Transforming Logistics Using Big Data

BLG01xBig Data and logistics are made for each other, and today the logistics industry is positioning itself to put this wealth of information to better use. This overarching study is a dynamic, living document designed to help organizations derive new strategies and develop more essential projects and innovations.

Big Data is a relatively untapped asset that companies can exploit once they adopt a shift of mindset and apply the right drilling techniques. It also goes way beyond the buzzwords to offer real-world use cases, revealing what’s happening now, and what’s likely to occur in the future.

This trend report starts with an introduction to the concept and meaning of Big Data, provides examples drawn from many different industries, and then presents logistics-used cases.

As logistics management and transportation networks become larger, more complex, and driven by demands for more exacting service levels, the type of data that is managed also becomes more complex.

Today, these data sources can include:

  • Traditional enterprise data from operational systems
  • Traffic & weather data from sensors, monitors and forecast systems
  • Vehicle diagnostics, driving patterns, and location information
  • Financial business forecasts
  • Advertising response data
  • Website browsing pattern data
  • Social media data

Big Data has much to offer to the world of logistics. Sophisticated data analytics can consolidate this traditionally fragmented sector, and these new capabilities put logistics providers in a pole position as “search engines in the physical world”.

Understanding Big Data

The sustained success of Internet powerhouses such as Amazon, Google, Facebook, and eBay provides evidence of a fourth production factor in today’s hyper-connected world. Besides resources, labor, and capital, there’s no doubt that information has become an essential element of competitive differentiation. Companies in every sector are making efforts to trade gut-feeling for accurate data-driven insight to achieve effective business decision making. No matter the issue that needs to be decided – anticipated sales volumes, customer product preferences, optimized work schedules – it is data that now has the power to help businesses succeed. As with a quest for oil, Big Data takes educated drilling in order to reveal a well of valuable information.

Why is the search for meaningful information so complicated? It’s because of the enormous growth of available data inside companies and on the public Internet. Back in 2008, the number of available digital information pieces (bits) surpassed the number of stars in the universe, thanks to the growth of social media, ubiquitous network access, and the steadily increasing number of smart connected devices.

Today’s “digital universe” is expanding at a rate that doubles the data volume every two years. In addition to this exponential growth in size, two further characteristics of data have substantially changed. Firstly, data is pouring in. The massive deployment of connected devices such as cars, smartphones, RFID readers, webcams, and sensor networks adds a vast number of autonomous data sources.

Tools such as these continuously generate data streams without human intervention, increasing the velocity of data aggregation and processing. Secondly, data is extremely varied. The vast majority of newly created information stems from camera images, video and surveillance footage, blog entries, forum discussions, and e-commerce catalogs. All of these unstructured data sources contribute to a much higher variety of data types.

Logistics and Big Data are a Perfect Solution

The logistics sector is ideally placed to benefit from the technological and methodological advancements of Big Data. A strong hint that data mastery has always been key to the discipline is that, in its ancient Greek roots, logistics means “practical arithmetic”. Today logistics providers manage a massive flow of goods and at the same time create vast data sets. For millions of shipments every day, origin and destination, size, weight, content, and location are all tracked across global delivery networks. But does this data tracking fully exploit value? Probably not.

Most likely there is enormous untapped potential for improving operational efficiency and customer experience, and creating useful new business models. Consider, for example, the benefits of integrating supply chain data streams from multiple logistics providers; this could eliminate current market fragmentation, enabling powerful new collaboration and services. Many providers realize that Big Data is a game-changing trend for the logistics industry. In a recent study on supply chain trends, sixty percent of the respondents stated that they are planning to invest in Big Data analytics within the next five years.



The highly competitive nature of companies involved in logistics management and transportation will assure that those that take advantage of these new data sources to augment what they know about their business will continue to be leaders. They will continue to invent new and better business processes and efficiencies and they will do so by evolving their Information Architecture in an impactful manner. Some will likely leverage their advanced footprints to offer data subscriber networks, thereby going into competition with data aggregators and further monetizing their IT investments.

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Saikumar Talari

Saikumar Talari

Saikumar Talari is a content writer who is currently working for Mindmajix. He is a technical blogger who likes to write content on emerging technologies in the software industry. In his free time, he enjoys playing football.

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