Freight data, logistics data, business intelligence data–there are many ways to describe the information we collect about today’s supply chain. Modern industries generate a ton of data, and that data is juxtaposed with the amount of empirical data generated every moment across all human activity. Humanity itself generates 402.74 million terabytes of data daily, and with that data comes risk, such as a cyberattack or experiencing internal (operational) setbacks. Such abundance can become perhaps the biggest risk for freight entities that rely on data for decision-making, particularly those surrounding supply chain optimization.
The volume of data is going to keep growing. The global freight and logistics market is expected to increase from $15.65 billion in 2022 to more than $20 billion in 2027, according to Procurement Tactics; the sheer volume of data is overwhelming. Therein lies its core risk: excessive and poorly managed data can lead to significant issues affecting overall supply chain performance. IL2000 takes a head-on strategy to mitigate the risk, and shippers need to understand how this influx of data can impact their operations and what steps they can take to mitigate potential problems.
Problem 1: Analysis paralysis and operational inefficiency
Analysis paralysis occurs when businesses are inundated with too much data, stalling critical decision-making processes. Instead of making swift, informed decisions, companies get bogged down in the sheer volume of information. This can delay responses to market changes, leading to missed opportunities and inefficiencies.
Managing large volumes of data without proper systems can also lead to operational inefficiency. Resources may be wasted on processing redundant or irrelevant data, diverting attention from more critical logistics tasks. This inefficiency can ripple through the entire supply chain, affecting warehousing and fulfillment, dock scheduling, and overall logistics performance. Together, the data creates a perfect storm for uncontrolled costs. However, implementing freight audit services can help identify and eliminate these inefficiencies in billing. This occurs while also opening the proverbial trailer doors to understanding what’s really happening in your supply chain.
Problem 2: Misguided decisions due to untimely data
Old data is bad data. Relying on outdated or irrelevant insights will result in misguided decisions. It can lead to strategies that are out of sync with actual market conditions. This misalignment can increase transit times or warehousing costs and cause issues across both the upstream and downstream supply chains. Regular data hygiene can ensure accuracy and relevance, while also enabling competitive advantage. Accurate data ensures agility and informed decision-making, which leads to more profitability.
Strategies for managing logistics data effectively
Adopting effective data management strategies is crucial for avoiding the pitfalls of overwhelming logistics data. Unfortunately, many of the systems in place today don’t go far enough to show exactly what’s needed to succeed. They may lack descriptive analytics to understand what has happened or not provide actionable insights. The resources often rely on blind trust, which is another problem that many IL2000 clients have expressed about past provider experiences; most partnerships end with not getting the results that were promised. It may not even be stalled results but rather challenges in how the results were communicated that led to issues.
Before finding yourself with a flat tire on the road to improved logistics data application, here are some actionable steps that you should start taking right now:
- Set clear data governance policies. Establish standards for data collection, storage, and usage to maintain integrity. As an example, IL2000 is continuously improving our process of collecting, storing, and analyzing data in our analytics software suite.
- Implement advanced analytics tools. Use advanced tools to filter out unnecessary data and focus on actionable insights. Yet, building in-house tools can cost a small fortune, and IL2000 can create the same value without lengthy and high in-house costs.
- Use real-time tracking systems. Enhance visibility and responsiveness by providing current information on shipments to end-users, i.e., shippers’ customers. The data shared in tracking systems is a powerful resource for aggregating information in real time, but its strength can be augmented when connected to business intelligence tools via APIs.
- Conduct regular data audits. Schedule periodic audits to identify and rectify data inconsistencies and redundancies. This ensures the data remains accurate and relevant over time.
- Invest in machine learning and AI-driven algorithms. Use machine learning to predict trends, optimize routes, and improve demand forecasting. Of course, machine learning is rapidly evolving as generative AI and other functions become more advanced, so it’s important to have a clear plan in place to accommodate new changes in analytics too.
Enhance data security measures. Implementing robust security protocols protects sensitive logistics data from breaches and unauthorized access. We’ve all seen what can happen without strong data security, which includes encryption, access controls, and regular security assessments. However, the opportunity to worry less about data security comes from having trust behind every system. Using APIs can also eliminate the risk of errors or even maliciously shared data with analytics tools. - Create a data-driven culture. Encouraging a company-wide culture that values data-driven decision-making will mean you’ll need to provide training and resources to employees at all levels to understand and utilize data effectively. Such needs also apply to knowing how to use the insights generated from the data to make informed decisions. Now, you’re not only collecting and analyzing data but putting it to use, and what looks like the right decision isn’t always obvious. This nuance is where IL2000’s supply chain consulting capabilities shine, putting insight and value to work to actualize real benefits.
- Leverage cloud-based solutions. Cloud storage and computing handle large datasets efficiently offering scalability, flexibility, and real-time data access from any location. Yet again, the functionality can be limited and subject to the internal developments of the platform.
- Focus on data visualization. Use visualization tools to present complex data in an easy-to-understand format, such as customized reports based on shared data.
Realize the value of successful business intelligence with IL2000
Effective logistics data management is critical for navigating the complexities of the modern supply chain. Shippers must evolve and tap the real potential of advanced business intelligence resources, but the road to adopting robust strategies and leveraging advanced technologies is anything but easy. Fortunately, businesses can optimize their logistics operations, improve efficiency, and maintain a competitive edge in an ever-evolving industry landscape by choosing the right partner–IL2000. Connect with an IL2000 expert to get started.