It was impossible to go through 2021 without hearing about the crisis afflicting global supply chains. Back in the first quarter of 2020 the pandemic triggered a catastrophic sequence of events that would ultimately impact how efficiently the world’s distribution networks operated.
Data Analytics is an imperative in logistics
Today, data is driving the economy and disrupting how businesses operate. Data analytics in logistics is one of the domains that is experiencing widespread adoption and utilisation. The intricate structure of the supply chain makes logistics a perfect use case. Information can be extracted from numerous internal and external sources and touch-points along the chain i.e., traditional operational systems, sensors incorporated in vehicles, connected devices, suppliers, partners and customers. Valuable insights from the data will unlock efficiencies and optimise business.
With hundreds or even thousands of vehicles to manage daily, determining the optimum travel routes to minimise fuel or energy costs while ensuring deliveries are on-time is a major headache. Data analytics have been streamlining route optimisations – the process of determining the most cost-effective route with routing systems. Vast amounts of data are garnered from shipment information, vehicle capacity, holidays, road quality, traffic densities, crime hotspots and weather conditions which can be leveraged to calculate the most efficient route and stop sequences for fleets or to determine the most suitable modes of transportation (airplane, truck, train or ship) for long-distance routes, as well as the junction points to optimise the flow through the supply chain.
Warehouses go beyond the role of just storing and handling goods. Smart warehouse systems utilise various interconnected technologies to form an ecosystem to automatically track where goods are received, identified, sorted, organised and prepared for shipment. Smarter warehouses automate the entire operation from supplier to customer. Data analytics, combined with automation, Internet of Things and artificial intelligence, provide enterprises with a bird’s eye view of the entire warehouse operation and relay back performance information related to the organisation and the delivery of goods. A smart warehouse improves productivity, efficiency, and accuracy while providing more flexibility and capability.
Over the past few years, the logistics industry has benefitted from predictive analytics advances. Algorithms anticipate future behaviours based on historical data for predictive analytics to forecast supply and demand. Businesses can make more intelligent decisions about inventory planning, shipments, labour and capacity requirements. Logistics operators can generate reports on customer preferences, forecast demand and allocate workforce and resources accordingly. Predicting machine failures more accurately would make maintaining a site easier. Repairs or servicing can be factored in before they need to occur. Catching these issues ahead of time, maximises equipment uptime, reduces delays and rationalises operational costs.
Global supply chains are lean and mean – and operate smoothly. While the pandemic exposed some of its fragilities embracing digital transformation has the potential to help logistics companies to take operations to another level – improving efficiencies, enhancing customer experiences as well better preparing us for unexpected events. Exploiting the data available is central to success as we digitally transform our way to a better future.
By Quy Le, Head of Delivery, FPT UK