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Four digital technologies transforming the supply chain

Kenny MacIver — February 2017
Markus Voss, CIO and COO at Deutsche Post DHL’s Supply Chain division, highlights the digital innovations reshaping the company’s business today — and promising to disrupt the logistics market of tomorrow.

As with many large organizations, Deutsche Post DHL Group looks to its IT group to track and assess the potential of different digital technologies to transform operational activities, enhance competitiveness and enable new business models.

Within the company’s €15.8 billion ($16.9bn) Supply Chain business, CIO and COO Markus Voss and his IT team keep a watching brief on dozens of different tech innovations. But four in particular — augmented reality, robotics, unmanned aerial vehicles and the Internet of Things — have rapidly demonstrated their business value in recent deployments and signalled just how impactful they will be in the future.
Smarter vision

As Voss observes, the early versions of smart glasses were a relative failure — especially in consumer markets. And indeed when DHL first looked at the technology in 2014 as a means of enhancing warehouse workers’ ability to pick, track and despatch items, both the optical head-mounted displays and their user interfaces felt  “clunky and were unworkable.” However, in Voss‘s view, the technology has evolved dramatically ever since, to the point where DHL Supply Chain is now rolling out smart glasses across its global warehouse network to help item pickers to optimize their work on the shopfloor.

Not only has the feedback from employees been positive, the efficiency gains have surpassed all expectations — especially when on-boarding new staff. “We’re seeing 10% to 12% improvements in productivity in operations that were already recognised as best in class,” he says. “And a brand new worker who’s never been in one of our warehouse before and has no experience of picking can put on the smart glasses and be operational within an hour.”
Relating to robots

DHL Supply Chain, which delivers customized logistics solutions to customers as diverse as Sanofi, Virgin Trains and Airbus, is also exploring the broad application of robotics — and that means making robots much more interactive and reactive. “The automotive industry has used robots for decades,” says Voss. “But these are usually contained in a dedicated cage, separate from people. In a logistics environment there’s a lot of movement, so robots need to work alongside human beings and react quickly to the things happening around them.”  

In recent months DHL Supply Chain has been trialling EffiBOT, an intelligent vehicle that automatically follows a worker as they move around a warehouse, depositing and picking items. “The EffiBOTs are taking all the unnecessary physical work out of dragging a big trolley around a warehouse,” he says. DHL is also using robots for repetitive tasks such as the packaging of different parts. These trials have been so successful, says Voss, that further deployments are now being planned.

And this is just the start, says Voss. “We see robots improving much further.  They need to be able to see, to react, to pick and to move around. And all of this is now coming together.” 
Ready for take-off

Unmanned aerial vehicles (or drones) are an equally hot topic at DHL. And again, the technologies are maturing at previously unforeseen speeds, says Voss.

It was only a year and a half ago that DHL teams at the company’s headquarters in Bonn were experimenting with drones by flying packages back and forth across the river Rhine. By mid-2016, however, they had integrated the drone capabilities into an existing offering for a pilot that included the use of the company’s Packstations, the parcel delivery lockers dotted across Germany where customers can collect their packages by using a PIN. “We have proven the viability of these drones in the consumer market and I don’t think it will be too long before we see delivery drones as part of our every day lives ,” says Voss.
‘Interacting with things’

Voss points out that DHL has exploited connected devices in its operations for several decades. But, as IoT technologies have become more sophisticated, the opportunity to add more intelligence into the flow of goods in transit has grown dramatically.

“We are currently using sensors in many different ways to optimize our environments,” says Voss. “IoT technology introduces brand new ways of interacting with things in the supply chain.”

He cites three examples. The DHL division is using IoT to track the movements of forklift trucks in its facilities in order to balance resources usage. “In some warehouses, we might have excess capacity. Just by looking at the data from sensors on how often each forklift is being driven around we can take significant waste out of the overall process.”

DHL is also injecting more intelligence and connectivity into the supply chain so that when a product is ordered it can be delivered exactly where and when it is needed. That includes delivering items to the trunks of customers’ cars.

At a more traditional level, the company is using IoT to refine the ‘track and trace’ service it offers around the movement of items. “Not only can we now locate where a specific item is in the journey to the customer, we can now also detect its environmental conditions,” says Voss. That is particularly important when dealing with delicate goods such as pharmaceutical products, which need to remain within a set temperature or humidity range. “It’s all about ensuring the customer is receiving the right quality of product,” says Voss.

As these developments highlight, the opportunities for digitally enhancing the business are simply accelerating, says Voss. “The speed at which we are able to develop those technologies, many of which are brand new, is just amazing.

• Markus Voss was a keynote speaker at Fujitsu Forum 2016 in Munich

• Photography: Stefan Hobmaier
First published
February 2017
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About: Markus Voss
For the past decade, Markus Voss has played a leading role in the planning and execution of DHL Supply Chain’s ambitious vision for digital technology. He became global CIO in 2015 and took on the additional role of COO role in January 2017.

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