The enhancement of digital transformation and the application of advanced technology is now playing critical roles in the development of key areas, especially logistics services. New technologies have practically influenced businesses and customers, substantially improving port operation efficiency. In 2020, The Prime Minister named logistics as one of eight critical areas for digital transformation.

Digital transformation trend in seaport operation nowadays

According to the Vietnam Logistics Business Association, logistics is a crucial service industry, a foundation for goods trade, and contributes to improving the economy’s competitiveness. Today’s most important requirement for science and technology in the logistics service industry is to increase digitization and automation to improve efficiency and reduce operating costs.

Along with that, the Ministry of Information and Communications approved Decision No. 1970/QD-BTTT dated 13/12/2021 to promote the momentum of opening up economic development, import, and export as well as international integration. The decision pointed out 6 main cores and constituent criteria for the purpose of assessing the level of digital transformation of each business, including (1) Digital experience for customers, (2) Strategy, (3) Infrastructure and digital technology, (4) Operation, (5) Digital transformation of corporate culture,  and (6) Data and information assets.

Through those factors, it is evident that digital technology and transformation in seaport operations are inevitable trends these days. During the Policy Dialogue in the Field of Logistics organized by the Ministry of Industry and Trade, Korea Trade and Investment Promotion Agency (KOTRA) in April 2022, Mr. Vu Ba Phuc, Director General of the Trade Promotion Agency (Ministry of Industry and Trade), stated that the 4.0 revolution is gradually transforming traditional logistics enterprises into a new chapter by applying advanced technologies to seaport operations to increase productivity and efficiency.

Implementing digital technologies in port operations

The application of Enterprise Resource Planning (ERP) is used by 44.8% of Ho Chi Minh City’s logistics companies; 41.4% of logistic industries get a warehouse management system; 44.8% apply the transportation management; barcodes and GPS sensors to track the process of delivery.

Presently, port service is a crucial focus point that plays a deciding role in enhancing the effectiveness of the overall transportation process. The main goal of port service is to create service quality zones that optimize logistical processes by increasing port compatibility, and technological advancement.

In addition, the TradeLens supply chain platform integrating blockchain technology is also used in today’s port operations. It is an open and neutral industry platform based on blockchain technology that promotes efficient, transparent, and secure information exchange to build trust in the global supply chain between businesses and individuals. This blockchain technology also provides business contracts to ensure smooth and secure logistics progress.

In addition to new technologies such as corporate governance, warehouse management, and transportation, E-port technology is also preferred by many organizations. According to Mr. Nguyen Hong Phuc, Sales Director of Tan Cang – Cai Mep International Port (TCIT), the E-port application was first implemented in Vietnam in 2017 by Saigon Newport Corporation. This appliance assists customers with declaring procedures and paying for container lifting and lowering fees; it ensures convenience, simplicity, time-saving, and cost-effectiveness when customers only need to access the internet and complete transactions quickly without guidance from port employees.

In Ba Ria-Vung Tau, Cai Mep International Port (CMIT) has also utilized this technology with exceptional features such as e-invoice and automatic customs supervision (e-cargo). Additionally, CMIT is the first port in Vietnam to use TradeLens technology to update cargo data, which immediately improves supply chain planning efficiency.

Advantages of digital transformation in port operations

Currently, digital transformation delivers numerous benefits to businesses as its application becomes increasingly necessary, which is the key for logistics firms to overcome obstacles, remain competitive, and accelerate their development. Consequently, it is undeniable that digital transformation has provided multiple benefits to organizations and customers, as evidenced by the following:

  • Digital transformation enables risk reduction, on-time delivery, and customer prestige while reducing costs and saving time through automation.
  • Improvements will also be made to the automation of back-office tasks such as email or fax, processes for calling to track freight, calculating freight rates, and completing paperwork.
  • Effective price management is executed with complete transparency, and the error rate and extra expenses are drastically minimized.
  • Digital transformation enables identifying shipping locations on a map and showing real-time shipment details.

In general, applying the new digital transformation technologies has resulted in the success of seaport businesses. Evidence shows that  Viettel Post has earned 21,452 billion VND, an increase of 24% over the same period, and its profit after taxes reached 295,89 billion VND in 2021. Since then, various existing logistics companies, including DHL, FedEx, Maersk Logistics, APL Logistics, CJ Logistics, and KMTC Logistics… have moved into the digital transformation era to achieve tremendous success.

Challenges of digital technology application, digital transformation in seaport operation

Although the development opportunities in the logistics industry are tremendous, there are still challenges that make it difficult for some businesses to apply digital technology to seaport operations. According to Mr. Dinh Ngoc Thang, Director General of Ho Chi Minh City Customs Department shared in the dialogue “Logistics Ho Chi Minh City Takes Off”, the total import and export turnover of goods as of 31/12/2021 implemented by the Customs Department reached 127.33 billion USD, up 9.5% over the same period in 2020 reached 116.28 billion USD. However, despite achieving the development mentioned above, the infrastructure system has not yet ensured quality nor reached the overall scale, making logistics activities not develop to their full potential.

In addition, Vietnam Freight Forwarder Association clarified that Vietnam’s technology application level in logistic activities is still low, far inferior to other countries’ groups in the region and the whole world. Specifically, many businesses do not attach importance to building a website, which is one of the most critical factors in attracting customers. Moreover, Vietnamese business websites lack important content such as order tracking tools, train schedule tracking, and document tracking.

In fact, the majority of Vietnamese logistics companies cannot arrange and manage the entire logistics operation process at seaports; they are limited to customs declaration, transit rental, and storage. The integration of logistics operations into a streamlined service chain that reduces costs and saves time is still inadequate. Although most transport companies have cruise control devices that use electronic data exchange for customs reporting and bill of lading processing, it is clear that cloud computing applications, blockchain technology, and artificial intelligence (AI) still have many limitations.

Understanding the above difficulties and challenges, the International Data Group in Vietnam (IDG Vietnam), in collaboration with the Digital Media Association, will organize the Vietnam E-government Conference & Expo 2022. This year’s conference has the theme “Digital citizenship, digital university, digital commerce models, the population database application development, and solutions for the national digital transformation enhancement.” The conference will be included the participation of leaders and experts in the field of Information Technology, sharing experiences on the application of digital technology in seaport operation and helping businesses have better development opportunities. 

IDG Vietnam cordially invites you to attend the Vietnam E-government Conference & Expo 2022 to understand more about the technological innovations, data application in logistics, and port operations to develop the digital economy and society towards the goal of national digital transformation in the period of 2022 – 2025.


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