The Logistics World- From Past to Present

CPO Innovation



Having the right product at the right time at the right place and in the right condition – these are the well-known requirements for logistics and transportation in general. But fulfilling these requirements is getting more and more complex in a dynamically changing logistic environment. There is a shift from traditional supply chains to open supply networks. Long-lasting business relationships are overrun by short-term business connections. The highly dynamic logistic markets and the advancing complexity of logistic networks require new methods, products and services. Aspects such as flexibility, adaptability and proactivity gain importance and can only be achieved by integration of new technologies. While problem initiated approaches usually only lead to minor improvements, technology driven approaches can evoke more radical changes. The technology driven approach that is used to define Smart Products and Smart Services is utilized and extended to define “Smart Logistics”.


History of Logistics-

1830– The steam engine, invented by James Watt in 1769, and the development of the railroads took the transport of goods to a whole new level. The turn of the nineteenth century heralded the advent of the steam locomotive, and 1830 saw the inauguration of the first rail route for freight – the Liverpool and Manchester Railway. From then on, the use of freight cars has risen steadily, and benchmarks such as the 1,435 millimeter standard gage became the norm.

1907– In 1907, with $100 of seed capital and two bicycles, Seattle-based US entrepreneur James E. Casey founded the world’s first parcel delivery service – the American Messenger Company, which would later become the United Parcel Service (UPS). Today, UPS has a fleet of 237 aircraft and 108,210 delivery cars, vans, haulers and motorcycles dedicated to delivering packages. Over 8,100 of its vehicles are powered by alternative fuels and advanced technologies.

1953– In the early 1950s, Toyota engineer Taiichi Ohno was tasked with boosting the car company’s productivity. While visiting a supermarket in the US, he had a eureka moment. Today we call it the “just-in-time” concept. Ohno realized that people only purchased what they needed then and there, and that in principle a supermarket was simply a well-run warehouse. He saw that if incoming goods matched outgoing goods as accurately as possible, no long-term storage space was required.

1956– On April 26, 1956, Malcom McLean launched the world’s first container ship – the Ideal X. Prior to this, he had grown the McLean Trucking Company into the second-largest freight forwarder in the US in a just few short years. He then sold 75 percent of the company and invested in ships. After a few modifications, McLean equipped the Ideal X with 58 steel boxes that were built in-house and tailor-made to fit the chassis of his trucks. Containerization was born, and has since become the world’s leading method of freight transportation. Then came an invention that revolutionized logistics: the barcode. At the time, the industry paid it scant attention.

1974– But many subsequent innovations, such as automatic tracking or modern warehousing, would have been inconceivable without it. Americans Norman Joseph Woodland, George Laurer and Bernard Silver are credited as its inventors. Incidentally, the very first barcoded product, scanned on June 26, 1974 by a cashier in Ohio, was a 10-pack of gum.


 THE SMART PORT In one of the terminals at the Port of Melbourne, automated cranes unload freight and move containers without human intervention. Trucks are automatically identified and routed by the logistics system. The system then issues loading and unloading orders to the cranes and container trucks. Cargo handling at the terminal is now six times faster than under the old system

PARCEL BOOM In 2016, Germany’s courier, express and parcel services delivered around 3.16 billion shipments; that’s over 10 million per delivery day. Volumes have doubled since 2000. The German Association for Mail and Express Logistics (BIEK) estimates that annual volumes will reach approximately 4.15 billion by 2021.

ASTRONOMICAL PRICES Supplying another celestial object is a very particular kind of logistical challenge. First, it requires enough fuel on board for the whole journey; and second, there’s no “roadside assistance” in space if something breaks down. As you’d expect, the prices are equally astronomical: sending a kilo of freight to the moon currently costs in the region of $41,000

LOSSES WITH A HEAVY PRICE around a third of all foodstuffs produced in the world never actually reach consumers; they perish during storage, transport or processing. Modern technologies like condition monitoring are critical in reducing these losses, for example by promptly flagging up breaks in the cold chain.