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As the world economy experiences turbulent changes, the retail transportation and logistics sectors reverberate with the negative effects and prepares itself for increasing complexities.
The industry has had to face the reduction of freight volumes and the rapid rise of fuel charges. Together with changes in regulatory requirements and a short supply of qualified drivers the situation has intensified. Although these challenges are widely recognised, customers continue to demand premium services, more options, more information simply put, more for their money. Transportation companies know they must respond to customer demands as well as the industrys competitive pressures, and this begs the question on every transport operators lips: how to increase revenue while reducing costs?
On one hand, the key rests with identifying new revenue streams and improving customer service, such as on-time, error-free and damage free shipments and accurate tracking ability. On the other hand, fixed and variable costs would be reduced by improving asset, resource and inventory utilisation and elimination of claims and accidents that detract from the profit line.
A viable multi-faceted solution lies in the introduction of In-Transit Visibility (ITV). This is a powerful tool in the transportation companys arsenal when seeking to improve efficiency and profitability. ITV is quickly becoming commonplace in private industry and is defined as the ability to track the identity, status and location of inventory and shipments from origin to consignee or destination, delivering true transparency to the supply chain thereby reducing the unnecessary waste of time, fuel and paper. Moreover, it prevents the attrition of customer relationships which attract new and repeat business.
The component benefits of ITV can be broken down into several areas and examined in relation to different aspects of transportation from accurate data capture to asset management.
Improved location awareness is a primary asset to a transport business and can be simplified with ITV, bringing visibility to products, records, drivers or vehicles. For example, more powerful mobile computers can perform real-time navigation and voice guided turn-by-turn directions, which enable safer, more cost efficient driving conditions. This enhances the performance and time and fuel management of even the most seasoned drivers.
Similarly, cameras in mobile devices can be used to capture images of shipment damage, though often at poor quality. However, bar code imagers in the very latest devices have full page scanning capabilities that can be used to capture quality, readable, images of documents for proof of delivery.
Todays mobile technology enables dynamic route optimisation; a software application allows the despatch control to add extra stopping points to a route. The software can sequence the stops to completely reorganise the route to include changes, improving fuel consumption and saving the driver time lost to map-reading. This is particularly useful when marrying priority deliveries with regular deliveries in an around a particular area. Route optimisation reduces unnecessary repetitive journeys in the neighbourhood.
True ITV allows transport operators to locate their fleet, and more importantly, shipments or inventory they are carrying at any specific time. This is enabled by item level tracking, providing the transparency that todays customers demand. Tracking enables on-hand proof and validation of en-route status, timely delivery to the correct location and recipient of the package. This can be particularly useful for damage control in the case of a product recall or when an emergency situation demands that inventory is redirected, as well as liability cases should products and packages be damaged.
Notably, the reporting systems in the transport industry are still very much paper oriented and this makes it extremely difficult for fleet operators to control productivity and enforce timeliness and accuracy of information capture. By utilising imaging technology to capture information, cash flow can be improved by reducing the time between delivery and invoicing. By using point and capture functionality it is now possible to generate quality images at manageable file sizes for the mobile environment that integrate with the industrys most commonly used imaging systems.
One of the more advanced tools is ITV enabled telematics systems that analyse driving patterns via vehicle mounted sensors. Accelerometers measure G-forces and alert the operations team at HQ to instances of vigorous driving techniques that can waste fuel and increase risk to liability. They can also measure vehicle efficiency, mechanical performance, safety parameters and fuel consumption patterns which alert to any potential problems before they turn into revenue-burning crises.
ITV also monitors human resources which is paramount to economically efficient operators. It addresses the age-old question Do we have enough drivers to accept this new assignment? ITV resolves this, alongside payroll and other information, such as special licenses or training, to help them choose the best driver for each job.
Similarly, ITV-enabled Real Time Location Services (RTLS) allows users to know exactly what is in the yard and, more importantly, where it is. This strengthens security of physical assets and speeds processes such as maintenance, so the maintenance crew can fix a light on a truck instead of spending time looking for it. Clearly, this increased awareness improves the productivity of operations and maintenance staff alike.
Overages and damages happen, however ITV can help companies minimise this and reclaim ensuing lost profits using data collection and imaging technology. These technologies prove shipment movement count and condition of inventory at each point of action. This up-to-the-minute, undisputable documentation streamlines back office processes, ultimately providing customers with a higher level of service and improves in-house operations.
Asset management is, at the best of times, a delicate balance of trying to achieve optimised performance of resources, resulting in maximised productivity. Operations employees such as dispatchers and customer service personnel rely on data to track locations, vehicle condition, driver and shipment information.
The mobile assets of a transportation fleet such as tractors, trailers and trucks are the most valuable elements of any transportation company and require the most capital to run and maintain. Owning excess equipment can ensure readiness for any customer request, but can also be needlessly costly. ITV enables sensible management of the fleet through various means to avoid costly options.
As we know, ITV in relation to direct customer relations is a useful tool for the transportation service provider to collect information needed to prove that the shipment was delivered on time, without damage and in full. ITV technologies provide multiple levels of proof, including signature capture and proof of delivery. Perhaps the greatest validator in delivery proof is electronic signature capture which speeds the order-to-cash cycle. Imaging technology is so advanced it can locate the signature on a page and optimise the image, ensuring that it is usable.
The now ubiquitous ITV enabled mobile computers that drivers use report on inventory, from a single letter envelope, to boxes, barrels, pallet or truckload level. ITV technology delivers proof of delivery in a format preferred by the customer - a service previously unavailable under the manually processed systems.
ITV also translates as a differentiating, new business opportunity, especially valuable during a challenging economic climate. Because accurate reporting can be viewed as an extension of the services your company provides to its customers, it can command a premium pricing structure previously unattainable with manual reporting methods, and secure return business.
With all these advantages at hand, ITV proves itself an oasis in the desert when it comes to revenue generation, especially in a challenging economic climate where differentiating ones service becomes significant. However, choosing the appropriate ITV solution for your business is also key as the options are wide ranging.
Solutions that are easy to handle get used more often, and therefore pay for themselves more quickly. Lightweight, ergonomic tools, that are easy to carry, and simply understood, are more appealing for the employees who will have to use it whether permanent or stand-in contractors.
Integrated devices that incorporate a bar code reader, camera, cell phone, data and voice communications with GPS are cost savers in terms of application choice and staff training. Rugged devices result in reduced total cost of ownership through longer use life with fewer repairs, higher solution up time, lower support costs and improved device utilisation.
Aim to get more value out of your technology investment. Choose a single platform solution that can be used for multiple applications, for example, a single device that can be used in a truck, or at the customers door, back office and warehouse.
Choose solutions that offer data capture instead of data creation, i.e. machine data collection over driver entry for example. Not only does this significantly enhance system accuracy, it brings new time management and workflow efficiencies.
Perhaps most importantly, try and ensure that your chosen solution offers longevity - in that it can be used and expanded for years to come.
Ultimately, the success of ITV in your transport business hinges on appropriate tools to meet your company needs. With the right tool visibility and control of assets, resources, shipments and information is possible to generate cost savings and enhanced revenue opportunities through raised customer confidence.
Before implementing ITV solutions for your transport company however, just keep in mind what sector of transportation you operate in. Work with providers whose solutions are based on open industry standards, so that your company can choose from an array of components when expanding your system, not just what is available to work within a limited, proprietary system.
Upon immediate analysis of an ITV solution, the areas of return are not always obvious. Be sure to examine opportunities the solution affords for expense reduction as well as productivity improvement. Also, look for benefits that grow your business, such as customer service improvement, customer visibility improvement and differentiated services that will net additional revenue. In the long run, ITV is guaranteed to be a boon to your transportation business because with control, mobility and visibility margins of success are widened, while margin for error fades into the background.