Ryder’s Transportation Management Engine…Quiet, Smooth Running, Powerful
Ryder TMC – Fort Worth, Texas USA
April 6, 2009
By
Richard Armstrong
Key Personnel:
Todd Carter, Vice President & General Manager
David Belter, Group Director
Robert Houston, Director – Transportation
John Tullis, Senior Director – Corporate Development
Ryder’s transportation management (TM) capabilities have matured into a high quality vehicle for supply chain solutions. The driver is Todd Carter, vice president and general manager of global transportation management. The course designer is John Williford, president of global supply chain solutions. The pit crew consists of a dozen key vertical and functional leaders.
Ryder’s TM operations are headquartered in Novi, MI and Fort Worth, TX. Novi evolved as a freight bill payment and transportation center for Ryder’s strong automotive logistics offering.¹ The Fort Worth transportation management center (TMC) has added a lot more horsepower and maneuverability.
The Fort Worth TMC is a well designed “tower control” operating environment. The building is painlessly functional. The main floor (control center) is perfectly lit, quiet and comfortable. It doesn’t feel at all like there are over 200 people at work.
The TMC is a 24/7 operation supported by 35 English speakers in Nanjing, China who are significantly involved in 2nd and 3rd shift coverage. Nanjing has a series of universities and proportionately more fluent English speakers than other cities in the PRC.
The functional areas at the TMC are order management, planning and optimization, entity (rate library) management and event management. Order management handles 2.8 million orders a year. Eighty percent of orders are received by EDI. Twenty percent are entered at web-based Ryder Entry or transmitted as XML flat files to Ryder’s transportation management system (TMS) tool kit. USPS is a major user of the latter. Paul Booth’s order management operation primarily deals in correcting exceptions. Some accounts require tweaking of up to 15% of shipments. Other large EDI accounts like Boeing only have 1–2% of orders that require manual modification.
Order management sends orders to Leslie Mandrell’s planning and optimization section. All orders are optimized using i2 Technologies Transportation Optimizer. Less-than-truckload (LTL) shipments are converted into multiple stop truckloads. End-to-end matches are made of truckloads. Yearly, 2.8 million orders are consolidated into 850,000 loads (3.3 shipments per load).
Optimized results rely on the rate library/contract information of Kathryn Cunningham’s entity management. Cunningham’s database is essential for transportation planning, execution and Novi’s freight bill payment operations. A total of 14,500 carrier rate “tariffs” are maintained.
Optimized and individual shipments are tendered to carriers using i2’s Transportation Manager. Carrier acceptance is handled electronically by Ryder’s proprietary “Power Tracker”. This software modification significantly assists Kathy Moore’s event management section. This section handles most of the transportation exceptions. Each of its exception managers cover about 250 loads a day. Ryder’s TMS operations provide dashboards with extensive key performance indicator (KPI) information and tracking capabilities for customers and truckers. Standard carrier KPIs cover on-time performance, tender acceptance, update activity and daily summaries.
Overall, the freight under management (FUM) process works very smoothly. At most times it is like a well made car operating on cruise control. In addition to the FUM operations at the TMC, Ryder has built a significant freight brokerage operation. Ruth Lopez’s operation now handles 100 loads a day and is expanding its backhaul management for Ryder’s dedicated contract carriage (DCC) operations. There are 18 people in Lopez’s operation split between customer service and dispatch/truck handlers. Lopez and the employees in Ryder’s brokerage were trained at the TMC. Margins are similar to industry averages. Most loads move in vans but there is refrigerated trailer and flatbed activity.
The smoothness and efficiency of Ryder’s TMS operation is exactly what Todd Carter wants. Carter has been at Ryder for a little over two years. He has fine tuned the operation to its world class capabilities. We met Carter at GATX over a decade ago. He was a key member of Joe Nicosia’s (Hope is not a plan!) team. Complimenting Carter’s efforts is John Williford and his master plan for Ryder. Williford is retooling Ryder’s Supply Chain Solutions and Dedicated Contract Carriage Divisions to concentrate on strong operational strengths and provide crafted but generally uniform solutions for customers in retail/consumer goods, high-tech and automotive verticals. The retail emphasis is new to Ryder and is a logical reworking of its powerful automotive manufacturing and transportation supply chain support functions.
Profitable but non-strategic, problematic operations in Argentina, Brazil and Chile have been eliminated in favor of strengthening North American and Asian operations. CRSA Logistics and its sister consolidation/deconsolidation company, TCTL, were added to handle Asia to Canada retail supply chain solutions. These operations are based in Shanghai and come with a good IT base which allows for expansion. In Shanghai, Paul Tay is crafting the plan for Ryder’s Asian expansion. This Asian/North American expansion is a major piece of Ryder’s retail vertical development.
Expanding Mexican operations is also in process. Ryder handles about 3,800 border crossings a week between Mexico and the U.S. Mexican/U.S. operations are key to automotive, high-tech and other Ryder customers. Within Mexico, Ryder has solid value-added warehousing and distribution (VAWD) and DCC operations and over $100 million in revenues. It is a strong base to build on.
Williford has charged his six primary direct reports with the development of proactive, quickly implementable, Lean solutions. Williford’s reports are key for expanding the new supply chain management offerings. They are:
Tom Jones, Senior Vice President & General Manger
Stephen Dean, Senior Vice President – Sales & Marketing
Steve Martin, Vice President – Supply Chain Excellence
Paul Tay, Vice President & Managing Director – Asia Pacific
Gene Sevilla, Vice President & Managing Director – Latin America
Guy Tokso, Vice President – Canadian Operations
Williford has a history of cutting edge solutions for high profile customers like GM (Vector) and USPS. He is not afraid to think outside the box and cut to the chase. He has put together a strong team for driving the change at Ryder and increasing third-party logistics competition.
¹See the Armstrong & Associates report “Ryder Streamlines Transportation Procurement…” from October 2, 2008.
Sources: A&A Primary Research, http://www.ryder.com/