How can business digitisation drive the transport industry?

By Dale Benton
History tells us that the transport and logistics industries have usually been behind the curve when it comes to digitisation and mobility compared to o...

History tells us that the transport and logistics industries have usually been behind the curve when it comes to digitisation and mobility compared to other industries.

However, in the last few years transport and logistics companies have been embracing digital devices and innovations. Why? Quite simply, because they have helped to increase the bottom line, and are enabling business leaders to create a wider gap between their company and its competitors.

This is set to continue as illustrated in the World Economic Forum white paper on the digitisation of the logistics industries, which states $1.5 trillion of value is at stake for logistics players as a result of digital transformation in the industry up until 2025.

A survey by IDG substantiates this and discusses a device explosion, therefore highlighting mobility as business critical with 64 per cent of enterprises placing it as a high priority on their technology agendas.

With IoT in transportation set to see a CAGR (compound annual growth rate) of almost 17 per cent by 2020, there is a clear need for companies to underpin their transformation strategy with mobility, and place it at the beating heart of the business – but is this happening across Europe and what does it look like in reality?

More devices, increased complexity and greater risk

40 per cent of business leaders in the industry said improved use of technology was a main focus for growth. From mobile tracking solutions and advanced GPS to telematics, the transport and logistics industry is embracing a multitude of IoT innovations. Businesses have seen the benefits of greater mobility, such as: improved internal and external communication, customer retention and an increase in the speed of decision making.

However, as the number of mobile devices explodes there also comes more complexity, IT pain points and far greater risk.

Therefore, will the promise of nirvana through mobility be vastly different from the reality?

To begin to answer the question there must be a mobility management plan in place. Only then can devices be managed correctly and work effectively.

Mobility management cannot work in isolation - for transport and logistics businesses to reach the end goal of reaping all the benefits they must place mobility at the heart of a transformational strategy. If not, it will be left working in a silo and unable to deliver true ROI and competitive differentiation.

Landscape challenges

Strategy is not the only consideration; transport and logistics companies are operating in a specific industry with its own idiosyncrasies, therefore they must consider their landscape. The UK Logistics Confidence Index 2016 highlighted that 49 per cent of business leaders confirmed current business conditions are tough with some of the biggest concerns cited as customer price pressure and cost control.

The Index also noted the best way to respond to pressure from customers demanding more for their money was through technological innovations, as this would both cut costs and add value.

Despite concerns over harsh business conditions the industry is also continuing its trend of mergers and acquisitions. The Index showed that over a third of respondents said they were likely to acquire another business over the next six months, which is one of the highest results since the survey began in 2008.

This can add further challenges when it comes to business critical mobility. Mergers and acquisitions can present mobility stumbling blocks as they often require the need to migrate or manage legacy systems. Without due diligence this becomes complicated, making it vulnerable to error, and as a result much less likely to deliver effective outcomes.

Gaining the best traction from IoT innovations

The industry needs to think laterally, and with the future in mind in order to see the real value from IoT. At SOTI’s Research & Innovation Lab, mobility related innovations are being devised and evaluated every day to help customers gain the best traction from connected devices.

SOTI’s MobiControl solution already manages the mobile equipment in customers’ vehicles; therefore to go a step further the company has been looking at connecting a device to the vehicles self-diagnostic and reporting capability.  Establishing this connection will enable information from both the device and vehicle to be analysed, which will undoubtedly provide an improved solution to the customer. In the case of Fleet Management companies for example, this type of connection is crucial; the customer is then able to remotely monitor and troubleshoot the on board device and also ensure the overall smooth running of the vehicle.

There’s no doubt IoT is transformative for the industry. A clear gauntlet has been laid down, the growth potential and competitive advantage to be gained through IoT is there for the taking. For instance sensors installed in vehicles can effectively create their own IoT network; by tying in the fleet management system into this network allows a business to collect more crucial data from the vehicle than ever before. The ability to remotely monitor and track the temperature of for example a refrigerator truck, will allow for immediate response should the climate change.  

However, investing in IoT technologies doesn’t come cheap. Businesses need to ensure those investments pay off and real value is delivered. 40 per cent of the value of IoT requires multiple systems to work together and 60 per cent requires the ability to integrate and analyse. Therefore, it is more than just connecting the dots; it’s being able to do something with it and making things smarter.

The industry is already making great strides by embracing IoT and mobile devices. Business critical mobility is being clearly driven by some companies and they are reaping rewards. However, it’s not widespread and for those considering the IoT investment and wanting to generate a real return and the creation of mobility nirvana then a strategic mobility management plan needs to be in place. The key also lies in starting small and achieving great success, then to build on it. In reality, in every industry we are seeing Io (some) T rather than IoE (Internet of Everything).

Finally, in order for companies to see real benefits from IoT the mobility strategy needs to sit at the heart of the organisation. Only then will organisations reap the business critical mobility rewards and leave competitors in their rear view mirror.


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