By Dr. Karen Reddington, President of FedEx Express, South Pacific
Today’s supply chains form the arteries and veins that keep global trade alive, connecting a largely borderless, always-on world economy.
New innovations offer disruptive possibilities for the future of global trade. It’s easy to hypothesize that Star Trek-style teleportation, drones, 3-D printing, and space logistics, will change trading. But the biggest shift to the supply chain will see it digitally connected and becoming part of the Internet of Things.
Complete visibility and control.
Certain pieces of the supply chain are already connected so packages can be tracked and monitored. But in the future even more tiny embedded sensors will enable more pervasive tagging. There’ll be sophisticated two-way communication with shipments and the human management or other connected devices. This will provide an unprecedented level of visibility and control of critical information such as location, temperature, light exposure, humidity, barometric pressure or shock.
Take healthcare. Fraud and security is a widespread menace in this now global industry. World Health Organization (WHO) figures show eight percent of medical products are suspected to be counterfeit, while pharmaceutical theft is becoming more widespread and sophisticated. Supply chain control and visibility is absolutely vital for healthcare as shipments are life-critical, sensitive and can be near-impossible to replace. Imagine if a package of medicine that was personalized for the DNA of a cancer patient were spoiled or stolen. You can’t pull a substitute off the warehouse shelf.
Complete connection will see near-molecular precision for managing global trade, offering new opportunities for logistical efficiency and control.
The intelligent supply chain.
An ever growing amount of information will be emitted as more of the supply chain is connected. This continuous flow of real-time data feeding artificial intelligence (AI) will bring an utmost level of efficiency and refinement. Adding AI into logistics unshackles manufacturers, suppliers and buyers to fine tune their inventory to actual demand. And when enough data on buying patterns has been gathered, AI can predict and manage at a granular level – reducing costly human errors and delays.
We’ll see the true transformative potential of data nourishing AI as we enter the next phase of the Internet of Things. Everyday objects – from refrigerators to toasters to cars – are set to be equipped with sensors that help manage how they operate and improving our lives. Connecting objects will have spectacular effects on supply chains and global trade. It’ll mean your refrigerator interacts with your supermarket ensuring your essentials are always stocked, which in turn will create orders with suppliers across the world. It’ll mean a connected part of a car engine detecting when it’ll soon need replacing, alerting the dealer and in-turn the part being automatically ordered from the manufacturer overseas. If you expand this concept beyond an individual and include hospitals, factories, businesses and countries, you get a sense of the impact a digitally connected supply chain will have on how the world flows.
Modern supply chains that are the core of global commerce have come a long way from a cart pulled by a horse to market. With the supply chain becoming part of the Internet of Things we’ll see a profound impact on global trade and how humankind is connected. We’ll live in world that is more intelligent, finely tuned, accessible, reliable and sustainable than ever. Right now, the superhighway of the world economy has never been more advanced. The even better news is it’s still under construction – the not so distant future will see the arteries of global trade become highly intelligent and semi-autonomous.
Karen Reddington is President of Asia Pacific Division of FedEx Express, the world’s largest express transportation company. In this role, which Dr. Reddington took up in January 2015, she heads up Asia Pacific from its headquarters in Hong Kong. The Asia Pacific Division comprises three regions: North Pacific, based in Tokyo; China, based in Shanghai; and South Pacific, based in Singapore. Dr. Reddington is responsible for leading the FedEx business across the region, including overall planning and implementation of corporate strategies and operations across 30 countries and territories with more than 18,000 employees.