Technology-led innovations to lead the way in warehousing for Mahindra

Transreporter - Technology-led innovations to lead the way in warehousing for Mahindra

In an interview, Sushil Rathi, COO, Mahindra Logistics, talks about challenges in the logistics sector including shortage of skilled manpower and how the company has encouraged environment friendly solutions through induction of electric vehicles to the fleet of 
employee transportation. 

What are the key strengths of Mahindra Logistics that sets it apart from others?
Mahindra Logistics Ltd (MLL) has a unique ‘asset-light services led’ business model, whereby assets necessary for operations such as vehicles, warehouses and manpower are provided by business partners. This enables us to offer a variety of flexible scalable solutions and services based on client’s requirement and handle complexities that are unique to the Indian logistics industry. Basically, the organised 3PL business model of MLL gives it an edge over the traditional 2PL capital intensive logistics model. 
The asset-light business model also helps the company to focus on technology, which is increasingly becoming a differentiator in logistics operations. Technology is the backbone with which MLL innovates, implements and drives its operations thereby providing services to clients across its different verticals within supply chain management and people transport solutions. 

How are you able to optimise operations? What are the new trends shaping the third party logistics sector?
The company’s pan-India presence allows better utilisation on forward and return transportation. The strength of 1,500 business partners, are helping us in maximising reach and services. Our deep understanding of end-use sectors and customising our services as per their requirements, is also helping us in optimising the operations. We have a strong programme around continuous improvement through Kaizens which helps improve the productivity in our stores and linefeed and warehousing operations.
The industry is moving towards technology led innovations, which is resulting in better visibility and transparency. It is also moving from a cost plus model to a variable pricing model. Today, customers are increasingly looking at end-to-end offerings from warehousing, to secondary distribution. 
What was the idea behind induction of electric vehicles to the fleet of employee transportation vehicles in Kerala?
Electric vehicles, for us, exemplifies the Mahindra Group’s vision of the Future of Mobility – a sustainable automotive ecosystem that brings mobility solutions to customers across the world. Mahindra Logistics also deeply believe in the need to adopt environment-friendly solutions and our business practices are aligned accordingly.  The induction of electric vehicles for employee transportation is a collaborative effort between, Mahindra Logistics, Mahindra Electric and our customers to have sustainable solution.
We have deployed EVs for employee transportation through our People Transport Service (PTS) vertical across Bangalore, Delhi, Pune and now Kerala. 

What are the major barriers of growth in the logistics industry? How are you trying to address those challenges?    
One of the major barriers is that logistics continues to be a largely unorganised sector. Share of 3PL in the overall industry is 5 per cent but is expected to grow. Given the large size of the industry, it attracts different players. There are large MNC companies, local players, as well as new technology players. The challenge is to organise the unorganised and educate customers on the benefits of outsourcing and focusing on the reduction of their total cost, rather than just the logistics cost. Another area of challenge is the shortage of skilled manpower including drivers. We are taking several steps in that direction to address the issue.

Do you think infrastructure status and introduction of national goods and services tax have helped in reducing inefficiencies in the industry?
FY18 has been a transformational year for the logistics industry because of GST and other policy decisions, including the infrastructure status. This has opened a huge window of opportunity for organised 3PL players like Mahindra Logistics. While the Goods and Service Tax has brought about a lot of changes in the last one year of its implementation, a lot more needs to be done such as development of infrastructure, multi-modal transportation within the country etc. 

How has technology such as artificial intelligence, blockchain, robotic automation, Internet of Things etc impacted transportation and warehouse management? 
Akin to most other industries, transportation and logistics is also currently confronting immense change; and like all change, this brings both risk and opportunity. New technology, new market entrants, new customer expectations and new business models are some of the recent happenings in the industry.