The Quest For Enterprise-Wide Transportation Excellence

Georgia Pacific describes a project to consolidate transportation management across its separate divisions.

Paul Snider is the director of transportation and logistics at Georgia Pacific (GP) – an $18.4 billion enterprise that makes 2 million shipments a year of products that range from tissues to two-by-fours. I recently had the opportunity to hear Paul describe GP's strategy to centralize the transportation management function across its four major divisions, a big piece of which is to migrate disparate TMS systems to a single software suite from RedPrairie. Paul's 30-minute, 29-slide presentation and audio replay can be accessed by visiting Optimizing Transportation Delivery Performance.

During his presentation, Paul discusses the overall transportation and logistics strategy across GP's four operating units (consumer products, building products, packaging, and bleached pulp and paper). He reviews which modules from which TMS vendors are currently in place at each unit and shares GP's software migration plan for the short and long term. The scope of business functions being addressed includes freight rating, freight consolidation, carrier assignment, dedicated planning and collaboration, and carrier management. The presentation includes an excellent graphic depicting how GP assesses its TMS systems' capabilities (including level of integration) in the following areas:

• Carrier contracting, which includes carrier selection, rating and tariff management, and capacity management
• Transportation planning, which includes shipment management, mode selection, multi mode planning, and routing and consolidation
• Execution and carrier management, which includes rating and carrier assignment, tendering, and carrier communication
• Freight settlement, which includes invoice processing, self invoicing, exception processing, accounts payable, check creation, and accruals tracking
• Scorecarding and analytics, which includes account tracking, carrier metrics, and data mining

Paul's presentation also provides good detail on the progress and early benefits of GP's freight consolidation efforts – which are greatly enabled by the centralized TMS strategy. Paul points to a reduction of LTL (less than truckload) shipments from 320,000 to 43,000 that resulted in more than $15 million in savings. Also contributing to the freight consolidation results is GP's participation in a 75-member, multi shipper cross-docking collaborative. Paul predicts significant growth in this business model as a way for shippers to address retailers' desire to place smaller orders at the last possible minute.

"An integrated TMS software suite with good reporting and analytic tools is critical to the success of our automated load control center," Paul explains. Other keys to success include support for the concept from top management, a well-trained and capable staff, and centralized control and visibility. The center's ultimate goal is to have the right capacity at the right place at the right time with the right level of service.