Are You Wasting the Power of Your TMS?

Bill Madden Director, Managed Services LeanLogistics

Bill Madden
Director, Managed Services
LeanLogistics

This is a very exciting week at LeanLogistics as we are only a few days away from ClientConnect ’16. Whether you are leveraging managed transportation services or LeanTMS within your own team, ensuring our clients are satisfied with our transportation management solution is always a priority. ClientConnect gives us an opportunity to provide hands-on training to help our end users leverage their investment.

A TMS can bring process alignment and visibility to managing transportation, creating opportunity for significant cost-savings for a company—by using LeanLogistics, MTS customers saved between 2 and 17 percent during 2015. But with the ever-changing market, it is easy to get two steps behind. Fluctuation in volumes and carrier networks can turn cost-effective strategies upside down in just a few months. TMS users need to be disciplined in staying informed on system updates and continue to explore new functionality to ensure they are getting the most bang for the buck.

Here are some signs you might be wasting the power of your TMS:

Limited Use of Functionality

Transportation management systems are robust. It is easy for companies to become content with status quo, and not invest the time into exploring what other functionality options the TMS offers to complement their evolving business needs. This can lead to a company not fully realizing efficiency gains and visibility into their supply chain.

Avoid Analytics Reporting

There is an enormous amount of data stored in a TMS. It takes training to learn how to pull the right data, over the right cadence, and keep that information relevant as decisions are being made. Once the data is extracted, users need to know where to look to understand the opportunities the analytics provide. It’s common to see cost-savings in one area of the Supply Chain, but not correlate a higher cost in a separate area, which off sets overall savings.

Not Utilizing Procurement

TMS customers who do not use the data available to them via their TMS to guide focus on potential procurement opportunities are missing out on enhancing their routing guides to improve cost and service.  LeanSource will record every detail of the event so users can see which carriers made bids and compare price points to a benchmarking index.

System Updates Ignored

Software engineers are regularly enhancing a TMS’s functionality with updates. These updates are often not made a priority by companies who don’t have the time or resources to devote to training. Usually the system updates were designed as a solution to another shipper’s supply chain opportunity—possibly one you didn’t know existed in yours. This could likely be a missed opportunity to improve cost and service.

During ClientConnect ’16 we are offering two lab discussions called “How Lean Are You?” Customers will receive a report that showcases what functionality of the TMS they are not currently utilizing. Shippers can sit down with a TMS expert to review their individual business needs and identify windows of opportunity for better cost savings. This can include finding new ways to use current functionality or turning on a new module.

It’s also a great time to highlight recent upgrades to the TMS so clients are aware of some of enhancements they can start using today. We don’t ever want to see a customer not fully taking advantage of the power of LeanTMS. Staying connected to our customers—one more way we are building better supply chains together.

 



Fleet Whiteboards, Spreadsheets, and Paper…Oh My!

Jeff Wood Product Launch Manager LeanLogistics

Jeff Wood
Product Launch Manager
LeanLogistics

When visiting the LeanLogistics headquarters you’ll see whiteboards everywhere—we use them for brainstorming, strategy sessions, and project updates. Whiteboards are  useful for a variety of purposes, but not an effective tool for managing a fleet. One of our goals during the development of LeanFleet was to give transportation managers the opportunity to replace their whiteboards with consoles.

Managing the planning and execution of a private fleet at a high level requires access to near real-time data regarding the positioning of assets and the availability of resources. During the development phase of LeanFleet, we made several on-site customer visits to observe their daily workflow. We noticed manual processes causing limited visibility to the supply chain.

Whiteboards —Some transportation teams used whiteboards to assist in tracking driver and asset locations for pick up, delivery, and backhaul.

Spreadsheets — Manual processes were in place to keep track of driver assignments, days off, and driver and asset availability.

Paper Information — Drivers were handed paper information with their load and stop details.

Manual entry accounts for an immense amount of time and labor and enhances the opportunity for human error. LeanFleet erases the need for a whiteboard by providing real-time information about fleet assets electronically, including a function that automates the selection of drivers based on a variety of factors including proximity, hours of service, and calendar events. Once the information is in LeanTMS, it can be retrieved at any time from any location providing visibility outside of the office.  We also saw an opportunity to allow companies to leverage their telematics investment to send dispatch information directly to the driver’s truck.

One Platform, Single Workflow

Some of our customers were experiencing a different set of obstacles as they tried to maintain a blended transportation strategy. Shippers using fleet assets as well as common carriers had to navigate through several different systems for everything from planning to settlement. Now, they can handle all planning and execution on one platform in a single workflow.

We have stayed in close contact with our customers who allowed us to observe their workflows as we developed LeanFleet. They were involved in reviewing prototypes and beta testing that provided valuable feedback that we incorporated into the product along the way.

Planners are excited about the visibility that will allow for better management of their fleet resources. Dispatchers enjoy the opportunity to eliminate spreadsheets and communicate directly with drivers via messaging. Drivers have responded well to having their assignment information relayed directly to the telematics system in their truck. Managers have experienced the value of having one system when reviewing reports and analytics to find ways to save money in their supply chain.

What’s your workflow say about your transportation strategy? Do you have a bottleneck we can help straighten out? Our developers love a challenge. Let us know how we can partner with you to build a better supply chain together.



In Sales You Love to Hear Feedback…

Mike Joseph Director of Business Development LeanLogistics

Mike Joseph
Director of Business Development
LeanLogistics

When you work in sales you always ask for feedback from clients. You want to know what customers are thinking and challenged with, and then make adjustments to meet their needs. Thirteen years ago, I started working at LeanLogistics as an implementation manager. I was impressed the company offered a free networking event for all clients called ClientConnect. I invited all of my customers to my first ClientConnect at the Haworth Center in Holland, Michigan. When the night was over, I felt it was a huge success. Later that month, I reached out to my clients to see what they thought. They all agreed the event was extremely valuable and they appreciated the opportunities it provided. But there was a running theme to their feedback for future ClientConnects: Don’t ever hold it in the middle of January in Holland, Michigan, again. (I guess not everyone appreciates a beautiful Michigan winter.)

True to form we listened to that feedback and adjusted our timing of ClientConnect. And over the years, we have moved it to different cities ranging from Chicago, Illinois, to Atlanta, Georgia. What’s been exciting to watch is how ClientConnect has grown through the years. The venue spaces are larger and larger as the number of clients taking part continues to expand. This evolution hit me a few years ago when I realized I no longer knew everyone in the room.  The days of ClientConnect serving as an opportunity for me to catch up with clients had changed. Now it was a chance to meet new customers brought in by different sales managers, to talk to them about LeanLogistics, and to find how our software solutions are working in their favor.

When new clients ask about ClientConnect I always tell them it’s a wonderful opportunity to get to know people who are in the supply chain industry, regardless of what vertical they work in. A logistics coordinator in retail could strike up a conversation with a food & beverage executive, or a transportation manager in a Fortune 500 company could break bread with an analyst from a family-owned business. We encourage everyone to let their guard down, enjoy the discussion, the networking, and learn something new.

All of the feedback I’ve heard through the years is that everyone loves ClientConnect. We value our customers. The customer comes first and ClientConnect is one way we give back. We want each customer to know we are dedicated to building better supply chains together.

Mike Collage ClientConnect



Maximize your TMS Investment with Excellent Customer Support

Deciding to buy a transportation management system (TMS) is a big decision and there are a lot of factors to consider. One area of consideration that, at times, can be overlooked is the type of customer support the company will provide after implementation. This is an important question because it can impact the ability to maximize a TMS investment.

At LeanLogistics, our customer’s satisfaction is a top priority. We are committed to ensuring all customers receive outstanding support from the moment they decide to purchase our software solution. LeanLogistics wins Stevie Award for Customer Service. Not every TMS provider has a customer support team, so make sure you ask a lot of direct questions about the company’s support program.

Building the Partnership

As a customer begins the initial process of utilizing new software, there is a period of time spent ramping up on system knowledge and working through day-to-day operations. But the real value of a software partner can be found in the days and weeks after the learning phase. Whether that hits two months or 12 months after you go-live, your software partner should be ready to start exposing other areas of value to increase your ROI.

When it comes to driving value out of the partnership there are two types of support: tactical and strategic. The combination will ensure you are covering basic blocking and tackling while also establishing a vision for the future.

Here are Some Common Tactical Support Questions

  • What new functionality do I need assistance setting up?
  • What problems arise in the daily process that could be avoided by implementing a new piece of the technology or modifying my current setup?
  • Why isn’t my current setup working the way I expected?

These questions are addressed by the tactical relationship the provider has with their customer and drives the business forward daily. Troubleshooting and problem solving is the responsibility of the customer support team. When evaluating a company’s customer support program ask about these common standards of support.

  1. Ease of requesting help
  2. Team members professionalism
  3. Seamless escalation of incidents
  4. Single point of contact through resolution
  5. Self-service materials for basic functions

In addition to the five standards listed above, our team also feeds key data back to the organization to allow for a more robust customer engagement strategy.

Strategic Questions to Consider

  • What business changes are coming up in the organization that could be addressed by the partner’s technology or services?
  • What are we not taking advantage of today that would be of interest?
  • How could we change business process to better align?
  • How are my other customers handling similar issues?

Relationships managers are key to the ongoing and long-term vision of the partnership. They open the conversation to understand your current and future business needs. As your advocate, the relationship manager will act as your voice internally to give your perspective on future development. This person should also act as a “priority manager”, someone who ensures you are implementing and seeing results from your recent projects.

What’s Your Communication Rhythm?

Remember, this is a partnership and you want to have a communication rhythm to keep everyone on the same page. Set a frequency of contact with your software partner. Tactical contact engages almost daily, but could also benefit from a monthly review of outstanding items. From the strategic perspective, some companies want to meet quarterly, while others only need to set a vision twice a year.  Establishing those communication guidelines will lead to continued success to maximize your investment.

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How to control transportation costs in the aquaculture industry

Aquaculture Blog imageNorway is the world’s second largest seafood exporter and the equivalent of 37 million seafood meals produced by Norway is consumed worldwide each day. In 2015, Norway exported NOK 74.5 billion (€7.86 billion) worth of seafood – 8% more than in 2014. 67% of exports go to the EU.

The unpredictability of harvesting live fish puts great pressure on the supply chain. Knowing customer demand but not completely knowing supply volume creates uncertainty as to whether the demand can be satisfied. And this leads to unknown transportation volumes.

This, together with short lead times to reach customer sites, can result in the shipper either having a surplus or shortage of transportation capacity which then leads to increased costs as the real capacity is determined.

LeanLogistics is running a half day and evening event to address this transportation challenge in the aquaculture industry. The event will be held in the luxurious five star The Thief Hotel in Oslo, Norway on 12th May 2016.

LeanLogistics has helped companies save between 5% and 15% of their transportation spend by using LeanLogistics Transportation Management Software (LeanTMS). Marine Harvest, a keynote speaker, has been a LeanLogistics customer since 2013 and has already saved up to 5% in transportation costs.

Attendees will have the opportunity to learn how to reduce transportation costs and control freight spend via automated self-invoicing using LeanLogistics’ Transportation Management System software (LeanTMS).

Attendees will also:

  • Learn how LeanLogistics helped Marine Harvest improve their supply chain
  • Hear about Norwegian transportation challenges from the Institute of Transport Logistics
  • Discover more about the Norwegian seafood industry from Sjomat Norge – the Norwegian Seafood Federation
  • Learn about recent trends and market developments from DNB Markets
  • Have the opportunity to network with peers in the aquaculture industry in a relaxed environment over lunch or dinner

Presentations will also be given by LeanLogistics senior management describing the features and benefits of the European LeanTMS solution and future product plans.

More information: http://info.leanlogistics.com/aquacultureevent.html  To register for the event https://www.surveymonkey.com/r/aquacultureregistration

#LLseafood



Scalability? It doesn’t happen overnight

Wherever you look today, you see overnight successes.  The latest app becomes all the rage on Android and IPhone’s. A video goes viral and creates a cult following.  A little known startup suddenly gets acquired by Microsoft for a sum three times your company’s size.  All of those can happen in the blink of an eye.  In today’s hyper connected world, it’s amazing how quickly fame and glory arrive, yet can so quickly fade.

Fortunately, that’s not how the supply chain works.  There aren’t too many supply chain professionals who watch their network undergo extreme changes in a matter of moments (with the exception of natural disasters of course).  Having a single truck delayed does not tank a business plan; neither does a single delighted customer bullet proof a company’s logistical success.  Supply chains are extremely resilient, but are often asked to shoulder major changes.  And when it comes to scaling that supply chain, it definitely does not happen overnight.

Scalability in the supply chain requires expertise and direction.  Not all supply chains need to scale in terms of size, but maybe it’s a matter of scaling back certain elements and scaling up others.  Mode shifts are a perfect example of this.  As intermodal continues to gain traction and unseasonably low capacity remains, being able to scale in different ways gives the supply chain options to retain its original purpose and goals.

Goals.  Sometimes that’s all practictioners have to go on, relying on their partners and suppliers to deliver the results.  Some will trust in the process, waving contracts and service expectations in front of their constituents.  Others, like CHEP, take a proactive approach to managing partners with technology.  In this way, positive results are scaled and negative outcomes are reduced.

Although it’s clear you can’t scale a supply chain overnight, there are some ways to help it along.  In previous blog posts, we’ve discussed getting your RFP in better shape or planning for seasonal shifts as ways to scale your supply chain, but there is another element to consider. If we go back to our first three examples in this post, they have a common theme: technology.  In today’s world, always-on SAAS infrastructure is table stakes for scaling for long term success.  Startups don’t buy servers anymore, they buy server space and time.  Storage of secure documents is often housed thousands of miles away to a data center able to take an 8.9 on the Richter scale.  It’s scalable and configurable.  Whether you need a lot or a little today and need the exact opposite tomorrow, a SAAS model delivers.  If you’re not there, it’s okay.  Chiquita had to take a journey, too.  Now, SAAS is part of their world.  Your supply chain might not be as complex as dealing with highly perishable food, but if a 115 year old company can adopt a scalable SAAS solution. so can your company.

Who knows what tomorrow will bring?  For those looking to scale their supply chain (up, down, or sideways), challenges lie ahead.  Those challenges are just that, a challenge.  With a combination of technology and expertise, plus a little bit of time, those supply chains will scale with sustainable growth.  When those goals are met and the company lauds it as an overnight success, the supply chain folks will know how it really happened.



Is Outsourcing Transportation The Right Decision?

In today’s constantly changing market, managing transportation is a key factor for a more efficient and cohesive supply chain. Many companies still use manual methods to manage freight, relying on their internal expertise to execute their supply chain. With faxes, spreadsheets and phones, transportation departments are prone to duplicated efforts, human error, loss and most importantly, lack of visibility in transportation processes. Then there are companies leveraging transportation technology, but require expertise and special skills to minimize costs of shipments while maximizing service. With changes in business models through acquisitions/mergers, fluctuating fuel costs, and a fast-growing marketplace, supply chain teams need to focus on their strategic operations and determine if outsourcing the transportation function can actually increase efficiencies. Although that decision can be difficult, the company must still move products, be cost-effective, meet service levels and satisfy customers.

Management of a company’s supply chain is an important aspect of a corporate strategy. Without the specific knowledge, resources and bandwidth, transportation is an area that can drastically affect a company’s bottom line and increase customer satisfaction. For many companies, outsourcing the transportation process to supply chain experts who are highly skilled and proficient with technology gives companies the ability to focus on their core competency, which is not always transportation. Instead of spending hours and budget on reoccurring training to drive the department to become tech savvy, by streamlining transportation management, companies gain more efficient processes while lowering costs. The winning combination of professional logisticians, proven supply chain processes, and industry-leading SaaS software enables companies to improve transportation without jeopardizing the core business offering.

Managed Transportation Services from LeanLogistics utilizes LeanTMS, a SaaS software application, combined with a team of experienced logistics professionals to create the optimal solution for companies seeking to future-proof transportation functions. Unlike other outsourced transportation services, LeanLogistics offers both the expertise and industry-leading software to support processes in a flexible and affordable fashion. Managed Transportation Services is nimble enough to support companies that move the transportation department inside and/or outside of the corporate umbrella, as needed to cover employee and marketplace changes.



Innovation

in•no•va•tion noun ˌi-nə-ˈvā-shən
1. the introduction of something new
2. a new idea, method, or device : novelty

Everyone has ideas. Not everyone has the chance to explore them. A few forward thinking companies are changing that. They’re taking an innovative approach to innovation by giving employees time to play with their own ideas, all on company time.

This approach has several names: 20% Time, FedEx days, Hack days, Hackathons, Intrapreneurship, among others. The effect is usually the same: ideas are expressed and new pathways to success emerge. In many cases new features or fixes for functionality are created for existing applications. In some cases prototypes go on to become an official product offering. The results don’t just apply to product creation or improvement; these events foster camaraderie, creativity, and communication as well as create a workplace that is fun and engaging.

Hackaction
At LeanLogistics, we hold one 24-hour hacking event per release, what we call “hackation”. The projects involve everything from improving our existing infrastructure to streamlining the user-experience of our applications. There is only one requirement: the project must be mildly related to what we do.

Before we even get to the hacking, we convene for a short period of time to pitch ideas. This serves to provide project sponsors with the ability to recruit fellow developers to larger projects, with the additional benefit of generating even more ideas and starting more discussions.

The event itself kicks off in the afternoon with a brief run-down of who is working on which projects. Then the teams, or lone developers, flee to the comfort of their computers to prove out their ideas. The hacking goes on for as long as the developers can stay awake, and continues in the morning until we’ve exhausted our 24 hours. Then we present.

It’s one thing to hear someone describe an idea, it’s another thing to see it in action. Every event, there’s at least one presentation that wows the entire audience to the point that someone shouts “I’m not following that one!” This is a clear indication that you did something awesome; the other developers don’t want to present anymore. The presentations still go on. It’s the most important part of the whole process. Not only are we showing what we’ve made, we’re discussing what we’ve learned, and where the idea could go afterwards. Once everyone has had a chance to present, we hold a vote to see which project “won”, which typically results in development time allocated to the project throughout the next release cycle.

The benefits don’t just stop at new functionality in the next release. As a result of participating, our developers have become more collaborative, more confident, more creative, and are discussing new ideas and new approaches to problem solving on a continuing basis. Throughout the release cycle, developers are keeping an eye out for improvements they can make during the next hackation. So much so, that it’s become common to hear the statement “that would make a good hackation project”.

With this new found freedom, we’ve come to enjoy increased productivity for our software, our people, and our customers. Take a look at a handful of actual hackation projects and the value they’ve provided:

Auto Load Build
One of our developers noticed that our customers were using our optimization capability to create loads out of single orders. Customers are now able set up the LeanTMS to automatically create a load when an order matches a specific set of criteria. You can even have it apply a routing guide, so that the load is tendered automatically, completely removing the need for a transportation coordinator to plan anything.

ElasticSearch
At LeanLogistics, we have many virtual machines that make up our various deployed environments. One System Administrator was particularly tired of having to log into each one to figure out what was happening with our applications. Thanks to a little bit of tinkering, we’re now able to use ElasticSearch to view all of our logs for all of our deployed environments from a single web application. We can see, in real-time, the details for any issues that arise, and what a user was doing prior to encountering an issue.

OSX / Linux Developer Machine
Some of our developers feel more comfortable coding on their favorite operating systems. In order to boost their own day-to-day productivity, they took the time to create automated scripts that set up a “non-standard” developer workstation and tie into every piece of technology we employ, ensuring their productivity and ability to perform every function the position requires.

Your Turn
Now that you have an idea about one of our approaches to innovation, as well as the benefit we’ve received from it, it’s your turn! Within the following sections, you’ll find pre-packaged research and other resources to help you establish a culture of innovation within your own organization. At the very least, you’ll be able to start a conversation and influence the people around you to think differently about how to improve your culture, your people, and ultimately, your market standing.

Intrinsic Motivation
In the tech sector we often hear of some nerd/geek accomplishing some task with the sole reason being “because I could”. This is the basis for intrinsic motivation; performing the act is the reward. Intrinsic motivation is the very reason that companies, like Google, who encourage people to pursue personal interests on company time, capture the hearts and minds of its’ engineers. And they get some awesome products and improvements out of it too.

The idea started with Harlow, a psychology professor, who conducted studies on primate behavior in the 1950s. He presented monkeys with a puzzle to solve and they played with it quite happily. As soon as he introduced rewards for solving the puzzle the monkeys’ performance decreased.

Later, Deci performed similar experiments with humans to determine behavioral motivation. He presented subjects with a puzzle that could be arranged in various configurations and compared their performance with and without monetary rewards. Those offered the reward performed below their counterparts.

What these experiments pointed to, was another unnamed motivation mechanism, what we now know as Intrinsic Motivation. In a later work, Deci said that humans have an “inherent tendency to seek out novelty and challenges, to extend and exercise their capacities, to explore, and to learn.” It’s this nature of human beings that some companies are embracing in order to create real partnerships and drive innovation.

More information on intrinsic motivation can be found in Drive, and The Flip Manifesto both by Daniel Pink. Pink’s work contains references to the effort of Harlow and Deci, as well as information on other studies that have come to similar conclusions concerning motivation.

Innovative Time Off (20%, 15%, 10% Time), Tinker Time
Innovative Time Off is an ongoing setting-aside of employee time so that they can pursue their own interests either within the existing bounds of company interests or completely outside organizational goals and objectives.

Marissa Mayer discusses the culture of innovation at Google. 50% of Google’s product launches in the second half of 2005 started as 20% time projects.
http://www.youtube.com/watch?v=soYKFWqVVzg

3M provides employees 15% of their time to work on their own projects.
http://solutions.3m.com/wps/portal/3M/zh_CN/global/sustainability/our-people/employee-engagement/

3M’s most famous side project: Post-It Notes
http://www.post-it.com/wps/portal/3M/en_US/Post_It/Global/About

Geim and Novoselov win the Nobel Prize for the discovery of graphene. The discovery was unrelated to their “sanctioned” projects and was done during “Friday night experiment” time.
http://www.nobelprize.org/nobel_prizes/physics/laureates/2010/geim-telephone.html

Atlassian has embraced 20% time as a way to foster creativity and improve product offerings.
http://www.atlassian.com/company/careers/life

Some teachers are embracing 20% time in the classroom.
http://www.20timeineducation.com/

FedEx Days, Hack Days, Hack Weeks, Hackathons
While referred to by many names, these “hack days” are days set aside for the sole purpose of allowing employees the freedom to pursue their own ideas. At the end of most of these events the participants are encouraged to present their prototypes to the rest of the group.

Symantec holds FedEx days for their employees.
http://www.symantec.com/connect/blogs/unleash-your-innovation-fedex-day

LinkedIn’s “InDay”: A FedEx day without the massive trademark violation.
http://blog.linkedin.com/2010/10/13/linkedin-labs/

Twitter hack week, a whole week set aside for tinkering on ideas.
http://blog.twitter.com/search?q=hack+week

Twitter was even founded by a daydreaming session.
http://www.nytimes.com/2010/10/31/technology/31ev.html?_r=1

Facebook holds hackathons.
http://www.facebook.com/hackathon

Non-corporate hackathons
Hackathons aren’t held just for internal corporate innovation. There are many events organized just for the fun of it, or even to further social causes.

New York Times hosts open hack days where anyone can register to participate.
http://open.blogs.nytimes.com/2011/12/06/recapping-timesopen-hack-day/

NASA participates in “Science Hack Days” where developers and scientists collaborate on, and hack together prototypes because they can.
http://open.nasa.gov/blog/2011/11/13/science-hack-day-sf/

Random Hacks of Kindness hosts hackathons where volunteers gather to solve real world problems.
http://www.rhok.org/

History Hack Days – events held to aid historians by providing technical solutions to history problems.
http://historyhackday.org/

Intrapreneurship
The “Hack day” or other bottom-up projects that gather enough company support to be folded into the company’s offerings are sometimes referred to as intrapreneurships, a “startup” within an established organization.

Case studies (Under Resources menu) covering: Sony’s PlayStation, Google, 3M, Virgin, and others: http://www.intrapreneurshipinstitute.com/



Familiarity and the Need to Explore the Unknown

jeff-yin

Jeff Yin, TMS R&D Manager

Studies show that our minds use strategies called heuristics – mental shortcuts – in order to make decisions. These heuristics help us avoid analyzing every possible path of a decision point, an expensive and exhausting process. One such heuristic, the Familiarity Heuristic, is described as our bias towards making the same decisions in familiar situations. This heuristic allows us to make quick judgments in situations that may not merit much thought because we have done it before and with good results. Using this heuristic can save us time, energy, and stress, and we would all love to have more of the former and less of the latter, right?

For example, imagine that you start a new job in a new building. You spend some time trying to find an optimal route to work in the morning, and you eventually cut down your commute to 25 minutes. You follow this route long enough for it to become habit, spending less energy analyzing your route to work and more time thinking about the day to come. Your high school science teacher would be thrilled to see you applying the scientific method, and you pat yourself on the back.

A few months later, a new road opens and you try it over the weekend. It cuts ten minutes off of your commute! This could change your life, and you cannot wait to try it. Except that on Monday morning, you sleep through your alarm. You hurry through your morning routine, jump into the car and drive as fast as you can. When you get to the intersection of your tried-and-true route and the new one you tried over the weekend, which direction do you take?

Which did you choose?

The familiarity heuristic suggests that we would tend to choose the tried-and-true route, even though it is probably slower than the new one and we know it. Under the stress of being late to work, this heuristic allows you to make a quick decision when you suddenly find yourself at that intersection between the known and the relatively unknown, even though you had already planned to choose the latter.

Now, think not about the stress of being late to work but of actually being at work. Having been fortunate enough to maintain work through the Great Recession, you have likely taken on more responsibilities in order to stay relevant. But with all those tasks and their corresponding deadlines, the familiarity heuristic is a dangerous one. Choosing the familiar path may yield more predictable results, but those results may not be sufficient to satisfy tighter and tighter deadlines. In favoring the desire for predictability over the need to innovate, this heuristic may cause you to miss opportunities to get better. I am fortunate to have been a part of the R&D team at LeanLogistics as we acknowledged one such opportunity, leading us down paths of both increased productivity and higher quality software.

Exploring the Unknown

Behind every project there are multiple parties working together towards a greater goal, software development notwithstanding. In this particular field, the two most prevalent ways of defining the interactions between those parties are called Waterfall and Scrum. In Waterfall there is an emphasis on procedure, linear processes, and checkpoints. This methodology is the one which LeanLogistics’ R&D team employed for years, as did much of the software development industry. It worked and we were darn good at it. But one day, someone chose to explore the lesser known path as opposed to the one we knew, and we embarked on a journey to convert to Scrum.

In Scrum, the emphasis is on building software together and in smaller iterations. This manifests itself in more frequent interaction between the involved parties, resulting in many small “slices” of working software. When built upon each other, these small slices solve the same complicated business problems that Waterfall can, but with the added benefit of frequently exposing the actual problem as opposed to the one initially scoped.

In choosing that unknown path, we have drastically decreased both the number of product defects introduced per iteration and the time that it takes to produce software that solves real problems. In questioning what we knew and stepping into that sometimes uncomfortable expanse, we experienced both excruciating pains and spectacular successes. Every day we choose not complacency in being good, but constant improvement in order to become the best. And just like in Scrum, it takes a lot of iterations, intentionally stepping outside of what feels familiar, in order to get there.



How to Budget Your Transportation Spend Better

Kevin Little Supply Chain Engineer LeanLogistics

Kevin Little
Supply Chain Engineer
LeanLogistics

My New Year’s resolution this year is to start budgeting my personal finances.  I have always considered myself a natural saver, so I didn’t think I needed a traditional budget.  However, I am realizing that as my age increases, so does the complexities of my finances.  Currently I keep track of my spending through an online tool that looks at where my money has gone after it is spent, but a budget will force me to figure out where my money is going before I spend it.  This will provide greater control and visibility into my spending and saving.

So what does this have to do with logistics?

In my current role, I have the opportunity to see a variety of ways in which companies structure and manage their transportation spend.  For some companies, managing transportation spend is similar to the person that manages finances by taking all of their receipts and shoving them into a drawer with hopes that they are net positive.  Their data might consist of five hand-typed spreadsheets, containing an average of 75 tabs, each with countless variations in formatting and aggregation. The data is there, but they have no real control or visibility into spending habits and trends. This might be okay if your transportation department consists of Kyle, the intern, dropping off a few packages at the post office, but for everyone else this isn’t going to cut it.

The next level of managing transportation spend data is similar to where I’m at in my personal finances. The data is there, and it is relatively easy to look back on trends, but the problem is that it is primarily backwards-facing.  This isn’t working for me anymore because in the last year and a half, I have married, bought a house, and welcomed home a 4 month old son (hence the reason for my increasingly complex finances).  My wife is a saver as well, but she doesn’t care about our three month spending trends when she is at the grocery store. She just needs to know how much money she can spend without going over budget.   In a business, the person making the day-to-day operational transportation decisions, like the person shopping, is concerned with not going over budget, more than trends. These companies (like me) are looking at where they have been without having the controls in place to direct where they are going.

Advancing beyond this point in managing transportation spend requires more than just good data; it requires a systematic approach to making the right financial/transportation decisions every day.  A Transportation Management System (TMS) will provide immediate information and controls needed to make the right choices at an operational level.  This could mean having operations see a budgeted rate for a lane before tendering a load to a carrier, or instant visibility to see what carriers have historically hauled in a lane when coverage is difficult.  A TMS can immediately provide value by forcing Takconsistency and control with tools that provide real-time data.

While I’m working on my budget for the New Year, go ahead and resolve to figure out how you are going to better manage your transportation spend.  Sorry Kyle, the intern, it may be time to start looking for a new job.