We have a lot of new technologies (some of them are still in the process of development), which intend to disrupt the business as we know it today. Most of the tech visionaries think, that technologies will disrupt companies which are operating in the supply chain. And in opposite leaders of supply chain companies, say that this will not happen. And what about the real thing? I think no one has a clear answer, as for the companies which operate in the supply chain business trust and individual approach to services is very important, that’s why this should serve as a block for technological platforms, nevertheless I’m sure that techno business will try to acquire they’re cut of the market pie. With this article, I would like to talk about the perspectives of the expedition companies (transport agents, transport brokers) has this business a cure for technological competition.
Why companies prefer to do business with expeditors?
In order to better understand this type of business, we need to identify why companies work with expeditors:
Of course, there are more reasons why companies do business with expeditors, but I think those are the main ones which create the additional value for the customer.
Which processes can be replaced by technologies?
We can say that companies perform business with expeditors, because of: Network, Experience, Risk reduction, Market knowledge, Psychological attributes, and additional functionality. In my opinion, technologies can easy replace:
We have two factors left so far, which human hands and minds can perform better than technologies:
Will the technologies disrupt the business model of expeditors?
So, if looking through a simple SWOT analyses principle, we can say, that technologies do have a really good chance to disrupt transport agent’s business (4 against 2). The essential question is whether this specialties representative and companies need already change they’re specialty or look for opportunities in another field? In my opinion, this is not necessary to happen, because experience and psychological characteristics are very important factors. Of course, weak market players, who do not create value for their customers and do not have experience which is needed for this business eventually will likely have to withdraw from the market. It can be argued that technologies will carry out a revitalizing function and will help the market to get rid of weaker players.
How to choose the winning strategy in order to win the competitive battle and strengthen business positions?
I think the strategy is very simple – you need to strengthen positions at which you are better than technological platforms: experience and psychological factors. This can be achieved by transforming your organization into a constant learning one, furthermore, you need to develop an organizational culture which is the best fitting for this goal, and invest into your employee’s knowledge development and improvement. Additionally, you need to leave lesser space for the technology platforms and sharing economy to beat you, therefore you need to invest into technologies which would better increase your service level, visibility, optimize business processes and increases overall business efficiency and are better suited for your clients, than the mass platforms.
In conclusion, I would like to say, that there is always a way out, and a way to win the competitive struggle. In order to succeed all you need is flexibility, agility, and creativity. Do not be afraid to use professional help in this path to help you achieve your goals more efficiently, faster and build a long-term competitive advantage.