Digitizing the Logistics Business in India- A Leadership Case Study

Abstract

The logistics industry is very important for any growing country. China has already shown how strong its logistics industry can be, and India will soon follow suit. Key factors that are propelling market growth are the growing amount of business data and the automation of tasks in fields like retail, transportation, education, and healthcare. All other businesses depend on the transportation and logistics sector to make moving goods by air, land, or sea easier.

Additionally, the swift adoption of enterprise software and services within IT infrastructures is enhancing decision-making, reducing inventory costs, and boosting profitability. In India, the third-party logistics market is projected to expand by USD 10.74 billion between 2020 and 2025, growing at a CAGR of 8%. This market is characterized by fragmentation, which is expected to intensify. The expansion efforts of numerous organizations worldwide are anticipated to stimulate market growth. The rising utilization of cloud platforms, with their advantages of flexibility, cost efficiency, and mobility, is driving demand for cloud-based software solutions and services among small and medium-sized enterprises. Challenges such as infrastructure limitations and the availability of skilled manpower hinder the logistics sector's growth in India. Despite its demographic advantage, the sector struggles with the perception of being a support industry rather than a core one. Slow technology adoption is another significant constraint. The transport sector is largely unorganized and lacks standardization, relying on improvisational techniques and terminologies. Globalization, while promoting standardization, poses a challenge for solution providers. Moreover, the sector's diverse customer base and varied expectations add complexity. The demand for customization, coupled with stakeholders' resistance to change, makes it difficult for large consultancies to adapt.