PostNord unlocks the potential of data to empower its business

With many digital initiatives, such as IoT, artificial intelligence and robotics, Nordic postal house PostNord is pushing digital technologies into every aspect of its business and changing the way it works.

We talked with PostNord’s Christian Østergaard, Lead Visionary & Senior Group Strategist, about how it is using digitalisation to optimise its business, the results it has achieved so far and its next steps in digitalisation. 

Unlocking the potential of data to empower all aspects of the business

Digitalisation is currently the single strongest influence on PostNord’s communication, e-commerce, and logistics business and the Nordic postal has been unlocking its true potential to drive strategic decisions. 

In particular, says Østergaard, PostNord has been actively using AI:

“We’ve been using AI to optimise our processes, to build digital twins of both our sortation systems and line haul transportation and to create computer visions of fill rates, parcel types, volumetric detections, security analyses and productivity tracking.” 

According to Østergaard, PostNord is also developing forecasting tools to detect whether customers will be home and to predict parcel volumes and ETDs, as well as NPL tools for detecting addresses and special labels, voice picking and virtual chat agents. 

But PostNord’s push to digitise wasn’t always the case. Says Østergaard:

“Before our digitalisation programme, we operated as many CEP companies continue to do – with forecasting and planning contained within siloes, on spreadsheets and without automatic data entry or analysis. This meant multiple iterations, a ton of data at risk of being manually mishandled and a lack of cohesion between our sections.”

Connecting the dots: Integrating data is key

PostNord’s ambition, therefore, has been to connect all its data (collected from vehicle GPS tracking, dongles, sortation equipment and other data points) into one system to which it could apply intelligence to predict metrics, such as parcel volumes and arrival profiles. As Østergaard explains:

“The idea is to build one platform or ecosystem that everybody can use to visualise KPIs, to create fact-based operations and to analyse and predict important criteria.” 

In order to get an idea of how this could look in reality, says Østergaard, PostNord has built digital twins – or virtual 3D replicas – of one their parcel sorting terminals,with a second one coming up in 2022, and long haul transportation to test how it can minimise wasted capacity and optimise equipment and processes. He says:

“Digital twins are necessary because things have become so complicated that we need to be using mathematics to run them instead of human brains.” 

PostNord has taken years of data and mapped them to figure out how to predict parcel volume for optimal planning. 

From here, Østergaard explains, PostNord has started to build digital models. The model for its long haul transportation, for example, has been able to take into consideration business constraints, such as terminal capacities, number of loading docks and driver working times. It has also been modelled to take into account other business features and variables, such as parcel profiles and workforce productivity. 

According to Østergaard, has been able to turn all of this data into AI flows, where parcel volumes for each terminal can now be forecasted. Based on the forecasts, schedules and plans can also be created through AI distribution modelling, within any given time frame the planner determines – taking into consideration the business constraints already built into the model.

 

 The results are in for PostNord 

What does all this mean for PostNord and what’s in store for future digitalisation? Østergaard states: 

“Through our digitalisation efforts, we’ve become much better at predicting volumes and workflows. The solutions are so user-friendly for our employees, that they’re eliminating wasted time. Our processes are constantly improved and optimized, which helps us save significant costs, while also helping us achieve our sustainability goals by reducing mileage.” 

According to Østergaard, PostNord will never stop its digitalisation efforts; it will always be hunting for new models in ways of working. And digitalisation will play a critical role in trends that he anticipates will have the greatest immediate impact on the industry. 

Here’s how Østergaard sees the future:

  • Climate change and demands for sustainable businesses: Enormous changes in industry behaviour are required; not only will transport be electrified and kilometres driven reduced, better use of space and utilisation of assets will also be expected and digital solutions will be a part of that.
  • Convenience: Customer demand for convenience – the number one growth opportunity for CEP companies – will need to be continually monitored through digital tools.
  • Cost: All customers (whether shippers or end consumers) will continue to demand the lowest costs possible; to meet that demand, CEP companies will need to find cheap and innovative solutions that are extremely efficient, can reach their customers and are scalable. 
  • Capacity: Data-driven technologies will enable CEP companies to always meet the needs of the market.  

 Collaborating with systems suppliers in digitalisation

To successfully transform its businesses, it’s important to PostNord that it’s able to work in collaboration with its systems providers. Østergaard believes:

"Together with our suppliers, we can develop and build the right digital solutions that meet the individual and changing needs of our customers. If both parties share their data, we can create very accurate copies of how operations are working in reality to better optimise overall system performance.” 

In summary, PostNord is using digitalisation in practically every aspect of its business today. A big drive behind its efforts is ensuring it is number one in customer convenience. As Østergaard says:

“Meeting the needs of our end customers is the whole aim.” 

For PostNord, that means having the ability to be flexible and dynamic. Digitalisation is enabling that

PostNord unlocks the potential of data to empower its business - Christian Østergaard at the Parcel+

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