Delving into the Middle East's logistics technology market

ACN touches base with some of the region’s logistics technology firms to find out the latest developments in the supply chain

Tags: Autodesk Middle EastEhrhardt + Partner Solutions - EPSGlobal ExpressLogisticsUnited Arab Emirates
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Delving into the Middle East's logistics technology market According to a forecast report produced by Transparency Market Research, the logistics market’s revenue is expected to grow at a CAGR of 7.5% from 2015 to 2024, rising from $8183.46bn reported in 2015, to reach $15522.02bn by 2023.
By  Alexander Sophoclis Pieri Published  June 18, 2017

In an era booming with rapid digital transformation and the advent of smart technologies, the latest market to make its way towards digital is logistics. Covering all aspects of the supply chain, which includes transportation, inventory management, order processing and customer service, logistics is one of the largest markets in the world and one set to grow even further in the coming decade.

According to a forecast report produced by Transparency Market Research, the logistics market’s revenue is expected to grow at a CAGR of 7.5% from 2015 to 2024, rising from $8183.46bn reported in 2015, to reach $15522.02bn by 2023. The report, which analysed trends, growth and forecasts associated with the global logistics market, also noted the market’s volume valued 54.69 billion tons in 2015, and is forecasted to reach 92.10 billion tons by 2024, growing at a CAGR of 6.0% from 2016 – 2024.

Transparency Market Research’s also noted that one of the biggest drivers of the logistics market was investments into technology, which included everything from automated material handling equipment to warehouse management software.

One company delivering warehouse logistics technologies in the Middle East region since September 2006 is Ehrhardt+Partner Solutions (EPS). Part of the Ehrhardt + Partner Group that was formed in 1986 and headquartered in Germany, EPS has, for the last decade, delivered a wide-range of integrated warehouse solutions to numerous enterprises across the Gulf.

At the crux of company’s logistics management offerings is the LFS software suite, a supply chain execution system that oversees every aspect of the supply chain process. The suite is comprised of three components; LFS.mfc, a Material Flow Controller module; LFS.tms, Transportation Management Solutions; and the LFS.wms, a warehouse management software.

The LFS software suite is also Logistics 4.0-ready, the LFS IoT connector serving as the primary communication interface, overseeing warehouse systems connected to the network. This covers everything processed through the suite’s modules, to active sensors and materials handling technology. The suite is also prepped to take on advanced technologies, such as drones and robotics.

While Industry 4.0 and IoT remain some of the top megatrends currently driving the logistics market, the team at EPS also highlighted the great importance of Big Data. With numerous points along the supply chain becoming connected and constantly monitored, the generation of data has grown tremendously over the last couple of years.

“Many companies have not yet recognised that Industry 4.0, the Internet-of-Things and Big Data are more than just marketing buzzwords. Intelligent solutions are the basis for the logistics of the future,” comments Makrem Kadachi, general manager of GCC at EPS Dubai.

Pointing to recent research figures, the team at EPS shared that global data volume will reach 44 billion gigabytes by 2020, roughly 10 times more than what is generated today. Identifying it as an “important currency of the industry”, it will become critical for companies to make economic use of such data, to both help optimise processes, as well as achieve success in the long-run.

As such predictive analytics is expected to play a central role in logistics in the near future, and nowhere else is this truer than within the Middle East market.

The generation of history data can be used to create predictions  that can influence decisions related to warehouse management. In the case of warehouse occupancy for example, history data combined with the right tools can maximise use of space and reduce picking efforts. The data can also be used to predict quantity assignment and process personnel requests.

“Without an integrated system, it is easy to lose the overview and significant optimisation potential.” explains Kadachi.

“Predictive analytics should be a part of the supply chain system. This way, the system can work with the history data to optimise the processes.”

Another logistics technology company quite heavily invested in analytics is that of Globe Express Services (GES). Established in 1974, GES has grown to become one of the world’s top providers of supply chain logistics technologies.

At the heart of its offerings lies its GES Vendor Portal, an in-house, web-based logistics visibility and supply chain events management solution. Its notable features include real-time supply chain data feeds, electronic invoicing, utilisation of e-Docs, as well as the incorporation of business intelligence.

As part of its recent efforts to improve its capabilities, GES brought on board Birst, an advanced network business analytics platform, which has helped improve visibility, as well as interlinking between various aspects of the organisation.

“By connecting every department through a network of analytics in the cloud, Birst allows our teams from different divisions to efficiently share key findings and important data for smarter, more systematic, and information-driven business actions,” comments Mustapha Kawam, president and CEO, Globe Express Services.

The company has also introduced its new CargoWise One platform that provides tools to help one better see and manage their supply chain. The solution itself blends data management, communication and automation technologies, which help to enhance the way data is collated and processed.

GES’ president and CEO went on to discuss the various challenges faced in the sector, and as one might expect, security remains an important issue in logistics.

“Cargo security is an important issue facing the regional industry today. As a response, we have seen the implementation of stricter cargo screening procedures, while at the same time supporting international trade and commerce activities,” explains Kawam.

Other challenges include contending with the Gulf region’s harsh environment, which impacts the transport of goods by land and over long-distances. With government support however, particularly in terms of infrastructure development, the regional sector is slowly developing better measure to address this issue. There is also the constant challenge of meeting end-user demand, which by its nature is constantly evolving.

“A number of state-of-the-art technologies have effectively reshaped the current supply chain market. Artificial intelligence, big data, wearable technologies, mobile robots, and drones, among others, hold the promise of completely transforming the industry by increasing the outputs, improving compliance, and accelerating the delivery of service,” comments Kawam.

Adding his own viewpoint to the discussion, Autodesk’s Louay Dahmash, who heads up the company’s operations in the Middle East, shares that end-user demands for integrated solutions surrounding IoT and Big Data have forced the creation of new business models.

He explains that certain forward-thinking manufacturers have begun to utilise IoT to move their business from one-time product transactions to ongoing product-as-a-service offerings.

Pointing to the Dubai Industrial Strategy 2030, Dahmash shares the initiative serves as a perfect driver that is encourage the development of integrated logistics that will greatly benefit both the manufacturing and industrial sectors in achieving sustainability.

“Dubai is already an international centre for manufacturing and logistics, but to take it to the next level, the Dubai Industrial vision aims to increase the production and added value of the manufacturing industry, and to accelerate energy-efficient and environment-friendly manufacturing that will make Dubai even more in-demand on a global scale,” explains Louay Dahmash, head of Middle East – Autodesk.

A long-standing player within the logistics technology market, one of the company’s high profile logistics offerings is the Autodesk Fusion Connect service. Serving as an IoT Cloud service, cloud-development platform, it enables designers and creators to connect and manage remote products.

“In the Architecture, Engineering and Construction (AEC) industry, it is very time consuming and cost ineffective to run through all site logistics, be it measuring every access dimension out on site or accurately positioning the machinery, and this is fairly typical preconstruction workflow and the risks of a logistics mistakes are very large,” comments Dahmash.

“This is where logistical features of BIM come along enhancing the overall productivity and efficiency across all phases of a project, from start to finish. By simulating a construction project, the implementation of BIM in construction bridges the communication gap between all stakeholders.

“The logistical building information model can be extremely useful for developing and projecting a thorough understanding of a project as well as the ability to complete it precisely, and monitoring it from start until end,” he added.

Looking to the future, Dahmash sees the logistics sector moving away from being solely focused on the physical presence and to instead shift its attention towards virtual processes that are driven by data streams.

Smart connections built upon highly-networked processes that are able to share key data between each other, will become the standard for the industry to aspire to.

“Companies are also evolving by tracking behaviour online, and using the found data to generate their services accordingly. In reality, technologies like Big Data, automation, blockchain and IoT are currently at the heart of the present and the future of logistics,” concludes Dahmash.

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