The great data unlock: How data is driving transportation

Today, transportation companies not only have access to higher resolution data, but also they can take advantage of cutting-edge data science to perform analytics in near real time. By monetizing data as a value-added service within the transport sector, businesses can increase operational efficiency and flexibility, while reducing fuel consumption. Overall, customer experience and safety have also improved manifold.

Managing data challenges

The real challenge within the transport industry is not about managing the exponential amount of data but truly unlocking the value of that data. Our survey of executives at transportation and manufacturing companies in the United States and Europe revealed four key friction areas:

1. The urgency of turning data into intelligence
   Historically, data has been organized to meet the needs of specific business functions. Transportation companies require specialized analysis to process data from all areas of the business and unlock value from siloed information within specific functions, business units, and regulators.
2. Managing data like a pro
   New and relevant tools and technologies such as data warehouses and data lakes continue to enhance industry practices at a rapid pace. There’s a need to invest more in data scientists to correctly analyze emerging industry trends.
3. The balancing act of investing vs. improving
   Large transportation companies often have free-standing information service units managed by chief information officers, but these structures create the dilemma of making a trade-off between investing in contemporary assets or improving legacy systems, impeding the progress expected by both customers and company leaders.
4. Tackling the surplus problem of reporting requirements
   New reporting requirements place unprecedented demands on technology resources, which consequently place added demands on already-scarce resources. Take the US Surface Transportation Board, for example, which necessitates that Class I rail carriers provide basic details like demurrage and accessorial charges, carload waybills, and agricultural contract summaries. Public transportation companies in the United States are also awaiting clearance regarding emissions and sustainability requirements from the Securities and Exchange Commission.

In an effort to tackle these challenges, companies need to adopt smart automation, remain flexible, and adapt their operational efficiency according to new insights from data analysis. Our recent survey found that 74% of transportation executives intend to or already do monetize data as a value-added service or capability because they already have in-house data scientists.

How smart automation improves the movement of goods

Automation has long been a staple in transportation companies’ strategies, though the focus has mainly been on robotic process automation, where digital bots are performing repetitive tasks.

More recently, artificial intelligence (AI) is helping transportation companies drive more value from rules-based automation. For example, Walmart and Procter & Gamble collaborated to create an automated reordering system. Walmart utilizes satellite communications, which are then sent to Procter & Gamble whenever an item is needed. Procter & Gamble fulfills the order and delivers the item. This helps Walmart form more accurate forecasts and react more efficiently to customer needs. Other opportunities for smarter automation include role-based, manual processes.¹

Data mastery is quickly becoming table stakes for the transportation industry. The road to a more stable and resilient future lies in companies being aware of success factors that make up intelligent automation, as well as their flexibility to embrace them.

Endnotes

¹ Hugo Britt, “The secret to managing the Walmart supply chain, one of the most effective supply chains in the world,” Thomas Insights, July 31, 2020.