Venture Solutions worked with this customer to provide significant cost savings, while keeping and enhancing their collaborative operating approach.
A recent conversion from independently run manufacturing plants to a collaborative operating approach, while creating increased efficiency, caused a steep cost increase. Venture Global Solutions worked with this customer to provide significant cost savings, while keeping and enhancing their collaborative operating approach. This was achieved by optimizing their transportation routes, providing overall supply chain visibility, and incorporating robust business intelligence tools specifically configured to provide financial and operational transparency across their entire network.
The large size of this manufacturer with multiple U.S based manufacturing plants, while beneficial in many ways, can also lead to breakdowns in communication, process checks and balances and ultimately, execution issues. Their initial transition from autonomously run plants to a centralized strategic and tactical planning and operating process, had many advantages.
More efficient procurement is possible when transportation synergy is leveraged to get the highest quality service at the best rates.
Many plants had suppliers in common. Taking this into account allowed for better routing plans that improved the performance of the supply chain overall.
However, these enhancements came at a steep cost.
Without the experience, established processes, and tools necessary to run a centralized operating model, there was a lot of trial and error and costs began to rise exponentially.
The company ultimately realized that it was time to bring in an experienced partner that could provide expertise in successfully running a shared network, powerful business intelligence tools that could assist in providing metrics/reporting, in addition to operational and financial transparency, and providing the resources necessary to ensure centralized visibility of their material flow.
Within a 45-day window, we completely revamped this customer’s operation to realize substantial savings and operational efficiency. Here is how we did it:
- Information Validation o Each plant was visited by a team of engineers to collect and validate PFEP data. Early on, it was discovered that accuracy was at 25%. After confirming, measuring, validating and updating the PFEP data, VGS was able to bring the collective accuracy up to 90%
- The number of containers circulating in their system was also inaccurate. We verified and updated their system to reflect the accurate amount.
- Our team also verified and updated all supplier locations and contact information
- Create and Review the VFES (Venture Shipping Plan For Every Supplier) with each plant. o Upon implementation and weekly afterward, we review the VFES with the customer, which is an electronic reference document that outlines the weekly ship plan in detail. It contains links to any plant agenda meetings and reviews any upcoming route changes.
- Four new cross-docks implemented
- Previously operating with three cross-docks, we increased to four and switched providers.
- Set-up in the most ideal locations included configuration of a powerful new WMS that supported scanning inbound/outbound at each location, seamlessly integrating with the customer’s ASNs.
- Great care was taken to ensure that all current suppliers were thoroughly educated on the new operating plan.
- New carrier base implemented o Savings were compounded by combining new carrier procurement with a Venture Command and Control (VCC) team.
- The VCC team managed active inbound routes ensuring that route milestones were met and exceptions were escalated. This team is supported by additional resources and provides coverage 24/7.
- New route implementation/Route Optimization
- The network optimization established the “blueprint” for routing, modes and frequencies for each supplier to plant lane combination.
- We designed new routes that minimized cost and miles while increasing cube/weight utilization of each trailer.
- Balancing the dock schedule improved efficiency and increased utilization between the trailers, resources and the yard. This allowed the correct modes and frequencies to be established, and optimized across the board.
- New TMS
- We converted from the previously used manual process for scheduling loads, tendering, planning and mode optimization of the inbound supplier moves to utilizing a TMS.
- The TMS supports tactical route planning week to week. The inputs to the system include up to date PFEP data in combination with demand (830/862/856) and carrier EDI interfaces.
- In conjunction with the TMS, our engineering team coordinates supplier & carrier signoffs based on the routing plan and dock schedule.
Vastly Improved Financial Performance
Upon implementing all facets of our solution, we reduced the customer’s logistics spend by 13%.
After operating the new solution for two months, VGS was able to identify additional inefficiencies. Through our process of checks and balances, we discovered opportunities for further optimization. By executing those adjustments, we saved the customer nearly double the expected savings.
TMS related enhancements
Switching to a robust TMS created the framework that allowed for drastic operational improvements. Newly acquired upgrades that contributed to those improvements include:
- Cost allocation
- Freight Bill Audit and Payment
- Plant specific accrual
- Plant specific cost and savings projection
- Highly detailed freight, financial, and operational reporting
Visibility of the entire network
The combination of the TMS implementation and the VGS support team provided created complete network transparency. Not only does the customer have end to end visibility, but they can see the financial implications of every move made by each location.