Investing in transport networks, will also strengthen your company
Ralf Faust, Head of Service of Krone Commercial Vehicle Group and member of the management board, met Christian Kille, Professor for Trade Logistics at the University of Applied Sciences Würzburg-Schweinfurt and initiator and member of the Logistikweisen, in Hamburg for a discussion about capacities, infrastructure and intelligent trailers.
Professor Kille, the logistics sector is growing at a gratifyingly rapid rate – in your opinion, what are the influencing factors determining the future? Kille: I think capacities, for example, is a key topic – particularly for your area, Mr Faust – namely service. Because the forwarder and the dispatching company is happy when they get the capacities they need.
Faust: Yes, we are in a turbulent market. Consumer behaviour has changed completely: The consumer wants to be able to buy asparagus and strawberries the whole year round. And then there is the Internet of Things and, of course, everything has to be controlled remotely. In the commercial vehicle sector, we were travelling long distances, predominantly on motorways and highways; road traffic in the city centre is now playing a bigger role – where maybe you need smaller vehicles.
Kille: Exactly. You need fewer capacities in terms of both space and staff. Or other personnel. On the topic of shippers and receivers, I recently led an interesting discussion on the B2B area: What would it be like if you were to take the stress out of the principle “ordered today, arrive tomorrow” and said that you would concentrate less on ever faster processes, and more on reliability - slower but also more structured? Sometimes, you just don’t need to get all the goods that quickly.
Faust: That is a good approach and could give more leeway for planning. Another exciting thing: When do I start planning these capacities? If the food market orders a bag of sugar, do I then register that with the sugar factory or even with the farmer who planted the sugar beets? Those are questions currently affecting logistics globally.
How much service do your customers need today, Mr Faust? Faust: Krone focuses on the development and manufacture of technical products. But services are playing an increasingly important role. Over recent years, the general service requirement has risen by 67 per cent among our customers. Not only are they buying a semi-trailer with specific equipment, they also want to use telematics, for example, and communicate via interfaces. I am certain that we will soon see every vehicle being able to transmit how much capacity it still has by itself.
“Every time an infrastructure is developed there are counterflows.”
Professor Christian Kille, University of Applied Sciences Würzburg-Schweinfurt
Kille: That would, of course, be the ultimate if the trailer could do it by itself. Who could be the potential customer there?
Faust: Anyone from the collection and general cargo segment. But even in direct traffic, there is always room for another pallet. In that context, we are busy developing how to measure bays in semi-trailers using sensors. The trailer is then able to communicate to a freight exchange that it has free bays. So can our customers also handle that with their current digital process structures? And what data do we need to provide as a commercial vehicle manufacturer? The digital structure and our knowledge of it has completely changed globally. Equally, jobs are changing for the people who work in logistics. Do you see this too?
Kille: Yes, jobs are changing and company culture is too. They have obviously mastered that at Krone and taken all their employees with them on this journey. But I know a lot of companies who find it hard from a sales point of view: The product is still sold, but not the after-service.
Faust: For us, it remains an important task to train our staff to advise the customer. We are also founding, for example, our own Krone Academy.
What external influencing factors do you think will have a decisive impact on the near future? Faust: In 2030, semi-trailers will travel 38 per cent more tonne-kilometres than they do today. Logistics is also always an indicator of the wellbeing of a company. The further east we go, the less well-built the motorways are. Investing in traffic networks, also strengthens your company.
Kille: The keyword infrastructure is very important, particularly in our company in Germany and regarding the question: What do members of the public make of it? Every time an infrastructure is developed, there are counterflows. We are an extremely wealthy society, and as soon as anything changes, we are afraid things will get worse. But we can only grow as a society and maintain the wealth if the economy in general and logistics in particular are provided with the infrastructure it needs. I can’t say “Lorries should go on the rails” and, on the other hand, be against rail construction. And I cannot order online but not want any delivery vehicle to be driven on the streets around where I live. In terms of involving relevant interest groups, we have quite a huge backlog as far as logistics is concerned.
ABOUT CHRISTIAN KILLE
Professor Christian Kille, born in 1972, studied electrical engineering and did his doctorate on logistics markets and their quantification. Since 2011, he has been Professor for Trade Logistics and Operations Management at the University of Applied Sciences Würzburg-Schweinfurt. His research focuses on forecasts and trend analysis specialising in the whole economic sector of logistics and its segments, trade logistics, logistics real estate and locations, as well as new business models and start-ups. He is a market expert for the “Bundesvereinigung Logistik” and a member of the jury of the “Logistics Hall of Fame”.
Mr Faust, what processes are initiated in-house at Krone as a result of customer requirements? Faust: So for example, we have initial customer requests for pay-by-use systems. That requires a completely new organisation and process management here in our company – no longer operated by production or working times, but by the matter of how we can network better with the customer. While the market used to think that intelligence could only be located in the tractor, today it is clear that the trailer has the data quantity and data structure that the logistics provider, shipper and processing industry need. The intelligent trailer can analyse the technical condition of a vehicle very quickly, and a lot of accidents can be avoided by planning repairs and maintenance in advance. Manufacturers and shippers want to know more and more about the transport and logistical processes – if possible in real time. The winner is the provider who can master the matter of the estimated time of arrival.
Kille: This raises the question of interfaces: Throughout the whole chain – from farm to end customer – there are still incompatible IT and physical interfaces stopping the Internet of Things from being realised. I think it is very important to always bear the customer in mind. You have to always think about supply-chain management in terms of the end customer. Do you build your IT solutions in such a way that they are then transferrable to other areas – delivery vehicles or private cars perhaps?
Faust: In the B2C area, it is quite hard, but in the B2B area, it works all the time – yes. Information that I have in the trailer today is similar to what you get in CEP vehicles. So, for example, we are now going with Rytle even further into the city and equipping cargo bikes with this technology. We are now facing completely new challenges with our service: If the tyre is flat, where do you go to find the nearest bicycle workshop for a professional cargo bike? We are thinking, for instance, about equipping a few cargo bikes as actual service vehicles, who can be called up remotely to solve problems. We are constantly developing – and a lot of inspiration comes from the daily business on the street.