siliconindia | | March 201719ance, warehousing and overland transport. Typically, the operational activities are carried out by multi-ple service providers. The top two levels in the pyramid which are tac-tical and strategic aim at end-to-end customer fulfilment in the most effi-cient manner by appointing a Lead Logistics Service Provider (LLSP). This further stresses the need for a seamless IT Integration between the LLSP and the customer ERP. The Logistics Industry is the sec-ond largest employer in India after agriculture. According to a study by NSDC, the sector currently employs over 16.74 million employees and is slated to employ more than 28.4 million employees by 2022. Due to this demand supply gap, the cost of manpower comprising of both blue collared and white collared employ-ees is increasing over the last few years. Thus, the need of automation and mechanization gets higher, and automation requires investment. Collaborative and integrated lo-gistics is the key to efficient supply chain. It will take a lot from both sides ­ the service users and ser-vice providers ­ to collaborate and establish world class logistics back bone for any business. Most of the engagement today take place at an operational level. There is an im-mediate need to evolve from vendor based relationships to partnerships with Logistics Service Providers (LSP) to invest and create efficient solutions by investing into the logis-tics needs. From our experience, we can say that we need to `spend more to save more'. The industry requires investments from a long term per-spective. There is a need to invest in specific types of trucks, warehouses & material handling equipment, IT Systems, training, and other essen-tial resources. This can be achieved only with a long term view. Effi-ciencies have to be created in the system to lower the `per unit cost' on a continuous basis. IT integration of the systems at both ends leads to achieving maximum efficiencies. At Rhenus, we have invested heavily into infrastructure and fleet keeping in mind the customers' re-quirements. Rhenus India believes in partnering with their customers, getting involved at the strategic lev-el, and making prudent investments. There has to be zero tolerance when it comes to EHS norms and there is a need of collaborative approach while building a world class sup-ply chain. Technology will be one of the key differentiators in the logistics space. Implementation of the Goods and Services Tax (GST), hopeful-ly this year, could very well boost growth in this sector. The whole logistics model would have to be reworked. Goods can then be trans-ported inter- and intra-state with much more ease. Today, the scenar-io is more of country within a coun-try. With the introduction of GST, we will move towards unified tax-ation laws across the country which will lower the cost of logistics. It will lead to consolidation of ware-houses, more movements through multi-axle vehicles, unitization, and palletization, thus bringing in economies of scale. There is a need to integrate the IT with this changing scenario. The government has made its in-tention clear to overhaul regulatory framework to improve the ease of doing business. It has been speaking about creating logistics hubs, dedi-cated freight corridors, Sagarmala project, and many others. But we have to wait and watch how things are implemented. Collaborative & integrated logistics is the key to efficient supply chain, as it will take a lot from both service users and service providers to collaborate and establish a world class logistics back boneVivek Arya
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