©2012 Don Dovgin All Rights Reserved.
Proprietary & Confidential
Consulting
Technology
Outsourcing
Providing total solutions,
rather than advice.
Utilizing the latest
technology to enable
and generate new
business opportu...
 Decades of experience
 Routinely achieve 8% to 12% savings for our clients
 Achieved as much as 50% savings in LTL
cat...
 Obtain visibility into enterprise spend to identify and prioritize sourcing
activities
 Use Best in Class methodology a...
Typical Scenario
 After six to eight months, actual savings can fall short of expectations by >40%
Time
Savings
Savings s...
Strategic
Alignment
Relationship
Leveraged
Drivers of Provider Selection
Consolidation of
requirements amongst
carriers
Op...
Broad Strategic Sourcing Experience
 Supported numerous teams with services that
provided combined savings in excess of $...
Step 1 Step 2 Step 3 Step 4
Step 5
Baseline
Spend
Components
Select
Sourcing
Strategy
Develop
Provider
Base
Select
Impleme...
Baseline
Database
5.
Award notifications
Negotiate agreements
1.
Baseline Spend
4.
Implementation Approach
Facility Profil...
 Cost-effective coordination of moving of the right material in sufficient quantities from
manufacturing to storage.
 Mo...
1. Distribution Strategy:
Channel strategy performs customer driven market segmentation, quantifies cost to
serve, optimiz...
What comprises TMG’s Distribution & Warehouse Optimization
Solution?
TMG is one of few firms that offer a comprehensive “c...
Traditional Warehouse Integrated Distribution Center
Characteristics
Client: Storage Depot
Isolated, discrete operation-fu...
What are the client benefits of TMG’s Solution?
 Increased volume (e.g. improved order fill rates)
 Reduced freight and ...
 TMG has some of the best industry experts available known for logistics
supply chain and strategy practice
 TMG approac...
645 N. Michigan Avenue, Suite 800 • Chicago, IL 60611
Phone: 312.280.1380 • Fax: 312.751.0313
Email: info@tmginconline.com...
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Reduce your transportation cost using our methodology

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Learn more about Transportation Management Group and the best practices to lower transportation costs.

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Reduce your transportation cost using our methodology

  1. 1. ©2012 Don Dovgin All Rights Reserved. Proprietary & Confidential Consulting Technology Outsourcing
  2. 2. Providing total solutions, rather than advice. Utilizing the latest technology to enable and generate new business opportunities for you. Creating value by delivering lifecycle solutions and bottom line results. Bringing value-based solutions to our clients to help build bridges for the future. We quantify our results so you see the value. Consulting Technology Outsourcing Relationshi ps Improved Profitability Driving hard for our clients
  3. 3.  Decades of experience  Routinely achieve 8% to 12% savings for our clients  Achieved as much as 50% savings in LTL categories  Utilize best practices in the industry  “Big Four” Consulting at a competitive cost  Warehouse, Distribution, Transportation, Logistics – Our Core Competency! Implementation
  4. 4.  Obtain visibility into enterprise spend to identify and prioritize sourcing activities  Use Best in Class methodology and templates to reduce effort for client  Customized application of RFP’s to uncover underlying category economics  Unlocking unrealized potential by letting carrier bid on strengths  Iterative bid analysis uncovers “what if” scenarios  Review carrier consolidation opportunities  Supported by comprehensive complement of analytic reports to ensure feasibility  Track implementation and actual savings, based on initiative recommendations  Identify secondary savings opportunities through sustained focus on quality Sourcing Process Transport Sourcing Methodology Baseline Data Prep Proposal Collection Bid Analysis Transportatio n Management
  5. 5. Typical Scenario  After six to eight months, actual savings can fall short of expectations by >40% Time Savings Savings shortfall due to weak compliance tracking Savings erosion due to weak category management Projected Annualized Savings Projected savings can erode rapidly without ongoing maintenance after implementation  Carriers don’t accept tendered loads  Non-compliant carriers used  New lanes emerge as supply chain partners change their networks  Volumes shift as loads are optimized Transport Support
  6. 6. Strategic Alignment Relationship Leveraged Drivers of Provider Selection Consolidation of requirements amongst carriers Operational integration based on historical successes Systematic matching of changing capacities and capabilities Notes  This is an iterative and evolving process  Timely progression through the appropriate stages is key for deriving incremental benefits  The majority of carrier relationships surveyed are being managed on the relationship level today Progression Emphasis on building relationships with a few core carriers Significant opportunities are uncovered when transportation has been managed based on strong relationships
  7. 7. Broad Strategic Sourcing Experience  Supported numerous teams with services that provided combined savings in excess of $200 million Deep Transportation Sourcing Expertise  Sourced over $1 Billion of global spend, generating an average savings of 14% per initiative  Routinely advise strategy consulting firms, journalists, and analysts in transportation sourcing Collaborative Carrier Approach  Methodology produces long-lasting carrier relationships  Frequent accolades from carriers validate collaborative approach Recent Results Result Result  International Air & Ocean  $3 million spend  TMG saved $700,000  NA Truckload  $7 million spend  TMG saved 1.5 million Result Result  LTL  $15 million spend  Saved 23%  Inbound Freight  Converted terms  TMG saved 15% WHY TMG?
  8. 8. Step 1 Step 2 Step 3 Step 4 Step 5 Baseline Spend Components Select Sourcing Strategy Develop Provider Base Select Implementation Approach Negotiate and Select Providers Integrate Providers Benchmark Performance Step 6 Step 7 7-Step Sourcing Methodology
  9. 9. Baseline Database 5. Award notifications Negotiate agreements 1. Baseline Spend 4. Implementation Approach Facility Profiles RFI/RFP Savings Calculations 2. Site interviews Data and Systems review Sourcing Strategy 3. Develop Provider Base 6. Company Announcement Integrate Providers 7. Organize KPI’s Benchmark Performance Track Savings Deeper into Sourcing Methodology Inputs Outputs
  10. 10.  Cost-effective coordination of moving of the right material in sufficient quantities from manufacturing to storage.  Movement from storage centers to on-time delivery to customers How Does TMG Implement Optimization?  Help client design and implement their physical distribution infrastructure:  Detailed design of the “inside and outside the four walls”  Helping clients address changes in their environment  Take in account factors such as:  Postponement cross-docking  Increased customer demands for accuracy, speed, value-added services and flexibility What is Distribution & Warehouse Optimization? Distribution & Warehouse Optimization Distribution operations account for the largest segment of assets in the supply chain, and the second largest segment of cost.
  11. 11. 1. Distribution Strategy: Channel strategy performs customer driven market segmentation, quantifies cost to serve, optimizes go-to-market strategies, service requirements and associated distribution capabilities; network strategy rationalizes current distribution network 2. Warehouse Management Systems: Focuses on execution capabilities of warehouse, enabling distribution capabilities and integrating with other supply chain partners and providing transaction backbone 3. Distribution Design: Improves processes such as cross-docking and consolidated distribution, picking and dispatching 4. Performance Management: Enhances human performance through and short term and continuous improvement efforts Distribution & Warehouse Optimization Four key components
  12. 12. What comprises TMG’s Distribution & Warehouse Optimization Solution? TMG is one of few firms that offer a comprehensive “cradle to grave” solution set. The solution incorporates:  Distribution Strategy: Channel requirements and desired capabilities definition, master distribution plan development, benchmarking/assessment, operating model definition, supply chain configuration  Warehouse Management Systems: Selection and implementation of WMS solutions  Distribution Design: Detailed facility design for new & retrofitted facilities, facility expansion  Performance Management: employee performance/measurement, operations management, slotting, equipment maintenance, vendor compliance Distribution & Warehouse Optimization
  13. 13. Traditional Warehouse Integrated Distribution Center Characteristics Client: Storage Depot Isolated, discrete operation-functional Inflexible, production oriented No value added Problem: One dimensional Flow- through distribution center- extension of suppliers. Integrated into cross-enterprise supply/demand chain. Resilient, geared to agile manufacturing. Products customized, made floor-ready Solution: Linkage of strategy, people, processes and technology Facilities Large centralized Up to half of storage space wasted Storage-oriented use of space Fewer, smaller, focused on regional markets Maximized space utilization Landing point for imported product, merge cross-dock unit, plus value-added service area People/Organization Individuals working alone in a single function Executives on single-discipline career track Excessive bureaucracy/supervision Multifunctional teams Executives cross-trained to manage total business, make knowledge-based decisions Empowered workers, few management levels Technology Legacy systems, not integrated with vendors Emphasis on assets – inventory, transportation, warehousing Traditional/rigid order management Integrated networks, distributed architecture Emphasis on information, instant feedback real-time readouts of business pulse points Advanced system provides full-span logistics visibility to implement agile distribution Dramatic, Measurable Results Order-handling cycle time, Shipping accuracy, Customer lead-time Twice as fast, Up to 20 percent better, 50 percent better, Improved 10 to 20 percent, 99.9 percent, down 75 percent, Distribution & Warehouse Optimization
  14. 14. What are the client benefits of TMG’s Solution?  Increased volume (e.g. improved order fill rates)  Reduced freight and indirect labor/warehousing costs  Optimized physical network / facilities  Leveraged new and/or alternative distribution channels  Reduced customer service & order management costs  Improved customer service (shorter lead times, more accuracy, value added se  Reduce Finished Goods inventories  Optimize AP and AR  Improve Asset Utilization and Rationalization Distribution & Warehouse Optimization Clients
  15. 15.  TMG has some of the best industry experts available known for logistics supply chain and strategy practice  TMG approach involves clients as part of our team that is trained with our winning formula  TMG takes an ongoing process to uniquely position client distribution facilities in a constant state of improvement, not in a constant state of flux  TMG shares implementation methods with top WMS vendors that have proven abilities in:  Fast-track operations implementation  Reliable operations performance delivery  Seamless integration between physical infrastructure and information systems  Designed-in worker usability  Structured employee learning and process ownership Why Hire TMG For Distribution & Warehouse Optimization What is the implementation timeframe?  Studies are 4 to 12 weeks  Process Implementation 12 to 18 weeks  Technology Implementation 4 to 18 weeks Who are the client decision-makers?  VP Materials  VP Logistics  VP Supply Chain
  16. 16. 645 N. Michigan Avenue, Suite 800 • Chicago, IL 60611 Phone: 312.280.1380 • Fax: 312.751.0313 Email: info@tmginconline.com www.tmginconline.com Learn more about freight studies and our solutions.
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