Planning And Maintaining Your Dream Yard
One key to logistics success is a healthy, well-maintained trailer yard. YMS solutions provide the fertilizer to help grow a yard to be proud of.
On Saturday nights in the mid-1970s, 60 percent of all TV sets were tuned in to the often controversial sitcom that introduced America to an iconic Queens, N.Y., loading dock worker named Archie Bunker. The cantankerous Bunker never missed an opportunity to insult, generalize, or misinterpret any situation that did not neatly comport with his own world view. Was it the inefficiencies of working on the loading dock that caused Archie's agitation?
Clipboards, time cards, paper, chalkboards—this was the yard management system that Archie Bunker would have used 30 years ago. For some companies today, not much has changed.
"Managing a yard can be tedious, inefficient, and cumbersome," says Chuck Bealke, vice president, transportation solutions for integrated software solutions provider Retalix Ltd., Supply Chain Division, Plano, Texas. "Historically, the yard has been an area where workers will tolerate chaos. But times are changing. Just as most warehouses use a warehouse management system (WMS), yards are being optimized by yard management systems (YMS). Companies are beginning to realize that no matter how efficient the warehouse, it means nothing without an efficient yard."
Ninety percent of the logistics professionals surveyed in an October 2008 Aberdeen Group study say they are interested in taking action within the next one to two years to improve operations by purchasing or updating software solutions in and around the warehouse, including transportation and yard management systems.
A yard management system prioritizes shipment arrivals, schedules trailer appointments, manages yard jockey activity, identifies trailer contents, and ensures that workers don't waste time looking for trailers, unloading product, or parking a trailer in the wrong dock location.
"Many companies focus on managing inventory inside the warehouse and transportation outside the warehouse, leaving a huge void in optimizing yard assets," says Tim Harvie, president and CEO of Englewood, Colo.-based Fluensee Inc., a provider of RFID-enabled asset management solutions. "Since mid-2008, supply chain productivity has improved significantly, much of it related to yard management. Previous YMS solutions were built on old business models and older technology. Today's YMS leverages new and emerging technologies."
SITTING ON THE DOCK
The business of logistics today revolves around saving money, particularly in trailer management. When drivers show up at a dock carrying containers, unloading commonly must occur within a specified time or the distribution center (DC) is charged per day by the transportation company.
"A truck left sitting costs the carrier money," explains Dick Lipari, sales manager for supply chain software vendor Royal4 Systems, Long Beach, Calif. "The carrier charges back for containers that are put in a corner, forgotten about, and not unloaded."
Rates vary by trucking company, but the charges are based on time. Containers average $75 per day, climb to $150 per day for the following week, and add $75 to that price per day for each week thereafter until the container is returned.
To help avoid these costs, Royal4 Systems added alerts to the yard management module included in its WISE warehouse management system. WISE ensures that the right trailer is scheduled for the right dock at the right time. Dispatchers receive dock schedule appointments wirelessly. Trailer type, trailer content (down to the SKU level), load type (perishable, dry, or hazardous), length of time trailer can be on the lot before the carrier issues penalty charges, purchase order associated with the load, and any errors or exceptions to the purchase order are all visible.
Exorbitant trailer detention charges were the reason why the Ford Assembly Plant in Claycomo, Mo., needed a new YMS. Able to accommodate up to 360 trailers in its bullpen at once, the company had a YMS in place when James Kennedy of the material planning and logistics department arrived on site.
"The previous YMS did not accurately track detention," recalls Kennedy. "Trailers were sitting too long, costing Ford upwards of $11,000 per month."
Ford has eliminated that cost by loading and unloading trailers within hours using KT3 yard management software from K&T Switching Service, Inc., Sheffield Village, Ohio. The yard management software was developed by K&T of Lorain Ltd. for licensed use by K&T Switching Service Inc. and K&T Logistics Inc.
"KT3 provides the ability to use RFID to track a container's comprehensive life cycle," explains Kelley Radican Stewart, president of K&T. KT3 works within Ford's infrastructure—as well as with outside suppliers and carriers—to implement and maintain operational efficiencies. Web-based Internet access streamlines container movements.
"Supervisors and drivers have access to the docks via the system," says Kennedy. "Drivers know where to drop their trailers, and yard supervisors know exactly when a trailer arrives and when it leaves the dock. Having insight into every move a trailer makes in the yard has saved significant time and money."
Sitting containers don't just cost money, they can be detrimental to a product's shelf life. "Companies are more environmentally aware today," says Lipari. "They know that products have a life, and that a container is no protection for most products. Workers must take action to unload products or move containers to better locations, and a YMS can help make that happen."
"Food logistics has been aware of shelf-life issues for a long time, but now the age expectancy of other products is moving to the forefront," says Lipari. For example, the quality of a tire can deteriorate if it is left in a very hot container for a prolonged time. Heat can also cause leaching of plastic into bottled water.
VALUE OF VISIBILITY
Another issue moving to the forefront is a desire for increased visibility—having more information about incoming and outgoing shipments—along the supply chain. Approximately 53 percent of respondents to the Aberdeen Group survey cite a need for greater connectivity with external parties for visibility into shipments and orders.
"Visibility is the starting point, and logistics managers value it a great deal. No company suffers from knowing more about their shipments," notes Michelle Kiang, founder and vice president of marketing for PINC Solutions, Berkeley, Calif., a yard visibility and management solutions provider.
PINC's YardHound offers real-time visibility of all yard activities accessible through a Web-based platform. "The YMS fills the communication and visibility gap between a WMS and a TMS," Kiang explains.
The lack of visibility was the challenge facing Dole—the world's largest producer and marketer of fresh fruit and vegetables—at its inbound operations in California's Salinas Valley. When materials arrived in the yard, workers had no real-time information about the fresh produce coming from the field or how long the material sat in the yard before it was moved into a cooling tube. Produce comes in to weigh stations and moves via conveyor to a cooling tube that quickly brings down the core temperature of the produce before it is stored in the warehouse cooler. There was no way to know which product was cooled in which cooling tube, explains Ashish Chona, CEO of technology company InSync Software, San Jose, Calif.
Dole chose to install InSync's food tracking and safety solution. Containers holding sensitive and perishable materials, such as produce, can be outfitted with temperature and other environmental sensors. InSync's software integrates this data into dashboard views to provide condition status. If assets have an expiration date, the loads are prioritized to minimize scrap and waste.
Installing InSync's software system provides Dole with 100-percent visibility of all produce coming into the yard and what happens to it once it arrives. The system tracks the date, time, and location of every pallet within and through the yard into the warehouse. The system also records the cooling time of each pallet: what time cooling started and ended, and when it was moved into the cooler warehouse from the cooling tube. This has had a significant impact on product quality and operational efficiencies, says Chona.
Eventually, Dole wants to track the temperature of materials, starting from field harvest, to allow smarter dispatching of materials into the cooling tube. A product that is more temperature-sensitive, for example, earns higher priority to a cooling tube than another product that may be waiting longer but is less temperature-sensitive.
Visibility is just as important to a single yard as it is to a large-scale operation. The YardPRO Web-based visual railcar inventory and yard management tool, developed by MaxAccel of Boulder, Colo., automatically keeps a near-real-time visual representation of each railcar's location in a yard. It also reports the status of the cars—loaded, empty, cleaned—the last commodity in the car, any reported mechanical defect, and other related information, explains Peter Sutcliffe, managing partner for MaxAccel.
One inland port installed YardPRO to ensure that yard operations and communications flow to everyone who needs to know the status of each railcar in the yard. Additionally, the software helped the port overcome inefficiencies associated with the varied needs and rate structures of its 12 internal customers.
Before the port implemented YardPRO, the morass of paper records, inconsistent information, billing errors, and high labor overhead created a challenge. YardPRO has automated the billing process, labor is more productive, and yard operations and communication flows as all players know the status of every railcar in the yard.
While it's tempting to implement a YMS to gain improved visibility, there are some hurdles to overcome—namely price. More than 30 percent of Aberdeen Group survey respondents believe that the cost of YMS solutions is too high. In today's economy, it can be tough to justify the investment. But solution providers argue the justification shouldn't be a roadblock because ROI can be realized in less than one year. "If the ROI is not less than one year, the YMS is not worth buying," says Lipari.
"Yard management systems used to require a $250,000 to $500,000 investment, which is why the market has traditionally been small," says Kiang. "But the availability of more cost-effective real-time logistics systems, combined with YMS, has driven down the price."
Many companies don't want to invest capital in radio frequency identification (RFID), notes Jim Harris, president of Cypress, Texas-based YardView. The company's YMS does not have RFID functionality, which can add costs to a YMS. The trailer tracking and logistics planning software can be configured to mirror any operation.
YMS ROI ASAP
Associated Food Stores (AFS), a cooperative that supplies about 600 independently owned retail supermarkets, invested in RFID and a YMS and realized ROI in less than one year. "Any data that can be automatically captured by RFID must be recorded; it's no longer a luxury," says Tim VandeMerwe, dry grocery logistics coordinator for AFS.
AFS installed Retalix YMS at its Farr West, Utah, distribution center to improve fleet use, facilitate inbound and outbound product tracking, and coordinate yard labor. Integrating the YMS with a WMS and logistics routing system has improved trailer tracking, dock assignments, and hostler management, says VandeMerwe.
Retalix Yard Management is designed to automate and control the arrival/departure, yard location, yard movement, and readiness of trailers in a full, online environment. The system uses real-time information from RFID tags to track actual location of equipment in the yard. The use of wireless communications for equipment and trailers allows improved control and monitoring of the delivery process for all merchandise that is sent or received, says Bealke.
Reducing the wait time for trailers in the yard is a key benefit of the Retalix solution. Knowing what equipment is in the yard and where it came from enables warehouse management to plan and monitor every move.
Incoming trailers from the gate can be routed to a specific dock based on accurate real-time open dock status. Using computer-assisted logic, the system knows how long the trailer has been loading/unloading and it can automatically redirect a move based on availability and status of yard resources. "The YMS is an integral part of our supply chain," says VandeMerwe.
No matter how integral to a supply chain, a yard management system might not be a wise investment for every company. A one-DC location with a small yard, for example, might perform perfectly well using a WMS that has a YMS module, or even a manual system. "But there is always value in a yard solution," adds Harvie.
A company cannot attain any value, however, unless it purchases a system that meets its specific needs. Ask these questions before selecting a YMS:
- Is the system adaptable to multiple yard locations?
- Is the current inventory management situation severe enough to justify the YMS investment?
- How much will the system help increase throughput?
- Is the system easy to configure and use?
- Will the YMS grow with the company?
Yard management systems have grown and evolved from simple modules in a warehouse management system to standalone solutions that can integrate with other programs for greater supply chain visibility and dynamic appointment scheduling.
What sets a YMS apart from a WMS is its ability to manage zones. The YMS allows users to establish zone rules that the system enforces. For instance, a company can designate one zone in a yard for hazardous materials storage only. Nothing else can be placed in that zone, and hazmat items can't be put anywhere but in that zone.
Yard management is just one aspect of the supply chain, and while it's a useful tool, a YMS can't solve every challenge. Just because you can move trailers around, doesn't mean you can manage a yard.
Just ask Archie Bunker.