1. Transportation
Management
Transportation Management

2. TRANSPORTATION REQUIREMENTS & STRATEGY
Transportation Strategy Alignment
CORPORATE / DIVISION MANAGEMENT SYSTEM
BUSINESS UNIT STRATEGIC PLAN
SUPPLY CHAIN DESIGN & PERFORMANCE SPECS
LOGISTICS (LINKAGE) OPERATING MODEL
TRANSPORTATION REQUIREMENTS & STRATEGY
Transportation Management

3. TRANSPORTATION PERFORMANCE EXPECTATIONS = OPERATING BUDGET
Integrated Management Framework
MISSION core purpose of the enterprise
VALUES timeless guiding principles
VISION word picture of ideal future business model
BUSINESS STRATEGY SBU game plan for success
KEY PERFORMANCE INDICATORS presentation of key / critical strategic business objectives
BALANCED SCORECARD business performance measures, goals, targets, and initiatives
CASCADING MEASURES performance measures common to all functions aligned to business objectives
GOALS DEPLOYMENT link balanced scorecard to business processes such as budgeting, reporting, compensation
TRANSPORTATION PERFORMANCE EXPECTATIONS = OPERATING BUDGET
Transportation Management

4. Strategic Business Unit Objectives & Goals (Supply Chain Examples)
Significantly improve on-time delivery performance
GOAL - design and implement carrier performance report card system in 2012; publish carrier targets by mode
Significantly reduce the cost of inbound freight per pound
GOAL - Consolidate LTL freight across enterprise and negotiate new carrier contracts reducing LTL freight cost / lb. by 5% in 2012
Significantly reduce total number of incidents
GOAL - Develop and implement core carrier driver training program in 2012 defining product safety targets and reporting requirements
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5. Continuous Improvement Cycle5
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6. 21st Century Supply Chain
UPSTREAM
extraction
NODE
conversion
VALUE ADDED TO PRODUCT OR SERVICE
manufacture
assembly
INFORMATION
distribution
PRODUCT FLOW
retail
LOGISTICS LINKAGES
consumption
DOWNSTREAM
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7. 21st Century Lean / JIT Supply Chain
Customer pulls product from producer
Triggers producer to replenish purchased items
Producer then pulls materials from supplier
Triggers supplier to replenish supply items
Continue pull process upstream in supply chain
Producer (Shipper)
Supplier
Customer
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8. Objectives of Logistics Function
Inventory Management
Customer Service
Order Fulfillment
Warehousing
Transportation
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9. Transportation Performance Variables
Performance Measure
Description
Cost
Total transportation cost including freight rates, buffer inventory warehousing, equipment leasing, assessorial charges, freight forwarder fees, broker’s fees, customs, etc.
Speed
Time requirements from when the shipment is released at the supplier’s facility to the time of receipt at buyer’s receiving dock
Reliability
Also know as fill rate; refers to ability to deliver on time; percentage of deliveries made within the specified time window
Capability
Ability of a carrier to move the material from supplier to buyer as required including special materials, hazardous materials, etc.
Accessibility
Capability of the carrier to pick up and deliver the shipment door-to-door
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10. Transportation Network Participants – shippers / carriers / 3PLs
Inbound Transportation
Outbound Transportation
PRODUCER inter / intra plant transportation
SUPPLIER
CUSTOMER
Reverse Logistics
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11. Logistics Process Management
Strategic business unit logistics management options
Internal Mgt employees providing leadership & expertise
Internal 3PL rd party logistics unit provide leadership & expertise
External 3PL rd party logistics unit providing leadership & expertise
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12. Carrier Selection Process
Aggregation
Freight Database Management
Report Cards Issued
Benchmark
Modal Rate Plan
Routing Guides
Optimization
MEASURE
PLAN
SETTLE DO
Freight Audit and Payment
Carrier Selection
Negotiation
Shipment Execution
Consolidation
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13. Benchmarking Process benchmarking provides …
company's comparative performance to that of other companies using both objective and subjective criteria
strategic positions of competitors for use as reference points in the formation of decisions and objectives
performance assessment for a specific activity relative to the methods of a competitor doing the same thing
comparative methodology for lowering costs, reducing defects, increasing quality, and / or improving outcomes linked to operational excellence
Transportation Management

14. Transportation Improvement Initiatives
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15. Transportation Mode Choices
Strengths
Limitations
Primary Role
Primary Product Characteristics
Example Products
Truck
Accessible
Fast & versatile
Customer service
Limited capacity
High cost
Move smaller shipments in local, regional, and national markets
High value
Finished goods
Low volume
Food; Clothing;
Electronics
Furniture
Rail
High capacity
Low cost
Accessibility
Inconsistent service
Damage rates
Move large shipments of domestic freight long distances
Low value
Raw materials
High volume
Coal/coke
Lumber/paper
Grain; Chemicals
Air
Speed
Freight protection
Flexibility
Low capacity
Move urgent shipments of domestic freight and smaller shipments of international freight
Time sensitive
Computers
Periodicals
Pharmaceuticals
B2C deliveries
Water
International
Slow
Move large domestic shipments via rivers, canals and large shipments of international freight
Bulk commodities
Containerized finished goods
Crude oil; Ores;
Minerals; Farm
Products; Clothing;
Electronics; Toys
Pipeline
In-transit storage
Efficiency
Limited network
Move large volumes of domestic freight long distances
Liquid commodities
Not time sensitive
Crude oil
Petroleum
Gasoline;
Natural gas
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16. Carrier Negotiating Approach - Ocean
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17. Enterprise Resource Planning (SAP)
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18. Transportation Management Software
SAP Transportation Management software helps companies to efficiently, quickly and accurately orchestrate the movement of goods. It creates an environment that simplifies, automates and interconnects transportation processes, improves order management, planning and consolidation and optimizing inbound and outbound shipments while taking into account real-world constraints and costs and penalties.
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19. SAP Transportation Management19 19

20. Transportation Management Dashboard20 20

21. Logistics Management Salaries
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22. Emerging Transportation Model
________________
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23. SCMN 4780 Transportation Strategy Test 3
Multiple Choice
True / False
Matching
Short-Answer
GJP will distribute schedule for final team deliverable submission
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