© GT Nexus, Inc.

How to Automatically Collect and Track Global Transportation Information in Real Time

Deliver Supply Chain Performance Analytics

A STRATEGIC IMPERATIVE FOR MANUFACTURERS

© GT Nexus, Inc.

Transportation planning in today’s global environment is far different than in the past, where manufacturers kept the pro-cess in-house or allocated goods across a few providers. Now, companies outsource a great deal of transportation to 3PLs and freight forwarders, who in turn collaborate with carriers to follow through with the manufacturer’s logistics plan.

However, as each of these partners record data within their internal systems, information on the thousands of lanes and various carriers gets fragmented; operating in silos makes it impossible to compare actual carrier performance and trans-portation spend with the original allocation plan. Companies without access to high-quality supply chain performance ana-lytics face a huge administrative burden in trying to manually reconcile data. They don’t have the ability to make the best possible logistics decisions.

Impact of Poor Supply Chain Performance AnalyticsWhen manufacturers don’t have a single platform, they are limited in both strategy and control throughout the supply chain. Instead of being freed up to make strategic supply chain decisions, managers are forced to spend time collecting data, experimenting with new procurement strategies, and guessing on best practices. Here’s what they face:

Inability to effectively monitor short- and long-term alloca-tion plans

Manual after-the-fact data collection

Non-automated operational and strategic report generation

Inability to effectively leverage volume in negotiations cycles

Lack of adequate controls to monitor liability exposure for MQCs (e.g. SOX)

Trying to fi nd procurement strategies to deal with con-stantly changing rates

The Root of the ProblemPoor supply chain analytics boil down to one issue: bad data. When manufacturers can’t explain how their actuals size up to their plans, it’s usually because of the following:

1. No easy way to capture actuals

Global transportation planning involves thousands of lanes in many regions, over varied modes, with hundreds of external partners and systems involved. Manufacturers at-tempting to line up their manually-collected data with their allocation plans will face two major drains on company resources:

Huge administrative burden

Fees and charges for under/over utilization

2. Decentralized operations

It’s typical for manufacturers to have operation centers that are spread out and disconnected from each other. Each partner in each region may have a unique system for supply chain management, leading to:

Reliance on third parties to do the work

Diffi culty integrating 3PLs and freight forwarders on a one-off basis

2

Companies spend a lot of money on ocean transportation, but have no easy way to track and analyze volumes by lane.

The Challenge

Too many cooks in the kitchen – when transportation is managed by many partners without a single platform, data integrity falls by the wayside.

Enterprise LogisticsPlan

LogisticsActuals

Enterprise3PL

3PL

Carrier

CarrierCarrier

Carrier

Carrier

Carrier

CarrierCarrier

Carrier

Plant

Plant

NetworkConnectivity

Agility

Customers

Customer

DC / Warehouse

Plan

Actual At-Risk DelayDynamic ETA

B

A

Sense more accurately

Operate more efficiently

Respond faster

Make better decisions

3

The SolutionCompanies that want quality supply chain analytics must adopt a cloud-based platform where all of their logistics partners can collaborate. On this type of network, global information on lanes, volumes, and rates is updated instantly. It’s then used to run detailed analytics on carrier performance and the outcome of particular allocation plans.

On a cloud supply chain platform, logistics and operation teams can improve supply chain performance and avoid wast-ing money on outdated and reactive manual processes.

Automatically collect and track global transportation information in real time.

Capture volumes as they occur by carrier, date, lane, ship-ment, and SKU

Use reports to benchmark actual against plan and make better decisions

Use analysis platform to analyze and rank carrier performance

How to use supply chain performance analytics:

1. Ensure that allocations are reviewed for sourcing decisions

2. Monitor liability exposure for MQC, e.g. SOX

3. Monitor partner performance against expected SLAs for shipment execution

Value PropositionsSupply chain performance analyt-ics can greatly contribute to ROI as well as make life easier for logistics and operations teams. The benefi ts are as follows:

1. Improve sourcing deci-sions and target costing by analyzing comparative data

Avoid over- or under-utilizing carriers by reviewing real-time allocation data

2. Improve labor effi ciency and lower administrative costs

Eliminate manual processes through automation

3. Benchmark carriers with supplier scorecarding to drive continuous improvement

Use global carrier template so each is measured the same way in every region

4. Provide the business with data related to corporate KPIs

Analyze transportation spend and sustainability metrics

Monitor supplier performance and inventory management

5. Assist with procurement and execution planning

6. Reduce freight spend by 2-7% to lower COGS

7. Decrease carrier fees by 2-3% to lower SG&A

Supply Chain Performance Analytics and the Networked CompanyTo gain access to high quality supply chain performance ana-lytics, companies must transform themselves from silo-based, inward-facing corporate operators to interconnected, highly agile business network orchestrators.

The key to great supply chain performance doesn’t lie in gathering data – that can be automated. Manufacturers should focus on making deci-sions based on high-quality data in the cloud.

Cloud technology captures service contract data in a central location, letting manufacturers award and adjust contracts throughout the cycle.

Enterprise

LogisticsPlan

LogisticsActuals

Enterprise

CarrierCarrierCarrier CarrierCarrier

Actuals

Carrier

3PL

3PL