Analyzing Freight & Logistics Operations
Disruption is the new normal in freight and logistics. Customers now demand greater speed and value, and want detailed information on the status of their shipments. Shoppers are increasingly mobile and connected, and shop across multiple channels. Manufacturers and retailers are rushing to re-introduce direct-to-door deliveries. The emerging Internet of Things allows companies to capture location and movement, temperature, audio, video and other information.
At the same time, tough and nimble competitors are moving into the sector. Some of the world's largest and most successful e-commerce players are reshaping the delivery landscape. In recent months, we've seen online giants acquire regional shipping firms, and make other plans that may include delivery fleets, drones, and aircraft leases.
A new as-a-service shipping and delivery model may now be emerging—and it poses significant operational challenges to companies across the global supply chain.
Customer and Operational Performance
How can you survive and prosper in a faster, more nimble transportation environment?
Data and analytics are the key. More than ever before, freight and logistics firms need real-time information to understand and manage their operations. Forward-looking firms are already using advanced analytics to gain end-to-end and near real-time visibility into mission-critical variables.
Those can include evaluating product pipelines and shipping patterns, weather-related events and other seasonal issues, understanding developing bottlenecks, and competitive challenges. Astute executives now leverage performance-based analytics to gain 360 degree views across line haul, pickup and delivery, and cross-dock operations.
Many are now using root cause analysis to identify and rectify service failures, labor requirements, and other issues. Data management and analytics allow companies to optimize freight mix and handling, routing and last-mile efficiencies, consolidated deliveries, and other operational strategies.
On-board telematics provide the data needed to document, understand, and improve driver performance. Not surprisingly, those same capabilities can help reduce accidents, improve driver recruitment and retention, and reduce worker's compensation claims. A robust business intelligence system can also simplify and strengthen regulatory and compliance efforts.
An e-Commerce Shift
Global online sellers are moving into the shipping and distribution space, and that means big changes for consumers, for manufacturers—and for freight and logistics companies of all kinds.
UPS, FedEx and others have traditionally handled the lion's share of last-mile deliveries. But serious problems during the 2013 holiday shopping season led more than one e-commerce firm to re-think that model. Those giant e-sellers are making noticeable moves into the trillion-dollar freight sector.
It's a move that started some time ago. Those data-oriented firms started by leveraging technology and efficiencies to create internal platforms—and then to roll them into a range of as-a-service innovations. Just look at their advances in e-commerce checkout and payments, cloud computing, and retail sales.
Now inbound logistics and delivery may be in the tech-giant crosshairs. In recent months, non-traditional firms have explored warehouse robotics, drones, truck and air fleets, and crowdsource deliveries. To meet those disruptive challenges, freight and logistics firms are embracing the new power of data and analytics.
Data and analytics can yield real operational and business advantages. Improved visibility allows freight and logistics firms to identify customer needs, mitigate risks, and understand their competitors. It provides the insights needed to bypass intermediaries and to link operational performance indicators to strategic business goals.
Disruption is coming to the freight and logistics industry. By seeing and understanding the full spectrum of operations, transport-oriented firms can survive and succeed in a dramatically changed environment.