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8 Advantage of Automated Route Planning and Optimisation

Automation applied to an inefficient operation will magnify the inefficiency”
Bill Gates

The above mentioned quote holds true for every business and industry. Digitisation and automation increases the efficiency of any business by 5X. As per a report by Forrester 77% of enterprises rely on paper work and around 63% rely on excel type programs, thus struggling to meet customer expectations around speed and streamlined experiences. On the other hand, digital-first business has grown deposits to $92 billion and $7 billion in lending balances. Logistics and supply chain industry has grown exponentially by leveraging automation and data processing. 

What is Route Planning and Optimisation? 

Finding a shortest route from pickup to destination is often considered as route planning and optimisation. But this is completely a misconception. Route optimisation is more complex than it looks. There is a considerable difference between route planning and optimisation. Route planning is synonymous with“route mapping” and “route sequencing”. Route planning  does not account for detailed routes & events that can impact a driver’s productivity and overall delivery process. On the other hand, route optimisation takes route planning solutions to the next level. Route optimisation takes into account parameters such as vehicle weight limit, drive time, shift patterns. Route optimisation streamline the everyday workflow and replace hours of work & eliminate the need to stare at maps for hours. 

Thus, route planning and optimisation is the process of determining the most cost & time efficient route. Here are the components to consider; 

  • Number of turns/intersections along the route
  • Turns on left side 
  • Nearest driver for dispatch 
  • Traffic congestion at a scheduled time 
  • Stops between the start and end point 

What is route optimisation software? 

A route optimisation software helps logistics & supply chain businesses to plan customers’ orders considering available resources, road network & operational constraints  to help businesses with an optimised route that reduces fleet cost and increases efficiency by automating the process of route planning & optimisation. The route optimisation strategies differ from software to software but the most common strategies include the following; 

  • Static – Under static strategy routes are planned quarterly or monthly. 
  • Dynamic – Dynamic strategy means new routes are developed daily. 
  • Real-time Dynamic – Real-time route planning during delivery day based on internal & external factors

Route optimisation software plans the sequence of stops a delivery driver follows to improve the driver’s efficiency and customer service. The software makes these efficient routes for an entire fleet based on the business’s constraints and goals, assisting dispatchers by automating the work of manual planning.

How can route optimisation software help?

Before the advent of transport management software dispatchers & logistics/supply chain personnel made use of pen, paper, whiteboards, maps, spreadsheets to plan routes. Though these handiwork worked but made the process of route planning & optimisation complicated and laborious. By automating these manual operations, dispatchers not only streamlined the workflow but also saved upto 8.2% of fuel. It is assumed that real-time monitoring of traffic congestion can help save time and increase on-time deliveries that further enhances customer experience. 

What are the advantages of route optimisation software?

After adoption of high-tech route planning software, logistics and supply chain companies can visibly see the improvement in their business growth. Some of the challenges that route optimisation system solve are given below; 

  • Reduce fleet & fuel cost
  • Improve customer service and fleet utilisation 
  • Optimal routes planning & reduce cut-off time for order taking 
  • Increase on-time deliveries & productivity 

Here are some of the benefits of choosing automated route planning software over manual planning; 

1. Lower Operational Cost 

One of the major expenditures of logistics businesses is spent on freight cost.  Undoubtedly, technical algorithms work better than human hypotheses. By optimising routes and proper route planning in place enhances the last mile delivery process and increases the delivery rate. How the right automation software cuts down the operational cost by 30-40%; 

  • Improved fleet maintenance – Efficient route optimisation means less miles on the road that decreases the fleet maintenance expenditure and increases the vehicle’s life cycle. 
  • Fleet Utilisation – With a proper & efficient route planning, it is possible that companies can achieve the same target in less vehicles. This further reduces the operational cost. 
  • Less Labour – Fewer vehicles reduces the labour cost & decreases the drivers’ wages. 

2. Route Monitoring

Having access to real-time fleet location helps logistics businesses to improve their customer experience and keep them informed about their shipment. This can also help to track drivers’ performance and to keep track of drivers’ speed limits & real-time activities. Surprisingly, some GPS tracking systems also access the live psychological behaviour of a driver and suggest improvements to enhance the drivers’ activity. This will also let logistics managers to have drivers’ appreciation programs as drivers are the main heroes of the logistics and supply chain market. 

3. Saves Time

To have a smooth flow of shipments number-one priority is to have a proper optimised route ready that follows customers and business constraints but planning and scheduling of these routes takes hours of human effort which decreases the efficiency of workflow. With the adoption of automated systems companies can save a lot of time and do scheduling & planning in a few minutes. 

4. Enhanced Customer Experience

Every business & industry operates to delight its target customers. In industries like logistics it’s not only essential but also challenging to improve customer success rate as a minor dissatisfaction in any of a business process will shift customer’s attention to others. By taking route planning and optimisation to automation companies can focus on strategising new ways to engage & retain customers. Dispatchers can also share real-time updates to customers & also forecast arrival & departure times based on the information available. 

5. Reducing Human Error 

Automated route planning & optimisation system not only saves time but also reduces the chances of human error. By taking your daily operations to digitisation businesses eliminate the chance of human error by 80%. Infact, 45% of workplace operations performed by humans can be automated using existing technologies. 

6. Increased productivity

With the right route planning and optimisation software logistics businesses not only streamline their workflow of employees but also increases drivers’ productivity by giving them access to handy and efficient routes and increases the chances of delivering more by decreasing the dead time spent on the road. 

7. Handling Uncertain Situations 

The manual route planning does not consider real-time disruption on the day of delivery or any other disturbance en-route. With automated system dispatchers can monitor real-time issues and can take prompt decisions to reroute to avoid delays. 

8. Effortless Fleet Management

Fleet management walks hand-in-hand with smart route planning. Keeping track of fleets that are on the road, returned from deliveries or parked in a facility is necessary to manage your orders. With the right automation software, logistics companies can easily manage fleets or track their whereabouts.

Fleet management solutions that offer fleet operators unlimited access to information about their vehicles and drivers, with a host of features, tools and reports to help maximise return on investment.

Conclusion 

The investment in an automated route planning and optimisation software can help boost logistics operations and also increases the productivity level. But it is also important to analyse which technology to invest in. From artificial intelligence to cloud computing every technology is contributing to logistics at its own level. Technology is empowering logistics and supply chain professionals with abundance of data that highlight operational gaps that further helps in
re- strategising the workflow. 

rupinder

Rupinder Kaur works as SEO Lead with Fretron and passionate writer. She is currently all in works writing about cloud computing, blockchain, AI, cloud accounting, software, cybersecurity, technology and trends in accounting and tax.

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