Opinion: Democratized Data Helps Carriers Compete
By Sam Liberto
Chief Executive Officer
ThoughtDrivers
This Opinion piece appears in the Nov. 23 print edition of Transport Topics. Click here to subscribe today.
Too many motor carriers are beholden to transaction-focused computer technology platforms and business processes. These functionally disjointed systems create barriers among departments such as finance, sales, operations and safety, and fail to provide the necessary intelligence for becoming and remaining competitive in today’s business climate.
The trucking sector largely has been a technology laggard. The AS/400 — the predominant data platform used by trucking companies — was introduced in the 1980s. As a software tool, the AS/400 is sufficient for recording transactions but woefully inadequate for purposes of analysis. With trucking’s operational complexities and high transaction volumes, carriers should be using computer technologies that provide business insights they can act on.
It is the nature of carriers to be highly protective of their data and processes and be so cost conscious that, as the saying goes, they will “walk across the dock to pick up a penny.” They also tend to be highly resistant to change, advice from consultants and off-the-shelf-software because they were “not invented here.”
These attitudes keep far too many carriers stubbornly wedded to outdated practices and systems, hampering their ability to compete in an already difficult, uncertain and highly challenging economy.
Traditionally, carriers’ computer systems have been controlled by a small group of information technology or management information systems professionals, or by computer department employees. At the same time, others have had limited access to data and information, instead submitting questions to “gatekeepers” who have run reports, sending them to the individuals requesting the information, creating little opportunity for collaboration among departments.
At one time — before the Internet became the principal communications medium — that model worked well because, for a variety of reasons, only a fraction of the company’s information was available on a computer, and information could not, and did not, flow “at the speed of thought” as it does today.
With instant communication as much a part of our daily routine as brushing our teeth, it is necessary for everyone who needs information pertaining to any aspect of the business to have access to reports, statistics and other content that helps to strengthen relationships between carriers and their customers.
The price for clinging to legacy systems that no longer meet requirements is losing customers to competitors who have made the necessary investments in people and technology.
The new reality for motor carriers is that to be successful, data must be readily available and understood thoroughly by all users who need it to carry out their job responsibilities. Only by having real-time access to information can managers and staff gain the insights they need to make decisions that determine the actions the carrier must take to run its business successfully in terms of profitability and workplace efficiency.
Data that are accessible across technology systems and departments — i.e., billing, operations, customer service and safety — can be analyzed and applied to business opportunities that make the carrier more competitive.
By providing organizationwide access to all data, management and staff can obtain a 360-degree view of any analysis scenario and make certain that business intelligence, rather than operations data in a vacuum, is the basis for every strategic and tactical decision.
The best solutions are “data democracies” consisting of information that is separated into multidimensional views, or “cubes,” that users can manipulate to help the company fulfill specific strategic objectives. These information cubes can consider many variables, such as weight, sales revenue and profitability, and translate them into quantifiable data carriers can use to help ensure that their operations and customer service are as efficient as possible.
These systems often are Web-hosted and contain an intuitive, familiar interface, for example, well-known Microsoft tools such as Excel. A typical system requires an investment between $50,000 and $150,000 plus ongoing subscription fees. But a return-on-investment of approximately 12 months is both typical and respectable.
Those numbers may appear large and are likely to be beyond the means of some carriers, but when a carrier offers widespread access to data, fewer staff resources are required to manage the system, with gatekeepers becoming unnecessary and bottlenecks disappearing.
Transitioning to a “data democracy” can be difficult because it is likely to result in staff reductions and changes in job functions and will require one-time “data cleanup” costs.
As the old saying goes, “No pain, no gain.” Although becoming a data democracy can create some hardships in the short-term, the long-term advantages are numerous. They include:
• Better use of staff time.
• Higher quality of information generated and used throughout the organization.
• Improved ability to serve customers and grow the business.
Little more than a decade ago, carriers were wondering how, or if, they were going to use the Internet for any aspect of their businesses. Today, the Internet has become indispensable. Over the next 10 years, democratization of data will experience a similar rise to prominence in carriers that remain or become successful as new economic realities reshape our industry for the better.
ThoughtDrivers, Pittsburgh, works with motor carriers to improve their business performance.
