The Role of Digitalisation in Germany’s Logistics Sector
Germany has one of the largest and most effective logistics industries in Europe. Its central European location, advanced infrastructure and size of the industry make Germany a powerhouse in the logistics sector worldwide.
As digitalisation continues to revolutionise industries from finance to healthcare, Germany has had to adapt and embrace the changes in the logistics sector. Digitalisation in logistics has transformed the industry, and innovative strategies and technological advancements have been introduced across processes to improve output and efficiency.
So, what is the role of digitalisation in Germany’s logistics sector?
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Importance of digitalisation in logistics: Germany
As one of Germany’s most lucrative industries, employing around three million people, logistics plays a central role in the country’s strong economy. Whether inbound or outbound, via a highway, port or the air, the logistics sector is one of the most important industries in Germany.
That is why the logistics sector must continue to transition and adapt to the digital world and welcome the demands of digitalisation.
Digitalisation in logistics has many benefits, including greater efficiency, improved customer experience, cost reduction and sustainability. Utilising technology leads to the development of new and innovative processes, which provide better services and overall performance of the logistics sector.
Three ways Germany’s logistics sector has been digitalised
Digitalisation in logistics has had a profound impact on how the sector works globally and continues to optimise day-to-day performance and delivery. The logistics industry has welcomed these changes to remain competitive and meet the demands of digital advancements in other sectors.
One of the main ways Germany’s logistics industry has become digitalised is through the utilisation of data analytics. Logistics companies across Germany can leverage big data to make informed strategic decisions, analyse large sets of data, predict demand and optimise digitalisation in supply chain.
Here are three other ways the logistics sector in Germany has been digitalised:
- Pick-By-Voice technology
Germany’s logistics sector continues to adapt and evolve to ensure it remains a dynamic player in the global logistics industry. One way it has shown this is with the seamless adoption of the Pick-By-Voice technology, which aims to enhance accuracy and productivity.
Pick-By-Voice is a packing system used throughout warehouses in Germany controlled by voice commands. This hands-free technology reduces the need for training and streamlines operations to meet the increasing demands for efficient supply chains.
This is one of several automated systems used in warehouses to reduce human error and increase productivity, highlighting the positive impact of digitalisation on the logistics industry.
- Real-time tracking of goods
Today, if you order an item online, the expectation is that you’ll instantaneously receive a tracking number to follow the progress of your parcel from clicking order to receiving the delivery. To meet this demand, logistics companies in Germany have utilised the advancement of digital platforms by using GPS and other technology to offer real-time tracking of goods.
The increased transparency and accuracy benefit both customers and providers who can monitor the progress of shipments throughout the entirety of the supply chain.
- Digital freight forwarding platforms
The movement of goods from one place to another has also undergone digitalisation through digital freight platforms. This advancement improves the management and communication during the shipping process.
The digital platforms make it easier for shippers and carriers to manage supply chains by providing a single platform for all logistics operations. This streamlines the shipping process and creates a user-friendly platform to improve customer satisfaction.
Challenges of digitalisation in logistics
Digitalising one of Germany’s largest and most lucrative sectors is not an overnight process. The digital age is constantly evolving, and industries are expected to adapt to trends and changes.
With that comes ample opportunity for progression, but also presents several challenges that must be addressed before implementing new technology.
Here are some challenges of the digitalisation in logistics:
- Privacy concerns: Data and cybersecurity measures
With any new technology that processes large amounts of data there are concerns over data privacy and security. It is integral to the success and trust of the logistics industry that companies continue to protect customers’ personal information and remain vigilant to the threat of theft.
Therefore, the digitalisation of the logistics sector requires an increased need for cybersecurity measures to protect companies from cyberattacks, which would make sensitive data vulnerable.
- Training and integration
Like all industries undergoing digitalisation, training is required. New technology requires specialised IT skills to collect, manage and analyse data. Therefore, companies must provide training for employees.
Once training takes place, it is important that the workforce is on board with the integration of technology and new digital processes into day-to-day work. All parties must be able to cooperate and be comfortable integrating new technology into existing systems and processes.
- Cost
Despite the digitalisation of logistics being a cost-effective long-term measure, there is a significant start-up cost to integrate the new technology into the sector. The investment into the introduction, maintenance and updating of software also requires hiring trained professionals and providing training programmes for the existing workforce.
Study a logistics programme in Germany
If you are looking to pursue a career in logistics, studying in an innovative country like Germany makes sense. With the country being a global leader in logistics, German universities provide students with advanced knowledge and skill development during logistics and supply chain management programmes.
The Berlin School of Business and Innovation offers an 18-month postgraduate programme in logistics in Germany to provide the world with highly skilled graduates armed with innovative solutions to enhance the logistics sector.
Check out BSBI’s MSc Global Logistics and Supply Chain Management programme today.