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Transportation Challenges and Best Practices: The Supply Chain Design Perspective Panel

By Rebecca Koke  June 17, 2015

The transportation and logistics marketplace often talk about volatility in the industry, but today they seem to be facing more challenges than ever. From the driver shortage, increasing compliance complexities, volatile fuel costs and constantly-evolving consumer demand, the tension between cost-cutting and maximizing profit is at a fever-pitch.

To tackle many of these unprecedented challenges, many supply chain professionals are turning to their peers to discuss these challenges and share ideas and best practices to overcome. From June 24-26 LLamasoft will host its fifth annual SummerCon supply chain design conference in Park City, Utah. The conference is designed specifically for supply chain modelers and executives to discuss the practice of design, the most prevalent challenges facing the industry, best practices and innovations on the horizon.

In addition to many customer case studies, this year’s conference will also feature a panel titled “A Supply Chain Design Perspective on Today’s Transportation Logistics Challenges.” The panel, to be held Wednesday, June 25 from 1-1:45 p.m., will feature LLamasoft customers Ryder and Wayfair, as well as supply chain expert and analyst Adrian Gonzalez and myself. At this interactive panel we will address some of the most pressing questions facing the industry today including, how are these transportation and logistics headlines affecting large global businesses? How can carriers and shippers join forces to work toward mutual goals? And just how close are we to seeing driverless trucks? One strategy the panel will discuss, that smart companies like Ryder and Wayfair have in practice today, is the use of transportation and network optimization technology to drive continuous improvements.

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Using Transportation and Network Optimization for Continuous Improvement

With the mounting challenges in the industry, it can be difficult for supply chain and logistics professionals to even know where to start to make the right improvements within their transportation network. Many of the world’s leading companies are finding results by implementing a transportation and network optimization strategy.

Building a Baseline Model

Before organizations can select what strategy will have the most impact on their business, it’s important to first establish a baseline model to assess the current-state. By utilizing detailed data, often down to the SKU level, of the actual transportation network teams can build a living model of their network, easily updated and consulted for the most up-to-date and accurate view.

Consider alternate modes of transportation or the use of private fleets

Despite the logistical challenges a vendor is facing, consumers still need their goods. In order to meet service levels, organizations can expand the modes from truckers to air, ocean or rail.

Additionally, companies may also consider right-sizing your inventory in order to meet desired service levels at the lowest possible cost. This can not only address the capacity challenges, but also result in significant cost savings. Private fleets can also serve as a cost effective alternative.

Use modeling technology to run what-if scenarios to test various strategies before implementation

Through the confines of your baseline model, you can test the effects of some of the strategies discussed by running “what-if” scenarios. This allows modelers the freedom to assess the impacts of various strategies prior to implementation in a risk-free environment separate from real-world practices. This empowers modelers by allowing them to accurately analyze potential network configurations and provide predictions of performance, making it easy to gain buy-in for a new strategy.

Adopt transportation modeling as an ongoing business process

While using transportation network modeling on a project basis is helpful and a great way to get started, the most long-term and impactful benefits arise out of adopting transportation optimization as an ongoing business process. These provides organizations a long-term view of their transportation network and the ability to track historical trends. Businesses can also access the living models to mitigate risks and engage in long-term planning.

Many of the world’s leading companies, including our SummerCon panelists, have many of these strategies in place today. Don’t miss this great session to hear about these strategies in action, best practices and more.

To learn more about SummerCon, visit www.summercon.net and follow the conference on Twitter with #SCon15.