By Mike Eaton | Principal, Transportation | Chainalytics |
When is the last time you took a step back and evaluated your Transportation Planning process? I spent the majority of my career on the operating side of the table. Similar to most operators, I think I made reasonably sound decisions around the need to change approaches and processes as I was faced with the ongoing incremental change that frequently occurs in business. In my experience on the consulting side, this also proves true of many organizations.
However, there’s always the specter of cumulative incremental change lurking. Over time, we make many incremental changes that are likely the best reaction to immediate operational necessity. But when viewed cumulatively over a period of time, we often end up with processes, organizations, and technology that don’t necessarily make sense if viewed through a fresh set of eyes.
Many organizations would benefit from an independent review of their current Transportation Planning processes. An outside perspective that provides insights from past industry experience, other like and similar industry shippers, and objective consortium based insights into Transportation Planning practices can greatly assist in that process. I often encounter individuals within large organizations who have sound perspective and insight on what might be done differently to improve current processes. Those folks often have expertise on one or two narrow aspect of the overall process. However, as the famous quote says, “no prophet is accepted in his hometown….” The reality is organizations often benefit most from seeing and hearing these perspectives from somebody with “no skin in the game” and a perspective on the broader process.
So what do you do to determine if you need a fresh look at your processes and/or an outside set of eyes to help you in that evaluation? Ask yourself several questions:
- Am I confident my organization has a sensible strategy around carrier selection and awards?
- Do I have an objective sense of whether what I pay for transportation services is competitive in the marketplace?
- Is the organization provided with adequate lead time for typical load building and tendering functions?
- Does the team have processes and technology in place to assist with tactical planning, tendering, tracing, tracking, and exception management?
- Does my organizational structure support the strategic needs of the organization and the tactical needs of daily operations?
- Do we have a high back-end exception rate on freight bill payment and/or audit failures?
If you have doubts or concerns after asking yourself these questions, it may be time to step back and examine the process from beginning to end. It’s important you approach this with the knowledge that any deficiencies in your current functions are likely the result of multiple years of incremental change by many leadership teams. There is always a lot of “history.” The focus needs to be on what changes can and should be made and what benefit might be achieved through those changes. Change for its own sake is seldom a sensible path. A periodic and independent “well-being check” of your Transportation Planning processes will almost always yield achievable savings opportunities and provide you with the ability to know that your organization is aligned with industry best practices and supporting your business effectively.
Mike Eaton is a Principal, in the Transportation Competency, at Chainalytics where he focuses on transportation management improvement initiatives and the application of transportation technology.
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