Discrete Manufacturer Achieves Significant Savings With Managed Transportation Services

Client Profile

The company is a recognized leader in the welded steel pipe industry, with pipes used in many different applications, including water infrastructure, energy, agriculture and industrial systems. The orginization is headquartered in Vancouver, Washington with nine manufacturing facilities across the United States and Mexico. Facilities are strategically located throughout the US to take advantage of regionalized markets to shorten the length of haul.

The company has two main divisions with diverse products and distribution needs. The Water Transmission Group manufactures large, high-pressure steel pipes and delivers product directly to a job site. The Supply Chain network is dynamic since locations and load configurations are always changing. In the tubular product division, the company operates three plants that manufacture smaller pipes with deliveries to customers, processors and distributors. The tubular product shipments are static loads that are standard and legal size.

Business Process and Problem Definition

The company’s transportation group was running in a decentralized manner, with each facility managing its own transportation and processes. There was a lack of consistency amongst the facilities which hindered the relationship with carriers. This decentralized management prevented the company from using corporate buying power to get the best rates from carriers. In addition, most processes were manual, being managed by fax, email, spreadsheet, and phone. With the combination of decentralized management and manual processes, the company had very limited visibility across the transportation network.

The company established goals for the transportation system and services:

  • Centralize transportation functions
  • Standardize and automate processes
  • Increase visibility across business units
  • Improve communication and collaboration
  • Reduce transportation costs

ANOTHER ASSURANCE OF VALUE…THE COMPANY SAVED APPROXIMATELY 25% IN THE FIRST YEAR

Process Improvement – SaaS Solution

Prior to choosing a transportation solution or service provider, the company went through an in-depth process internally to gain insight on how each facility managed freight. The company researched numerous TMS vendors before choosing LeanLogistics based on the technology capabilities and personnel expertise in the Managed Transportation Services team.

The company chose LeanLogistics Managed Transportation Services, which uses LeanTMS® technology, to implement best practices and further optimize day-to-day transportation management. LeanLogistics’ transportation experts centralize and standardize transaction practices while implementing recognized best practices to provide the most cost-efficient yet effective business processes.

With LeanLogistics, the company centralized transportation management to ensure the best carrier with proper equipment at a true price when and where the freight is needed. In addition, transportation processes are standardized and automated from order entry to freight invoice payment. The company now has visibility into lanes to leverage volume while using the appropriate mix of carriers.

Through the use of Managed Transportation Services, the company monitors freight for all manufacturing plants while improving communications with carriers. On behalf of the company, Managed Transportation Services utilizes LeanTMS to determine the best carrier for each load, tender freight to the carriers, ensure carrier compliance, track loads in transit, pay freight bills, and report on transportation key performance indicators.

Additional capabilities of LeanLogistics Managed Transportation Services to the company include:

  • Reduced costs and operational burdens
  • Centralized control of transportation management
  • Standardized and automate processes
  • Increased collaboration among facilities and suppliers
  • Improved visibility

Value Delivered

With LeanLogistics Managed Transportation Services and LeanTMS, the company saved approximately 25% in the first year with a return on investment for the project within the first six months. Bottom line, LeanLogistics helps the company decrease the cost
per load. The company now benchmarks the top 30 lanes quarterly and pays at or below market level for these lanes based on the increased visibility provided by LeanLogistics. In addition, LeanLogistics enables the company to mitigate cost in many different areas including assessing the impact of a shorter lead time and effects to the bottom line.

The company gains multiple operational efficiencies with LeanLogistics. For example, the company automated the entire invoicing and payment process allowing employees to become better utilized in more strategic projects. Another example of efficiencies for the company is found in the dramatic increase in carrier performance. Prior to LeanLogistics, carrier on-time performance was 72% and now stands at 99%.

The benefits the company continues to receive from LeanLogistics include:

  • Decreased cost per load
  • Mitigated costs and improved accuracy
  • Increased operational efficiencies
  • Improved carrier performance and payment
  • Increased visibility with dashboards and reports

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