As the global port congestion has caused several challenges to the supply chain industry, it is important to see how technology and digital systems could assist in such cases.
Michael Rabinowitz, CEO of CoEnterprise, an enterprise software and services company headquartered in New York City, has expressed his views on the continuing global port congestion and the possible techy assistance with the right use of digital tools.
CoEnterprise was founded in 2010 and delivers supply chain and business analytics solutions and services aiming to empower companies to integrate and analyze their data to break down barriers and make faster, smarter business decisions.
- Do you believe the shipping industry could have avoided the global port congestion that occurred in the last few months?
Certain challenges were unavoidable, such as fluctuating demand and limited capacity. However, organizations could have been better prepared. Leveraging the right technology to increase supply chain visibility could have allowed businesses to significantly reduce delays and disruption while maintaining agility and continuity.
The real issue is that long before disruptions such as Covid-19 or the Suez Canal blockage occurred, the shipping industry was already plagued with weak spots. For example, natural disasters such as the recent flooding in China and Europe have always had the power to completely disrupt global shipping with our lack of contingency planning tools. Many organizations have failed to proactively plan and have continued with archaic processes and legacy tech, which made current port congestion as severe as it is today.
Going forward, leading businesses are investing in data analytics to gain the visibility needed to foresee shipping issues and make real-time decisions when it matters most.
- How can shipping stakeholders minimize the impacts on the supply chain caused by the current port congestion in several major ports in the world?
It starts with visibility. A clear, comprehensive view into your operations and chain of suppliers is vital. And continues with advanced analytics and deep learning technologies such as Machine Learning and Artificial Intelligence (AI). These technologies help companies predict and in many cases prevent disruptions. Without knowing where the kinks in your armor lie, there is no way to foresee potential problems, thus leaving you vulnerable and blindsided when disruption hits.
It also is critical to mention the importance of supplier relationships and diversification. The stronger and broader your network is, the greater ability you have to pivot when one piece of the puzzle gets bent. Clearing up port congestion will not happen overnight, so having a bigger picture focus now will be key for longer term resilience.
This continued disruption paves the way for a better future as organizations are forced to assess the state of their supply chain and evaluate what they can improve upon moving forward.
- Can shipping companies use maritime data to make better decisions in such difficult situations, such as severe port congestions and long shipment delays?
Data is power in nearly all situations – as long as you have the right tools to interpret it. Companies can absolutely leverage maritime data to make better decisions. By pinpointing where the clogs are, maritime data allows brands to pivot their strategy to avoid delays and disruption.
To achieve this level of proactivity, technology must aggregate the vast data into comprehensive, actionable insights. Little to no advantage can be seen from tech that lacks the ability to effectively analyze this complex chain of data, making it crucial to invest in the right tools to enact real change.
The major advantage of leveraging data is the ability to act quickly. Having stronger contingency plans in place will allow companies to pivot when needed, thus setting them up for better success.
- The digital transformation of the shipping industry has been a “hot topic” during the last few years. How could potential digital systems and technology help in similar conditions in the future?
The right tech enables organizations to achieve maximum visibility into their operations through centralized, accessible data. A data analytics solution can transform that data from numbers in a spreadsheet into actionable insights that allow brands to make more strategic decisions. From reducing costly fines and chargebacks to diminishing late shipments and payments, operations are able to run more smoothly while the benefits are reflected in your bottom line.
IDC projects organizations that leverage the right digital tools will result in a 15% productivity boost by the end of 2021. Companies that digitize now will be able to better mitigate risk and maintain agility and continuity as port congestion continues and other threats rise.
- What proactive measures should be taken for the avoidance of similar incidents in the future?
Taking proactive measures for tomorrow starts by establishing visibility into your global supply chain today. My biggest piece of advice is to invest in supply chain analytics tech that allows you to get ahead of disturbances rather than reacting to them. Organizations don’t need to sit and wait to be told of backups – they can actually foresee congestion, pivot to a new plan, and avoid costly delays.
While not quite a crystal ball, these insights come in a close second to getting a look into the future. Having clear, robust contingency plans in place now will help you as crises rise, eliminating the need to scramble when severe port congestion hits.