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What are the Best Ways Fleet Managers Can Reduce Costs?

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Archives, Global Logistics, Global Trade Daily, Trucking

What are the Best Ways Fleet Managers Can Reduce Costs?

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Effective fleet management can be expensive. To keep vehicles operational requires spending on labor, fuel costs, maintenance and telematics. Managers also must consider external factors — like driver behavior and weather — that can further impact fleet performance.

When facing tight fleet budgets, it’s important to know how simple adjustments to vehicles and driver practices can reduce costs. These are some of the best strategies fleet managers can use tWhen facing tight fleet budgets, it’s important to know how simple adjustments to vehicles and driver practices can reduce costs. These are some of the best strategies fleet managers can use to do that.

1. Track Driver Behavior

How drivers use fleet vehicles can have a significant impact on fuel economy and vehicle lifespan.

Many modern telematics systems make it easy to track events like harsh braking and idling — practices that can increase vehicle wear and tear and fuel consumption. They can even put drivers in violation of certain city ordinances. These systems can help any business reduce unsafe and wasteful driving practices.

2. Keep Vehicles Maintained and Road-Ready

Proactive vehicle maintenance ensures vehicles are ready for use and less likely to break down on the road — reducing potential downtime.

The correct care can also have a significant impact on vehicle handling and the longevity of different components.

Properly inflated tires, for example, can make many vehicles easier to control and can also help tires last longer. Under-inflated tires tend to run much hotter, according to studies on tractor-trailer tire performance, and just 20% under-inflation can decrease tire lifespan by 30%.

Because tires naturally deflate over time — and because tire pressure can increase or decrease as temperatures change — it’s not unusual for vehicle tires to become under-inflated.

The right grade of motor oil can provide similar benefits for lifespan and fuel economy.

Preventive maintenance is more expensive than repairing vehicles as problems arise, but it can help fleet managers drive down overall upkeep costs in the long run.

Advanced telematics systems can provide fleet managers with instant notification on unusual performance or behavior, allowing them to schedule inspections or repairs as quickly as possible.

For example, networked tire pressure sensors can provide managers with a real-time view of fleet-wide tire pressure readings. Data from engine control units or similar onboard sensors can alert managers when components begin to fail or flag warnings.

In the near future, these systems may also enable predictive maintenance, a maintenance strategy that uses vehicle performance data and AI algorithms to determine when care will be needed.

3. Shop Based on Lifetime Costs

It’s not unusual for a fleet manager to primarily base purchasing decisions on a vehicle’s sticker price. While price will have a major short-term impact on budgets, it doesn’t always reflect how much it will cost in the long term.

Maintenance and fuel costs, downtime, taxation, and insurance can significantly impact a vehicle’s lifetime and recurring expenses. Opting for vehicles that are more expensive but reliable and cheaper to maintain can reduce fleet costs significantly.

When buying a new vehicle, consider reviewing weight and size, vehicle maintenance schedule and customer reviews. Owners may also want to investigate the possible savings alternative fuel vehicles may provide by eliminating the need for gasoline and diesel.

Adopting a forward-looking approach to vehicle and equipment purchasing can help in other ways, as well.

For example, the construction industry currently faces rising demand for almost every type of equipment as the economy recovers from COVID-19. Demand significantly outpaces the industry’s current workforce capacity and supply of resources and heavy equipment.

After a weak year, demand for heavy machinery recovered and then hit record highs in 2021. Many machines are in especially high demand as both residential and non-residential construction starts continue to trend upwards to pre-pandemic levels.

Demand for concrete pumps is expected to rise to meet the need for new foundations and infrastructure investments. At the same time, tight supply has already caused significant price increases for skid steer loaders, tractors, earthmovers and other types of construction equipment.

Considering the state of the market and likely future demand will help managers make additional purchases in the future, when prices are higher and vehicles are harder to come by.

4. Optimize Driver Routes

Efficient route planning is one of the best ways to reduce fuel costs and keep operating expenses low. Many modern fleet scheduling and management solutions offer tools that help managers find the fastest possible route for each given job.

The tool uses information like vehicle location, fuel economy, traffic and even weather conditions to automatically schedule routes so drivers reach jobs as quickly as possible, with minimal fuel consumption.

Savings from optimized routes can add up over time, helping teams cut down on one of the most significant fleet expenses.

5. Know How and When to Right-Size

Fleet right-sizing is the process of purging underutilized or overly specialized vehicles from a fleet. These vehicles are likely not necessary for operations or can be replaced by more useful models. They can significantly increase maintenance, storage and fuel costs while they remain with a business.

The right-sizing process typically follows a few steps, some of which can help managers identify underperforming vehicles in any fleet:

1. Break the fleet down into major vehicle groups or classifications.

2. Calculate average utilization for each vehicle or machine (often a measure of business mileage over a year-long period, or hours in use).

3. Identify vehicles with particularly low utilization — typically in the bottom 25 or 50 percent.

4. Identify low-utilization vehicles that are still necessary for operations.

5. Create a list of nonessential vehicles and right-size.

Other important metrics to use alongside utilization may include fuel consumption, maintenance costs and average hours in use. These metrics can be useful when the miles traveled metric does not accurately reflect the utility of a fleet vehicle.

The right disposal practices can help to make a business’s right-sizing more cost-effective. Selling vehicles as soon as possible after they are identified as being underutilized is important due to the high depreciation rate.

A formal disposal strategy that includes gathering users’ manuals and shop guides and cleaning and removing equipment can streamline the process.

How Fleet Managers Can Reduce Fleet Costs and Streamline Operations

Operating a fleet will always be expensive, but managers can use these practices to keep expenses within budget. Because driver behavior and maintenance costs are significant expense generators, telematics systems and procedures that track and minimize these expenses will typically be a good investment.

Management practices that take advantage of route optimization software and right-sizing strategies will also ensure minimal operating costs.

As alternative fuel vehicles become more common and practical, they may also be a good investment for fleet managers. The electricity these vehicles need is often cheaper than gasoline or diesel, and fewer moving parts can make for lower maintenance costs.

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Emily Newton is an industrial journalist. As Editor-in-Chief of Revolutionized, she regularly covers how technology is changing the industry.

Supply Chain Industry
3pls, Archives, Global Logistics, Global Trade Daily

Factors that are Reshaping the Supply Chain Industry

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In the modern supply chain, the technology and software you use are as important as your strategies. Plenty of decisions and actions you need to take now happen in the digital world. So, you must pick the right technology if you want to see better efficiency in your chain. In essence, choosing the solution you want to use can make or break your position on the global stage. Hence, technology is and will stay one of the main things that define the game. But, what are the exact factors that are reshaping the supply chain industry? Well, that’s what we’re here to find out.

Last year, COVID-19 took the supply chain to a new place, but not all in a bad way. The changes that took place opened new opportunities and created new practices for companies. We found ways to improve agility and eliminate risks, and things are only getting better.

To figure out how to make them better for your system, take a look at the key things that are transforming the industry at the moment.

Artificial intelligence

Algorithm-based decision-making software and data analyzers are being adopted in every niche, so it’s clear that the era of useful AI has arrived.

When it comes to the supply chains, among other things, AI can help you eliminate human error and reduce costs. It’ll allow you to restructure workflows, so all your workers can be more focused and productive. The technology will support them and make their jobs easier. We’ll explain how this happens a bit later.

The pace of technological change

Technology is developing faster than we can learn to use it. Let’s take eCommerce as an example. It provided people with a whole new way of shopping and took the world by storm. All of a sudden, you’re able to find anything you need and have it delivered to your door without ever having to leave the comfort of your home. Thanks to it, customer demands and expectations have changed. Now, they expect quick and even same-day deliveries. So, the logistics industry has to respond to that to stay in favor of people.

As a company, the only way to stay relevant is to build a reliable infrastructure and learn how to use new technology developments. Experts believe that online and mobile shopping will be the preferred way of buying for the majority of people in the future. Even today, people are getting everything from groceries to appliances online, so why would that change in the years to come?

To update your system, try to make your processes more streamlined. That will give you a better chance of keeping up with modern timeframes.

The Internet of things

We can’t talk about the factors that are reshaping the supply chain industry and not mention the Internet of things. Although most people will associate the term with smart home appliances, this technology is actually invented to deal with sensors and tracking equipment.

So, the IoT is what you’ll use if you want to reduce commercial warehousing costs. However, it can help you do much more than just that. With it, you can connect all the products, people, and processes within your organization and share information among them in real-time. Just like that, everything becomes streamlined, and your productivity goes up.

Automation and robotics

Of course, people have been using task-specific robots for decades in industries such as automotive. However, the latest generation of robots can learn how to do multiple tasks, so they have much more potential.

In supply chains, you can find a use case for these almost anywhere. Add AI into the mix, and you quickly realize that robots can bring many new things to manufacturing processes and reduce staff costs. With time, more and more repetitive or dangerous tasks will be performed by these.

Big Data

Big Data is used to track data and measure the performance of factories in real-time. In past times, to survey workers, you had to put an entire factory under surveillance. But today, modern sensors and networks give us insights that we couldn’t get before. You can even collect data on each and every employee if you want to. This way, you’ll spot problems much more easily and fix them sooner.

When you remove the bottlenecks in the delivery process, you’ll also improve the lives of your workers. You’ll streamline their roles, and they won’t waste time on unnecessary or frustrating tasks. If you rely on Big Data-driven decision-making, you’ll create a leaner business model and reduce wastage.

3D printing

If we’re talking about prototyping new products and designs, there isn’t a tool as useful as 3D printing. Companies that invested in it say that they managed to halve their prototype production times, and that’s a huge thing. If you have to wait for weeks until you get parts to start working, that creates problems right down the supply chain. It lengthens the process and increases the costs. On the other hand, 3D printing alleviates supply chain weaknesses that already exist.

Use it, and you can apply design iterations to the molds within hours. So, you’ll be speeding up the process and encouraging the closer engagement of product designers and the manufacturing team. And for that, 3D printing is one of the factors that are reshaping the supply chain industry.

Factors that are reshaping the supply chain industry – delivered

Incredible advancements in technology are at the root of all factors that are reshaping the supply chain industry. If you fail to incorporate them, you will fall behind. Therefore, follow the latest trends and introduce the changes that will streamline your processes, make your business functioning more efficiently and productive.

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Deon Williams is a freelance writer with a degree in systems engineering. Although it’s not his main job, he loves to write articles and share his expertise. In the past, Deon helped companies like zippyshelldmv.com to streamline their processes and increase their earnings. When he’s not working, he loves to read in his comfy chair and play basketball with his two sons. 

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5 Innovations in Manufacturing Processes and Their Effect on the Bottom Line

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Manufacturing is a rapidly evolving industry. With a broad spectrum of sectors depending on manufacturing, modern facilities are often quick to adopt new technology that improves on their existing processes.

The rise of automation, artificial intelligence (AI) and data have created a wave of digital transformation. As manufacturing grows and becomes increasingly competitive, capitalizing on Industry 4.0 innovations can determine whether or not a company will succeed.

Here’s a look at five of these innovations and how they affect the bottom line.

1. Cobots

Robots aren’t new in the manufacturing industry. But as automation has grown, new approaches and technologies have emerged that can take its benefits further. Collaborative robots, or cobots, are one of the most significant of these upgrades to factory automation.

In a 2021 study, 44.9% of surveyed businesses said that robots are an integral part of their operations. Of those companies, 34.9% had adopted cobots. Cobots have slowly become more popular as manufacturers have realized the limits of traditional automation. Other robotic solutions are expensive and inflexible, making it difficult to scale, but not cobots.

Since cobots work alongside humans instead of replacing them, they typically automate fewer processes at once. Consequently, they’re often more affordable than traditional automation and easier to implement. Manufacturers can then automate one process at a time, slowly scaling up to meet demand or new challenges.

This incremental approach to automation removes the high upfront costs and disruptions of traditional automation. As a result, cobots enable manufacturers, especially smaller businesses, to scale up and down with ease. These companies can then enjoy quicker, higher ROIs.

2. IoT Sensors

Another growing innovation in manufacturing is the implementation of internet of things (IoT) sensors. While these technologies aren’t a manufacturing-specific phenomenon, they hold considerable potential in this sector. Perhaps their most popular and impressive use case is predictive maintenance.

Predictive maintenance improves on traditional maintenance schedules by avoiding both breakdowns and unnecessary repairs. According to a Deloitte report, it reduces maintenance costs by 25% on average. That’s an impressive figure on its own, but it also reduces breakdowns by an average of 70%.

Considering that an hour of downtime costs more than $100,000 in 98% of organizations, that adds up to considerable savings. Predictive maintenance isn’t the only application of IoT sensors in manufacturing, either.

Manufacturers can also use these sensors to gather data points throughout their operations. This data can then reveal areas of potential improvement, enabling ongoing optimization. The longer manufacturers use these technologies, the more they can save through them.

3. Additive Manufacturing

One recent innovation that is specific to manufacturing is 3D printing, also known as additive manufacturing. While this technology is most well known as a tool for hobbyists, it originated as an industrial production technique. Recent advances have made it a more viable solution, leading to a comeback in industrial manufacturing.

Additive manufacturing lets manufacturers produce parts and products as a single piece instead of assembling multiple smaller components. Like mil-spec buffer tubes, which are made of a single piece of aluminum, this improves products’ strength and resiliency. As a result, they produce fewer defects, improving the company’s bottom line.

Since additive manufacturing adds material instead of cutting it away, it also reduces waste. Manufacturers can get more parts or products from the same amount of materials. 3D printers also typically work faster than traditional production techniques, leading to a quicker time to market.

Additive manufacturing is also more energy-efficient. Some products, like car batteries, require a lot of energy to handle the sensitive materials they need, leading to higher costs. By reducing energy consumption through additive manufacturing, facilities can increase their profit margins. Alternatively, they could reduce end prices, selling more with consistent profit margins.

4. 5G Connectivity

Like the IoT, 5G isn’t strictly a manufacturing technology, but it has impressive potential for the sector. 5G networks aren’t widespread enough yet to bring substantial improvements to the consumer sector, but they’re ideal for manufacturing facilities. Their higher bandwidth, increased speeds and lower latency let smart manufacturing reach its full height.

5G networks can theoretically support up to one million devices per square kilometer, ten times 4G’s limits. That will allow manufacturers to expand their IoT infrastructure to virtually every machine in the facility. Lower latencies will allow these interconnected systems to communicate more efficiently and reliably, unlocking Industry 4.0’s potential.

With all of these machines connected to one another, manufacturers could create cohesive autonomous environments. If a disruption occurs in one process, machines down the line could know and adapt to it, minimizing its impact. As a result, manufacturers could maintain higher productivity levels, minimizing their losses from lost time.

5G lets manufacturers use technologies like the IoT and automation to their full extent. This leads to higher ROIs for these significant investments.

5. Machine Vision Error Detection

AI has many use cases in manufacturing, but one of its most enticing is machine vision. Machine vision systems let manufacturers automate quality control processes at both the front and back end of production lines. This automation, in turn, improves the efficiency and accuracy of their error detection.

When Heineken installed a machine vision quality control system in its Marseille, France bottling plant, it highlighted this technology’s benefits. The facility’s bottling machine operates at 22 bottles per second, far too fast for human workers to spot any bottle defects without stopping it. The machine vision system, on the other hand, can analyze bottles at speed with a 0% error rate.

Machine vision error detection lets manufacturers increase production while maintaining the same level of quality. Since these systems deliver a level of consistency impossible for a human, they’re also more accurate. As a result, facilities will also produce fewer defects.

Fewer defects translate into less waste, and faster checking enables increased output. These factors combined result in an improved bottom line.

New Technologies Make Manufacturing More Profitable

These five technologies aren’t the only ones pushing manufacturing forward, but they are among the most notable. As more facilities embrace these innovations, manufacturing is becoming a more profitable industry.

Technologies like these improve efficiency, minimize errors, optimize operations and more. Manufacturers that can capitalize on them early will ensure their future success, and those that don’t may quickly fall behind.

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AI Beyond the Hype: This is Our Moment to Embrace Digitization

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AI for business is one of the most talked-about innovations and for good reason. As in other areas of our lives, it holds the potential to fundamentally alter the processes and structures humanity has been accustomed to for decades and, in some cases, even centuries.

Yet, like many other groundbreaking technologies before it, when it comes to real-world business processes, it’s understandable to feel that the recent attention around AI’s value has outpaced the current reality. Yes, today AI can more precisely tailor content recommendations in social media apps like Instagram, Twitter and YouTube and help refine the photos we take on our phones.

But where is the AI-driven revolution in the way we work—helping us do our jobs better, more efficiently, and unlocking value in unexpected places? We believe it’s here, today.

How do we know? Because at BT Sourced, our new standalone procurement company within the BT Group, we’ve already started to see the benefits. We’ve come to believe that, properly implemented, AI can be a game-changer—and that while there’s a lot of excitement about the future of AI, we’re proof that the future is now. Here’s why.


Why AI—and Why Now?

Out of sheer necessity, the COVID-19 pandemic accelerated what had been a gradual shift toward the rapid digitization of procurement. In the face of disruption, from remote work to shortages of goods and services across the value chain, having the adaptability to quickly source the best suppliers became critical. Agile procurement teams armed with cutting-edge technology were and will continue to be, best positioned to streamline sourcing, driving long-term growth and value for the BT customer and operating model.

Deloitte’s 2021 Global Chief Procurement Officer Survey found that driving operational efficiencies was the new No. 1 priority for CPOs, replacing reducing costs for the first time in the report’s 10-year history. In this next normal, procurement must modernize and simplify its processes to become faster and more agile for the near and long term.

The biggest barrier to transforming procurement is changing the way people work. Critically, the new AI-powered platform BT Sourced is using enables us to collaborate from any location by improving visibility, workflows, and communication across all functions. Increasing agility and efficiency is also key to achieving another important goal: enabling a greater focus on strategic initiatives and collaboration.

Adopting AI, along with tools that feature analytical intelligence and enable self-procurement, means our teams can now study recurring behaviors, empower end-users and discover new areas to contribute value. These new platforms are giving us the insights to make fast, data-driven decisions that benefit everyone throughout our value chain. They can be shared across the business, enabling us to work more closely than ever with our stakeholders while AI manages manual and repetitive tasks in the background.

AI for Good 

The financial benefits of AI and automation in procurement are clear. But what about other important goals such as inclusion and corporate social responsibility? How can AI in procurement support workforce development and contribute to the greater good?

At BT Sourced, we’re committed to expanding economic opportunity and reducing our environmental impact. In many ways, AI supports our commitment to more sustainable sourcing—from driving new efficiencies to enabling deeper analysis and awareness of environmental, social and financial risks throughout our supply chain. Now more than ever, we’re able to more precisely track compliance with our global responsibility model, sustainability criteria and principles of responsible behavior for suppliers regarding ethics, conduct, social issues and the environment.

We’re also leveraging AI to support supplier diversity and inclusion, expanding our network to include qualified alternatives from a base of top-performing, diverse small and midsize companies, increasing access to innovative service providers that may have otherwise been overlooked.

The Present and Future of AI

As the last year has proven, AI is no longer procurement’s future—it is our present and, without question, our future. Agile, value-added procurement requires the insights and efficiency that only AI and automation can deliver at scale. The pressing need to develop more responsible, inclusive supply chains and practices only makes the case for digital transformation stronger.

We have an unprecedented opportunity for change. Companies have a unique opportunity to move quickly to modernize their procurement technology and achieve benefits for both their stakeholders and their broader communities. We’ve arrived at the right moment to disrupt traditional models and processes, making the vision of a more efficient, sustainable and inclusive AI-powered future, a reality today.

_________________________________________________________________

Cyril Pourrat is the Chief Procurement Officer at BT Group

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Semiconductor Memory Market to Have a Promising Future Ahead

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The semiconductor memory market will witness considerable expansion driven by the higher adoption of memory and storage components in moveable medical devices and healthcare equipment. These intelligent point-of-care devices include glucose, heart rate, continuous temperature, and pulse oximeter monitors and are used to store real-time diagnostic data, which can be later easily derived from the semiconductor memory. This information not only assists in analyzing the disease source but also renders early treatment and diagnosis of the targeted diseases.

On this note, it has been reported that the global semiconductor memory market size will reach over USD 180 billion in annual remuneration by 2027.

Below are the key trends likely to influence the industry expansion

Rising preference for MRAM semiconductor memories

Magneto-resistive Random-access Memory (MRAM) semiconductor memory industry is pegged to see a CAGR of nearly 15% in the analysis timeframe. This is mainly ascribing to the non-volatility, low power consumption, higher durability, faster read/write cycles, and enhanced data storage capacities for extended durations of the MRAM devices. This has pushed leading business participants to come up with MRAM chipsets for use in consumer electronics applications. To quote an instance, Samsung Electronics, in March 2019, launched the eMRAM, deployed with 28FDS process technology to offer higher performance and endurance in applications of embedded systems.

Expanding industrial application scope

Demand for semiconductor memories in industrial applications accounted for around 10% of the overall market share in 2020. This is owing to the incessant requirement for semiconductor memory chipsets across numerous industrial components. The rise in the number of smart factories in South Korea, Germany, China, and the U.S. has bolstered the adoption of IIoT devices, robotics, and automation equipment. According to the Ministry of SMEs and Startups, the number of registered smart factories in Korea reached 19,799 in 2020. This penetration will add a positive edge to the intake of semiconductor memory solutions in the industrial sector.

Europe to emerge as a key producer

The semiconductor memory industry share in Europe is poised to expand at a 5% CAGR up to 2027 driven by the increased automotive production and the prominent presence of leading automotive OEMs in the region. The European Automobile Manufacturers’ Association estimated that Europe produced close to 15.8 million passenger vehicles in FY2019, accounting for nearly 21% of the total passenger vehicle production in the world.

Furthermore, semiconductor memories are widely integrated with in-vehicle communications, instrument clusters, navigation systems, telematics, among several other automotive electronics. This has paved the path for advanced automotive safety systems, including self-driving cars in the region.

Competitive business initiatives

Suppliers of different semiconductor memory types are working towards inorganic marketing strategies, like mergers and acquisitions to gain competitive advantages. For instance, SK Hynix, Inc., in October 2020, struck an acquisition deal with Intel Corporation to obtain its NAND memory and storage business for USD 9 billion. This acquisition is inclusive of Intel’s NAND component and wafer business as well as the Dalian NAND memory production facility from NAND SSD business Intel, which is in China.

Impact of COVID-19 crisis

The ongoing COVID-19 pandemic tremendously affected the growth of the semiconductor memory market particularly in the first two quarters of 2020 owing to the imposition of severe nationwide lockdowns by several governments. This made way for supply chain disruptions as well as international trade barriers with regard to raw materials and components. However, the emergence of the work-from-home policies supported the demand for semiconductor memories amidst the pandemic given the growing sales of consumer electronic devices, like tablets, laptops, and smartphones.

Rising advancements in medical science and equipment have given rise to multiple opportunities for semiconductor memory manufacturers in integrating AI and IoT technologies. There is also an escalating need for telematics, in-vehicle infotainment systems, instrument clusters, and ADAS solutions in advanced automotive and connected cars. The increasing developments in Flash memory, such as 3D NAND Flash drives to enhance the transmission speed while reducing latency will further complement the industry expansion.

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Future in Maintenance: Will Machines And AI Replace Maintenance Workers?

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A widespread narrative on work in the future is that machines will take care of everything. Robotics, artificial intelligence, and modern algorithms powered by new energy sources will replace the way this world works. People will be out of jobs as they will not be able to compete with machines powered by AI. Leading to widespread unemployment and dispossession of the masses. The state of affairs is, allegedly, no different for maintenance activities in the future and looks bleak for maintenance employees. 

Now, is this the bleak future we face, or is it ‘immanentizing the eschaton’ as Willian F. Buckley puts it? For that, we have to take a look at the current state of maintenance automation, the potential evolution of the same, and historical precedents for such radical changes.

Maintenance automation: A Swiss army knife?

Maintenance activities have become a lot simpler with the help of technology. Managing maintenance schedules to predictive maintenance can be accomplished with the aid of modern technology. Everything with some level of computerized decision-making is broadly termed automation. But there are varying degrees of automation depending upon the entity making the decisions in various processes.

All processes in an industrial environment are formed by one or more of the following functions.

1. Monitor function

2. Advice function

3. Decide function

4. Implement function

The control of each of these functions can be handled by a computer or a human. Based on this, there are ten levels of automation starting from complete manual control to full automation. In full automation, all the functions in the process are controlled by a computer. The different levels of automation and who controls different functions in each of those levels are illustrated in the table given below.

The aim of all automation advancements is to reach the level of full automation. Today in most automation instances, computers control only one or two of the functions that form the process. The common narrative is that technological improvements snowball and compound to an exponential degree to deliver fully automated systems in the not-so-distant future. This will lead to the take over of all maintenance activities by machines and AI replacing all maintenance workers.

But what the narrative misses out on is the law of diminishing returns. According to the definition from Investopedia, “The law of diminishing marginal returns is a theory in economics that predicts that after some optimal level of capacity is reached, adding an additional factor of production will actually result in smaller increases in output.”

Applying the law in maintenance automation, after a period of compounding a ceiling is reached from where incremental improvement requires a disproportionately high amount of time, resources, and effort. This follows the trajectory of an S-curve as shown above. The progress in automation will follow a snail’s pace after a critical limit is reached. 

The real-world impact of the S-curve can be seen everywhere in technological advancement. The capacity of semiconductor chips was supposed to grow exponentially to infinity. “Faster and faster processors every year” was the narrative pushed during the initial phases of semiconductor development. Today, semiconductor manufacturing is fast approaching the physical limitation and the cost of improving the tech is orders of magnitude higher than earlier.

A similar ceiling for innovation will also hit the march to full automation of maintenance activities in manufacturing facilities. The cost of implementing incremental automation will rise exponentially after reaching a critical limit. Till the critical point automation technology will rise exponentially at a minimal cost. The problem is that no one really knows what is the critical point for maintenance automation or for any other technological evolution.

In the future, there will be an exponential rise in the technology driving maintenance automation. But it will not completely eliminate the need for human workers in maintenance activities. Maintenance automation brings about improvement in processes, efficiency, and in turn bottom line. But after a critical limit, an incremental increase in efficiency comes at a huge cost.

Horse buggies were replaced by cars and taxis. A lot of coachmen lost their jobs due to the transition. In addition to that, horse merchants, workers taking care of horses, carriage makers, all lost their jobs. But plenty of new jobs were created in the process of transitioning into automobile-based transportation. Cars and taxis were unheard of before the existence of automobiles. Plenty of new jobs such as cab drivers, car salesmen, car dealers, mechanics, etc came into being. This is the sort of creative disruption that always happens in free-market capitalism and maintenance automation would be no different.

Creative disruption

The most plausible scenario, for maintenance automation, is where human workers work in conjunction with machines and artificial intelligence. Software and algorithmic tools will be used extensively for process automation intelligence. Robotic arms and other robotic devices that can be programmed to perform regular tasks would be created. But since there is a lot of variability in a lot of maintenance tasks creating custom programmed robots for each instance would be cumbersome. 

The tasks that require flexibility and dexterity will be exclusively carried out by human maintenance technicians. They will have assistance from cobots. ‘Cobot’ is an abbreviated form of ‘collaborative robot’. It is specially designed robots that assist human workers in accomplishing their tasks. This form of creative cooperation will be commonplace for maintenance activities of the future.

The bottom line is that machines and AI will take over a lot of mundane and repetitive tasks. This frees up human capital to deal with more creative and complex tasks. While on the one hand, a lot of traditional maintenance jobs will no longer exist. But on the other hand, plenty of never seen before jobs will be created. Machines and AI would be a net positive for all maintenance activities and jobs in a plant, in the long term.

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Bryan Christiansen is the founder and CEO of Limble CMMS. Limble is a modern, easy-to-use mobile CMMS software that takes the stress and chaos out of maintenance by helping managers organize, automate, and streamline their maintenance operations.

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Smart Cities of the Future Rely on Innovation, Critical Discussions

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In the Chinese city of Hangzhou, an AI-based smart technology called “City Brain” has helped reduce traffic jams by 15%. During the pandemic, New York City analyzed data related to spending pattern changes in specific neighborhoods to better allocate aid disbursement and investment priorities. And San Diego was lauded for approaching city-building with a “citizen-centric focus”, thanks in part to its use of mobile apps, and expansion of open data, along with its Get It Done citizen reporting tool.


 

Smart cities are sprouting up around the globe at an increasing rate, and they are quickly becoming model frameworks for future-ready urban centers seeking to level up how they collect and parse citizen data. What they all have in common is how they invest resources and time into developing city-centric solutions to address the wide swath of city challenges: waste and water management, public safety, transportation, air quality monitoring, traffic and parking, public works, municipal Wi-Fi, and more.

What the future of cities relies on, especially as they all recover from a devastating pandemic, is the innovation brimming across hundreds of projects built to answer a critical question: how can we leverage the data from smart city technologies to digitally empower cities to adapt and thrive?

When cities smarten up, everyone wins

For cities considering the pros and cons of adopting new technologies, it’s hard to argue with the data: By 2025, cities that deploy smart-mobility applications have the potential to cut commuting times by 20% on average, with some people enjoying even larger reductions, a McKinsey report found.

Take the sprinkler your neighbors automatically ran this weekend after it rained. If cities deployed sensors and analytics to water consumption patterns, which pairs advanced metering with digital feedback messages, it can urge people toward conservation and reduce consumption by 25% in cities where residential water usage is high. While currently, much of this IoT technology and data is owned by the private sector, it’s critical to bridge this gap in order to help the public better understand their behaviors and impact through data. Additionally, access to this data will enable cities to make better decisions about public resources and amenities.

The more data a city can collect about its citizens’ habits, the more sense they can make of which resources can be allocated where. And it can save lives, too. In Nevada cities, Waycare’s predictive AI delivers an 18% reduction in primary crashes and a 43% reduction in the percentage of speeding drivers along key corridors.

Some cities haven’t caught up to the shining examples of layering data collection and real-time analysis in urban centers. More often than not, they are encumbered by bureaucratic and outdated approaches to data collection.

There’s a disconnect between the municipalities and corporations that may have IoT data and the stakeholders, including those same cities and private developers who could benefit from it, too. Same-old strategies on data gathering, such as physical surveys and endless meetings to pick at each process, should be phased out, and allow for an intermediary to help finesse the conversation between those three pillars of city development.

Also, cities have to address the unease some people may feel about surveillance technology, for example. In China, where that tech has long been the norm, they’re even anxious about how their data will be used by their government: According to a recent survey by tech firm Tencent and Chinese state broadcaster CCTV, nearly 80% of respondents said they worried about the impact of artificial intelligence on their privacy.

Pandemic’s curveball could end up being a home run

If there’s any hand wringing over the state of cities due to the havoc wrought by the pandemic, urban theorist Richard Florida offers some comforting words: “Cities have been the epicenters of infectious disease since the time of Gilgamesh, and they have always bounced back—often stronger than before.”

Some insiders believe that as much as the pandemic crippled supply chains and shut down business sectors across communities, it brought a few silver linings. Data collection strategies accelerated immensely, whether from health care departments or government agencies. The continuing trend of leveraging Internet of Things devices, which connect to each other quickly and remotely, also gave rise to intriguing pairings.

At the state and infrastructure levels, AI and machine learning will likely be matched with IoT for even closer social monitoring as pandemic warning and control systems are established, notes a report from research firm MSCI.

As broadband use skyrocketed during a year of work-from-home policies, rollouts of 5G networks continued at a brisk space, and even picked up in areas that needed high-quality connectivity as soon as possible. Building that underlying network is fundamental to enable seamless adoption of technologies at the heart of smart cities of the future.

Going forward, city planners and developers will work with datasets from businesses who layer various granular data on heat maps via an analytics platform. Understanding the correlation between income levels and access to certain retail, like grocery stores, or access to transit and parks where a neighborhood’s density is rapidly increasing, may be opportunities for cities to identify community needs and work with developers on new projects.

“Six key groups of people should be at the table to discuss where smart cities go from here,” says Chelsea Collier, founder of Digi.City, a consultant specializing in smart city technology.

Those groups should be:

-Government bodies, from local to federal

-Educational institutions, from kindergarten to post-secondary

-Startup entrepreneurs to bring subject matter expertise to the discussion

-Artists and creative who can fuel projects with outside-the-box solutions

-Social sectors such as nonprofits and advocacy groups

-and communities and their citizens

“When everyone listens to each other’s perspective, it’s more useful than just working towards someone’s agenda,” adds Collier.

The smarter the city, the more it’s open to how various sectors, private and public, can drive innovation and growth forward. The future of cities will be written by those players who look beyond their own personal missions and instead cast a wide net to strengthen neighborhoods adapting to a strange post-pandemic era fraught with challenges.

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Sara Maffey is the head of industry relations at Local Logic, a location intelligence platform that digitizes the build world for consumers, investors, developers and governments. Local Logic delivers an unrivaled clarity and actionable insights capable of creating more sustainable and equitable cities.

oil and gas
Archives, Global Trade Daily, Special Reports, Utilities

AI in the Oil and Gas Market

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Artificial Intelligence (AI) is beneficial to all types of industries. In the oil and gas industry, it stands to make huge gains. The industry is one of the most dangerous because of the constant risk of fires and explosions due to the explosive nature of these fuels. Digital transformation in the oil and gas sector may save about 10% of field operations cost thanks to using augmented visual technologies. AI improves business operations, the productivity of the fuels, and safety. It also lends preciseness to applications such as quality control, prediction planning, and predictive maintenance, all of which affect the running of the business.

AI technologies are used in three ways. The first is in operation, which pertains to the upstream, midstream, and downstream. Upstream deals with the exploration and production sector. Midstream is when the transportation of crude or refined petroleum products takes place. Downstream is the process of refining, processing, and purifying crude oil and natural gas.

The second is service type defined by professional services and managed services. The third is geography, which is segmented into five continent-based areas of the world.

Use of AI In Safety

AI works to optimize operations during the upstream, midstream, and downstream functions. Defects may arise in the pipeline or in the mechanisms used to explore for oil and produce it. Using AI will detect any defects in the machinery or pipeline used to explore, produce, transport, refine and process crude oil and natural gas, enabling the rectification of any identified error. This will save costs and prevent extensive damage that may otherwise have occurred.

AI in the oil and gas industry promotes high safety and security standards. Oil and gas are highly dangerous because of the fuels’ flammability and the production of toxic fumes. AI systems can monitor toxicity levels and leaks and send an alert to rectify the flagged issues.

Another safety hazard in the industry is the change of temperature. Environmental conditions can cause changes in the safety of the storage and transportation of crude oil and natural gas. Early detection is key to make the necessary corrections to avert disaster quickly. AI can automatically adjust heating and cooling systems so that the product remains safe throughout the changing seasons of the year. AI will also help alert the maintenance crew when maintenance is needed on various machinery used to process and transport the crude oil.

AI In Business Optimization

AI aids businesses to predict downtimes, for example, when machinery is being maintained. The business can make arrangements to get alternative equipment, thus preventing loss of income because of better planning.

With proper maintenance, the life of the machinery is lengthened, which results in long-term cost savings.

Data is used in the oil industry to derive information on various plants and assist geoscientists in making strategic decisions. For example, if there is a need to move an exploration plant to another site. AI can quickly process large amounts of data, enabling real-time decision-making that improves overall business operations, leading to efficiency, fewer risks, and damage, which is costly, and cost savings based on improved business processes.

AI-based technologies can also increase the rate of exploration, which is a time-consuming and capital-intensive venture. AI can interpret the geology, geophysics and oil reservoir of a geographical location so that exploration is more precise, thus eliminating the need to spend more money on a hit-and-miss scenario.

AI in Quality Assurance

Artificial Intelligence in the oil and gas industry is great for quality assurance. The industry is highly dynamic, and the risk factors are high. AI-based technologies are designed for seamless applications and limitless uses. This increases the quality of the entire process from the beginning point of exploration to the endpoint of purification and processing crude oil and natural gas. This is done by early detection of any existing or potential risks to be corrected immediately.

warehousing
Archives, Global Logistics, Global Trade Daily, Warehousing

The Future of Warehousing

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In September of 2018, Forbes Insights published a survey of 400 senior haulage executives. They reported that more than two-thirds of the respondents believed seismic changes had to occur within the logistics sector, otherwise its warehouses would risk not being able to facilitate the growing demand for freight delivery.

Three years and a global pandemic later, and demand for warehouses is higher than ever. So how has the industry endured this tumultuous period? The simple answer is greater investment in technology! Innovators within warehousing have continued to incorporate intuitive software into their models to cut costs, speed up delivery time and improve efficiency.

With this trend of incorporating technologies into the haulage sector only set to continue, the mind boggles at what warehouses could be capable of in the future. To that end let’s unravel the warehouse innovations set to be introduced in the coming years and what the biggest names are doing today to ensure they won’t be left behind.

Warehousing the Amazon way

We would be remiss not to mention Amazon in a discussion about the future of warehousing. After all, their network accounts for over 150 million square feet of warehouse space across the globe.

The company has, since its emergence in the ‘90s, being trailblazers for cutting-edge warehousing models. In the mid-2000s they popularized fulfillment centers whereby sellers could leverage the vast network of warehouses Amazon had to store, pack and ship their customer’s orders for the same standardized fee – no matter where an item was being sent.

Since then, many warehouses have attempted to adopt something similar to the Fulfilment By Amazon (FBA) program and offer to not only store their client’s products but package and deliver them as well. However, none have been able to even rival the FBA. Namely because of one very appealing benefit that FBA offers sellers: Prime eligibility.

This legacy of advancement was further solidified by the recent announcement that Amazon was opening its first robotics fulfillment center in Alberta, Canada. The automated warehouse, slated to open in 2022, is the result of almost a decade-long investment.

In 2012, Amazon purchased robotics company Kiva Systems for $775 million which gave them ownership of a new fleet of mobile robots which were capable of carrying shelves of products from worker to worker and intuitively navigate a warehouse according to barcodes on the floor. Like the FBA program, it’s expected that many warehouses will use Amazon as inspiration and invest in some form of robotics to aid with automation.

Automation for all

As Amazon recognized, automation is the silver bullet when it comes to boosting a warehouse’s operations. Having a workforce that never tires, runs 24/7, and provides a near-perfect output is invaluable. It’s likely that every stage of warehouse infrastructures will have some form of automation in the next few years if they haven’t already.

Drones are expected to have a significant role in the future of warehousing, specifically in aiding inventory control. MIT conducted research in 2017 where they programmed drones to fly above a warehouse floor to read RFID tags from more than ten meters away. The study was a success with the drones only having a 19cm margin of error.

There are currently some safety concerns delaying the immediate integration of drones in warehousing but the continual developments of the technology suggest that we’re not too far away from seeing them introduced.

Automated conveyors and sortation systems have been staples of warehouse infrastructures for decades, now experts are predicting that a third system will become part of every warehouse’s arsenal. The ARC advisory group’s warehouse automation and AS/RS research forecasts that the shuttle systems market is going to grow exponentially.

For context, a warehouse shuttle system is a mobile cart that transports items in pallet racking. It replaces the need for an operative to use a forklift to retrieve stock totes, trays, or cases in a storage buffer. The system, which is also being touted as an essential by various trade groups, provides warehouses with high throughput, scalability, and storage density.

Considering that repetitive tasks can be mechanized fairly easily, there’s plenty of reasons to be excited for what other types of automation could be introduced into warehouse infrastructures and the benefits that they will no doubt yield.

Big Data & AI

Big data and machine learning have revolutionized many industries since their proliferation in the early 2000s and it’s expected to do the same to warehousing.

Order and inventory accuracy, as well as fulfillment time, are all Key Performance Indicators (KPIs) that could be improved through the use of Artificial Intelligence (AI). AI can also evaluate more general drivers that may affect a warehouse’s overall performance including safety, facility damages, and employee productivity. Using this aggregated data AI is able to start automating tasks, collecting the necessary information, and making decisions on its own.

Some industry leaders have already made the transition and began using AI. For example, Alibaba recently fully automated its stocking and shipping warehouses in China by using robots controlled by a sophisticated machine learning algorithm.

Further down the line, many experts believe that more advanced metrics will come into play as well, such as predictive analytics which will give operators a helping hand when it comes to forecasting and drive smarter decision making in the warehouse’s overall operations. Predictive analytics will help with evaluating demand for warehouse space, planning inventory location, responding to supply chain issues, and reducing risks associated with more complex supplier networks.

It’s clear to see that the prospects for warehousing in the near future are bright with plenty of exciting technology currently in use and on the horizon. The industry’s willingness to constantly evolve is truly admirable, with interest in big data, automation, innovative models, and AI at an all-time high. We should all be very excited about the future of warehousing.

IT
Archives, Global Trade Daily, Software

Why Strategic IT Should be at the Top of Every Executive’s Priority List

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To say that technology has been important to business survival in recent years is certainly an understatement. In 2020, 70% of United States employees worked remotely, teams and customers relied on virtual tools to communicate, and a dispersed workforce led to additional concerns about cybersecurity. The result has been not only an increased use of technology, but also a heightened awareness of its role in driving strategic growth – and a long-overdue need for business leaders and executives to add strategic IT experts to their roster of trusted advisors.

From early in the pandemic, technology was inextricably linked to business success; in a world of physical disconnection, there was no longer a choice when it came to digital transformation. The truth, though, is that technology has been influencing the way we do business for decades. Consider the most mission-critical processes in your company; chances are every single one of them involves technology. From client onboarding and team communication to record-keeping and strategic planning, tech is not simply a part of your business – it is the foundation upon which it is built; an essential part of optimizing productivity; and the glue that holds teams, organizations, and customers together regardless of how or where they’re working. As you look towards resurgence and growth, you should be treating your tech just as you do any other foundational pillar – with strategic thoughtfulness and the expert input of business-minded advisors.

Making the Right Business Decisions About Technology: Four Key Considerations

While the importance of technology is more apparent than ever now, the ideal implementation of it within your business may not be so clear. With so many tools, vendors, and applications to choose from, finding the right ones for your company requires not only a willingness to embrace innovation but also the ability to marry technology to overarching business goals. When you do, technology becomes a competitive advantage that lets you work smarter, faster, and more productively: at companies that prioritize making tech highly accessible to their teams, employees spend 17% less time on manual processes, collaborate 16% more often, and make decisions 16% faster. As you consider how to make the right technology choices for your company, here are four key factors to consider:

1. Cybersecurity

Leaders have long known that cybersecurity was a necessary element of their IT support; organizations must have good cyber hygiene, or they could suffer loss of data, money, and reputation. Recently, however, a spike in cyber-attacks has begun to create a heightened awareness of the breadth of cybersecurity – so much so that the Department of Homeland Security recently launched a web page dedicated exclusively to addressing the challenges of increased cyber-threats. Cybersecurity efforts should go much deeper than firewalls and antivirus software; they should be built from a deep view of your entire environment to make sure you are accounting for security in every possible way. How far back should your backups go? Too far and you risk an outdated recovery point. Not far enough and you could lose a swath of critical data in one fell swoop. Is every employee trained in how to spot potential cyber threats? If not, they could easily and unknowingly compromise your company’s security. How many offices does your business have? How many remote employees? How do they need to communicate, and how sensitive is the information they’ll be sharing? All of these questions – and many more – should be at the forefront of your conversations with your technology advisors.

2. Data analytics

Data is the bread and butter of any company. It tells you who your customers are, how your team is functioning, your profit margins, your inefficiencies, the list is practically endless. As your company pursues overall growth goals, there is perhaps no more impactful IT consideration than data analytics. A consumer population that just spent a year and a half reassessing and reprioritizing is already proving unpredictable, and the deeper level of understanding that data analytics can provide will be crucial to ensuring you are addressing what may be brand new pain points – and winning their business. A skilled technology advisor can help you pinpoint the data that will drive your business goals and deliver it to you in a way that helps you make more informed business decisions more quickly. For our clients, we create custom dashboards to relay data about both their company and their industry at large, giving them a multi-layered analytical view of their business that helps them make research-backed decisions that directly drive revenue, productivity, and growth.

3. Automation

Automation can have a huge impact on labor and cost by allowing staff to devote their time and focus to the most complex tasks. In some cases, it can even eliminate the need for additional roles. With a record-high number of businesses reporting trouble hiring right now, this is critical to streamlining operations and progressing toward business goals with fewer staff. The idea of automation is nothing new for executives; it’s likely been discussed among their leadership team for years. What many may not realize, however, is how much it has evolved – and how cost-effective it has become – since those discussions began. The automation tools that used to require expensive, custom development are now simple enough for employees to build them with fairly minimal guidance. It’s estimated that nearly half of all work tasks can be automated by current technology, so working with your advisors to identify opportunities to automate can have a huge impact on your company’s efficiency – and bottom line.

4. Strategic IT consulting

As a business owner, you shouldn’t have to try to keep up with the rapid pace of changes in technology – and with so many other responsibilities on your plate, chances are you couldn’t even if you did try. Your IT team should be more than providers, they should be strategic and holistic advisors in the same way your accounting, financial, and legal advisors are. That means not only keeping you informed about the changing tech landscape, but also helping you connect IT solutions to your overarching business goals by talking to about your company, not just your technology. Do you have plans to expand? What type of growth do you anticipate in your products or services? What are your business goals over the next 12 months? What is your current market share and who are your competitors? What do you wish you were doing better? These are the meaningful, goal-based conversations your IT advisors should be leading to make sure your technology isn’t just working in the background of your business but is actively and strategically driving it forward.

Your Tech is Your Advantage

When you treat technology as a standalone concern – or worse yet, an afterthought – you miss out on the opportunity to leverage it as a major competitive advantage. The technology your company relies on isn’t just about new tools or security or even remote environments; it’s about all of these things working in tandem to move your business forward – not just toward safe and seamless tech, but towards your larger goals for revenue and growth.

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About Anders CPAs + Advisors

For 55 years, Anders has delivered full-service accounting, tax, audit and advisory services to growth-oriented companies, organizations, and individuals. For 26 years, the Anders Technology team has helped businesses across all industries leverage technology to innovate, transform, and improve their bottom lines. Guided by an experienced team of advisors, Anders Technology is a Microsoft Gold Partner, the highest level in the Microsoft Partner Network. For more information on Anders, visit anderscpa.com and follow us on Twitter, Facebook, LinkedIn, and Instagram: @AndersCPA.

About Julia Deien, Microsoft Certified Professional

As a solutions architect and Microsoft Certified Professional, Julia helps organizations achieve their growth by matching technology solutions to business goals. This happens through collaborating with clients and analyzing their technology needs and business processes. Using her expertise in the Microsoft cloud platform and industry knowledge, she consults, designs, and implements technology strategies to help Anders clients not only understand their business’ technology, but maximize its full power.

About Jason Gotway, VSP5, VMTSP, VCP550

Jason is a solutions architect and team lead with over 10 years of experience in technology and cybersecurity. Using his knowledge of methods used by cybersecurity hackers, Jason educates companies and individuals on best practices for staying safe in all things cyber and implementing efforts to avoid cybercrime. He works with businesses to develop customized cybersecurity strategies to keep their company and employees safe and productive, whether they work in-office or remotely.