Every enterprise needs a drone strategy

Every company that deals with logistics and transportation needs a drone strategy. And the sooner you start planning, the better.
Written by Chris Kanaracus, Contributor

While the notion of package delivery via civilian drones may remain a fanciful notion to some, the reality is that drones may become a mainstream method of transport sooner rather than later.

For one thing, the Federal Aviation Administration intends to have drone regulations ready by the middle of this year, and Amazon has said it will be ready to launch its 30-minute drone delivery service as soon as that happens.

European authorities are developing a regulatory framework for drones as well. Once complete, it should spark a major increase in commercial drone activity there.

Now JD.com, a large Chinese online retailer, has begun testing delivery drones, as the Wall Street Journal reports:

The Beijing-based company said Thursday it has started an experiment with bright red drones emblazoned with its logo to carry small packages to far-flung areas that are difficult to reach with regular truck routes.

The Chinese companies are investing hundreds of millions of dollars to reach the new shoppers, but the infrastructure around villages is poor and logistics of getting goods to buyers has been a challenge.

Villages are spread out, and are connected by such narrow roadways that delivery trucks often can't fit. Addresses are difficult to find. But about 600 million people live in rural China--nearly double the population of the U.S.--and incomes in those areas are rising faster than in cities.

Drone delivery may "enhance the efficiency of logistics and distribution, saving labor costs," while providing a faster shopping experience to customers, JD.com said in a statement.

Enterprises: It's time to get your drones on

"Every company that touches or deals with logistics and transportation probably needs to actively or passively have some kind of drone strategy," says Constellation Research VP and principal analyst Guy-Frederic Courtin. "Now is the time."

The possibilities of large-scale commercial drone deployments are broad indeed, if you use some imagination.

Also: SkyBender: Now Google tests out drone-delivered 5G internet | Move over drones: Here come Skype co-founders' self-driving delivery robots | Export of Chinese-made drones increases

"What if I'm in a park with my kid and I forgot the sunscreen?" Courtin says. "Could Amazon deliver that to me within 30 minutes someday? That someday is much closer than we think."

Drones need not be purely about consumer sales, Courtin adds, pointing to transportation giant DHL's use of commercial drones to deliver medication and other urgently needed goods to the remote German island of Juist. "Here, [drone delivery] is looked at more like an SNL skit," Courtin says. "But that's doing it a massive disservice."

There are four steps enterprises should take when developing a drone strategy, Courtin adds.

First, figure out the business case, Courtin says: "Is it to be able to extend your network to places where dispatching a delivery truck might not be cost-effective?"

Second, start thinking about who to partner with and how to acquire the needed hardware, he adds.

Third, be sure to closely track the progress and substance of drone regulations.

Finally, while the drone wave looms large, timing is everything, Courtin says. "Is it worth getting out there on a limb before anybody else to talk about it? Will they see you as being cutting edge and innovative or being sort of crazy? That's something that has to be in consideration."

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Constellation Insights is an online news service published daily to advise members of the Insights community on the significance and implications of developments in enterprise technology.

Constellation Insights is crafted by leading analysts to go beyond merely reporting on news stories to provide detailed advice to community members on how to evaluate and respond to changes in enterprise technology. Learn more about Constellation Insights.

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