In short, today we will talk more about the concept of Logistics 5.0.

By observing the development of humanity, from prehistoric man to the current – “technological” – we can see that over time objects, machines and techniques were created and invented that allowed and enabled life to no longer consider survival as the sole objective. And in parallel with this development, management techniques, methodologies, and systems necessary to support, optimize, and reduce the cost of operations have emerged, in the midst of an increasingly globalized and competitive scenario. The interesting thing about this analysis is that as early as 1970 Alvin Toffler was studying a management model that would unite people and systems, that would make the organization’s processes more flexible and agile, thus coining the term adhocracy. After 52 years, the term is still current, however, new phases of business development have emerged.

What is Industry 5.0?

The main idea of development until 2016 was to automate all processes making maximum use of technology to reduce human intervention. This way it would be possible to have standardization, production speed, continuous quality, and cost reduction, thus meeting the strategic planning of companies. However, with a deeper study and analysis of micro and macroeconomic factors, it was concluded that 100% robotic automation would not be the best of the options. Even before Logistics 5.0, Industry 5.0 emerged in 2016 in Japan, based on the concept of Society 5.0, which has the human being as the catalyst agent of innovations and technological development.

In this vein, Industry 5.0 comes to be a reference of how the integration of human capital with machine automation can happen. This must happen continuously so that the innovation factor is not lost in the middle of the road in processes already established and operating. This way, it is also possible to meet factors such as inclusion and sustainability that have become preponderant when hiring a service and/or buying a product. Not to mention the quality of life factor when it comes time for the employee choosing the company in which to work, for example.

Who is the 5.0 consumer?

In the materials, studies, articles and texts available on the internet, Consumer 5.0 is defined as the youngsters from Generation Z and the Millenials. These were born in a process of technological evolution much more accentuated and accelerated than Generation Y, much more updated and predisposed to have their relationship with companies based on experience, speed, and consistency of service. Well, Consumer 5.0 is more directly linked to young people. However, with the Covid-19 pandemic and the consequent partial or total lockdowns for certain periods, with internet access and “prevented” from shopping, people started to use e-commerce much more.

This information is corroborated by data from the United Nations (UN) Department of Trade and Development that show a 60% growth in e-commerce after the start of the pandemic. Thus, we see the need for the company’s strategic positioning to be based on the understanding of the changing profile of consumption in society as a whole. Being the focus of the business the customer and his experience, the probability of him picking up his smartphone, googling and checking other options becomes much smaller, given the history and loyalty that is built with him.

 What would Logistics 5.0 be, then?

In this new phase some concepts no longer fit the evolutionary-technological reality and need to be updated to focus on customer experience, as is the case of the supply chain. Formerly its definition was static and broad informing that it would be only: “the set of activities that involve production, storage, and transportation of products or services.”

Today it is part of the Logistics 5.0 concept that puts all internal departments oriented towards customer service. In other words, before, it was not seen and/or analyzed in the different operational levels. From this point on, there is a need for a new way of understanding, conceiving, and implementing logistics processes – then comes Logistics 5.0. This is how Logistics 5.0 is built, according to Juan Antonio Narco (author of the book Logistics 5.0, 2021): We then realize that the Logistics 5.0 value chain is formed by two preliminary phases:

– Collaborative: Visibility, connectivity and predictability;

– Dynamic and agile: Digital transformation and human talent.

In these phases an entire scenario mapping takes place to identify needs and needs and behaviors and enable the formation and generation of value and experience to the customer. After the initial phase there is the post phase, which would be the deliveries of the value chain 5.0.

For the entire conception of the product and/or service needs to be produced, delivered to the customer and, above all, generate profit. With that we have:

– Procurement: Supply logistics, plant and distribution;

– Demand: Marketing, sales, service, and inventory.

Main trends in Logistics 5.0

The main trends refer to innovation in the area of technology and, consequently, change in organizational culture aligned to consumption patterns. Thus, technologies such as the Internet of Things (IOT), Artificial Intelligence (AI) and Big Data that make the human-technological mix emerge and are developed. This need is corroborated when Luis Eduardo Ribeiro points out as one of the trends for Logistics in 2022 “the doubled investment in technology, risk management, and automation for reliable data.” For, according to him, “All this leads to the search for the most reliable demand planning and forecasting tools to significantly improve visibility and thus become much more responsive in rapid time to major disruptions and variability in their domestic, regional and global supply chains.”

Technology in international logistics

In a first moment, the implementation of technology aims to automate and standardize actions that were done manually. Everything with the clear objective of gaining efficiency and assertiveness by avoiding errors and technical problems that cause delays in the process flow. From this digitalization we gain the advantage of storing historical data. In other words, it is possible to generate the most varied statistics that can be based on past analyses, as well as project the future. With this, people can work in a more analytical way, generating savings possibilities, as well as discovering and generating opportunities for companies.

Impacts of Logistics 5.0 in the coming years

Logistics has an important strategic participation in the development and economic growth of countries, because it is through logistics that the needs of the production chain and clients are met, whether with

– the acquisition of raw materials;

– foreign trade; and/or

– the distribution and/or movement of products.

In this way, Logistics 5.0 presents itself as a solution to make competitive processes. Whether with cost reduction, integration or gains in operational efficiency.

For this reason, in face of the volatile and agile scenario in which we are inserted, it is necessary to pay attention to strategic planning in order to make an adequacy of equipment, systems, and trained people. Failure to take these actions will culminate in the obsolescence of the processes, generating an impact that may result in the closure of the company in the near future.

This operational success in the coming years will only be possible if the needs for investments to be made are identified assertively today. As we saw earlier, the consumer’s search is for experience.

When he is not served, he makes his criticism and/or complaint on the internet, which may influence many consumers, whether current or possible.

To illustrate what was said above about the adaptation for survival, it’s interesting to quote the example of Kodak, which at a certain moment held 80% of the world camera and film market, didn’t adapt to the digitalization technology and today is remembered in a nostalgic way.

Cheap2Ship: innovation and technology for negotiating freight

Cheap2Ship has been bringing more innovation and transparency to the logistics and supply chain market since 2017. In this way, it cooperates with its partners’ organizational success so that they can bring together human and technological capital.  Come discover how to have more agility in the process of hiring international freight, viewing all your suppliers and choosing the best option with the visualization of information on screen effectively.