Mark Twain is credited with the phrase “I am interested in the future because it is the place where I am going to spend the rest of my life.” Actually, it has been of common interest to the whole of the human species since the world began. We no longer read the future in the entrails of sacrificed animals; for example, for the Etrurians of 2,000 years ago, a ram’s liver in poor condition was an unequivocal indication that a project had to be abandoned. In return, we have developed an entire industry of grounded guesswork that we call prospective science.
Key Points
Forward-looking analysis has a lot to say about what could happen in the logistics and transportation sectors in the coming months. We are talking about a field of activities that moved a total of more than 16,000 million euros worldwide in 2022 and that is expected to reach 19,000 in 2026, at an average annual growth rate of 4.4%, despite the complex economic and sociopolitical context in which we are immersed.
A sector is about to reach its boiling point.
The main challenges for the sector consist of making overlapping crisis scenarios compatible with the need to continue accelerating its process of technological transformation. In this sense, consultants such as the prestigious PwC predict in their annual reports that “the high rate of business concentration that was already registered in 2022, as the absorption or merger processes between companies become widespread, will increase even more in 2023.”
PwC predicts a scenario of arm-in-arm competition between the main players in the sector. A fight without quarter in which “the companies that best adapt to technological innovations and demonstrate the greatest capacity to diversify and single out their services” will survive and those that also have the best-prepared professional staff to take advantage of technological changes.
“Even warehouse operators will need a higher level of training because their job will no longer consist of moving boxes but rather effectively handling increasingly complex technological tools.”
Technology and talent will make the difference.
Along these lines, Antonio Iglesias, a professor at the ESIC business school, predicts that 2023 could be the year of the definitive “professionalization of the logistics sector.” Iglesias foresees a scenario of accelerated transformation in which “all employees, including warehouse operators, are going to need a higher level of training because their job will no longer consist of moving boxes but of effectively handling a series of tools and increasingly complex technologies.”
Iglesias adds that the logistics of the day after tomorrow will need “carriers trained in the management and supervision of increasingly sophisticated and complex machines,” technicians “in stock management, purchasing, transport, sustainability, or systems,” and managers “with a transversal business vision that must come from specific training, since it is not achieved only with experience.” Mara Pilar Caballero, managing director of postal and parcel services at Correos, acknowledges that a sector in “constant development” such as logistics “very often finds itself with the handicap of not having the specific type of talent to continue growing.” Above all, “as far as new technologies applied to the sector are concerned,” At Correos, they consider that the continuity and improvement of their business model require “continuous and specific training of our teams.”
Domingo Cabeza, professor of business and marketing at the Universitat Pompeu Fabra in Barcelona and director of the consulting firm DC Asociados, adds that the shortage of talent in the sector “is a cause for concern for large logistics companies, but also, and especially, for SMEs,” which have to adapt to a very demanding technological leap with scarce resources and, often, without adequate personnel. In his opinion, it “remains to be seen” if the collaboration between large companies and universities ends up being successful and helps to alleviate the problem.
Jess Royo, director of the Master’s Degree in Productive Operations and Logistics at the University of Zaragoza, agrees that “there is a growing demand for technological talent in the sector, and from the university world we have considered contributing to training professionals with this type of profile.” He believes that this new training offer “is adapted to the needs of the sector, as shown by the fact that, of the 30 students in my last promotion, 26 had already found paid work or internships before the end of the course.” He acknowledges, however, that “it is still very few places; it is almost a pilot experience.”
External consultancies will acquire an increasing role.
Another trend that analysts agree on is the use by many companies of external consulting services that can help them update their business lines and increase their productivity. Pilar Caballero assures that Correos “is fully confident in the skills and qualities of its extensive staff of but does not rule out, in line with what international consultants such as Gartner recommend, “recourse to external advisory services that allow exploring new changes.” Iglesias considers that these external collaborations will focus on “aspects related to information technology, automation, and artificial intelligence, since many companies do not have human resources with adequate knowledge to launch initiatives in this regard.”
“In Spain, logistics itself is being outsourced more and more: companies that previously had their own warehouses and fleets are increasing and now prefer to leave it in the hands of specialized companies”
Cabeza adds that, judging by what the corporate magazines in the sector are publishing, more and more companies are assuming “that resorting to external advisory services may be essential for them to remain competitive in a changing market and increase their profitability.”
Royo considers “that resorting to external consultancies is undoubtedly a growing trend, but in Spain, what is being outsourced is increasingly the logistics itself: the number of companies that previously had their own warehouses and transport fleets continues to increase, and now they prefer to leave it in the hands of specialised companies, with which, among other things, they transform a fixed expense into a variable one.”
Sustainability is less and less negotiable.
Correos plans to accelerate the electrification of its transport fleet this year, but Caballero highlights that the transition to a more sustainable model has already taken place and is yielding very tangible results: “We have a wide network of sustainable delivery routes that are carried out both on foot and with the 1,500 sustainable vehicles that we have.” Currently, the postal delivery company already has “14,295 sustainable delivery routes, which represents 69% of our territorial coverage.” More than 3,000 postal codes receive their shipments through the sustainable services of Correos.
Cabeza asserts that “it is to be expected that the sustainability and electrification of transport fleets will accelerate in the very short term,” especially due to “technological advances as well as the policies of many governments and the growing social awareness of environmental risks, which also implies an incentive or additional pressure for the companies.” Despite everything, he adds that in this crucial aspect, “there are still important gaps to cover.” Iglesias opts for cautious skepticism: “I am not entirely clear that most companies are going to take decisive steps in that direction unless they receive public aid.”
Royo adds: “Electrification by itself does not yet cover all the needs of the logistics sector because in Spain there is still a lack of charging stations and, in addition, the recharging processes continue to be slow and inefficient.” From his point of view, “the revolution in terms of sustainability of the transport model is what can promote the use of hydrogen trucks both in the city and, above all, on large interurban routes.”
AI and blockchain: the new norm
Iglesias considers with some reserve the changes that are to be expected in the very short term in the so-called “4.0” technological fields: “Given the crisis situation we are experiencing, I doubt that we will see spectacular advances by most companies.” Despite everything, he considers that it is in this area that the future of the sector is at stake.
Cabeza is confident that major changes will take place: “The use of these technologies will allow us to connect, manage, and update data in a very innovative way.” In addition, it will make it possible to build safe, reliable, and transparent systems that will translate into much more efficient services. Ultimately, “technology will improve the quality of life for both individuals and businesses.”
Caballero cites, in turn, a series of technologically disruptive projects that Correos is working on right now and that will continue to gain traction throughout 2023: “Exploitation of data to implement corrective measures and detect opportunities, automation to improve productivity, and route optimization using artificial intelligence”
