Logistics And Supply Chain: Between “Polycrisis” And Digital Challenges

Malik Zeniti, Director of the Cluster of Logistics (Photo © Cluster for Logistics)

“2022 was a turbulent year”, the Cluster for Logistics Luxembourg explained in its latest activity report. However, “resilience, strong professional competences, and digital transformation can limit disruptions in supply chains,” insisted Malik Zeniti the Director of the lobbying organisation.

The Cluster for Logistics Luxembourg (C4L), an association promoting the country’s logistics hub abroad, has released its annual activity report. The organisation counts 100 members of the sector including half a dozen startups.

2022 was a turbulent year, and had its number of new challenges and opportunities,” the document says. “Russia’s war of aggression on Ukraine, high uncertainties about China’s political course, the No-Covid policy impacting growth figures and the large impact of the energy crisis generating inflation, had a strong impact on competitiveness and creation of value in the sector”.

A situation the lobbying organisation sees as a “polycrisis”. The term describes the simultaneous occurrence of several catastrophic events, a coincidence of multiple crises which becomes more dangerous than each disaster or emergency on their own.

The term was Initially mentioned by French philosophers Edgar Morin and Brigitte Kern in 1999 in their book ‘Homeland Earth: A Manifesto for a New Millennium‘. The World Economic Forum reused it in its Global Risk Report 2023.

“Digitization and environmental transitions are in the roadmap for 2030.”

Malik Zeniti, Director of the Cluster for Logistics

“Cautiously optimistic”

Although customers and stakeholders, the industry and commerce continued to face “remarkable risks of disruptions throughout the year”, C4L remains “cautiously optimistic” but sees “weaker developments ahead impacted by global developments,” Malik Zeniti its Director explained. “Resilience and strong professional competences can limit disruptions in supply chains.”.

Luxembourg supply chain and logistics infrastructures include the 6th largest freight airport in Europe (1.2 million metric tons per year).

On the rail/road segment, the logistics zone Eurohub Center of Contern, which is close to the airport, offers airfreight handling and contract logistics (for healthcare, robots, retail, e-commerce and secured high value airfreight).

In South Luxembourg, the Bettembourg/Dudelange Logistics Park Eurohub Sud is connected to Scandinavia, Belgium, France, Spain, Italy, Germany, Poland, Turkey and China.

On the navigation segment, Mertert’s trimodal platform (water/highway/rail) manages the import and export of heavy goods including oil, agri-food products, ferrous and building materials.

The whole relies on digital infrastructures (redundant national and international high-speed connectivity, data centers, public key, blockchain…) and on Intelligent Transport Systems (ITS).

These IT monitoring systems operate new technologies and solutions dedicated among others to the optimisation of transport infrastructures, security and safety improvement, service development and to sustainable logistics favoring the shift from roadway to other environmentally friendly modes of transport.

“The C4L makes sure to maintain and expand Start-up Matchmaking events to the needs of our members.”

Malik Zeniti, Director of the Cluster for Logistics

Digital challenges

“Digitisation and environmental transitions are in the roadmap for 2030,” Malik Zeniti added.

In February and March 2022, the Cluster for Logistics Luxembourg and the Ministry of the Economy, conducted an anonymous “digital transformation in transport & logistics survey”.

The aim was to understand the needs, challenges and requirements of transport and logistics companies in their digital transformation processes. 39% of the Cluster’s members responded.

In order to manage their operational efficiency, most participants said they use solutions including transportation planning processes, digital freight documents and warehouse operations. They also use tracking and tracing as well as customer service solutions.

The main technologies used by logistics companies include advanced analytics and artificial Intelligence solutions, Internet of Things based Solutions as well as in-house technologies.

The main barriers for driving digital transformation processes expressed by respondents are the lack of time and conflicting priorities, followed by the lack of internal expertise and of suitable internal offers as well as the lack of financial resources.

“The C4L will organise digital workshops with experts on hot topics of digital transformation in logistics to react to the requests of the study participants,” Zeniti promised. “The Logistics Conversations podcast and newsletter will increasingly tackle topics around digital transformation. Besides this the C4L makes sure to maintain and expand Start-up Matchmaking events to the needs of our members.”

To tackle the lack of information, the C4L plans to develop joint information campaigns, support initiatives and promotion initiatives together with the Ministry of the Economy, Luxinnovation and other organizations.

The Cluster for Logistics Luxembourg (C4L) was founded in 2009 with the aim of diversifying Luxembourg’s economy largely based at that time on the finance industry. The roadmap included the development of new logistics and supply chain opportunities such as a multimodal hub in the heart of Europe (from Scandinavia to China) integrating the country’s cargo, airport, rail, road and maritime infrastructures.

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