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Data-driven decisions are now the focus of attention for managers in the supply chain industry. The use of big data in global logistics has increased substantially in recent times. A research study by Research and Markets estimates that the supply chain big data analytics market share will hit $9.28 billion by 2026, up from $3.55 billion in 2020.
Traditionally, SCM relied on ERP and other disparate storage systems for data. However, as the SCM landscape is becoming increasingly complex, the traditional systems are proving to be inefficient and inadequate. Managers are now turning to big data analytics to make better decisions, optimize their supply chain, and improve overall efficiency. This blog discusses the value of big data analytics and how it can benefit your business.
Big data is a combination of tools, algorithms, and processing systems used to interpret insights from disparate data. It involves the application of statistics, mathematics, simulations, and other techniques to gain insights from data that help organizations make better decisions.
Collecting data is crucial for logistics companies. For example, data about the cargo fleet condition, the road it travels, fuel consumption, and the number of drivers can help decide on crucial areas and techniques to optimize operations. In essence, logistics companies use big data analytics systems with GPS devices and other tracking tools to monitor the movement of goods in real-time. Managers combine the information with traffic data, fleet data, and on-road network data to control the fleet, schedule shipments, and automate routine tasks.
Punctuality and transparency are crucial in the supply chain sector. Today, customers demand shorter lead times at lower costs. Implementing big data in logistics helps managers foresee and prevent bottlenecks in the supply chain that could lead to delays. Big data also helps companies to utilize resources and improve transparency for enhanced operational efficiency.
Besides, technology assists companies in improving customer experience and maintaining their loyalty. Big data allows businesses to systematically analyze the data on their customers and determine who they are, what they prefer, their shopping patterns, and the best strategy to convert them. Implementing a practical data-driven business approach can also lead to satisfied customers and increased revenue.
The following are the benefits of big data in supply chain management:
As mentioned earlier, big data analytics systems allow logistics companies to monitor the movement of goods in real-time. These insights help managers plan and schedule deliveries effectively while factoring in predictions regarding weather conditions or accidents. Because they can monitor the delivery status of parcels in real-time, customers get automated notifications in case of expected delays. This translates to a more efficient logistic operation and more real-time updates for the customers and partners.
Big data in logistics can help save money in many ways, including:
Big data analytics in supply chain management help improve responsiveness so companies can meet consumer expectations by delivering quality products on time. Big data analytics enables managers to understand the market situation better, segment customers, predict future trends, and locate new market opportunities. When logistics companies gain better control over their inventory, it results in more satisfied customers.
With big data analytics, businesses can go from being reactive to being proactive. Big data in logistics and SCM ensures problems are fixed by predicting them before they happen. Besides, the prescriptive insights gained from big data lead to reduced risk of damage and waste.
One of the ways big data analytics is utilized in the supply chain is cargo monitoring. Before, companies relied on a milestone-based supply chain visibility concept, resulting in logistics blind spots. With such a concept, data on the status of assets is only recorded when goods reach a specific checkpoint or milestone. In between the checkpoints, companies didn’t have the visibility to determine the location of their inventory and the bottleneck or inefficiencies in the supply chain. With the help of data analytics and IoT, which enables real-time cargo tracking and monitoring systems, companies gain end-to-end in-transit visibility from the manufacturer to the delivery stage. With big data, companies are empowered to access crucial data anytime and anywhere, thus enabling supply chain leaders to take proactive actions on unplanned, distracting events and delays in the supply chain.
Big data has ensured businesses in the supply chain sector no longer have to speculate about the nature of their operations. They can systematically analyze available data to track and monitor cargo delivery, enhance customer experience, cut costs, identify bottlenecks, and proactively resolve emerging issues. However, there is a huge difference between having access to big data and knowing how to transform business effectively. Most companies are still facing challenges with how to use big data appropriately.
RTS Labs provides the right software to help you integrate big data into your operations and maximize its benefits. We have helped several businesses of all sizes with customer logistics and supply chain software that meets unique business needs.
Get in touch with us today to learn more about how we can help.
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