Lean Supply Chain Edition
November 2009

Information InDepth

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Oracle Transportation Management Optimizes Fleet and Common-Carrier Truck Loads Together

A capability unique to transportation management systems in the latest release of Oracle Transportation Management allows companies to simultaneously optimize their internal truck fleets and those they hire from common carriers.

Early users say this holistic view is helping them reduce trucking costs by 10 percent or more while also cutting carbon emissions.

“Organizations can significantly reduce the number of miles traveled by either trucking resource because of Oracle Transportation Management’s ability to create more efficient routes,” says John Murphy, Oracle senior director of transportation and logistics. “Planners traditionally had to use two different systems to manage both of those trucking assets.”

Instead, with a single system, Oracle Transportation Management analyzes historical shipping volumes across the organization’s network of facilities, distribution centers, suppliers, and customers to create the best routes. By evaluating both internal fleets and common carriers, transportation managers can mix and match the resources available to determine the lowest total costs.

For example, if demand trends indicate a facility in Texas will run out of fleet vehicles, the advanced view provided by Oracle Transportation Management helps planners avoid contracting for relatively high-priced local carriers. Instead, they can hire lower-cost carriers from another region to send trucks to Texas. To avoid the wasted costs and energy of empty trucks rolling to the facility, Oracle Transportation Management can show the logistics staff opportunities for keeping outgoing and incoming shipments at full capacity, which also encourages common carriers to negotiate lower rates, Murphy says.

“Running the optimizations doesn’t require any additional expertise from the users,” he adds. “Once transportation planners put the relevant information into Oracle Transportation Management, the underlying optimization algorithms come up with the best way to fulfill the orders.”

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