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Logistics: Every Company is a Software Company — and Many are Logistics Companies Now Too
Every business may now be a software company. But many businesses now are becoming logistics companies too. Logistics has become a a key capability for many large businesses, and some businesses, like Amazon, are bringing their logistic capabilities fully in-house.
Tim Worstall, Fellow a the Adam Smith Institute in London, wrote in a piece for Forbes that “at the economic heart of each of these three of businesses, WalMart, Amazon and Inditex, they’re really, what gives them their competitive and absolute advantages, logistics companies.
Amazon is leading the way in developing a highly efficient logistics network. Jeff Bezos wrote in a letter to his employees that “what this makes clear is that Amazon is less a retailer and more a logistics organization dedicated to moving physical goods and digital bits in as many ways and as efficiently as possible.”
Amazon’s competitors are worried, for example, Home Depot considered acquiring XPO, a $9 billion logistics company.
Apple also recognized early on the importance of logistics. Steve Jobs knew this when he picked Tim Cook to be his successor. Apple’s CEO Tim Cook was considered a logistics genius before being elevated to his position as CEO. Steve Musil, writer and editor at CNET, said that “Cook is credited with completely restructuring Apple’s manufacturing operations, insisting that Apple shut down its overseas factories and farm out the work to third-party manufacturers. As a result, the company reduced inventory and improved margins on its entire product lineup.”
