Digital transformation is particularly challenging for industries that have traditionally used proprietary technology. The transportation and logistics space is one of them.
Chris Blumenberg, CTO and Co-founder of rideOS, comments, “Historically, dispatch and logistics technologies have been closely guarded secrets, known only to the transportation network companies (TNCs) and delivery companies.” Companies developed their own transportation technology solutions in-house, often to realize cost reductions that result from efficiency improvements, multiplied at large scale.
Changes in the competitive landscape and customer demands are driving change. New entrants with new business models are taking a bite out of incumbent businesses’ market share with operations that let them provide innovative and streamlined services and provide them faster.
The Move Toward Standardized Transportation Technology
Blumenberg points out that as the market continues to fragment, more providers are looking for ways to optimize fleet efficiency, and, looking back over 2019, he sees the industry-changing course.
“An increased demand from a diverse customer base creates the need to standardize technology to remove friction from integration,” he says and adds that rideOS has identified common anti-patterns and pitfalls when integrating with numerous providers to meet this need.
“As the technology for fleet efficiency continues to standardize, it will enable more providers to quickly realize these efficiency gains, since the pains of integration are reduced,” Blumenberg explains.
Furthermore, he says providers will realize massive cost savings as they scale. “In the short term, companies will see cost savings from market-competitive prices and feature differentiators such as premium deliveries and tighter guaranteed delivery times,” he says.
Blumenberg adds that long term, cities can take advantage of fleet efficiency to help reduce traffic congestion and, ultimately, carbon emissions, which is an inspiring vision for the rideOS team.
The Challenge for ISVs
Blumenberg’s advice for ISVs is to learn all you can about this space to gain a deep understanding of how past transportation technology trends emerged and became mainstream. “Think about connectivity infrastructure for the web, the rise of mobile devices, etc. and identify the factors and key inflection points that led to their adoption,” Blumenberg says. “Next, apply those litmus tests to current trends you see in artificial intelligence (AI), autonomous vehicles, and virtual reality (VR), to name a few.”
That will prepare you to see how your products, solutions and services align with those trends and with companies’ technology adoption lifecycle.
“There’s no silver bullet, but we can at least learn from past experiences and theories on the general direction we should move towards,” he says.
Looking Ahead to 2020
Blumenberg expects to see continued consolidation and standardization of dispatch technologies so that it becomes much clearer how to integrate with a state-of-the-art fleet optimization solution while avoiding all the pitfalls of dealing with trip state management.
“On another front, we expect to see applications using this approach to integration emerge for other related domains, such as goods delivery, logistics, and freight,” he says. “It’s an exciting time to be working in this space.”