Green Supply Chain and Digitalization: How Tech Makes Logistics Sustainable

The pandemic is not just a mere health crisis. It is a devastating economic disruption and has caused dramatic labor turmoil on a global scale. As far as the supply chains are concerned, we have witnessed their exposure to vulnerability and inadequate contingency plans. Due to the growing saliency of ethical aspect during Covid, companies find it crucial to shift to responsible consumption. Putting corporate social responsibility at the forefront, businesses do not expect a rapid reward. On the contrary, it is a long-term strategy that provides a competitive advantage for the years ahead.

Sustainable supply chains hit the triple bottom line. The strategy encompasses economic, social, and environmental dimensions. As per the Green Growth report, the companies with a strong CSR (corporate social responsibility) posture tend to show resilience in the face of the current challenges. Commitment to responsible conduct demands utmost transparency, unrestricted communication, and superb risk management. Having this mindset embedded in the supply chains is the path to a greater social value in the context of public procurement.

Logistics organizations increasingly embark on digitalization as the locomotive for green supply chains. Adopting ML, AI, big data analytics, IoT, cloud, and beyond creates a new business paradigm where technologies build smart, effective and sustainable logistics. Let’s see how exactly they do it.

Sustainability in the language of tech

It would be appropriate to discuss specific technologies and solutions they provide.

Big data and AI. The application of algorithms fosters synergetic collaboration, which is a crucial factor in logistics chain effectiveness. When the supply chain is intelligent and collaborative, it means that a company can share transportation methods with its partners. For instance, a specialized algorithm powered by Vlerick, is a tool for sharing shipping details and finding a relevant transporting provider. The technology uses GPS data to record detailed shipping firms’ information. In this way, a company can expedite logistics, drive cost-effectiveness, decrease waste levels, and therefore become green.

Driverless vehicles are the most popular application of artificial intelligence in the context of logistics. First and foremost, a business can strengthen its route planning — finding more advantageous routes. This automation eliminates the human factor and brings more accuracy. In the coming years, we will witness an increasing number of zero-emission autonomous boats.

The planning of delivery urgency is another area where AI algorithms work well. More specifically, they help to boost shipping efficiency by defining its real necessity. Algorithms analyze the environment and then generate routes that bring fuel and urgency into line. Moreover, artificial intelligence easily adjusts to shifts in delivery prioritization. When done manually, this type of calculation can take a lot of time and cause delays. AI significantly speeds up complex decision-making. Using deep reinforcement learning, an organization calculates the accurate number of goods, the exact time of shipping, and the most relevant vehicle type. The fact that the system works in real-time helps mitigate any risks and quickly adapt to fluctuations. By conducting constant analysis of the supply chain, smart solutions recommend improvements and green contractors and partners.

Internet of Things. According to the Information Age data, industrial interconnectedness improves the environmental posture of more than 67% of companies. IoT works miracles in terms of fuel efficiency, waste reduction, and infrastructure management. First and foremost, IoT solutions help to plan routes rationally and reduce petrol consumption. Second, a company can track goods conditions during transportation. If any damage happens, or an item is near its expiry date, it is replaced timely. And third, civic infrastructure management through IoT…

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