IoT and Big Data in logistics are changing the game
The risen in success and power of new giants such as Amazon, Google, Facebook, and eBay may have given us insight into a new factor of production. Information has appeared alongside with resources, labour and capital as the fourth production factor which can greatly distinguished company from its competitors.
Companies world-wide are making a trade-off between gut-feeling for accurate data-driven insight in order to obtain effective business decision making. No matter the issues to be decided – anticipated sales volumes, customer product preferences, optimized work schedules – It is data that hold the power of success for business.
What is Big Data?
Big Data refers to the process of analysing large, complex sets of information using sophisticated, predictive, and behavioural analytic methods to forecast the likelihood of potential outcomes.
Standard business reports focus on specific operations and departments. Big data takes a comprehensive look across all this data (and more) and tries to make sense of it all to detect patterns and predict the likelihood of possible event in the future.
What could be the impact of Big Data in Logistics?
The logistics sector is ideally placed to benefit from the technological and methodological advancements of Big Data. A strong hint that data mastery has always been key to the discipline is that, in its ancient Greek roots logistics means “practical arithmetic”. Today logistics providers manage a massive flow of goods and at the same time create vast data sets. For millions of shipments every day., origin and destination, size, weight, content, and location are all tracked across global delivery networks. But does this data tracking is fully exploit value by the company? Probably not.
Most likely there is a huge hidden potential for improving operational efficiency and customer experience, creating useful new business models. Consider, for example, the benefits of integrating supply chain data streams from multiple logistics providers, this could eliminate current market fragmentation, enabling powerful new collaboration and services. Many providers realize that Big Data is a game-changing trend for the logistics industry.
There is already existed an enormous amount of data that the company owned. However, there is a lot of refinery to be made on that information so that they can be practical and useful for business. With Big Data analytics, companies can achieve the attitude, skill set, and technology required to process data and generate more value from their information assets.
What is IoT?
The Internet of Things refers to the interconnection of devices and physical objects with embedded sensors, that allows for the continuous recording of their state (location, temperature, motion, impact, etc.) regardless of their location and time.
With the advances in networking technologies (Bluetooth, 4G, LTE, Fibber, etc.) its availability and low costs, the ability to interconnect devices and sensors through and to a common system have never been so feasible.
What could be the impact of IoT in logistics?
One industry that will see significant ripple effects is the logistics industry. In particular, the IoT will have a huge impact on how supply chain leaders access information and collaborate.
IoT is not the first time the logistics industry has heard of. FedEx introduced parcel tracking a while ago and pushed it competitiveness into the next level. Furthermore, Walmart implemented pallet level RFID tags a decade or so ago. In 2007, executives announced that the technology had greatly reduced excess inventory in the retail behemoth’s warehouses and cut out of stock occurrences by almost a third.
The IoT is not new for the logistics industry. FedEx introduced parcel tracking decades ago and its competitors scrambled to catch up.
Similarly, Walmart implemented pallet level RFID tags a decade or so ago. In 2007, executives announced that the technology had greatly reduced excess inventory in the retail behemoth’s warehouses and cut out-of-stock occurrences by almost a third.
Despite many supply chain organizations already being ahead of the curve when it comes to the IoT, it’s really just the beginning.
Enhance in-transit visibility
It’s now a given that a parcel can be tracked every step of its journey, from the moment it’s shipped to when it’s finally delivered into the hands of the consumer.
But in most cases, it’s still a matter of barcodes being scanned – usually by humans – as the item goes through various distribution points.
With the IoT, an RFID tag is placed on the parcel or pallet and the truck or van acts as the ‘reader’, eliminating the need for humans to do anything more than load the vehicle.
The delivery vehicle will then connect to the cloud and transmit the RFID-derived information and its location. And it won’t just be the vehicle’s position – temperature data will be available in real-time as well, except in very remote areas.
Warehouses, distribution centres are a fundamental part of supply chains and supply chain companies.
As a result, efficiencies gained in these facilities translate directly to improvements in the bottom line.
With parcels, pallets and containers RFID-tagged and able to communicate with infrastructure – machine-to-machine sharing – warehouses will be able to track inventory, vehicles and equipment through the cloud.
Through translating physical location into digital data, organizations will be able to automate asset and location tracking.
Additionally, taking humans out of these physical spaces will reduce workplace health and safety risks.
By providing a 360-degree view of a facility, organizations will be able to reduce congestion, trailer moves, fuel usage and wasted time. And by connecting and working with the right import-export partner, organizations will be able do this across the globe.
Improve respond time and risk management
The ability to collect information in real-time will allow businesses to respond to incidents and requests almost instantaneously and understand why, when, and how things happen. This will in turn help them to correct operational inefficiencies that might have existed for decades, deliver outstanding service, and reduce safety and security risks.
Iot and Big Data in logistics can change the game
Individually each of the technology already has tremendous benefits to business on their own, but the major benefits come from the combination of the two.
On one hand, IoT will generate valuable information through the interconnectivity of devices, sensors and systems for the business. On the other hand, Big Data will provide the ability to filter and sort out information, make sense of them and predict potential scenarios and outcomes.
Business will have to acquire the mentality to shift from a solely service organization to an information driven business.
A business that can make decisions based on timely, reliable, and statistically signification volumes of data. A business that can accurate understand the relationship between weather conditions, carrier, transportation mode, workforce productivity, delivery time, and profitability. Or a business that can avoid under or over allocation of resources by tracking warehouse, workforce and transportation utilization in real-time (and over time) to meet demand.
Logistics is being transformed through the power of data-driven insights. Unprecedented amounts of data can now be captured from various sources along the supply chain. Capitalizing on the value of big data offers massive potential to optimize capacity utilization, improve customer experience, reduce risk, and create new business models.