November 2013 | Sponsored | Knowledge Base

Saving Time and Money Through Automation

Tags: Logistics I.T.

Tom Heine, is CEO, Aljex Software, 732-357-8700

au•to•ma•tion (n): The technique, method, or system of operating or controlling a process by highly automatic means, as by electronic devices, reducing human intervention to a minimum.   — Dictionary.com

The number-one expense for brokers and 3PLs is payroll. Every function employees deal with has a cost in hourly pay, salary, or commission. Whether they are paid for increments of time is immaterial. Time is still money.

That's because there are only so many minutes in a day. And if that day includes lots of repeated functions that could be automated but are not, the result is more loads that could have been dispatched, more revenue that could have been earned, or—at the very least—missed opportunities.

If automation of these repeated office functions can increase efficiency by 20%, that's the equivalent of an added day each week. Or, looking at it another way: You can save 20% of your employee's annual salary.

In fact, the administrative side of freight can be a largely automated process. So an improvement of 20% is a very reasonable goal. The means are at hand.

Perhaps the most obvious first step is to have an interactive website. Enable those you deal with to access the information they need without having to call.

For example, customers should be able to track shipments on your website, and employees should not have to enter that tracking data. That can happen automatically with data received from trucks on the road. It can be from an onboard computer system or an individual driver's GPS-equipped cell phone. Electronic automation can update the tracking data.

It's a great benefit. Employees don't have to deal with customer calls looking for updated tracking information, and they don't have to deal with check calls from drivers either. It's all automated through software.

Similarly, customers should be able to enter shipment information on your site. When customers fill out their own online documents, you save twice. First, it's one thing an employee doesn't have to do. Second, it eliminates the inevitable errors that derive from entering information taken over the phone. Software automation takes the customer-completed order form and populates fields in the related transportation documents as well as on your computer screens. Every phone call a front line employee doesn't have to make or answer means more time for other, more productive work.

Speaking of communication, don't forget EDI (Electronic Data Interchange). It has been around for a long time for the singular purpose of enabling electronic communication among partners in the supply chain. Most major corporations and many not-so-major corporations use EDI to automate the exchange of information. Every step on the path of a shipment, from creation of a bill of lading, to the final carrier invoice, can be documented and shared among trading partners automatically. That can be a lot of information your employees do not have to collect, enter, convey or receive. Remember that in 2013, you can trade with a lot of companies and not have to pay EDI fees.

Each job should be analyzed; every repeated function should be measured. For example, how long does it take to book a load—or in the case of a carrier, to dispatch a load? What are the individual steps involved? How many phone calls are required? How many emails? How long does the dispatcher spend working on the computer? How long does he or she wait between screens? How many steps are required to get essential information from various sources and place it in the necessary documents? Save 10 seconds off of a one-minute job, that's 16.6% savings.

Much automation is accomplished through smart software that understands information entered in one instance, and used in many places. Double entry is your enemy. If you have duplicate entry issues, the software you currently have can probably be modified to eliminate it.

Do you know all that your current system can do? Are you realizing its potential in your business? Are your people adequately trained in how to use it? The opportunities for automation exist, and the returns for finding and implementing them can be money on the bottom line.

There is also very healthy competition among a number of software providers who want your business. Sometimes you can save a lot by finding a new system. Just remember, save 20% of your employee's time, and you are saving them one full day per week!