Logistics Data: What Are Actionable Insights and How Can You Use Them?
Getting started using logistics data doesn’t come easy for most companies. Taking the step from getting the data to doing something worthwhile with it is usually where companies stall. There are plenty of ideas for what data a company can collect, but it seldom becomes useful without a plan. Data and reports, for their own sake, have little value. Worthwhile logistics data and reports need to be actionable.
What are actionable insights when it comes to logistics data?
Being actionable means there’s information in the data that leads to something your company can do – as in taking action – to benefit your logistics operation. To do so requires you to know what you are looking for and have an objective in mind.
When is data not actionable? Data that offers no insight or meaningful conclusions is not actionable. This can be data on costs or service performance but with no benchmark to understand what it means. For example, if your data tells you the average cost per mile you pay is $1.50. So what? What do you do with that information? Data needs to have context.
Shipment cost has no context if you do not know what a ‘good’ rate is. Or, if you do feel your costs are too high, the ability to understand why it is happening. Similarly, an on-time delivery performance percentage means nothing without knowing what good or acceptable percentage actually is.
Suppose you want to find ways to improve service performance. In that case, actionable insights tell you that Carrier XYZ is responsible for most of the delivery issues so that you can make the necessary changes. Or, you can calculate that sourcing your corrugated boxes from company ABC is $1,000 more expensive to ship to your warehouse when the local box company is $500 more for the same boxes but does not charge for shipping at all.
The process for getting actionable insights
As a first step, consider the important questions your company needs answered instead of thinking of what report you can create because you can or what you think someone may want.
A non-actionable question could be, ‘How much are we spending on freight?’ An actionable insight would come from asking, ‘What specific changes can we make to our carrier pool to reduce shipping costs.’
Getting from the first to the second actionable question is easy with the right approach. There is always a series of steps you can take to produce useful answers.
Actionable example #1: Lower costs in areas you are overpaying
Here’s a simple question that gets you closer to an actionable insight: Are there carriers we are using charging us above market rates?
With access to your logistics data, it’s simple to calculate the cost for different lanes and carriers. you can identify carriers being paid higher rates compared to others. Or, if you have a benchmark rate for that lane (thanks to ShipperGuide), you can compare costs to market rates.
What change can you make with this information? Armed with this data, you can make an effort to find lower-cost carriers that charge market-appropriate rates or use Shipperguide to run a freight procurement event.
Actionable example #2: Implement service improvements
Like rates, finding opportunities to improve service performance is a great actionable use of data.
Access to carrier performance analytics allows shippers to understand where service performance does and doesn’t need to improve. Having comprehensive data on carriers within a freight management platform, like ShipperGuide, can be a game-changer for shippers, offering valuable insights to drive service improvements in one centralized dashboard. Using a data-driven approach to carrier selection, shippers can continuously refine their logistics strategies (take action on the data collected in your freight platform), ultimately enhancing overall service and customer satisfaction.
What change can you make with this information? If, for example, you identify a pattern or trend in delivery times, reliability, and cost-efficiency for a specific carrier, you are then empowered to make informed decisions about selecting specific carriers for your loads, all while establishing stronger relationships with your carriers by providing constructive feedback and setting mutually beneficial service level agreements.
Not using logistics data is a missed opportunity for many companies. But just having the data is not enough. You need the ability to both understand and do something with it — the data needs to be actionable.
ShipperGuide not only gathers and centralizes all of your shipping data but also makes it easy for you to gain smart, data-driven insights you can implement to improve your logistics operations and reduce costs.
Leveraging Loadsmart’s chatbot A.I. feature is another fast way shippers can fine-tune the insights they are looking for and get to the actionable solution even faster.
Curious to learn more about A.I. and actionable insights? Watch this video and see what happens when ShipperGuide is asked, ‘Give me 5 bullet points to convince my boss to adopt a freight procurement and execution platform.’ https://lp.loadsmart.com/shipperguide-loadsmart-ai