Data analytics: CEPs shouldn't just pay for any system service – here’s what to look out for

Data is today’s approach to improving operational efficiency and system availability. Or, more accurately, data can be an efficient and cost-effective approach to improving operational efficiency and system availability.

Proactive, data-based decisions are an industry game-changer and an extremely valuable resource for any CEP operation. By implementing the full spectrum of modern data services, a CEP company can improve the two most important aspects of their parcel sortation system: operational efficiency (how efficiently the system moves items) and system availability (system uptime, which is dependent on maintenance activities).

But how should CEP operators choose between different data-driven solutions? Which data-driven services are the crucial must-haves? Learn about the answers in this article and understand the competitive advantages that CEP operators can reap from implementing a data-driven operation.

Why are more system owners choosing data-driven support?

Before we get into the checklist of data-driven must-haves, let’s take a step back: why is it so important for CEP companies to team up with a data-savvy sortation system service provider in the first place?

Most companies in the CEP industry see a need to strengthen competitiveness. One of the key ways to do this is by lowering operating expenses (OPEX) while maintaining a stable performance. Two of the core indicators in this effort are increasing system availability and avoiding unexpected downtime. Data-driven maintenance is a significant addition to both endeavours.

Part of the reason that some CEPs find operations costly is due to their approach to scheduled service and maintenance; defined tasks with specific time intervals often lead to large amounts of planned downtime and a critical diminishing of system availability. Data-driven O&M is the best way to change the approach from scheduled service to condition-based, proactive service on both hardware and software. This not only results in less downtime, but also reduces the overall O&M cost by a significant margin.

Data-driven, predictive maintenance is also the best practice for avoiding highly expensive consequences of unexpected downtime. By staying alert and proactive via monitoring data analytics, O&M teams can manage potential issues before they reach a full-blown system stop. Modern CEPs have room for service windows, but unexpected downtime can be a disaster – especially when people are at work and delivery times need to be met.

Overall, there is a strong incentive to replace traditional, schedule-based O&M with diagnostic data-based O&M. To achieve this, more parcel distribution companies are teaming up with system suppliers who specialise in a data-based approach to O&M.

How a data-driven operation is made possible

While data-driven diagnostic services may seem complicated and difficult to achieve, some of the industry’s most forward-thinking systems providers have successfully cracked the code of data analytics through diagnostic models that are extremely accurate at identifying issues and scenarios.

Also, as the system supplier helps other sites, learning from an issue occurring at one site prevents the same issue from happening at other sites; the systems provider’s monitoring and diagnostics tools work as an eye in the sky that helps all involved CEPs achieve a higher level of system availability.

Another benefit for a data-based operation is the provided experts: data specialists who work together with system specialists to analyse the data and design the correct diagnostic models.

These specialists are vital and offer a profound understanding of systems. When this is linked with the knowledge of engineers, technicians and the other specialists who built the system, and combined with the data, it becomes a powerful force.

This combination of data and system specialists is what makes a data-driven operation possible.

What should CEP operators expect from their system supporter?

So how can companies in the CEP industry make sure that they find the right partner for data-driven operations?

As a baseline, the CEP operator (as the system owner), should prioritise a partner who:

1. Is specialised in the company’s parcel sortation system – preferably from the company that designed the system.
2. Offers data-based services for every aspect of system service and support – especially O&M – to improve the operation in real-time, prevent breakdowns (and maintain cybersecurity), and ensure effective fixes if anything goes wrong .
3. Offers a 24/7/365 hotline where specialists are directly accessible and work proactively instead of ‘just’ reactively.

What else can CEP operators expect before they embark on the data-driven journey?

System improvement services

The main purpose of improvement services is to enable parcel sortation system owners to proactively optimise distribution centre availability. This helps avoid downtime during operations, based on live data and diagnostic models.

The improvement services consist of a series of diagnostic and monitoring programmes at the operational and system levels, plus a range of dashboards for easy management and tracking of both operational and maintenance data.

Real-time analytics

Real-time analytics can unlock detailed insights into system health and operational performance through using a cloud-based solution. The data can be turned into actionable plans to optimise the specific system and operational performance in real-time.

The CEP operator will receive real-time analytics and live statuses on processes inside the sortation system, such as sorters, inductions, discharges, failures and recirculation.

Customisable dashboards can be designed to present data and actionable insights for every level of the sortation site, including operations, maintenance and management.

For example, they can be used to explain why small parcels end up on the large parcel sorter, which is a common challenge at CEP logistics sites equipped with systems for both small and large parcel sorting. To find the source of the misplacement, sorter data can be used to evaluate the impact of different reasons that can lead to this occurring.

By using a dashboard to understand this, the CEP can be guided to prioritise the necessary work and optimise the use of the sorting system, which reduces the number of small parcels on the wrong sorters and translates into more system capacity.

How diagnostic models lead to optimised performance

Data-based diagnostic models continuously check the operational health of the site to identify developing issues before they arise. Customer data models crunch data 24/7/365 to spot adverse trends and take targeted countermeasures that help improve efficiency and reduce costs.

By identifying trends before they become events that impact system health, data-based diagnostic models also significantly limit the risk of unexpected stops. These stops can bring CEPs to their knees by hindering production for hours or even days.

Another example of performance optimisation is through automatic data analysis of discharge failures that identify causes and reduce error numbers. In some instances, data-based insights have identified the root cause and reduced the number of rejects by more than 70 percent.

At the component level, automated continuous monitoring of operational parameters such as vibration and temperature can detect anomalies that may indicate a risk of failure in either hardware or software.

Through a combination of monitoring and proactive intervention from the hotline, a CEP operator can apply a condition-based maintenance strategy that maximises availability. This is a much more cost-effective approach to maintenance than conventional scheduled maintenance.

Prevention and cybersecurity management

Nowadays, preventive services are required to ensure a stable system execution platform. Many legislative demands require preventive and protective actions, such as identifying and addressing known cyber-risks. The ultimate goal is to achieve a stronger system readiness and to be as prepared as possible with an approach that balances investment and risk.

A good systems provider has experts in place to monitor the risk level of the system platform and take the required preventive actions. Experts should access the system through a process that is well-documented at every step to meet the highest standards of security management.

Today, the ISO 27001 certification is considered to be the gold standard for information security management and the least to expect from a systems provider. It is for the CEP operator to guarantee that access to their sortation system and controls complies with globally recognised best practices to ensure top-notch protection.  A system supplier can only achieve such a certification by passing an audit carried out by externally approved cybersecurity specialists, and the certification must be renewed within a pre-determined timeframe.

Cybersecurity is an increasingly important aspect of ‘prevention’. Security management in cybersecurity should, as a minimum, also include: antivirus management, inspection management, and patch and vulnerability management.  The service provider must have proven processes for testing any possible impact on a site, including evaluating whether an update is required for the specific site.

There are many reasons to prioritise sourcing security management from a systems provider: CEP operators will get operational continuity and reliability, as well as assurance that the entire organisation complies with regulations. A good and certified set-up also minimises loss due to potential cyberattacks and protects the CEP operator’s reputation as a reliable site owner and business partner.

With all of the above covered, there is only one risk left: unusual circumstances.

Ensure

Everyone wants to feel secure with the right protection against worst-case scenarios – which includes having a hotline structure in place to make sure that any breakdowns, hardware issues or software bugs will be fixed as quickly and efficiently as possible.

The best hotline services are centred around a proactive staff team who are available 24/7/365-, consisting system specialists with the right combination of seniority and skills. In case of an incident, it is crucial the CEP operator has immediate and direct access to these specialists.

Every CEP operator would agree that in the case of an actual system emergency, there is no time for sitting in an endless phone queue in a digital phone system and asking to be put through to the correct people.

Specialist support

Another important aspect of modern hotline services is specialist support. System owners should always be supported directly by a specialist who understands their system and is able to fix software bugs remotely. Such a specialist will offer fast and specialised assistance to get operations up and running again in the minimum amount of time.

Hotline experts not only work on resolving incidents, but also provide a root cause analysis afterwards, which helps the system owner make informed, data-driven decisions to improve the system. If an incident occurs that is software-related, hotline services will cover software bug fixes and not discuss payment until the issue is resolved.

Change management

In addition, the system supplier chosen should offer efficient change management in the case of incidents.

As an example, there should be proven change management procedures for software updates, so the system owner is in control of risk management and fallback procedures.

Takeaway: Data-driven services are an all-round game-changer

CEP companies that successfully embrace the full potential of modern data-driven services will reap tremendous performance benefits.

A data-based, diagnostic approach to service can optimise almost every aspect of the CEP operation:

• Improve real-time performance and availability
• Prevent operational and cybersecurity issues and breakdowns
• Ensure the most efficient solution in case of any unforeseen emergency

CEP companies have always done everything in their power to increase availability. Given the current level of competition in the industry, this focus has been sharpened even more. Unfortunately, the objective to limit downtime has unintentionally resulted in significant amounts of planned downtime due to the industry’s singular reliance on scheduled maintenance.

Data-driven, diagnostic services change the entire narrative. Predictive and condition-based service is now an option. Planned downtime can be almost entirely avoided. Full, real-time transparency into how the system is performing and how performance can be optimised is available. The sum of all those parts is that a perfectly run CEP operation is now within reach.

The key is data, but in a much more practical sense, the key is to partner up with the right service provider – one that understands how to unlock the massive potential of data analytics. This includes a 24/7/365 hotline, a dedicated and specialised diagnostics team, and a monitoring unit that is always analysing diagnostic data results to help clients stay out of trouble and on top of performance.

Going forward, incorporating data analytics into parcel system service and maintenance will be a key competitive differentiator in the industry. In truth, the race has already begun.