Why even a good dispatch software is not enough for LTL carriers?

 

Unlike the Full truckload (TL) carriers, in less-than-truckload (LTL) operations prevail lots of multi-stop pickups. For small LTL carriers, linehaul can also include an end to end multi-stop deliveries. Good dispatch software help carriers to input orders and then dispatch them to drivers and trucks. They would also help to settle with drivers and bill clients. Some may have extensive assets (tractors, trailers, etc.) management systems. Advanced systems such as Trimble transportation (TMW) can offer tracking and mileage calculation option via their own solution such as PC miler. Others, especially those targeting SME’s will provide a plugin option to get data from PC miles or similar solutions. On top of the Dispatch system, companies should equip their trucks with ELDs (Geotab, Omnitracs, Samsara, etc.) which is a good tool to track mandatory Hours of Service (HOS). Almost all providers also offer telematics functional. This is basically a tech environment for a typical mid or large LTL carrier. Smaller ones may be using spreadsheets and, in the meantime, one of the GPS tracking software. As ELDs are mandatory both in the US and Canada, every carrier can track the location of their trucks.

As you have noticed there are a couple of functions that require extensive labor force and basically remained untacked so far:

  1. Multi-stop pickup planning. Large carriers such as YRC, Old Dominion, and others in the top 50 list have thousands of trucks and hundreds of terminals. Each terminal handles 500+ inbound orders a day. Smaller LTL carriers can have a handful of terminals but per terminal volumes are going to be relatively similar. While linehaul planning from terminal a can be relatively easy, the inbound multi-stop planning is where planners mostly straggle.

 

  1. Dynamic management and communication. ELDs give a decent understanding of the locations of your trucks. While this is fine in the case of FTL linehauls, multi-stop LTL management requires a more granular approach. First, dispatchers should know what’s happening in each stop and how changing dwell times or other random occasions will affect the accuracy of deliveries to remaining stops. Second, it’s crucial to have timely and automated warnings of potential late deliveries to each and every stop. Third, drivers should be instantly updated about changing loads and routes. And last but not the least, customers should receive automated notification about approaching drivers and drivers should be notified about available docs in case of large customers.

We have calculated that the solving abovementioned problems properly helps to decrease total driven mileage by 5-7% annually, save about 300 hours of planner’s time and improve delivery accuracy by a whopping 30%. Does this imply that one needs to search for new dispatch or TMS software? That’s not necessary as today’s API enabled environment helps to get these problems solved without undertaking large projects or inquiring additional costs.

You can reach us out on info@lessplatform.com in case want to learn more about how we can mobilize these benefits for you.

Author
Vardan Markosyan is the CEO at Less® Platform
MBA from the University of Chicago Booth School of Business
Ph.D. in Economics from the Institute of Economy of NAS RA
He spent decades of research and consultancy on business process optimization and system design


Solving inbound planning & execution problems for LTL carriers

 

Less than truckload (LTL) operations are mostly organized using the hub-and-spoke model. From an organizational perspective, we need to plan thousands of inbound LTL shipments for terminals and then create line hauls to move the freight to distribution centers. Additionally, there are smaller LTL carriers who practice direct-to-the-customer line hauls. Thus, we can conditionally divide LTL planning into;

      a) inbound operations-when multiple multi-stop pickups are occurring

      b) outbound operations-when LTL freight is being consolidated in the terminals and hauled to distribution centers.

As inbound operations are different in nature the approach to the planning and execution should be different respectively. Planners and executers are dealing with complexities that can potentially degrade service level, increase planning time, and result in more miles driven than necessary. Less balanced loads and the need for dynamic changes cause their efforts to be less effective and result in overall reductions in efficiency.

  1. Demand in everyday LTL operations is highly variable 

Unlike other pickup and delivery operations such as wholesale distribution, everyday demand for multi-stop LTL operations is highly variable. Distributors have a relatively stable customer base and therefore a stable planning process while LTL carriers are required to plan their inbound operations from scratch every day. Thus, the majority of planners use a zone-based approach; where specific drivers are assigned to specific zones and then planners try to create routes in these zones. While this helps planners to get their daily plans done this approach, unfortunately, creates lots of extra miles driven, unbalanced loads and consumes too much of planners’ time.

  1. It is very hard to get balanced and timely loads while keeping mileage and other cost variables under the control

A planners’ main concern is to pick up orders from terminals by assuring accurate delivery windows. When demand is variable it often comes at the cost of mileage optimization or too many trucks thrown at the problem. Planners juggle many variables in their heads such as delivery windows, variable service times, HOS requirements, capacity constraints, and driver-specific requests. As a result of this complex process, a human being can hope to get 60-80% of optimality utilizing this manual method.

  1. While ELDs or other GPS tracking software helps to trace trucks they have a little positive effect on communication between a dispatcher and dozens of drivers   

ELDs are great at getting driving data for calculating service hours as well as monitoring the location of trucks. Additionally, LTL inbound operations are multistep in nature and often include dozens of stops. Large LTL carriers with 100+ trucks (the largest nationwide carriers have 1000+ trucks and dozens of terminals) should assign and monitor multistep pickups for thousands of shipments a day for a given terminal. Currently, dispatch sheets are printed on paper and communication is done via calls which is a  time consuming and inefficient process. Dispatchers also don’t have full and timely visibility of the pickup process for each stop as well as dynamic ETAs for the planed stops. It makes execution time consuming and inefficient.

 

How Less® Platform solves above-mentioned problems:

       1. Innovative planning engine. We have built a load and route planning and scheduling engine which gets 96-99% optimal load plans in minutes for thousands of deliveries. It involves all the real-life constraints such as the need to fit into delivery windows, variable service times for different sizes of orders, HOS requirements, order, and truck capacities. Thousands of pickups in dozens of terminals is no problem and can be planned simultaneously by one planner in 10-15 minutes.

       2. Our Driver app is connected with a central console. Dispatchers can assign planned loads instantly to hundreds of drivers and they will have all the planned loads on their phones. The status of each stop will be updated instantly. Dynamic ETA’s for all stops, including service times, breaks, traffic, and other variables will be visible both for drivers and dispatchers. Thus, dispatchers will be notified as soon as an ETA for any stop will be beyond its delivery windows. The driver app also allows you to notify customers about the arriving trucks as well as to capture digital POD. All the information for implemented loads is stored in the database in which managers can monitor the efficiency of operations using summary tables and graphs for each instance.

The LTL industry needs new tools to solve old problems more successfully. Decreasing costs by improving efficiency has become an urgent need. They should also take into consideration new realities for remote operations that are here to stay. As a result, the long-term profitably and competitive position of a company depends on how fast the industry will adopt new technologies to improve their operations.

 

Author
Vardan Markosyan is the CEO at Less® Platform
MBA from the University of Chicago Booth School of Business
Ph.D. in Economics from the Institute of Economy of NAS RA
He spent decades of research and consultancy on business process optimization and system design