In the trucking industry -- where profit margins are narrow and every cent and second can have repercussions -- analytics has a good chance of affecting results.
Analytics, or the translation of data into meaningful insights and actions, continues to rapidly change the way business is being done.
According to trucking executives and industry experts, it has proved to be a game changer for a sector that employs one in 11 Arkansas workers.
Margaret Townsend, senior vice president of engineering at J.B. Hunt Transport Services Inc., worked in finance, manufacturing and at Microsoft before recently moving to Lowell, J.B. Hunt's headquarters.
"Analytics has more potential in the logistics industry than in any industry I've worked in," she said.
"I think you would be unwise to enter or compete in this industry without knowing your data, though that's from an IT perspective," said Wayne Brown, vice president of information technology at Maverick Transportation in North Little Rock. "Every department has dashboards, and every department uses analytics on some level."
Jim Griffin, chief operating officer and chief technology officer at FleetAdvantage, defined analytics as "taking a variety of data points and allowing them to tell you a story." FleetAdvantage, a truck leasing company in Florida, offers proprietary optimization software to help trucking companies strategize about the most cost-effective ways to manage their equipment.
"I would say actually that trucking is a leading innovator with data," Griffin said. "I think the value that it provides to the customers and to the market has really piqued the industry's interest."
Brad Delco, transport analyst at Stephens Inc. in Little Rock, estimated that the average profit margin in the trucking industry is 7.5 percent, adding that the stakes are high when working to make any part of the process more efficient.
Brown said the trucking industry has a long and growing list of data points to work with, from rapidly developing technology in trucks and engines "which are computers now," data on driver health, plus information from cameras, and automatic braking and cruise control systems. "As data has expanded and gotten more unwieldy, we've had to figure out how to make it usable," he said.
"I always get tickled when people say big data. It's more like enormous data now."
Brown said Maverick blends various operational, safety and truck data sets to produce meaningful conclusions. One model involves driver safety. By combining a variety of inputs, including pay, mileage, home time, "anything you can think of," he said, the company can determine which drivers might be "at risk for an accident and then call them, use some preventative measures to help."
"You don't want to miss an opportunity to find the nuggets within the data in analytics that help you make a difference, whether that's profitability, safety, retention, whatever," he said.
"From an IT perspective that's the biggest thing: not missing those nuggets and being able to consume all of those and make sense of them."
Townsend said "no section at the company is not touched by the engineers." She manages J.B. Hunt's team of about 80 industrial engineers, data scientists and mathematicians working on analytics.
According to Townsend, J.B. Hunt has had an engineering department for 24 years, but activity has especially ramped up in the past 15. She said the company continues to make a "very significant investment" in analytics, which she defined in three parts as, "predictive modeling [trying to understand what's going to happen next], forecasting [what if these trends continue] and statistical analysis [to try to understand why this is happening]."
The Lowell company recently announced plans to install solar-powered GPS tracking devices in all of its 90,000 pieces of trailing equipment, which will provide a new data set to evaluate and use.
Bobby McElyea is a vice president at Cal-Ark International in Little Rock, which also has been developing in-house analytics. He said the "traditional transportation model" did not take into account data potential.
"It was more of a 'shoot from the hip' style of leadership. There was so much data that nobody knew how to tap into it." Now, with electronic logging and other data records available, he said there is no excuse not to use it.
"It's taking a simple concept, taking the energy to break apart a load into multiple pieces that all mean different things and assigning the accountability to the appropriate source," he said.
Cal-Ark President and CEO Rochelle Bartholomew said the company has learned a great deal from its data. "We had these ideas, these perceptions of how we were operating, but when you really go back and evaluate, you find all these other things in operations," she said.
"And you have to do it, because that's step one to improvement."
Often these effects are felt beyond companies' employees. For example, McElyea said that instead of just telling a customer that rates need to increase, Cal-Ark can point to exactly what is driving up the cost and work with the customer on what could mitigate that, like adjusted shipping times.
"Our hope is that we can get very good at explaining what's profitable, what's not profitable and share that with customers and get everyone moving in the right direction," McElyea said.
Townsend said J.B. Hunt shares its optimization tools with its customers.
"We can use our proprietary software to help them optimize their networks, so we can be a better carrier for them, and so that they can lower their overall network costs, whether we are a single source carrier or not," she said.
There has been another side-effect to Cal-Ark's analytics implementation, McElyea said: empowering Cal-Ark's staff with "the tools and information they need to make good decisions." With data to back up decisions, they don't feel the need to consult a superior every time, he said.
And data analytics appears to be here to stay. Townsend called it "a very core part of the solution" at J.B. Hunt and in the industry.
Brown said data models and tools must constantly be reevaluated to take into account ever-changing driver demographics, a changing economy and a quickly-changing trucking business.
"That's one thing about analytics I think some people don't get," he noted. "If you don't continue to evolve with your data, if it's not a continuous process, then it becomes very stale."
Brown pointed out that now the data has moved beyond the back office and into the trucks. "These days we push safety data directly to the drivers on the truck through in-cab telematics and our driver app," he said, referring to safety and driving data that can affect driver pay.
"If we had all that data and didn't use it or didn't react to it, then we'd fail," Brown said, adding "the amount of data we have is not going to be any less. It's only going to be more."
SundayMonday Business on 03/05/2017