Digital technology, especially fleet optimisation systems, will play a critical role in the switch to more sustainable logistics operations. The goal of the modern logistics operator is to balance green strategies with efficiency. Here, five industry experts provide invaluable insights on how best to achieve this with the latest digital trends…
Optimising route optimisation using artificial intelligence
As more companies look to ‘go green’, attention not only turns to being more sustainable but also the cost of doing so. One option is to look at artificial intelligence. Among its many advantages, Philip Ashton, founder and CEO of 7bridges, says: “AI has the capability to optimise logistics for multiple goals, including the reduction of carbon emissions while balancing the associated costs of more environmentally friendly operations.”
An AI such as that offered by the company can do this by balancing multiple variables. “It will calculate the best dispatch site, carrier and route for shipments.” It can reference historical and real-time information relating to things like operational capacity, previous performance, the availability of ‘green’ transportation modes, carrier prices, estimated shipping times, and the likelihood of route disruptions. When looking at route optimisation specifically, businesses could choose to adopt a multi-carrier mode of operation, which increases its capability to provide the most eco-responsible delivery option for their customer.
“An automated and intelligent fulfilment process can consider environmental impact – selecting a carrier with the lowest CO2 impact by assessing the fleet’s CO2 emissions, routing and/or selecting green services, where available,” he says. As delivery and transportation technologies develop, some carriers will give electric vans and robotic vehicles a higher profile, “and if you have access to an intelligent fulfilment process it can be tuned to seek and prefer these options when available”.
Blockchain and the boost for location intelligence
Blockchain technologies are a natural fit to boost location intelligence, according to Erminio Di Paola, vice president at Here Technologies. By layering reliable location data with the intrinsic security of the blockchain’s distributed ledger it “provides 100% certainty that an asset is being used at the right place, at the right time, by the right person”.With regard to large-scale fleets, “there may be thousands if not millions of goods being transported at one time.” Using a system that can track every asset with full certainty, fleet managers can be confident on the location and status of any item in their chain. Additionally, supply chain employees have less opportunities to make mistakes. However, when issues do arise, these errors can be discovered quickly by the technology, so “eliminating the need for a central intermediary to govern the network”.
Blockchain also makes transactions more transparent and decentralised, which allows the possibility to automatically verify accuracy by matching the location of an item with the report from a logistics company.
As every computer in the network has its own copy of the blockchain, this helps to eliminate a single point of failure. The same capabilities can help with fraud detection, too. Layering mapping capabilities and rich location data to a blockchain record helps to identify malicious activities, in doing so ensuring teams can deliver more accurate updates.
How geocoding gives you a headstart in delivery efficiency
Geocoding has become one of the latest trends used by logistics providers to optimise their routes when making deliveries as it involves linking an address to a specific location on the Earth’s surface. This sort of technology is used by What3Words, which has divided the world into 3m2 grids. For DeliveryApp, integrating What3Words into its platform presented a number of benefits “but the majority of these focussed around improving efficiencies,” suggests Joanna Person, operations director at DeliveryApp.
Densely populated urban environments such as city centres and industrial estates can share postcodes covering large areas and often drivers would use these postcodes as their main form of navigation.
However, Person adds, this would result in drivers “circling locations looking for obscured signage or tower blocks with similar names and numbers”. As well as time implications, this would increase the volume of fuel burned, and vehicles idling, while looking for a destination and accelerating as they circle the location all increases the carbon impact of an individual delivery reducing mpg.
After adopting What3Words’ technology, Person says the geocoding technology has helped to reduce times and CO2 emissions as drivers can go straight to location pinpointed to a 3m2 grid using the most direct route. “Very early data would suggest this integration of geocoding technology has almost completely removed these incidents and as such collection and drop-off times to locations are up to 15% faster than before and distance completed for each job is approximately 3% closer to the original customer quote.”
Over the space of the year, Person notes, the technology could reduce the distance travelled by the company’s fleet by thousands of miles, reducing its carbon impact significantly.
Prioritising profits and planet simultaneously
Technology on its own will never be sufficient to drive change. “You need people,” says Neil Kinnear, sales manager at Peak. “People bought into the tech, who see the value in using it and are happy to champion it. Which is no mean feat when it comes to AI-powered routing solutions, which ultimately need the support.”For businesses investing significant amounts in route optimisation, ensuring employees understand the value of a new solution and trust its output enough to follow the recommendation is paramount. Decision intelligence (DI) is the commercial application of AI to the decision-making process. “It is outcome-focused, so solutions are built with an end goal in mind.” It also means they can be tailored, accounting for last-mile delivery and complex or reactive supply chains.
Traditional AI route optimisers might have a reputation for being quite alien in their outputs to drivers, but DI is different – it learns from their actions. If a driver always avoids a certain street at a certain time of day if they know it gets busy, a DI route optimiser will take that into account. This means drivers recognise the output and are involved in iterating and improving the technology. “It’s not simply a tool they’re mandated to use, but one they’ve had a hand in building,” Kinnear explains. It’s an approach that breaks down silos between the teams developing the tech and those using it. “Delivering route optimisation with DI enables businesses to prioritise both profit and planet simultaneously. It helps deliver against short term KPIs, such as reducing logistics costs and increasing jobs per route, while continuing the journey towards carbon neutrality – all of which needs buy-in from drivers.”
The power of data to transform supply chains in delivery efficiency
Data has the power to completely transform the supply chain industry. “The insights can not only help to ensure more optimised routes but reduce empty running and the number of trucks on the road,” says Wenjia Tang, head of data, DigiHaul.
In the past, network visibility – key to fleet optimisation – has been a challenge, and still is. Firms with owned or dedicated networks have made some progress through TMS, but the sub-contractor network is so fragmented that until recently there wasn’t a consolidated way of gaining proper visibility. That’s why DigiHaul launched its app. “It’s a way for data from any carrier to be tracked and centralised,” Tang says. It collects data and creates a picture of vehicle utilisation that can optimise the transport networks. An area that data has the power to change is in backhauling, (returning a vehicle to its original point of departure). Currently, more than 20% of backhaul journeys in the UK are running empty. And in the context of the climate and driver crises, this should be a priority. “By combining tracking data with information such as a shipper and carrier’s profile, their location, travel distances, vehicle characteristics and collection dates and times, we can find efficiencies to bring down empty running and under-utilisation.”
For instance, if a shipper has a load that needs to go from A to B, a carrier might simply pick this up as a job then drive back from B to A with an empty truck. “If we take a holistic view of the network,” Tang adds, we can create a better picture of how that shipper and carrier can work together. We might identify an opportunity of picking up a load from B to A – or even B to C to A – and work with them to optimise collection/delivery windows.”
This article was published in the June issue of CiTTi magazine.
