2014 ANNUAL CONFERENCE & EXHIBITION Planning Your Next IT & Finance Move June 16-18 Lincolnshire...
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2014 ANNUAL CONFERENCE & EXHIBITION Planning Your Next IT & Finance Move June 16-18 Lincolnshire Marriott Resort Lincolnshire, IL New Transportation Paradigm
2014 ANNUAL CONFERENCE & EXHIBITION Planning Your Next IT
& Finance Move June 16-18 Lincolnshire Marriott Resort
Lincolnshire, IL New Transportation Paradigm Demands Carriers Adopt
Supply Chain Mentality
Slide 2
ATA Antitrust Statement All ATA meetings are held in strict
compliance with applicable state and federal laws and ATAs
antitrust policies that prohibit the exchange of information among
competitors regarding matters pertaining to price, refusals to
deal, markets division, tying relationships and other topics which
might infringe upon antitrust regulations. No such exchange or
discussion will be tolerated during this meeting. As an attendee it
is your duty to avoid improper conversations.
Slide 3
Thanks To Our Sponsors! Gold Sponsor Welcome Reception
Sponsor
Slide 4
Thanks To Our Sponsors! Silver Sponsors Walk Around Luncheon
Sponsor Banquet Pre-Dinner Reception Sponsor General Luncheon
Sponsor
Speakers Ben Cubitt, Transplace, Inc. Erika Matias-Goodman, US
Gypsum Corp. Andy Miller, TMW Systems Moderator Carl Kirk, American
Trucking Associations
Slide 7
Ben Cubitt Transplace
Slide 8
8 Transplace 2014. All Contents confidential. Transplace has
successfully built a critical mass of supply and demand in the
North American transportation marketplace across all modes and
regions. Domestic & global scope North American customer base
Global shipment flows Critical mass of demand 15 Million orders 48
Million transactions annually 4 Million shipments annually $5+
Billion managed spend Critical mass of supply Thousands of carriers
under contract Multimodal network Business process excellence and
Lean Six Sigma execution Inbound and Outbound shipment execution
excellence Focus on granular information on shipper side Focus on
carrier communications excellence on the capacity side Transplace
Size and Scale
Slide 9
9 Transplace 2014. All Contents confidential. Technology and
Service Offerings LOGISTICS CONSULTING SERVICES Benchmarking
Transportation Procurement Network Analysis & Design
Professional Services Consulting Joint Lean Six Sigma Projects $1.5
BILLION TOTAL SPEND MANAGED LEAD LOGISTICS PROVIDER (LLP) Full
Transportation Outsourcing Transportation Provider Contracting
Shipment Control Centers Inbound Freight Management Freight Bill
Audit & Payment Co-Loading Innovation $3.0 BILLION TOTAL SPEND
MANAGED CAPACITY PROVIDER Single Source Core, Committed and Primary
Brokerage Spot Dedicated Fleet $550 MILLION TOTAL SPEND MANAGED
TECHNOLOGY On-Demand TMS Optimization Highly Configurable BI,
Reporting and Analytics Rapid Implementation & Integration
Documentation Creation & Management $320 MILLION TOTAL SPEND
MANAGED TECHNOLOGY SOLUTION MANAGEMENT SOLUTION Basic Comprehensive
Basic Comprehensive
Slide 10
Performance Scorecards State of the Industry Freight metrics
and KPIs are now on the C-Team (especially the CFO) agenda. Erratic
fuel costs (and FSC impact on EPS), weather events (Hurricane
Katrina to Polar Vortex 2014), and emergence of Supply Chain
profession. Shippers use TMS systems and 3PL relationships to
generate BI reports. Rarely shared with carrier partners. Shippers
increasingly generating monthly Performance Scorecards shared with
Core Carriers Many carriers generate shipper scorecards, generally
not shared with shippers Shippers respond to data and fact based
selling. TL carriers do not share industry trend / cost data as
well as Rail / IM / LTL carriers. Information sharing and a more
comprehensive network score card could help shippers and carriers
drive network efficiency.
Slide 11
Internal KPI Benchmarking KPIs begin at a site or carrier
level, then shippers want to benchmark performance across the
network by site, by carrier classification, etc.
Slide 12
External KPI Benchmarking 3PLs can also provide collaborative
benchmarks across customers, by industry vertical, etc..
Slide 13
Carrier Merit or Award Programs Carrier Performance against
established and communicated criteria are key inputs to carrier
recognition programs Carrier of the Year, Platinum carrier,
etc.
Slide 14
Erika Matias-Goodman US Gypsum Corp.
Slide 15
USG PROFILE Focused on Building Products and Specialty
Distribution Leading brands, product innovation Excellent customer
base Strong manufacturing and distribution network Expanding into
global markets
Slide 16
LEADING INDUSTRY POSITIONS Source: USG estimates and SEC
filings #1 Market Share of Gypsum Wallboard in N.A. USG 28% USG 32%
#2 Market Share of U.S. Ceilings Systems USG 11% #1 Market Share of
Gypsum Wallboard Distribution in U.S.
Slide 17
17 Transportation Operations - Strategy USG Plan to Win -
Strengthen the Core - Diversify Earnings - Differentiate through
Innovation Key MeasuresKey ObjectivesKey Strategies Strengthen the
Core: Lowest cost procurement strengthens the core. Freight Cost
vs. Budget Freight Cost vs. Last Year Achieve lowest competitive
cost that meets USG service, safety, and capacity needs. Annual
full TL RFP. Manage Fuel Surcharge. Manage Accessorial Charges.
Manage payload utilization. Strengthen the Core: Provide industry
leading delivery service and solutions. On-Time Delivery Customer
Satisfaction Provide industry leading On Time Delivery experience.
Exceed Customers service requirements. Measure Carrier performance
via fact based score carding. Partner with high service, growing
carriers. Differentiate through Innovation: Capacity during tight
supply can be a competitive advantage. Tender Acceptance % %
Uncovered Shipments Maintain available capacity throughout the
business cycle. Be recognized as a Preferred Shipper by key
Carriers. Leverage USG spend to achieve Tier 1 Customer Status.
Proactively develop multisource strategies and support Carrier
networks. Develop Driver Friendly culture.
Slide 18
USG Carrier Performance Ranking USG scorecard ranks and
classifies carrier performance Gold, Silver, Bronze. Data driven,
Performance KPIs, color coding for easy visual management.
Slide 19
19 USG Carrier Scorecard USG provides carriers data on their
volume and performance.
Slide 20
20 USG Carrier Scorecard USG scorecard focuses on all areas of
performance service, claims.
Slide 21
21 USG Carrier Scorecard USG scorecard ties back to performance
levels Gold, Silver, Bronze.
Slide 22
USG Carrier of the Year Criteria Carrier maintained 4
consecutive quarters of consistent certification on USGs top 30
Scorecard. (Mandatory) Carrier hauled at least 2500 loads for USG
during the year. Carrier provided service from multiple USG
shipping locations. (Mandatory) Carrier meets annual On-Time
Delivery goal for current year (96% 2014). (Mandatory) Carrier is
EPA SmartWay certified. (Mandatory) Carrier settled 100% of their
claims within 45 days during the year. (Mandatory) 80% of Flatbed
trailers used to service USG are 102 wide and able to haul 49,000
pounds. Carrier invests in technology to allow real-time
information, e.g. EDI Capable (ability to send unfiltered data)
Electronic On-Board Recorders (EOBR) Geo Fencing
Slide 23
Performance Reports TMS Carrier Portal USG carriers have the
ability to log into Transplace TMS portal They can do this as often
as desired (monthly, weekly, daily) Three reports are available to
help carriers monitor and optimize their performance Status Updates
Compliance Shows how many of the required check calls have been
entered and how timely they were submitted Tender Acceptance Shows
the date/time a shipment is tendered, the response date/time by the
carrier to accept or reject the tender, and the time difference
between the two Accept/Reject Detail Shows the following details of
any loads that werent accepted by the carrier: Origin/Destination,
Pickup Date, and Transplace transaction number
Slide 24
Carrier Shipper Scorecards Carriers have shipper scorecards but
these are generally for internal use only and not shared with the
shipper.
Slide 25
Preferred Shipper Program Carriers survey responses and
discussions consistently ranked economics and driver productivity
as the keys to preferred shipper status
Slide 26
Are Network Scorecards in our future? Network efficiency and
driver productivity (pay) is becoming the driving concern and focus
for carriers. Carriers will reward efficient shippers with
capacity. Keep the trucks and drivers moving. 24/7 freight is very
desirable No touch, efficient freight Keeping drivers becoming more
important than finding loads. Treat drivers with respect and as a
valuable network asset. Understand what impacts driver pay (miles
per week). Plan tender times, pick-up and delivery times to
maximize miles per day. Get drivers loaded and unloaded in target
times. Carriers want partners at every level Pre-bid discussion and
non-bid strategic lanes Want more flexibility pick-up / delivery
windows, equipment, etc Less rigid tender times, increase late day
/ weekend acceptance
Slide 27
Where is the market headed Will the economy shift into a higher
gear with negative impacts on capacity? Will the leverage shift
from shippers to carriers? How fast? How strong? Will shippers
respond to carrier requests for changes in accessorials or
modifications to drive network efficiency? Will changes be
collaborative or carrier mandates? Can carriers negotiate changes
with shippers - Some? Most? All? Will carriers have to pursue
indirect actions (swap up shippers / lanes) Will industry driver
shortage crisis force more collaborative network optimization?
Slide 28
Andy Miller TMW Systems
Slide 29
TMW Systems is best- known for transportation operations
software Automates the workflow of the entire transportation
process from order to cash Drives business execution, efficiency
and profitability Facilitates visibility and transparency across
all organizational departments Management Human Resources
Accounting Drivers/ Carriers Shipment Planning Customer Service
Customer PurchasingPayroll Operations Maintenance Dispatch 5
Slide 30
Omni-Channelwhat does it mean to the consumer? Seamless
customer experience across all touch points with a retailer Shop
and purchase goods online, in a store, from a catalog or a
smartphone Be able to pick up or have goods delivered anywhere
Ability to easily return good anywhere High expectations are set
across all retailers
Slide 31
Omni-Channelwhat does it mean to the retailer? Tasked with
offering exceptional flexibility and service to match that of
leading retailers Provide on the fly visibility to product
availability for consumers Provide multiple shipping and delivery
options Challenges with satisfying consumer demand
Slide 32
Omni-Channelwhat does it mean to Carriers and Logistics
Companies? Carriers must be willing to adapt to the changing
procurement arrangements established by the retailer Omni-Channel
retailers utilize a network of distribution channels The fixed
environment is now becoming much more dynamic Carriers can expect
retailers to continually re-evaluate their distribution
network
Slide 33
Omni-Channelwhat does it mean for Carriers and Logistics
Companies? Visibility to orders and the parameters around each
order are imperative Where are the orders coming from? What day and
time are goods to be delivered?
Slide 34
Omni-Channelwhat does it mean for Carriers and Logistics
Companies? Adaptive Freight Rate Pricing Exceptional service doesnt
come with a small price tag Carriers and Logistics companies are
adapting complex costing models Retailers are focusing on network
optimization
Slide 35
Omni-Channelwhat does it mean for Carriers and Logistics
Companies? Primary challenges faced Offering higher service levels
typically underutilizes capacity Requires more resources in an
environment that already has a driver shortage Speed of delivery is
imperative, a smaller distribution footprint is typically a
requirement to provide cross-dock operations closer to
customers
Slide 36
Omni-Channelwhat does it mean for Carriers and Logistics
Companies? Last Mile Delivery is now becoming more of a focus than
ever High consumer expectations have set the bar amongst retailers
Retailers are offering multiple delivery options to best suit the
needs of the consumer High Service standards are not only labor
intensive, but also cause Carriers and Logistics Companies to
operate less efficiently when compared to conventional distribution
models
Slide 37
TMW Systemshow are we equipping customers for the Omni-Channel
Sophisticated Planning Requirements. Strict Appointment and/or
Delivery Windows Special Equipment Requirements Driver Skillsets,
shifts, and work rules Mixed fleets with varying truck
Capacities
Slide 38
Emerging Markets with the Omni-Channel Retail Home Delivery
Business Requirements Next day for traditional Online orders Need
for same day delivery rapidly growing Coordination between Inbound
product availability and outbound routes Planning Challenges
Customer Volume and Locations change daily 80-150 stops per route
Accurate driving times are crucial for scheduling
Slide 39
Complexities of Serving the Omni-Channel A small example: 15
trucks / 15 stops each 1,800 possible combinations to think about
and manage Its not just point A to point B, but rather point A to
every other possible stop that could go with it!