Business models are changing and as a result the way a business measures its performance and understands its business processes need to change, a group of leading logistics CIOs and business technology leaders in the Netherlands discussed.The CIO roundtable debate, hosted by Integration Matters and CGI Netherlands in February 2017, brought together CIOs from ports, rail, retail, parcel delivery and chartering to discuss business performance monitoring.

CIOs from the logistics sector discussed how delivery capabilities will be challenged by drones, autonomous vehicles, 3D printing of goods close to market demand and crowd-sourcing of services, issues which will reshape their business in coming years. DHL, the German headquartered international logistics supplier, is already using drones in an experimental program to provide services to remote island communities in the north of Germany.

The impact of market trends on business monitoring

“All of this will have an impact on how we monitor our business,” the CIO of a major parcel delivery company said. Other challenges the logistics CIO community will face are growing recycling demands and the need for the industry to increase the amount of capacity sharing it use to increase services as price margins decrease.

The CIOs discussed how they as information leaders will need to move to a position of publishing information to alert customers and partners to spare capacity in warehouses or vehicles that can be used. All agreed that disruptive businesses like Airbnb and Uber, the lodging and taxi services, are in effect publishing companies and that CIOs will need to enable their organization to become publishers.

For logistics CIOs to enable their organizations to adapt to new challenges will require increased visibility of the business process and the ability to react to failures in the service. This in turn will mean that technology suppliers will need to become increasingly aware of the demands of operating a logistics business.

Integrate with your business partners to meet the needs of change

“Suppliers are not aware of their impact on the business service levels or on business process,” a technology leader expressed. A number of the attendees said they had service level agreements with their suppliers that measured the impact of outages. “We measure an outage by shipments lost,” the CIO from the parcel sector said. “There are a lot of gaps in the integration layers in businesses,” says Abdelghani Faiz of Integration Matters.

Although the community openly agreed that cloud computing and software-as-a-service (SaaS) offered great potential, the adoption levels in the room were below 20% of the enterprise estate amongst the attendees. The group cited how cloud and SaaS tools had the potential to increase the disconnect between a technology supplier and the quality of business outcomes. “With SaaS they are so far away from the business processes that they have no idea what can happen in your business,” one attendee said.

With the community agreeing that greater analysis of the business is required, the conversation focused on the technology challenges logistics CIOs. “More and more services are being added to the CIO’s service portfolio and the services are coming from a wider range of providers,” a business technology leader expressed, adding this created “shadow data” across the organization.

A CIO from the retail sector said he and his organization were working to enable greater analysis and pro-active fixing of issues closer to the problem. “If you are too centralized you are losing time and knowledge” he said. The community also discussed how rollbacks have become problematic in the complex multi-service environment that the CIOs have to manage.

Digital transformation will certainly change the old rules of supply chain management. Carlos Cordon, LEGO Professor of Strategy and Supply Chain Management at IMD, described great examples in his blog post “How Adidas and Amazon re-write the rules of supply chain management.” These new business models demand a complete view into end-to-end processes from a business perspective.

Talk to Hans Delleman or Frank Levert, if you want to discuss how you can use end-to-end monitoring to guide digital business initiatives in your organization.

About CGI 
Founded in 1976, CGI Group Inc. is the fifth largest independent information technology and business process services firm in the world. Approximately 68,000 professionals serve thousands of global clients from offices and delivery centers across the Americas, Europe and Asia Pacific, leveraging a comprehensive portfolio of services, including high-end business and IT consulting, systems integration, application development and maintenance, and infrastructure management, as well as 150 IP-based services and solutions. With annual revenue in excess of C$10 billion and an order backlog exceeding C$20 billion, CGI shares are listed on the TSX (GIB.A) and the NYSE (GIB).

About Integration Matters
Integration Matters helps organizations achieve operational excellence and digital business success by providing the tools and expertise necessary to monitor end-to-end business processes and measure business outcomes. Over 300 companies from across the globe in the energy, telecom, banking, insurance, retail and transport and logistics industries benefit already from Integration Matters’ software. Corporate headquarters is based in Hattingen (Germany) with offices in London and New York.

About the Author: Birgit Jordan is Marketing Director at Integration Matters.