This article was written in regards to the UK and from a supply chain/logistics perspective, but the ideas and statements can be applied to any area or industry.
As the economy continues to recover, companies that survive long-term will be those that are looking for a competitive edge in every situation. This is where the role of a business analyst comes to the fore.
As a new breed of transformers that turn data into knowledge, analysts not only keep up with the current generation of business systems to generate timely, accurate and useful information, but also provide ideas and evidence of how systems need to evolve.
The logistics industry is characterized by high volumes, tight margins, low back-order levels and low switching costs, because contracts tend to be short-term. Competitiveness is at an all-time high and if your business can’t provide the capacity to deliver customers’ goods to the right location at the right time and for the right price, another freight forwarder will step in and take the lead.
It’s survival of the fittest, and this is where the Business Analyst comes in: to identify and interpret relevant data, both within the business and from external sources; present data to users in a format that can be quickly understood and acted upon; propose courses of action based upon these findings and implement performance indicators to ensure objectives are achieved; and assess the information requirements of managers and users, and make sure they are fulfilled.
In doing this the analyst helps ensure your capacity to move goods (in terms of routes and availability dates) is planned to meet customer demand, operating costs are monitored and controlled, and planned objectives are being achieved.
Besides the usual financial reporting against budgets and forecasts, analysts should also work closely with all business functions, to allow objective decision-making in areas such as identifying loss-making or highly profitable customers or routes, calculating the effectiveness of sales promotions, weighing up the allocation of resources and process mapping to identify cost- and time-saving initiatives.
The range of data that can be analyzed is vast – financial (sales, costs, profits, margins, overheads, currency fluctuations), personnel (productivity levels, overtime volumes, staff turnover), statistical (from the Office for National Statistics for benchmarking and forecasting), external forecasts or announced changes (fuel price movements, changes in the minimum wage, NI rates), and, last but not least, qualitative data from internal sources (customer feedback, late deliveries and returns statistics, sales credit patterns).
Any freight forwarding business wanting to survive in this information-rich, customer-empowered age should be looking to employ or develop an existing employee into an analyst role. Outsourcing this position isn’t recommended – the analyst needs to be close to the processes, people and data on a daily basis to create a deeper understanding of the business, its opportunities and the threats facing it.
Over the years, the internet has made it quicker and easier for customers to find alternative freight forwarders and compare prices. Sophisticated tools and frequently updated data for currency analysis and hedging are readily available to both businesses and customers, often for little or no extra cost. Freight forwarders must now benchmark themselves against other operators and monitor currency fluctuations, in particular, more frequently than ever.
The increases in the power and sophistication of tools available to the analyst mean companies now have large databases at their disposal that can be analyzed for both quantitative and qualitative information. Continuous review must be undertaken; however, to ensure data, as well as hardware and software, stays up to date.
As customers are demanding more direct relationships with IT systems, to speed up and simplify the ordering process and drive down the cost per transaction, the importance of data analysis is only going to rise. While a substantial investment in the right systems must be made, this investment means nothing without the right eyes behind it. These eyes, if part of your decision-making team, can prove an invaluable asset to the modern day freight forwarder.