Trucking: A Supply Chain Workhorse


What image comes to mind when almost anyone thinks about moving palettes of product from a manufacturer to a distribution center or to a store for purchase? Trucks, and rightly so. The American Trucking Association reported that trucks moved 70.2 percent of all domestic freight tonnage in the United States. It took 3.6 million heavy-duty Class 8 trucks moving 10.5 billion tons of freight and burning 39 billion tons of diesel fuel to accomplish that feat.

Clearly, the trucking industry is a huge part of the supply chain. That’s quite a load of trucks, drivers, and freight to manage. How in the world can anyone or any company manage all of their drivers and trucks, not to mention all the freight they move? Can a company know all their trucks’ locations at any point on their routes in real time? Is a truck’s tire or engine about to fail while on its route, possibly impacting delivery time? Could anyone have foreseen that truck’s issues and taken it out of service for repair? If a company has multiple drivers delivering to a company, how can it know they are all taking the most economical and timely route or perhaps a route that can damage trailer contents? Is the environment in each trailer suitable for the type of freight it’s carrying? Are your drivers driving as safely as they could or should?

Attorneys say you should never ask a question to which you don’t know the answer; all these questions have answers that may surprise you. Briefly, the answer to all these questions is yes. Let’s explore a little.

What is The Internet of Things?

Almost everyone has an idea of what the Internet is. It began as a network of hardware and software technologies that allowed computers to connect to it and talk to each other so people in government, scientific, and academic circles could find information and share it with each other.

Now all kinds of devices connect and communicate through the Internet – smart TVs, smartphones, vending machines, refrigerators, and more recently, small devices called sensors. Hence the name The Internet of Things, or IoT for short. The Internet of Everything Under the Sun doesn’t quite have the same ring and the acronym is even worse.

Sensors communicate among themselves, meaning they send information to and from one another and with an asset tracking system or fleet management system (depending upon the type of asset you’re managing), all in real time, to help businesses solve many types of difficult business problems and save significant money that otherwise would have been lost.

Profound Benefits of IoT to the Supply Chain

The IoT will impact the supply chain in ways never seen before, creating sweeping revenue opportunities and operational efficiencies heretofore unseen. Asset tracking, vendor relations, forecasting and inventory, connected fleets, and maintenance are all areas within supply chain management that will see unprecedented boons. Here are some examples of the use of and the benefits from the IoT:

1. Asset Tracking and Supply Chain Visibility

A case study by Sierra Wireless discusses how one of their customers, Tive, helped a washing machine manufacturer identify and resolve washing machine damage that occurred during shipping by employing IoT asset tracking to improve supply chain visibility.

In another example, real time asset tracking saved $1.5 million of medication from ruin because trackers placed inside the shipping container alerted the pharmaceutical company that the container temperature was too low. The pharmaceutical company immediately was able to reach someone at the port where the container was and fix the temperature issue.

2. Proactive and Preventive Maintenance

Who hasn’t seen a fleet truck stopped on a highway shoulder with its cab up and the driver trying to determine what needs repair? In the meantime, the scheduled delivery time looks less likely by the minute.

That situation never would have occurred had the fleet owner installed sensors that talked to a fleet management system. The sensors would have alerted the fleet management system about the problem before the truck was even loaded with its freight. The system would have taken the truck out of service and scheduled it for repair for whatever component the sensor indicated was about to malfunction or was malfunctioning. Additionally, the fleet management system would only schedule a technician certified to work on that make and model of truck; problem solved even before it began.

Think of the headaches the IoT averted in that hypothetical scenario:

  • A truck destined to break down was not dispatched.
  • Towing fees were avoided.
  • The driver was able to do what he did best – be productive driving and not be sidelined on a shoulder somewhere.
  • Foreknowledge about a defective truck avoided a late delivery, keeping original delivery time commitments intact.
  • The truck technician could repair the truck faster because the truck sensor identified the problem, saving diagnosis time, and scheduled the right person to do the work.

3. Platooning

Platooning, which groups trucks on a journey, employs artificial intelligence and other IoT technologies to allow legal, digital tailgating among a fleet of trucks. It can improve truck safety using technology already available on trucks – lane-keep assist, adaptive cruise control, and air brakes. It also promises to reduce fuel consumption from 5-20 percent by meticulously and automatically managing the distances among fleets of trucks through wireless communication among sensors, allowing trucks to take advantage of an aerodynamic effect, known as drafting.

Platooning also improves road capacity and road safety. Because of the near instantaneous communication of these state-of-the-art driving support systems, trucks simultaneously can accelerate or brake, which supports better traffic flow. They also can follow each other more closely because platooned trucks react orders of magnitude faster than human drivers. They don’t require the same amount of distance between them to compensate for the slower reaction time.

Looking Forward and Forward-Looking

These are incredibly exciting times in the transportation industry with many positive changes in the near future. With change comes opportunity and all of us at Mission Financial Services look forward to helping you take advantage of those opportunities. Contact us today to get started with your commercial vehicle loan.

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