Successful logistics management requires complex technology and consistent data. Luckily, those things come with a side of powerful information that can be used across the entire organization. The insights offered by the systems required to effectively manage your supply chain can help you improve other areas of your business as well. Here’s what you need to know.
First: What is Big Data?
Companies in all sectors hope to improve the overall efficiency of their business. One tool at their disposal for doing so is Big Data. What does that term entail? Big Data is a broad term that encompasses sets of information that are so immense and transferred so quickly that traditional methods of processing cannot reasonably handle it. That’s a lot of data! The most popular definition was created back in 2001 by Gartner and spans three components.
- Variety – Today, there are more types of data and more ways to collect it than we’ve ever seen before. Big data can be gathered from sources that were previously novel like sensors, GPS information, relational data, and a lot more.
- Velocity – How fast can data be transferred and processed? One of the biggest advantages of big data is that you can gain real-time insights due to near instantaneous collection and transfer.
- Volume – The pool of data that companies have available has grown tremendously. This means the amount of data as well as the variety is expanding. Being able to manage data of volumes previously not thought possible is a daily occurrence now.
Improving Efficiency with Logistics Data
With the understanding of the sheer amount of data available to business leaders, what can be done to improve productivity? Here are six actionable ways to improve overall effectiveness through analysis of logistics data.
- Enhance freight movement and routing. If you have a transportation element to your business, then you are probably always looking for new ways to optimize logistics. Doing so will save money as well as reduce shipping time and mistakes. There is a balance between over-extending resources and failing to provide enough to complete necessary processes. Getting this balance right is what transportation is all about! Some variables are difficult to account for, such as constantly changing fuel costs, closures of highways or construction, or unpredictable weather conditions. In years past, transportation experts would need to manually pull information on these variables and then calculate the best ways to work within these parameters. Now, we have up-to-the-minute information due to things like GPS tracking. For instance, we can understand issues with a route in advance and make different plans.
- Optimize the all-important last mile. The “last mile” of route optimization is critical. Companies have until the product is actually delivered to customers to make changes that can improve efficiency. A comprehensive logistics system with robust data can help fill in the gaps of the last mile. Low-cost data sources like GPS trackers, scanners, and sensors provide a better picture of the complete delivery process. For example, delivery trucks with GPS trackers can provide key information about where a truck is in the delivery process.
- Anticipate and mitigate issues. Sophisticated data processes incorporate multiple streams of data into a more responsive system. For example, an AI or machine learning system can integrate GPS data plus weather patterns to see what might impact future shipments. The company can then inform partners or customers of potential delays. By understanding expected delays, every party can take the appropriate action to minimize disruptions. As an example, sensors placed in trucks or ships can be diagnostically invaluable. These sensors can provide key insights into blind spots in the transportation process by gathering information on how long the truck idles or runs, for example. A predictive approach can significantly reduce the occurrence of common transportation disruptions.
- Ensure accurate inventory. Transportation can only go well when the items needed are actually available. When there is an inventory issue – such as requested products not being able to be delivered – customers will experience a disruption. Then, those customers are more likely to shop with a competitor next time. It’s important to remember that stock is part of your company’s inventory even after it’s left the warehouse. Just because items are physically somewhere else doesn’t mean they aren’t part of your overall inventory picture. Transportation data should include detailed information on inventory counts, order cuts and logs of product arrivals and departures. By regularly reviewing this data, you can reveal inventory patterns or other issues that become predictable. Big brands are already using cutting-edge technology to ensure accurate stock maintenance, and these tools are becoming more available to companies of every size.
- Improve customer service – You might be surprised to learn how much value transportation data has to overall customer service. Using this data to optimize the supply chain will improve overall customer experience. Today’s customers expect full transparency in their order process – from seeing different shipment options to getting periodic updates on their order and having access to full tracking information. A more seamless and information-rich experience will translate to more loyal customers. Furthermore, related to the points above, if you do see a potential issue, you can make customers aware of it before they experience delays.
The use of data in logistics operations can create important shifts in your overall business. Using this data properly can reduce disruptions, save resources, and improve customer experiences – all leading to more profits hitting your bottom line. The good news is that sophisticated 3PL providers leverage the latest and greatest technology and are able to optimize through the use of associated data. At Taylored, we offer business analytics as well as data integration and warehouse management services.