Beware of Real-time Transportation Visibility “Big Hat, No Carrier”

real-time transportation visibilityReal-time transportation visibility has become a powerful tool for shippers and logistics services providers (LSPs). Because the market is so hot, a number of transportation visibility vendors have entered the space and, to get attention, have made big claims about their tracking capabilities, which are misleading potential users. What we are seeing is a bad case of “Big Hat, No Cattle”. If you haven’t heard the term before, it’s an old Texas saying about making a big showing, but not having much substance behind it. In this case, it’s carriers, not cattle. Our work with customers shows that there are 5 key points that determine if a real-time shipment tracking solution provider can go beyond the “big hat” promises to successfully provide shipment visibility.

Theoretical versus actual

Getting real-time tracking information through ELDs is one of the most important ways to achieve good visibility, but it is also extremely misleading. A number of vendors are making claims to be connected to hundreds of thousands—if not millions—of carriers because of their ELD provider connections. It’s a theoretical statement that doesn’t describe how many actual carriers are tracking loads with the real-time visibility provider. Our analysis shows that only a fraction of the claimed connects are being actively used.  Ask your real-time shipment tracking provider how many loads were actually tracked by each carrier over the last 12 months to get an accurate perspective on their actual network reach.

Small carrier/mobile strategy

An ELD only strategy will not effectively cover the transportation market. The carrier market is incredibly fragmented—there are almost 2 million small carriers (97% have less than 20 trucks) in the U.S. and many of them will not be using an ELD service that provides GPS tracking. In addition, in peak seasons, carriers contract smaller carriers to move freight on their behalf and these carriers are most likely not using the same ELD system. The only way to get to visibility from small carriers is via a mobile app, and drivers have to be coerced/incentivized to download and actively use it. To understand how effective a real-time visibility provider is with their small carrier coverage, look at their program for onboarding small carriers with mobile solutions. Do they have the resources and technology in their platform to facilitate small carrier mobile app adoption? You can also ask for their number of mobile app downloads and look at the app ratings on Google Play and Apple’s App Store. If, for example, the provider’s app only has 10 reviews then you know that hardly anyone is using it.

Understand modal tracking differences

Similar to the number of actual carriers being tracked, there is a lot of confusion being spread about the ability to provide real-time tracking across the transportation modes. Different transportation modes do not operate the same way and the tracking information has different characteristics depending on the mode. For example, real-time truck load mode tracking has had the greatest adoption because it is the easiest to track. There is only one truck involved with predefined pick-ups and drop-offs, so providing a real-time ETA is feasible over the life of the shipment. LTL, however, has multiple trucks involved and there are no predefined routes for the entire journey of the freight. In addition, the vast majority of carriers do not have the technology to provide shipment level tracking beyond status-based messages. Expecting to have the same granularity of tracking data in truck load and LTL is not reasonable. A blended tracking message approach is required to support multiple modes. To determine how well your real-time shipment tracking provider can address transportation modes beyond truckload, ask to see how they have integrated LTL, air, ocean, etc.-based milestone tracking into their real-time tracking platform and the scale of those modal networks.

Carrier/driver compliance

Nothing matters other than loads tracked, and it is not a given that carriers and drivers will track their loads. It is actually a never-ending battle to get them to do it. Tracking compliance needs to be built into the visibility platform to automate much of the load tendering, acceptance and tracking processes. In addition, there needs to be a team to measure carrier/driver performance and analyze processes and procedures to ensure that shippers or LSPs and carriers are consistently executing their part of the process. To drive compliance even higher, there should be incentive programs in place to motivate carrier and driver participation. Carrier compliance strategies and programs are incredibly important to drive and sustain value over time. Your real-time shipment tracking provider should be able to show you how they are combining technology and human interaction to keep carriers and drivers participating.

Customer engagement

The real-time visibility implementations with the greatest carrier adoption and sustained tracking performance have ongoing involvement from the customer. You will need to dedicate resources to consistently monitor and drive carrier participation. The real-time shipment tracking provider should be the expert in driving participation, but ultimately the carrier works for you, the customer, and will work to your level of expectations. The “carrot and stick” approach produces results but will require you to intervene with a number of your carriers over time as there are always a set of carriers that don’t do a good job providing visibility. This is something we have seen in our 20+ years of building real-time logistics messaging networks. Today’s technology has made it easier, but it hasn’t changed the human psyche. If you didn’t hear any of this from your real-time tracking solution provider, or they said that they had it all covered, you should be very concerned about the ultimate success of your implementation and the long-term value you will receive from it.

Real-time transportation visibility is changing how companies manage transportation and demonstrating the value that transportation information has to the supply chain and customers. However, vendor capabilities are also evolving, and it isn’t as easy as many of the vendors in the market are portraying to get to the value. Don’t get fooled by the big hat. Make sure to check how many large and small carriers actually use their solution consistently and if they have an effective program to maintain carrier compliance working together with you. How is your real-time transportation visibility program going? Let me know.

As Executive Vice President, Marketing and Services, Chris Jones (CJones@descartes.com) is primarily responsible for Descartes marketing activities and implementation of Descartes’ solutions. Chris has over 30 years of experience in the supply chain market, including the last 10 years as a part of the Descartes leadership team. Prior to Descartes, he has held a variety of senior management positions in other organizations including: Senior Vice President at The Aberdeen Group’s Value Chain Research division, Executive Vice President of Marketing and Corporate Development for SynQuest and Vice President and Research Director for Enterprise Resource Planning Solutions at The Gartner Group and Associate Director Operations & Technology for Kraft Foods.

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