ARLINGTON, Va.; Oct. 26, 2017 – Digital disruption in the post and parcel industry will see robots and driverless vehicles delivering the mail, augmented reality creating efficiencies in delivery and Artificial Intelligence (AI) making it easier to connect customers to products and services, according to new research from Accenture.
The report, The New Delivery Paradigm, examined delivery and purchasing trends, business practices and analysis of 25 postal organizations and delivery companies conducting business across the Americas, Europe and Asia-Pacific.
One of the key findings: Investments in advanced digital technologies could help generate more than $500 million of value annually for an average post and parcel organization. The right digital strategy also could unlock the potential of 22nd century and last-mile delivery systems and remain relevant in an industry facing not only declining mail volumes but also increased competition for hyper local delivery and a rapidly changing last-mile landscape to fight for growing parcel volumes.
Being digital would mean transforming core operations to enable digital transformation and grow profitability and could include AI, smart collectors, digital warehouses, connected vehicles, connected lockers, augmented workforce and robotic process automation, said Brody Buhler, who leads Accenture’s global post and parcel practice.
“In an era when customers are always connected and are becoming accustomed to a digital customer experience, high-performing posts and parcel organizations need to embrace digital more fully unlock the dynamic potential in advanced technologies to drive every aspect of the business,” Buhler continued.
According to the report, multiple options exist to become a digital business: digital marketing, sales transformation, chatbots for 24-hour customer service, development of online loyalty programs. Among the new business models that could be developed are on-demand deliveries, drone deliveries, B2C subscriptions, sharing platforms, payment systems and digital identifications.
The report shows that AI and robotics already are enabling post and parcel organizations to make possible new opportunities across fundamental business practices. The US Postal Service is using AI to create post office collection points that weigh, price and collect mail and parcels and answer questions. In the Netherlands, robots and guided vehicles are being used to pick up, place and move parcels through the warehouse and help at main sortation facilities. UPS and Amazon are leveraging AI through chatbots to create customer service assistants and increase self-serve and auto-serve options. And new delivery companies are testing self-driving vehicles, drones and self-driving parcel carriers to augment the delivery process.
Robotics have the potential to transform delivery organizations’ warehouse operations, supporting peak demand and lowering costs. Using robotics to support human effort in repetitive tasks, like pulling packages, can improve productivity and reduce costs. Robots and guided vehicles accelerate the movement of product through warehouses while reducing a distribution center’s physical foot print. These actions can have a profound effect on revenue and cost savings.
The report also looked at the use of augmented reality, determining that AR and support applications are empowering the workforce in new ways. Pick-by-vision enables employees with real-tune information and guidance to improve productivity, reduce errors and minimize paperwork. Dynamic route planning information and parcel and customer information with AR overlays creates a more seamless experience for the delivery workforce.
Organizations must consider three areas to be successful, according to the report:
- Digital in core operations: Data-driven operations excellence that uses insight and prediction to realize efficiency gains in processing and fulfilment
- Digital customer interactions: Reinventing the customer experience to offer more personalized, efficient and convenient services for both consumers and businesses
- New digital delivery models: Radically altering the cost profile and capabilities of last-mile delivery networks
“These technologies are changing every aspect of the post and parcel business. The cost savings and service offerings they enable will change the industry and unlock value for those organizations that have boldly invested,” Buhler sad. “The time to prepare is now.”
Since the publication of its first high performing posts report in 2006, Accenture has conducted ongoing, in-depth research of the postal industry, using the Accenture High Performance Business methodology to review and assess the relative performance of postal organizations.
This study examined the global courier, express and parcel (CEP) market size and growth, including business-to-business (B2B) and business-to-consumer (B2C) segments, domestic versus international shipping as well as overnight and on-day delivery and time-definite products segments under 150 pounds or 70 kilograms. Current and new players in the market, including global integrators, postal organizations, regional, shared-economy and crowdsourcing players as well as retailers moving downstream were studied. These organizations conduct business across the Americas, Europe and Asia-Pacific and include the US Postal Service, FedEx, UPS, DHL, Singapore Post and Swiss Post. Sources included public information, paid and proprietary primary and secondary research, internal and external subject matter specialist interviews and extensive market and financial analysis.