Getting Beyond Narrow ROI with YMS

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


With the YMS in place, the car manufacturer replaced inventory with information. Before the YMS, a typical shipment of parts would come to Detroit, sit in the yard a few days, get put away in the warehouse and often get shipped out the next day. The process was slow and imprecise because between the time the TMS lost sight of the trailers as they passed through the gate and the time the WMS picked up the product when it arrived on the warehouse shelves, the parts were basically lost. Now, with inventory visibility in the yard, priority shipments can be pulled directly to dock. In many cases, the shipments can be cross-docked straight onto an outbound trailer, saving on inventory holding costs and ultimately allowing the manufacturer to buy parts in much smaller lots. All this translates into lower inventory costs and higher velocity.

Improved Service Levels
Britain's Royal Mail was facing a brand new challenge: competition. With an already established reputation for high-quality service, the real challenge was to drive down cost while maintaining its strict service level promise that any of the 82 million pieces of first-class mail posted daily up to 7 p.m. would be delivered anywhere in the U.K. by 9 a.m. the following day.

The answer to the challenge was to move to a centralized mail distribution center and to make that center as efficient as possible. The first step was to select a YMS with simulation and visualization capabilities. Royal Mail was able to use the software to optimize the design of its brand new cross-dock facility with an optimal layout to avoid the congestion problems that typically affect high-volume yards.

Royal Mail uses a team of Yard Marshals with handheld devices to log the status of the inbound trailers and, in combination with a team of controllers and the information provided by the YMS, they are able to prioritize trailers with the most time-sensitive cargo and ensure the trailers don't wait for docks, and docks don't wait for trailers at peak times.

The net result has been a 53 percent reduction in the number of shunting vehicles needed and a 40 percent reduction in control room staff over predicted staffing levels and, even more important, an overall fleet reduction of 5 percent. All while maintaining Royal Mail's already sky-high service levels.

Royal Mail is planning to push the project even further with the integration of GPS tracking that will further reduce manpower needs and increase efficiency.

Keep Thinking Outside the Yard

The current generation of YMS can integrate with or complement other systems in your supply chain, giving you constant visibility. But more than that, a YMS gives you the power to adjust, prioritize and optimize operations at one of the most critical junctures in your supply chain.

The real message here is that for YMS to become widely adopted and effectively implemented, we need to move the issue to the top of the logistics agenda where it belongs. Narrowly defined ROI alone simply isn't a compelling enough argument. But the systemic benefits of overall logistics integration are compelling. Increased velocity. Increased flexibility. Increased visibility. Increased profitability. Those are the factors that have yet to be quantified.

By focusing on the real-world benefits that all logistics organizations are striving to achieve, we can reframe the debate about the relative importance of YMS. We can make sure that decision-makers understand that a YMS is a must-have for logistics excellence.

About the Author: Greg Braun is a veteran of the transportation and logistics industry with more than 20 years industry experience. Before co-founding C3 Solutions, Braun was manager of information services at Groupe Robert (one of Canada's largest trucking companies). While at Groupe Robert, Braun was successful in developing a number of logistics solutions offered to retail and manufacturing customers. For more than 10 years now, Braun has been a key figure in defining the core challenges of yard management and tailoring solutions that meet real-world business needs. You can contact him at gbraun@c3solutions.com.

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