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Aramex deploys disruptive technologies to innovate and grow its e-commerce business

(Image credit: Aramex)

Dubai-listed logistics company Aramex is deploying disruptive technologies to improve operational efficiency, shorten transit times and offer seamless customer experience in a bid to become an innovative e-commerce solutions provider.

 “The growth of global e-commerce activities has fueled a lot of demand and a lot of expectations around it because it is a personalised delivery. This growth has changed the way we handle our last mile capacity. The majority of the business today is transferring from a traditional B2B [business to business] to B2C [business to customers] and this comes with a lot of challenges,” Mohammed Sleeq, Chief Digital Officer at Aramex, said in a chat with TechRadar Middle East.

Aramex has digitally evolved in the last ten years because of the growth of the e-commerce business, with 60% of its shipments volume generated today come from B2C (business to customer).

One of the challenges, Sleeq said is seasonality and the volatility in the volumes, with e-commerce activities increasing business during Ramadan, Black Friday, Cyber Monday, Christmas and New Year. Sometimes during the season, Aramex has to handle double the shipments volume or more. In the last 12 months, Aramex has moved around 105m shipments globally.

 “They need to have the right capacity to manage the volatility in shipment volumes is extremely evident. Last-mile operators are tapping into the next generation delivery capacity, which means they need to modernise their core landscape and adopt a cloud strategy to improve agility and speed to market,” Sleeq said.

However, he said that the cloud is one element of Aramex’s digital transformation and it is one of the most challenging and exciting elements of the journey. “We look at cloud as the foundation for innovation and growth for Aramex,” he said.

Drone delivery on radar

“At Aramex, we are actively trying to leverage fresher and newer technologies which will help reduce manually intensive processes on the ground, supported by the use of machine learning (ML) and innovative last-mile technologies to enhance the delivery experience and scalability. Customer expectations are increasing with the e-commerce boom, it’s all about faster delivery, shorter transit times and real-time visibility,” he said.

 “As the world of digital transformation rapidly evolves, emerging last-mile technologies are becoming a reality. The UAE government is actively looking to initiate drones and autonomous vehicles technologies in the region to be at the forefront of technology advancement. We are looking at it very closely.”

 “We will be looking at designing a drone delivery for Aramex and what it would look like – whether it is a home delivery or hub connection delivery remains unclear. We are partnering with drone providers early on to ensure that Aramex will be one of the first to introduce such solutions,” he said.

Discussions will be at a far advanced stage in 2021; he said and added that the drones could possibly connect loads between distribution centres in remote areas as part of the first phase.

Sleeq said that e-commerce companies are investing in their own last-mile distribution arms. “We are witnessing a new breed of competition, digital operators and startups popping up to solve for last-mile delivery, but the industry challenges continue to be very critical and very hard to solve, such as lack of pin or zip codes and address management structure in the region,” he said.

Aramex is deploying machine learning and predictive analytics to decrease the human decision-making process on the ground and increase dependency on AI capabilities to make these decisions. “We have data science engineers internally that is solving the industry challenges. We sit on large amounts of data which can be used to solve these challenges to a large extent; we are putting it into use,” he said.

 “Mobility on demand will continue to be a driver for our customer journey roadmap but we are trying to evolve from a mobile-first approach to an AI-based approach to make the delivery experience more seamless. Customer experience programmes represent 40% of what we do in the digital transformation,” Sleeq said.

Platform powered by AWS  

The ML-based platform is providing the company with the ability to have accurate and instant delivery time predictions, using calculations based on seasonality and capacity constraints.

As a result of this adoption, Aramex has increased accuracy in shipping-date predictions by 74%, and lowered its average processing time for a prediction from 2.5 seconds to under 150 milliseconds.

Sleeq said that Aramex can look at its customers’ delivery experience and expectations from origination to last-mile delivery and work backwards to identify technologies and processes that can help it to deliver faster, more efficiently and operate with elasticity.

To strengthen its last-mile delivery capabilities, Aramex launched Aramex Spot, more pick-up options, by partnering with commercial locations to utilize their outlets as convenient Pudo (pickup dropoff) locations for its customers’ shipments across Saudi Arabia and the UAE.

Aramex has already partnered up with commercial locations and expects to grow to 150 spot locations across Saudi Arabia and the UAE by the end of 2020.

Sleeq proudly claims that Aramex has the biggest data lakes in the region on Amazon Web Services (AWS).

He added that these data points will be used for predictive analytics and facilitate the move into microservices architecture, built on top of the data lake, to reduce dependency on legacy systems, subsequently help enhance last-mile operations efficiency.

“We have selected AWS because it has the technology stack to support big data and machine learning capabilities and it is the most matured product in the market. We moved our big data architecture and BI architecture and started moving operational systems to the AWS cloud,” he said.

The biggest chunk, Aramex’ core operational systems, are being evaluated and there are multiple approaches to move to the cloud.

“It will take between 24-36 months to migrate the whole landscape to the cloud,” he said.

The Dubai firm, which is running its SAP’s ERP to modernise its back-end systems, is decoupling its legacy systems in a bid to move into the AWS platform by next year.

“We are seeing a lot of commoditisation when it comes to machine learning capabilities by AWS and we are leveraging voice-enabled technologies, e-commerce specific capabilities like Amazon Forecast and Amazon Personalize to be integrated into our platform,” he said.