Operational visibility – knowing where a shipment is and monitoring the environmental conditions in near real-time of cargo in-transit – is becoming an important tool for the supply chain and the transportation industries, according to a new survey of shippers and logistics providers conducted by eyefortransport (eft) in conjunction with AT&T. One way to gather this information is through machine to machine (M2M) technology, which eft said “will overtime surpass RFID and bar codes, ranking second to GPS as a visibility tool.”
The biggest challenges that transportation and supply chain managers face are higher operating costs, the commoditization of prices, a more complex regulatory environment, capacity crunches and demands for growth and delivering higher customer satisfaction, according to eft. The report, “Visibility, Speed and Agility - How M2M is Redefining the Supply Chain and Transportation,” reveals how these executives are using or planning to use technology to deal with these challenges.
“One of the key conclusions we draw from the survey results is that supply chain, transportation and logistics leaders view the collection, analysis and sharing of critical visibility data intelligence as a necessity and a key tool to overcoming the increasing complexity and challenges their industry is facing," said eft.
One of the key findings reveals that 90 percent of respondents believe that improving operational visibility and real-time information is either “critical and necessary” or “very important.” Less than one percent said improving operational visibility was “not important.”
In addition, companies are becoming more sophisticated in their visibility requirement beyond location checks, which is used in the supply chain by more than 80% of respondents. The study finds that companies are looking for real-time information on temperature, security, vibration and environmental conditions to maintain the quality of goods from departure to destination. More than 40 percent of respondents report they use temperature data and visibility data for security reasons to combat theft. Operational visibility information in use includes engine telemetry, tilt sensors, tire pressures and driver performance, along with automated solutions to collect the data.
The survey also reveals that 65 percent of respondents who have not deployed visibility solutions said “timeliness of information is a big challenge.” This compares to 46 percent who have deployed visibility solutions. “This clearly proves that operational visibility solutions are dramatically reducing the challenge of timely information,” according to the report.
The top three reasons for companies to deploy real-time visibility technology, according to those respondents who have not deployed the technology are to improve customer service through better information, improve speed/delivery timeframes through data analytics, and provide customers with more frequent updates on shipment pick-up and delivery completed.
Payback is expected to be within two years, according to companies that have and have not deployed some of these operational visibility solutions. The findings: 80 percent of companies who have already deployed some solutions and are looking to expand their use believe they will get a return within two years on their new deployments, while 56 percent of companies who have not yet deployed any type of solution see a return on investment (ROI) within two years. More than 50 percent of companies who have not deployed operational visibility solutions expect to deploy solutions within the next two years.
However, companies who have already deployed operational visibility technology are looking to deploy more advanced technologies in the future such as M2M compared to those who are looking to deploy operational efficiency for the first time, said eft. “By combining both sensor and monitoring M2M technologies, it is clear that some form of M2M technology will be the second most used technology after GPS tracking in future deployments used to gather operational visibility information.”
The survey numbers indicate that M2M is growing as the technology of choice for operational visibility technology.
- 26 percent of companies that use operational visibility technology use M2M technologies
- 33 percent of companies that are looking to deploy operational visibility technologies for the first time are going to include M2M technologies in their solution
- 46 percent of companies that already have operational visibility technologies and are planning further deployments are going to use M2M technologies
The use of M2M technologies for operational visibility technologies will nearly double in the next couple of years, said eft. Click here for more information about the survey.