System Efficiency

This chapter brings together a number of views on how the overall effectiveness of global trade and distribution is likely to be improved over the next decade. From the adoption of increasingly open supply webs to enhancing the efficiency of the last mile, it also looks at the role of autonomous vehicles and new exchange and distribution models.

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From driverless cars to drones, far reaching changes will transform the efficiency of delivery and flow of goods in the next decade, says the Future of Trade report from DMCC.

Companies are already sharing distribution networks with competitors to improve global access for their products and meet rising customer expectations on cost and quality.

It means that for many companies, competitive advantage is determined by the efficiency of supply trains, illustrated by the fact that over 80 per cent of everything we own has at one point been on a ship.

This transformation of supply chains is being driven by technology, from digitalisation, which widens markets and improves transparency through better tracking and control of costs, to 3-D printing, which could even end the need for a supply chain at all. Amazon has already filed patents for a delivery truck fitted with a 3-D printer.

This move towards what has been described as a vast and decentralised web of interconnected suppliers, combined with global outsourcing will benefit consumers and some companies, but will the resilience of others.

Into this equation come dramatic changes in the technology of delivery. Self-driving vehicles will not just transport goods but load and unload packages. Swarms of such vehicles will communicate with each other for maximum efficiency.

With the last leg of distribution representing up to half the delivery cost, customers can expect the traditional delivery man to be replaced by everything from drones to using their cars as a delivery address, with access to a trunk that opens with a generated code.

In the future, companies like Uber are likely to carry goods as well as passengers, often at the same time if the destinations are close. All this will hasten the day when consumers will no longer feel the same need to visit physical stores.

Within less than ten years it is predicted that there will be fully autonomous highways for both cars and trucks and even for delivery pods in cities. In the best case, the saving of net costs will be over 50 per cent, but even in areas where the impact will not be so significant, these advances will change the way we think about moving goods and our perceptions of trade.

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For the last 12 months DMCC, the authority on trade, enterprise and commodities in Dubai, has teamed up with FutureAgenda on an odyssey to discover the future of global trade. We gathered industry leaders, academics and experts in five key cities to discuss how global trade will change in the next decade and how it will drive the global economy into the next phase of growth.

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Systems Efficiency – Max Conze

Intelligence is Key to Technology

Over the next decade technology will become increasingly intelligent and so will the ways we make technology. At Dyson we are focused on making machines that are intelligent and connected so they understand the environment, connect to it and improve it.

One such technology is Dyson 360i our latest robotic vacuum cleaning system. Rather than bouncing randomly around the room, a unique 360 degree vision system allows it to see the room and map its route around it. It means the machine knows where it is going and it knows where it has been. These images are processed by software to enable the robot to know where it is in the room. From this information and from feedback through sensors, maps are created to enable the robot to plan how to move systematically through the room. Thus it uses its intelligence to clean the room more effectively and efficiently. But such intelligent technology requires very intricate manufacturing. The machine has the Dyson digital motor at its core. This Dyson designed motor spins three-times faster than conventional motors yet it is a third of the size and half of the weight, without compromising on power. Because Dyson’s digital motor runs at such high speeds they are made on fully automated production lines in Singapore. We have had to develop robotic production lines from scratch to ensure their accuracy.

We compete in a global market place and our technology is our future. We invest over GBP3 million a week in research and development focused on working with the brightest minds both within Dyson and in universities around the world to research and develop intelligent technology that solves the problems others ignore.

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Breaking the Chain to Spin a Web

It is argued that open supply webs allow companies to achieve better global distribution than previously available because their supply chain efficiency is improved by opening space and assets to other companies’ short-term needs. Geographic reach is extended and customers gain from fast and reliable provision from globally dispersed facilities. Companies are therefore able to exploit a more open supply web and have access to more distributed manufacturing, assembly and distribution facilities which can be used for both short and long term contracts without having to make large investments, take on long-term leasing or strategic partnerships. As we move forward, the core questions will be how organisations seek to balance the reward of greater efficiency against the apparent commercial risk of partnerships with competitors. The reality, so some see, is that the transparency and effectiveness of a more flexible approach will become the main driver in making the open supply web the norm for the future.

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Over the next decade technology will become increasingly intelligent and so will the ways we make technology. At Dyson we are focused on making machines that are intelligent and connected so they understand the environment connect to it, and improve it.

Max Conze
CEO
Dyson

Key Facts

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80%
of everything we use or consume has at some point in its life been on a ship

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of companies are actively planning to start using some kind of analytics in the supply chain

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14 Days
to transport containers from China to Europe by rail compared to 60 days by sea

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clocked by Audi's driverless RS7 car circuiting Hockenheim racetrack

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Stability to use data sources for big data opportunity
56% Chain visibility
47% Geo-location
42% Product traceability

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17% of companies have already started to use data analytics in the supply chain

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Our Partners for Future of Trade

Download the Whitepaper

For the last 12 months DMCC, the authority on trade, enterprise and commodities in Dubai, has teamed up with FutureAgenda on an odyssey to discover the future of global trade. We gathered industry leaders, academics and experts in five key cities to discuss how global trade will change in the next decade and how it will drive the global economy into the next phase of growth.

Download PDF

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