September 2004 | Case Studies | Reader Profile

Marilyn Necak: Making Freight Pay

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For Marilyn Necak, success lies in the details. In her job as disbursement manager for General Electric's Client Business Services Inc. (CBSI), she monitors the service providers that handle freight payments and accounts payable to make sure they process each invoice correctly and hold vendors to the terms of their contracts.

More and more, she also mines the details connected with these payments. Her goal is to uncover information that can help improve operations. On the freight payment side, Necak and her staff analyze which carriers are moving which freight in which lanes and how much GE's subsidiary businesses spend on different transportation services.

"This allows us to refine our contracts, identify the carriers that we most want to do business with, and leverage our buys more efficiently," she says.

Necak became freight operations leader for CBSI in 2002; she took charge of accounts payable as well, with a separate staff, in 2003.

On the freight side, she oversees two vendors that audit and pay the freight bills for all of GE's businesses. These bills cover inbound and outbound shipments of everything from raw materials to finished products such as light bulbs, home appliances and power generators.

One of Necak's first projects in freight operations was to replace the incumbent freight payment vendor with a provider that could handle global trade. She credits the Six Sigma quality regimen for helping her team choose objectively, based on metrics that matched vendor capabilities with CBSI's needs.

The two vendors that rose to the top—IPS Worldwide, Ormond Beach, Fla., and AIMS Logistics, Collierville, Tenn.—are relatively small, but "they both turned out to be diamond-in-the-rough finds for us," she says.

While the vendors manage payments, Necak uses the data they generate to benefit the GE businesses. One goal right now is to provide more precise information on how much businesses spend on different modes of transportation, she says.

Necak is also helping traffic managers analyze the payment data "to see if we can identify some of the more efficient carriers they could be using," she says.

In another project, Necak and her team are encouraging carriers that haven't already done so to switch from paper invoices to electronic data interchange (EDI). Today, 74 percent of CBSI's invoices are handled electronically, compared with 67 percent before the push began.

"Our goal is to try to be at 80 percent GE-wide by the end of this year. Then we want to start going to 90 percent," she says. Smaller carriers that can't implement EDI might use web-based invoicing and payment technology, she notes.

Life in the back office doesn't often resemble an extreme sport, but every now and then Necak gets a taste of high drama.

Last fall, for example, GE Energy had to ship electrical transformers to Afghanistan, where a customer needed them the following day. The only aircraft that could handle the load was a jet from Russia, and it couldn't leave the ground until its owner had received payment in advance.

"We were able to work with our vendors to get the information processed and initiate a same-day wire," Necak says. "That's the only kind of harrowing stories we have here—instances where an entire production line can be closed, dependent upon our ability to think outside the box."

The Big Questions

What are you reading?

Angels and Demons, by Dan Brown

Business motto?

"Use the quality tools for improvement." The quality model relies on metrics and root cause analysis to help identify what's really the issue.

Advice to people starting out in logistics?

Go into it with a very open mind, because you will encompass and touch so many different things. Try to learn everything there is to learn about the whole process.

What's in your briefcase?

Instead of a briefcase I carry my laptop, plus a portfolio containing notes I've taken during the day.

What do you do when you're not at work?

I like to read, travel, play tennis, golf for fun, take bike rides, and go to the beach.

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