Internet of Things, Cloud and the Future of Transportation
Today, contextual technologies like social, mobile, analytics and cloud (the “SMAC” stack) are converging to create significant opportunities in the transportation industry. Part of this is driven by our rapidly evolving customer expectations; whether it is our customers or our associates (driver and office), the value we expect from technology in the new digital reality has changed. We are living in a world of instant gratification, where everyone wants (and demands) information instantly and will consume it, irrespective of context. The ability to use these contextual technologies across our value chain at Schneider, and to seamlessly integrate information, is a key factor that provides insights to our businesses in near real time. This creates competitive differentiation, which is exactly what we aim to achieve in the transportation and logistics industry as a whole.
“We definitely understand the important and transformative opportunities that technology and data science offer. They are not only enablers but also the foundation on which to build current and future business strategies.”
Leveraging New Trends
Our industry is heavily regulated, with new legislation such as the electronic logging device mandate, which requires electronic onboard recording of activities on the vehicle. Such technologies may be a disruptor for smaller players in the industry, as they will have to incorporate them to meet regulatory requirements. While not an issue for us at Schneider, we see the requirement to bring technology into every cab as a potential disruptor that will impact the transportation industry and perhaps others. Finding ways to allow drivers the opportunity to engage with us through social media channels is another trend that is being looked at. This is another example of consumer technology and expectations driving how the industry needs to operate. But perhaps the biggest potential opportunity in our industry is the Internet of Things (IoT). It has given users the ability to gather data from across the value chain, like telematics from the truck, insight from the drivers and so on. By analyzing these streams of data, companies like ours can gain insights and make changes to existing processes in near real time.
Key Role of IoT in Transportation
There already is a wide array of technology available today across the transportation and logistics industry landscape. We have collision detection, a plethora of sensors and many IoT devices that play a key role in everything from safety to decision engineering problems like route optimization. But as I mentioned above, we believe that the main differentiator in this arena will be IoT, and we are moving fast in that space already.
As with all technology, there is room for further development and improvement of IoT capabilities, and one key opportunity lies in our ability to bring various kinds of structured and unstructured data together and create useful context. We see “Big Data” vendors investing heavily and looking into non-structured data in an effort to further develop ways to accelerate these capabilities. We are already using sensors that relay information to us, like fuel levels and other vehicular data. The ability to use IoT to acquire information, combined with telematics data from the truck and driver generated data, such as the status of work assignments and hard braking events, can help companies make much more informed decisions. While this technology offers a major competitive advantage for users today, we expect these tools to be the norm in the coming years and something that every transportation and logistics company will continue to build on.
Technology and Schneider
We were the first to pioneer satellite communication with trucks in the field and the first company to put automated transportation management systems on the mainframe. At Schneider, we understand the important and transformative opportunities that technology offers. Technology is not only an enabler but also a foundation to build current and future business strategies. We have many leading edge projects underway that focus on disrupting the industry and driving technology forward. We have taken a platform-based approach to drive innovation across the entirety of our businesses. In addition to the SMAC capabilities and IoT mentioned above, security is also a major investment area for us. The convergence of security in the physical and digital worlds has led to the emergence of the Chief Information Security Officer (CISO) concept. At Schneider, this is especially important, as our physical assets are just as important as our digital ones. We have made our CISO responsible for both physical and information security and see this as one more place where we can differentiate ourselves and gain competitive advantage in the industry.
Strategies to Stay Ahead
We like to talk about IT being the business, but in the end, you have to appreciate what your individual core competency is and apply it effectively. Our special sauce is knowing how to use technology to enable business results, and leveraging pragmatic excellence has enabled us to be leaders in the field. We understand that technological advancement does not happen overnight, but you, as the CIO, need to build a practical and measured approach to introducing innovations. Thoughtless releases of capabilities are just as risky as waiting too long and “polishing the cannonball.” A balancing act must be played, where you create practical, well-devised plans but also have the guts to sometimes be scrappy in order to position technology to push your business forward.
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