Maximizing Intermodal Efficiency
Intermodal transportation was developed to improve efficiency as U.S. consumer demand and shipment volume grew. When a trucking entrepreneur realized it would be more efficient to use the same conveyance for different shipping modes, without having to handle the cargo, intermodalism was created. The resulting interoperability of the assets themselves—containers, chassis, railcars—is evidence of improved intermodal shipping efficiency.
Shippers do not need to worry how well those pieces fit together; rather, intermodal stakeholders need to align their processes to drive efficiencies today. Blair Peterson, senior vice president of International Asset Systems (IAS), a global transportation solutions provider, offers suggestions for maximizing intermodal shipping efficiency.
1. Align goals. Position your intermodal transportation objectives so they are in line with your corporate objectives. The efficiencies gained from intermodal should support, and be recognized in, your company’s business goals.
2. Choose providers wisely. Know the delivery criteria your customers are looking for, and select transportation providers accordingly.
3. Contract sensibly. It is not all about the rate when choosing providers. Reliability by schedule adherence (railroads), punctuality (truckers), or timeliness (shipment data) also is critical.
4. Standardize the dispatch process. Your intermodal dispatch team needs to work wisely and consistently. Leverage your investment in technology and associated process refinement to ensure your intermodal network runs efficiently.
5. Make it easy for service providers. Standardize your business requirements for shipment acknowledgement, scheduling, en-route event capture, proof of delivery, and billing. In times of tight capacity, quality transportation providers will gravitate to the transportation buyers that are easiest to work with.
6. Connect your intermodal network. Get closer to quality providers with data integration (or an efficient multi-tenant portal), process standardization, and requirements consistency. Having the transportation buyer and provider on one platform gives a clear view of shipment data and service provider compliance.
7. Gather data. Be sure to collect performance data around critical intermodal nodes. But before you start, get buy-in to big data objectives from internal and external stakeholders so everyone knows what is being measured and why.
8. Take advantage of data. Use data about lanes, modes, customers, and vendors to drive decision-making, tune your intermodal network, and identify efficiency opportunities. The unit of measure can be revenue, cost, margin, hours, minutes, steps, stops, or calls.
9. Integrate in both directions. Good shipment data will drive optimization in your transportation management system, and generate efficient transportation orders for your intermodal providers to execute.
10. Examine your network. Recognize, reward, and rationalize your vendor network based on performance. By being easy to work with, measuring compliance, and rewarding performance with more volume, your intermodal network will become more efficient over time. All the stakeholders in your intermodal transport chain will benefit.