Business Intelligence: a key to climate-friendly cost savings?

Hit 3 birds with one stone*: cut greenhouse gas emissions, reduce operating costs and increase market share by using data smartly. How? Let's define a few concepts first.

(*No actual birds were harmed in this metaphor.)

What is business intelligence?

Business intelligence (BI) is the analytical process that improves business operations by selecting relevant data and by manipulating it using BI features. Some of these features are listed by SelectHub: dashboards, visualizations, reporting, predictive analytics, data mining, ERL, OLAP and drill-down functionalities.

These analytical processes can be descriptive and tell you what happened, diagnostic which explain why something happened, predictive which are powered by machine learning algorithms to suggest what will happen or prescriptive which recommend what to do.

Using these processes, companies can effectively gather, store, and analyze complex information, providing them with a clear picture of possible hidden patterns, customer behaviour and overall business operations.

What is the most carbon-intensive mode of transport?

The logistics sector is one of the most significant contributors to CO2 emissions globally, of which road transport is the most polluting of all modes and is expected to jump to a little over 31% by 2030, IEA report shows.

The obvious choice is for electric power to replace fossil fuels in this sector, but it is currently difficult to implement in every country due to high energy infrastructure costs for redesigning parking lots and depots, and insufficient investments in clean energy sources such as solar and wind.

Aside from that, the energy crisis might put pressure on businesses to adhere to a new EU legislation in order to increase transparency regarding sustainability.

This new legislation is called the Corporate Sustainability Reporting Directive (CSRD) and it includes all large and listed companies in EU-regulated markets (with the exception of micro-enterprises) and covers the following information that these companies will need to provide in their management report:

  • Business strategies that are compatible with limiting global warming to 1.5 °C in line with the Paris Agreement.
  • Double materiality concept: Sustainability risk affecting the company + Companies’ impact on society and environment.
  • Company’s sustainability policy including due diligence.
  • Adverse impacts connected with the value chain (scope 1, 2 and 3 emissions).
  • Description of principal risks related to sustainability matters.
  • Reporting in line with Sustainable Finance Disclosure Regulation (SFDR) and the EU Taxonomy Regulation.

What are emission scopes and how do they help?

According to The Greenhouse Gas Protocol, companies need to set three emission scopes.

  • Scope 1 relates to a company's direct greenhouse gas emissions, such as the use of fuel in vehicles and logistical bases, as well as coolant leakage at warehouses.
  • Scope 2 refers to indirect emissions from the use of electricity, heat, or steam supplied by others.
  • Scope 3 refers to other indirect emissions besides scope 2, such as waste generated in operations, business travel or employee commuting. We’ll explain further how businesses can keep their emissions in check.

How can logistics professionals reduce CO2 emissions?

If total replacement of fossil fuels is not a realistic option for now, at least logistics professionals can try their best and keep CO2 emissions at the lowest possible level.

To measure its scope emissions, every company has to integrate a solution that gathers relevant data, determines where the footprint comes from and guides them towards the actions needed to reduce its emissions.

For this reason, BI solutions are essential digital assets because they can assist in visualising otherwise hard-to-digest data, and turn it into easy-to-interpret insights, cutting through the clutter and helping with recognizing the environmental impact.

Big data can sound scary and overwhelming, but business intelligence solutions can turn anxiety into satisfaction, as they can be applied to monitor all the emission scopes so your company is in full control over the entire supply chain.

The metric of carbon footprinting should preferably be integrated into one platform that also includes financial and energy consumption information to avoid inconsistencies and gain more accurate insights.

Now that we understand how emissions are quantified and what is expected of companies, here’s how Qubiz can help you be energy efficient as you save costs.

How can we optimise your operations?

Qubiz built a similar solution for a transportation company which in turn allowed them to focus on their custom-made transport expertise.

The solution collects data from the company’s various systems (ERP, truck board, etc) and generates reports with actionable business insights. It also has a feature for fuel consumption optimisation that has been developed taking into account the various variables related to routes used for transportation. Using those variables, it can surface the most cost-effective/profitable routes for drivers to take while also keeping an eye on the greenhouse gas emissions.

Another feature of this solution is post-calculation. Having so much information available (e.g. fuel costs in different regions, highway tolls, refuelling points projected) it can surface real-time actionable insights (profitable routes, costly driver behaviour etc.)

Furthermore, due to all this available data, it is now much easier to present upfront realistic quotations regarding transport opportunities.

Being a long-term partner, we are constantly experimenting with new ways to improve the company's business through this solution. Currently exploring machine learning capabilities in various areas for simplified workflows like the document management solution we developed for another client. It uses a high-accuracy and self-learning algorithm to detect and classify freight documents (e.g. CMRs and Weight Tickets), facilitating the invoicing process while also being easy to integrate into your system.

Conclusions

We can’t suddenly turn all cargo trucks electric but we can control the CO2 emissions until a proper energy access plan will enable a full electric transition.

Nevertheless, this is a win-win situation and not just a short-term investment, as environmentally responsible practices build stakeholder trust and loyalty while driving down costs.

Animated windmills with a button to take you to the services page

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