Much time and effort is spent on ensuring components and finished vehicles are produced on time, but inefficiencies in the supply chain can put a spanner in the works at any moment. Simple things such as inclement weather or human error can lead to rising costs and missed opportunities, but new data streams and automated processes could make a world of difference.
Supply chain visibility is a serious consideration for any manufacturer, and particularly those on a global stage. According to research from EFT Supply Chain & Logistics Business Intelligence, visibility was the primary challenge facing global supply chains in 2018.
The HERE brand is well known for its mapping expertise and subsequent tie-up with a consortium of German automakers back in 2015. However, it is also an expert in location services, and is helping manufacturers to keep tabs on how their products pass through the supply chain. In short, location intelligence can enhance operations by providing an insight into the health and performance of an entire supply chain in real-time.
Setting the context
As Peter Kueth, a Product Manager at HERE, explained during a recent Automotive World webinar, it “helps you to do your job just that little bit better.” The potential gains are not marginal, however, with some manufacturers having saved millions in otherwise lost revenue by optimising their location intelligence.
“Location context is important for a range of industries,” said Kueth. From optimised garbage collection in a smart city, to warehouse equipment and goods tracking, the benefits can be felt across the board. Logistics and fleet management firms in particular could reap the biggest rewards from increased supply chain visibility.
“Freight moves from A to B in a supply chain, but the sheer complexity of how many companies are involved is mind boggling,” observed Kueth. For instance, HERE has found that a single container moves around a port eight times on average before it is shipped—eight chances for the container to be misplaced or mishandled. “But with improved traceability, you know exactly where the container is, where it has been moved and who has had access to it,” he advised.
For freight companies, telematics has proven invaluable in keeping track of the truck, but that comes with the assumption that the cargo has in fact made it to the truck as planned. HERE sees an opportunity to ensure that the freight itself can be better traced. “We want to make it as cost effective as possible to track the piece of equipment or finished goods that you need, and ensure you are not reliant on a third-party data entry,” said Kueth.
The human element
Indeed, while data is often presented as being ‘real time’, many supply chain architectures rely on what is known as the ‘stage-gate’ concept: you may know when something leaves and arrives, but there remains a grey area in between.
In HERE’s experience, even the world’s leading manufacturers often pick up the phone to find out where their freight is. That call goes through to the freight company, which then calls the dispatcher to get in contact with the driver, who can then provide an estimated time of arrival. It is a highly manual process with a low level of accuracy. “A big problem is that so-called ‘real time’ data streams do not exist in these paradigms,” affirmed Kueth. “Many supply chain architectures are a little dated, but we are making sure there are no grey areas.”
Late deliveries are bad, but goods often arrive before they are required and incur storage costs. In some cases, deliveries can come days early because the manufacturer has been forced to assume a worst-case scenario. “Late is bad, but early is also bad,” warned Kueth. Accurate tracking can help to mitigate and manage the problem.
Make the most of connectivity
With this in mind, HERE is looping new data streams into the equation. Real-time data sourced from vehicle sensors, routing, weather and traffic systems, for example, can help manufacturers to understand where something is, and where it will be. It is a step change from simply receiving a notification that the freight has been dispatched and delivered, often with delays between each message.
The approach is not only about reducing lost time, but also lost goods. Trucks can be valuable targets for organised crime, and on-board global positioning systems (GPS) can be tampered with to veer the truck off course into a trap. Hackers can also fiddle with trip data to ensure the fleet operator is none the wiser.
HERE’s access to global connectivity infrastructure acts as a level of redundancy in the event that a GPS system has been jammed or ‘spoofed’ by hijackers, said Kueth. “We have a database of 3.6 billion Wi-Fi hotspots globally and 150 million cell phone towers, so without ever using GPS, we can instantly know where your freight is and act as a second source to validate your GPS,” he explained. “You will not have incorrect logs, and will not dispatch police to the wrong location.”
But it is not good enough to simply know when the freight has arrived: manufacturers also need to know where in the facility it is being stored. For example, an accurate indoor tracking system can provide a whole new level of visibility. Engines and other large parts can be better traced as they travel around the plant, and staff can accurately find cars that require reworking—rather than hoping that the person who parked the vehicle has accurately filled out a spreadsheet.
It is that element of manual data entry which has pressed HERE to address supply chain issues so closely. It has carried out investigations to find out where improvements can be made, and has found that some problems arise from fairly straightforward issues.
For example, one major manufacturer supposedly only shipped goods on Fridays—according to its back office system at least. However, it became apparent that this was not the case. While the data suggested that cars were only shipped on that day, staff members had in fact been making the job easier for themselves. Tracking stickers that are attached to containers would be scanned all in one go on a Friday, rather than step-by-step throughout the week. It is a story of human error that completely messed with the system’s readings.
“To the system, it looked like everything was only shipped on Fridays. How good can your planning be if your data is off by four days at the beginning?” said Kueth. HERE’s team is working on a solution that automates the check-in and check-out of goods being shipped to remove the human part of the equation.
It illustrates part of a wider push to cut out wasted time and money in making and selling new vehicles. Getting finished products where they need to be, on time and without error, is pivotal in achieving the efficiencies of scale required of a global manufacturer. As Kueth concluded: “A lack of visibility causes lost money and time—it’s as simple as that.”