Logistics DX (Digital Transformation) refers to the efforts to innovate business processes and services in the logistics industry by leveraging digital technologies. The purpose of Logistics DX is to promote digitalization and innovation in the logistics industry, aiming to improve efficiency and competitiveness.
Logistics DX and Logistics IoT (Internet of Things) are closely related. Logistics IoT is a technology that utilizes sensors and networks in the logistics industry to collect and analyze logistics data, enabling efficiency and visibility improvements. In Logistics DX, efforts are made to optimize logistics processes through the utilization of digitalized data using Logistics IoT.
Relationship between Logistics DX and Logistics IoT
Logistics DX and Logistics IoT are similar concepts. IoT (Internet of Things) refers to connecting all kinds of things, such as cars and home appliances, to the Internet, which were traditionally independent of networks, to achieve efficiency improvements in business and daily life.
Logistics IoT applies this IoT mechanism to the logistics field, realizing the visibility of logistics processes. Examples include monitoring temperature changes of goods during transportation using temperature sensors, implementing RFID for efficient inspection work, and automating tasks such as unmanned handling robots (AGVs) and autonomous mobile robots (AMRs) for transportation within warehouses.
Logistics IoT can be considered as one of the elements of Logistics DX, included as a subcategory within the larger category of Logistics DX.
Two Background Factors Driving Logistics DX
In recent years, Logistics DX has been driven by two major factors
Decline in workforce due to labor shortage
Decline in workforce due to labor shortage: The first factor is the worsening labor shortage. In Japan, due to the progress of an aging population, many industries, including the logistics industry, are facing a shortage of labor. The logistics industry, in particular, is facing a severe situation where manpower is not readily available due to long working hours and low wages. From truck drivers' shortage to insufficient manpower in various processes such as unloading, inspection, de-palletization, transportation, storage, and picking, there is a concern that it will be difficult to maintain logistics services without addressing these issues.
Not only in the logistics industry but also in the manufacturing industry with factories, labor shortage has become a serious issue. According to the Manufacturing White Paper 2022, the number of young workers in the manufacturing industry has decreased by approximately 1.21 million over a period of about 20 years. On the other hand, the number of elderly workers has increased by about 330,000 over the same period, indicating a shortage of the overall population and an aging workforce in the manufacturing industry.
Increase in e-commerce volume due to the growth of the e-commerce market influenced by COVID-19
The second factor is the rapid growth of the e-commerce market and the increase in e-commerce volume due to the COVID-19 pandemic. According to the ""Market Survey on E-commerce"" by the Ministry of Economy, Trade, and Industry, the size of the physical e-commerce market in 2020 was approximately 12.23 trillion yen, showing a growth rate of over 20% compared to 10.515 trillion yen in 2019. The rapid increase is attributed to the increased demand for stay-at-home consumption due to the spread of the novel coronavirus. As a result, consumer behavior has shifted from purchasing in physical stores to purchasing on e-commerce sites, leading to an increase in e-commerce demand.
With the expansion of the e-commerce market, factories and warehouses have to operate with reduced workers due to infection prevention measures while dealing with increased volume of goods circulation.
In summary, the logistics industry, facing a labor shortage while the market expands, needs to achieve efficiency through automation and digitalization to meet market needs.
Automation as the First Step towards Logistics DX Realization
As mentioned earlier, Logistics DX refers to the digitalization of logistics processes and a significant transformation of logistics itself. How can we promote Logistics DX effectively?
Since it is not physically possible to increase the workforce to address the labor shortage, it is necessary to review workforce allocation. ""Automation of logistics"" is one of the DX initiatives that can contribute to solving these challenges. By automating tasks with low productivity through digitalization and consolidating human resources for tasks with high productivity, efficiency can be achieved.
Automation not only leads to labor reduction but also helps eliminate dependence on specific individuals in the workflow and reduces human errors in picking and delivery, among others.
In the next section, we will focus on ""automation of logistics"" as a specific initiative to realize Logistics DX and provide detailed examples.
Specific Initiatives for Logistics DX and IoT by Process
To transform the logistics landscape and improve productivity, it is essential to start with ""automation of logistics."" Simple tasks such as loading and unloading goods can be fully automated, while more complex tasks like picking small parts or products can be achieved through collaboration between humans and machines.
Specific automation initiatives for Logistics DX and IoT, organized by process, include:
Automation of loading and unloading
Automation of unloading and loading goods using unmanned forklifts to achieve safe and efficient operations.
Introducing flexible facilities that can adapt to changes to establish a storage system capable of efficiently managing the overall process and maintaining high-quality standards.
Introducing a Warehouse Execution System (WES) or Warehouse Management System (WMS) to support the automation and IoT (visualization) of logistics processes. Accumulating data allows further improvements. For more details on each initiative and solutions, please refer to the respective service pages linked above.
LOGITO provides solutions that support initiatives such as those mentioned above. LOGITO is a specialist in promoting the automation and visualization of logistics processes. We offer optimal equipment and solutions tailored to individual needs by comparing manufacturers from Japan and abroad, addressing the challenges faced by logistics operations suffering from a shortage of manpower and achieving operational efficiency through robot adoption. From analysis of on-site challenges to after-support, we provide a one-stop solution.
In the attached document, we explain points to consider when promoting logistics automation and provide more details about LOGITO. If you are interested in Logistics DX, please take a look at the document."
Related Documents
Primer Guidebook for Successful Logistics Automation
In this book, we the current state of logistics automation and examples of failure , and explain the checkpoints to prevent failures in logistics automation.
Leveraging the know-how cultivated through a global network of 34 bases in 17 countries around the world, the LOGITO management office provides a variety of useful information for the practice of logistics automation, from industry trends related to logistics automation to know-how and success stories.
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LOGITO is a logistics automation solution provided by DJK.
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