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How UPS uses analytics to drive down costs (and no, it doesn't call it big data)

John Dix | Dec. 2, 2014
Network World Editor in Chief John Dix caught up with UPS Senior Director of Process Management Jack Levis for an update on their latest achievements.

Often when people talk about data, they say they want to go from data to information to knowledge. We did that when we did the predictive models. We're making tomorrow's decision from the prediction, so that was knowledge. After knowledge is wisdom, and that's where we are with ORION, because a newer driver with his new order of delivery and a navigation system will be wise just like the driver who's been on the route a long time.

But after wisdom is really the Holy Grail, and that's clairvoyance. Imagine a data architecture and an analytics system of the future that predicts a problem is going to exist and solves it before you even know something is wrong. We'll look like Sherlock Holmes. And that's where I think we'll be one day. It will be a transaction-by-transaction optimization. What do I do with this particular transaction, at this particular time, with a brain like ORION pulling the strings? That's where we'll get to.

Let me end with a stupid question. "MythBusters" once did a piece exploring the myth that a delivery truck that only made right-hand turns would be more efficient. Have you found that to be true?

Let me tell you what is true. A left-hand turn is more expensive in multiple ways. Your vehicle is idling longer, it takes longer to make that left turn and it's less safe. So we try to avoid left-hand turns. The "MythBusters" episode showed in San Francisco that only making right-hand turns was quicker for a truck than turning right and left. So our routes are set up in such a manner that we need fewer left-hand turns. That's our method.

And by the way, that came from Parade magazine. They wanted to know what an average everyday person can do to reduce their fuel footprint and that was one of a number of things we supplied. As we told Parade, it's important to use the right vehicle for the job (e.g. don't take a minivan if you can get by with your compact car), consolidate trips (e.g. don't go out twice if you only need to go out once, or park once and walk between the stores instead of driving between stores), and try not to make left-hand turns. And everybody picks up on the left-hand turns. That's how it came about.

It's the No.1 question I get every time I speak.


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