One of the major challenges that businesses face today is one of end-to-end visibility in their operations. Finding that one central point where you can stand and see what is happening throughout the operations is very difficult. Because it is highly unlikely that it is there in the first place. Having that kind of visibility translates to having data moving through your system in an efficient, reliable and timely manner. And for that to happen the necessary infrastructure has to be in place. Infrastructure both in terms of processes and technology. A lot of times data falls within the cracks and visibility is lost because these are not integrated or missing, and when things function in silos data will fall through the cracks.
For example consider a fictional company that is providing logistics services. A challenge could be that there is little to no visibility of the consignments and packages beyond a certain point. There could be little or no visibility on the status of the consignments and little or no updates on the schedules of various partner organizations. Data flows would be intermittent. Track and trace would be a major issue. This could be due to various reasons, not necessarily just because of the absence of systems and processes. A lot of the processes could be manual and status updates could be available locally but not centrally. The systems themselves could be distributed and localized with synchronization methods that are scheduled as batch jobs. It could be a problem with the architecture of the systems themselves with central servers being available but the updates happening over unreliable networking infrastructure. Or the manual processes themselves failing. It could be any number of reasons. Providing the necessary architecture and platforms that will integrate all the systems together so that there is an end-to-end visibility of the data is absolutely essential.
This is part 2 in the series on the key areas that need focus in any Digital Transformation exercise.
In Part 1, we saw that the key areas that needed transformation were:
1. Customer Experience
2. Operational processes
3. New business models
Part 1 had talked about Customer Experience. This part takes a look at improving operational efficiencies using automation, data and analytics.
The challenge that most organizations face while trying to improve operational performance and efficiencies is one of trade-offs. Do they focus on the needs of the global company or the needs of local departments? Is it important to focus on short term efficiencies and improvements or work on the long term growth? Avoid risk or innovate? This pushes organizations into making tradeoffs, or more often choosing one over the other. Standardization gets chosen over empowerment as more efficiency is seen in standardized processes as compared to empowered workers choosing their own methods of working. Controlling processes improves efficiency and reduces risk. But it also suppresses innovation which could lead to better processes being introduced that could improve efficiencies manifold. At the same time, allowing innovation could lead to inefficiencies or put the company at risk. So a balancing game is played out and established practices and processes that have proved to be efficient and leading to less risk are continued with little innovation being attempted.
There are companies that are going the digital way that have brought in transformation by way of adopting digital technologies and applying them to their operational processes. Automating, collecting data and analysis of the data leading to insights and improvements and optimizations are being adopted by companies taking up digital transformation exercises. On the operations front, implementing platforms and tools and building out an ecosystem of business partners and supply chain partners is an essential part of the transformational exercise.
Let us look at an example of a fictional company that is in the logistics service providing business. The ecosystem consists of the business partners, customers and the operations staff along with the warehouses, transportation hubs and fleets, and the control systems at the warehouses and hubs, and the platforms and applications in the enterprise. Shown below is diagram which represents the various components and data flows of the fictional company that provides warehousing and logistics services to retail and ecommerce businesses.
1. The Partner portal is used for onboarding of partners and customers. The customers and partners who register on the platform have visibility into their part of the business. They have access to business reports and transaction reports that are relevant to their part of the business in the operations. This portal is also integrated with the enterprise systems for financial payments and other partner management related functions.
2. The warehouses owned/leased by the company have local systems that integrate with the local control and automation systems. They are also integrated with the central warehouse management system. The devices and sensors that are used to register and track the movement of the products within the warehouse are connected through the gateways at the warehouses to the API gateway in the enterprise cloud and in turn to the IoT platform that collects the data from these devices.
3. After the pick and pack operations at the warehouse, the consignments are moved to the transport hubs. The transport hubs also have devices and gateways that collect data on the inward and outward movement of all the consignments and vehicles. This data is collected by the IoT platform in the enterprise cloud.
4. The transport fleet vehicles themselves have onboard devices (OBDs) that are connected to the IoT platform through the gateways. These devices can track various vehicle parameters and also through gps the movement of the trucks itself. The data is continuously collected in IoT platform.
5. The API gateway in the enterprise cloud is a secure gateway that provides the necessary security for all the data that is being collected from the various devices in the ecosystem. The API management platform allows for the secure management of the APIs that are being exposed by the organization for the external partners as well as the APIs that are being used for internal integrations with the enterprise and operational systems.
6. In our particular example, the Internet of Things (IoT) platform plays a crucial role in the overall solution. It need not necessarily be present in all implementations. It is required only when you have devices that need to be monitored and data collected for control and analytics in the overall solution. There are three main parts to an IoT system. There are the devices which generate the data from the sensors that measure specific parameters. The devices can be installed wherever any parameter needs to be measured and monitored. There are devices that are installed in the warehouses, transport hubs and in the transport fleet vehicles. Each device is a sensor that has a particular function and which is connected to a local gateway device. For example in a vehicle onboard devices can measure various engine parameters, tyre performance parameters, fuel consumption related parameters, temperature of refrigerated trucks, etc. The sensor sends data through the gateway to the IoT platform which then collects this data in realtime and can further process and act on it. The second part of the system is the collection of the data. The APIs and gateway, along with the applications on the platform collect the data in realtime and store it. The third part is the analytics which is carried out on the data that is being collected. This part is a part of the overall IoT platform and can also be supplemented by integrating with other advanced analytics platforms for advanced actionable insights.
7. The central command center is where all the monitoring is done. The tracking and tracing of the various consignments, the movements of the fleet vehicles, the conditions of the vehicles, the performance of the drivers, the status of the goods moving through the system along with all the other parameters that need to be monitored in the ecosystem can be done from the central command center. This platform will have inputs from the IoT platform, from the advanced analytics platform, and the supporting applications and this will be the main console which will be manned and monitored by the operations staff of the organization. This is the main center where all the alerts, alarms and actionable items will be displayed.
8. The analytics platform provides the advanced analytics required by the system. This will provide actionable insights that can be used to directly impact the overall performance and efficiencies of the operations. The analytics platforms supplement the IoT platform which will have its own analytics. The advanced analytics platform provides the analytics which requires inputs from not only the devices but also all the other systems and applications in the ecosystem.
9. The integration layer integrates the various systems of engagement, systems of insight and differentiation, systems of record in the enterprise, partner systems, cloud integration where separate clouds are involved and other components that will allow the secure interactions between various applications in the ecosystem. This layer will provide the data translation, transformation and orchestration as required by the applications and the overall solution.
10. The enterprise applications which serve as the systems of record and the other enterprise applications that are used by the organization are also integrated with the other parts of the ecosystem through the integration layer. The resource planning, scheduling, accounting, vendor and partner management as well as the organization’s employee management is carried out by the applications in this layer.
The solution described would ensure that all operations are monitored at all times and that there is enough data being collected in realtime to ensure that alarms and alerts are triggered at the right times for the necessary actions to be taken. There is visibility at all times of all the parts of the operation along with status updates that are accurate. The overall performance and efficiency of this operation will definitely be much higher than that of one which does not have the necessary platforms and integrations in place.
You can go from being left in the dark about various parts of your operation to being completely in control with full visibility into all aspects of the operation. You need no longer be in a situation where you have to say ‘Now I see you, now I don’t’.
Now I will see you. Always!