Transportation Operational Planning: A ladder to Success

The competition is stiff and the Golden-Rule - "Survival of the Fittest" - is still holding good.

Mumbai, India (prHWY.com) August 28, 2012 - With the customers becoming more and more - demanding for better service, speed savvy and price sensitive, there is no better time to evaluate your transportation and logistics operation and identify ways to turn it into a market advantage.

Stage 1-- Zero Planning

Stage 1 organizations have basic shipping needs that they handle ad-hoc, and coordinate between a warehouse manager or directly with a third-party provider.Customer service is a weak link for them as the company cannot guarantee delivery schedules, and shipping errors become the norm. These costs are driven mainly by the labor-intensive operations.

Stage 2--Reacting at 11th Hour

Stage 2 organizations have a One-Up to the previous stage. These companies are in a state where transportation planning continues to rely upon intuition, with predictable and almost constant business environments. Transportation management remains primarily paper-based, with manual procedures to coordinate and track shipments. These organizations face an extremely challenging task as they have to deal with large volumes. They are not able to coherently map all the information available to make optimized transportation decisions. They cannot effectively manage operational problems such as long lead times, damaged goods, and delayed deliveries.

Stage 3--Tactical Rule-Based Planning

This is the stage where most of the companies are stuck. Here transportation is planned at a tactical stage. Using entry-stage information systems, these companies are able to define generalized business rules that allow them to pre-plan transportation and distribution activities. These rules are formalized inside a transportation management system that enables the company to perform repeated tasks in a fairly automated, disciplined, and predictable manner.A key concern for companies at this stage is that the transportation network changes too frequently to adapt. Therefore, the system is not able to respond quickly to deliver optimized shipping schedules, routes, and costs.

Stage4--Continuous Optimization Planning- Leaders

Stage 4 companies which are"early adopters" of technology systems whose processes have evolved through the previous stages. Their transportation management systems are dynamic and finely tuned to perform analysis on all shipments in real time, delivering fully optimized transportation operations. This set recognizes that transportation is a critical element to the success of their business. Their goal is to actually use their logistics departments to gain significant competitive advantages within their markets. They can quickly adapt to changing consumer demands, ensure shipments are optimally consolidated, automatically coordinate shipping schedules, maximize delivery speeds, and minimize transportation costs.


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