FedEx Freight Delivers Sales Planning to its Supply Chain

Enterprise planning and performance management software from Steelwedge deployed as on-demand solution

MEnterprise planning and performance management software from Steelwedge deployed as on-demand solution

Pleasanton, CA  July 25, 2005  FedEx Freight, which is a U.S. provider of next-day and second-day less-than-truckload (LTL) freight services, said it is using Steelwedge Software's Enterprise Planning and Performance Management (EPPM) solutions for enterprise sales forecasting.

The solution is currently deployed in an on-demand model.

With more than 350,000 active accounts and 4.5 million freight bills annually, FedEx Freight said it needed a consensus-based sales forecasting engine to power enterprise demand planning. The company's in-house forecasting tool provided a means for district managers and sales leadership to review historical revenue, number of shipments and tonnage at the customer center, territory and national levels and use that information to manually create sales forecasts.

The system, however, did not provide a statistically rigorous method of producing forecasts. Further, FedEx Freight accounts are continually realigned and shifted between customer centers and territories, and the in-house tool did not automatically reflect these changes. As a result, ongoing manual adjustments were needed, causing confusion. Finally, strategic forecasts differentiated by product type were not available, so long-term equipment purchasing and support equipment decisions could not be easily made.

Steelwedge advocated a collaborative planning system and determined that the solution to the realignment problem was to forecast at the account level. This permitted moving the forecast (including qualitative adjustments) with the history when realigning customer centers and territories.

The solution also forecasts active accounts individually, and groups inactive accounts by their customer center to provide planning flexibility and detail. As a result, the time required to develop a final sales plan is reduced and forecast accuracy improved.

In addition, participation in the planning process has increased, leading to greater buy-in and support of sales plans from the field. And by deploying the solution as a Steelwedge on-demand service, FedEx Freight said it was able to deploy the solution quickly and cost-effectively.

We are very excited to see FedEx Freight leveraging our collaborative sales forecasting capabilities in an on-demand model to improve their overall planning process, said Steelwedge CEO Timothy Campbell. The solution manages more than 30 million forecasts.

For more information on the challenges of enterprise performance management in the age of real-time data, read "The Reality of Real-time Performance Management," the Net Best Thing column in the October/November 2003 issue of Supply & Demand Chain Executive.

For a look at the challenges of expanding performance management to encompass the extended supply chain, read "Taking Performance Management Outside the Four Walls" in the April/May 2004 issue of Supply & Demand Chain Executive.