What do shippers want? Custom IT solutions

In the face of ever-increasing shipper demands, carriers and third-party logistics service providers (3PLs) find themselves jumping through hoops to devise special information technology (IT) solutions. For that reason, the results of a recent survey of chief information officers (CIOs) for logistics and transportation service companies are pretty much what you'd expect. That is, the top challenge facing CIOs is providing custom IT solutions for their clients.

That was one of the most interesting findings of a CIO survey conducted by the information technology giant HP and the British conference organizer eyefortransport (eft). One hundred eighty-seven respondents took part in the survey. Fifty-three percent of respondents came from the United States, 24 percent from Europe, and the remainder from other parts of the globe.

Given the push for individualized solutions, it also comes as no surprise that 67 percent of respondents plan to increase their IT spending this year. As for specific areas for investment, warehouse management systems topped the list, with 46 percent of respondents planning to purchase that type of application. Modifications to business applications came in second, followed by electronic data interchange and transportation management systems.

Although in most cases, the respondents looked to software vendors to supply their applications, the survey found several instances where the CIOs said they would rather build their own solution than buy or rent one. This was particularly true when it came to applications for route planning and business intelligence as well as for modifications to existing programs.

Big data continues to have appeal. Forty-two percent of respondents reported that they are using big data technologies, and another 19 percent plan to make investments in that area in the next 12 months. When it comes to setting up their big data programs, most CIOs plan to seek outside help. Fifty-seven percent of survey participants said they would use an outside firm to develop their big data strategy.

As for which big data technologies respondents plan to invest in, analytics topped the list, cited by 46 percent of CIOs in the survey. Most respondents said they would use analytics as a way to gain insights into capacity management and for product and market segmentation. Incidentally, when survey-takers were asked how they are currently using big data, the least popular response was analyzing data from social media to spot trends—which is, of course, the hottest area for big data analysis in corporations these days (think marketing for consumer products).

Despite the interest in big data, few provider CIOs are planning to spend big bucks on it in 2014. Seventy-three percent of respondents said they plan to spend less than a million dollars. Sixteen percent said they would spend between $1 million and $1.5 million, and 11 percent between $1.5 million and $2 million.

The study also found that companies using cloud-based solutions are more apt than their noncloud-using peers to have deployed sensor technology. Thirty-nine percent of cloud users were using some type of sensor compared with 25 percent of noncloud users. Companies using (or considering using) sensors— whether they used cloud-based solutions or not—were most likely to deploy sensor technology in the following areas: global positioning systems (GPS), radio-frequency identification (RFID), temperature monitoring, and humidity monitoring.

For their part, CIOs view technology as essential to the business. In fact, a third of respondents—33 percent—said that from their point of view, technology innovation held a higher priority than core business activities.