Getting Beyond Narrow ROI with YMS

Redefining ROI puts yard management systems at the top of the logistics agenda


One of the reasons yard management and dock scheduling software has been slow to be adopted throughout the logistics world is the constant focus on ROI. Vendors, including ourselves, have been guilty of thinking only about the impact our software has on the tractors, trailers and shunters at work in the yard.

Yes, ROI is important. Yes, you will save money on shunters, driver and trailer detention and a host of other yard costs. Typically, for companies with a fleet over 100 tractors, YMS (yard management system) projects reach payback in under a year and generate strong direct savings. But those savings often aren't enough to drive a YMS purchase to the top of a C-level decision-maker's logistics priority list.

Maybe we haven't been including the right factors when we calculate ROI. It's time we started to think outside the yard. It's time to get beyond the narrow definition of ROI and look at the real impact YMS software can have on today's high-velocity logistics organizations.

The Yard — Where Cutting-edge Technology Meets Clipboards and Magnets

Your ERP system allows you to rationalize nearly every aspect of your business, from electronic data interchange (EDI) integration with suppliers and vendors to the most minute of purchasing details. Your warehouse management system (WMS) has allowed you to minimize inventory and cut costs. Your transportation management system (TMS) optimizes your routing and boosts the overall productivity of your trailer fleet. But what happens when a trailer full of merchandise hits the front gate of your distribution center?

What is a YMS?

At the most basic level, a yard management system is a piece of enterprise-level software that allows logistics operators to control the flow of tractors, trailers and shunters entering the yard of their distribution center.

A properly configured, fully featured YMS provides visibility down to the stock-keeping unit (SKU) level for everything in a yard, from the gate to the dock and back out the gate again.

With this type of visibility comes the flexibility to reprioritize, create custom loads, fine-tune the flow in a yard and avoid tie-ups. That visibility also extends to other logistics systems. By integrating with WMS, TMS and ERP systems, the YMS becomes a strategic link, turning a yard into a logistics accelerator and optimizer rather than a weak link in the supply chain.

What happens is that your freight drops off the screens of your cutting-edge systems and reappears as magnets on a whiteboard. For the duration of its stay in your yard, you lose visibility and control of freight until it reappears in your warehouse or until the trailer is picked up by a tractor and leaves your yard. While the contents of the trailer are in your yard, your logistics system is losing the velocity and control you spent so much to achieve.

Productivity, Inventory and Service Levels: Three Real-world Challenges

Productivity Loss
WMS and TMS provide a great boost to human productivity in a supply chain. With a WMS, a fork-lift operator or lumper moves freight a minimum distance either to put it in the optimal shelf space or load a trailer in the most effective unload sequence. But what if the trailer is not at the dock on time? Then the freight needs to be staged and all the hard-earned productivity gains created by the WMS are lost.

With a TMS, your organization gains driver productivity by optimizing the routes and ensuring the right type of trailer is used. But if the driver can't find the right trailer in the yard or picks up the wrong trailer or is delayed at the gate, your productivity gains go up in smoke.

The WMS or TMS combine to provide very precise instructions, for instance, to bring an empty 53-ft. trailer to door 94 for loading a specific route with specific freight. But as one national retailer pointed out to us, "If you're relying on a Dock Controller with a radio, the Dock Controller becomes the choke point, calling out one load at a time." At peak times this, too, can erode the productivity gains you invested so much in to attain.

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