order lifecycle can be taken care of automatically - what type of packaging is required, which mode of transport is most suitable, which carrier is the best fit, what’s the most cost-effective delivery option, when the labels are ready to be printed, and the location of the goods once they’ve left the warehouse, to name a few.
While manually tending to your consignments may be manageable for now, as your business grows, those resources are better utilised elsewhere. Looking up freight prices to save $10 here and $5 there might seem beneficial, but if you have 1000 consignments a day, this approach is just not feasible. Automation is the only way that you can scale to meet large volume logistics operations.
You can do more with less.
Re-entering key ERP order information into a transport management system opens your business to human error. This can result in:
· Confusion in the warehouse as to the contents and priority of orders.
· Dispatch of product to the wrong place with the outcome being costly recall, time delays and frustrated customers.
· High freight costs due to mistakes in type or size selection, impacting your freight decisions and spend.
· Poor quality management with goods being marked as fit for sale when they are not.
Integrating a logistics management system with your ERP, eCommerce and/or warehousing system provides you with better data and eliminates manual entry errors. By establishing this foundation of accurate data, you can then consider harnessing automation capabilities to streamline operations and minimise the costly mistakes associated with manual data entry. One consignment can go from $4000 to $8000 by just choosing the wrong method of freight.
To reap the rewards of an integrated and automated process, you must invest some time upfront to define the rules that will take the place of human decision making. This step may seem intimidating, but it’s critical and it will result in accurate data, better visibility, and consistent outcomes.
For most organisations, this step involves defining around 10 or more ‘if this then that’ rules. For example, if an order is marked as “urgent” then sen via air freight, or if the destination is within this set of postcodes then select that particular carrier, or if this consignment is destined for Perth then dispatch via rail.
Leveraging formally documented rules is a good starting point when defining these rules, but the challenge is often in extracting knowledge from people’s heads about the decisions and processes that are performed everyday. There’s many a warehouse manager that can eyeball a consignment and instinctively know how it needs to get to the customer.
With formal and informal rules documented and automated decision making in place, staff that would otherwise be consumed by menial tasks are freed up to focus on more strategic initiatives such as data analysis. Shifting focus to those areas can deliver significant business value - for example, analysing the prices and lanes for cost savings, rather than trying to drive manual efficiencies within the warehouse.
There are risks to your business by not harnessing integrations and automations in your logistics operations:
The informal rules we spoke about previously can become a big problem if a key team member has the knowledge about the freight decision making matrix in their head only. If they are sick or go on holiday, you’re left with a huge gap in terms of process knowledge that cannot be filled, often resulting in costly mistakes. Establishing formal, documented rules embeds corporate knowledge in your systems and processes, not in someone’s head.
Directly integrating your systems via API provides much greater visibility and in turn, improved security. With a constant record of your data and your user’s activity, you’ll be able to quickly pinpoint any issues and keep teams accountable for their actions.
It’s important to consider stakeholders across your business when evaluating this type of project to ensure you have buy-in across the board, from your warehouse staff to the IT team. This will ensure any concerns - from employee adoption to security queries - can be addressed upfront.
It’s easier than you think to embrace the power of automation and integration. Whether you’re starting with a spreadsheet or looking to improve your existing siloed environment, have 10 consignments a day or 10,000, Freight People can help you take the first steps on your automation and integration journey.