Once upon a more uncomplicated time, logistics was something a motor carriers’ customers had to worry about. The trucking company’s only concern was to deliver freight somewhere and do that at an acceptable cost, on time, and in one piece.
Some fleet executives who’ve been out of college a few years may remember having come across a logistics-management course or two that was offered to business-administration students and then, over time in trucking, started to hear more about logistics, if only at first as a buzzword bandied about here and there at industry meetings.
Then there are those, like me, who are students of history and so got our first sense of the scale of logistics’ importance when we heard that Napoleon purportedly declared that an army marches on its stomach.
Fast-forward a century and a half and us history buffs are peering into France again, this time at the late summer and fall of 1944, when the fabled truck drivers of the Red Ball Express ran hell for leather under enemy fire in convoys of over 100 trucks at a clip to resupply the rapidly advancing U.S. Third and Fourth Armies as they raced to cut off enemy troops before they crossed back into Germany.
In that three-month campaign that showed logistics can be pressed into battle as a tactical as well as a strategic weapon, more than 6,000 trucks hauled over 400,000 tons of gasoline, ammo, and everything else the motorized American army needed to “attack and attack and attack some more,” to quote legendary General George S. Patton Jr.
Jump up to today, and logistics has leaped well out of the history books to hit trucking square in the face. Now, you can no longer expect to run a motor carrier of any size without at least a glancing appreciation for the impact logistics— in one way or another-- has on every link in the supply chain.
That’s why savvy managers of fleets ranging from a handful to thousands of trucks are delving into how they can get the most out of their relationships with freight brokers and third-party logistics providers, how they can leverage technology to better serve shippers/receivers, and whether they should start up their own brokerages.
Lots of market trends are driving all this seemingly sudden attention to logistics by truckers-- everything from changes in freight flow and demand wrought by e-commerce/omnichannel distribution growth to the advent of more and slicker digital freight-matching solutions and services.
To be sure, what we can now call fleet logistics is being driven as hard as a Red Ball Express Deuce-and-a-half GMC by floods of data, which must be channeled to generate information that can seek out freight and move it at the lowest cost and as visible as possible.
All this was driven home to me by a panel that discussed intelligent freight-matching in a Sept. 12 session on the third data-packed day of the FTR Annual Conference. The meeting, fittingly enough with its focus on all freight transportation modes, was held within the magnificent Grand Hall of historic Union Station in downtown Indianapolis.
Kicking things off, moderator Brent Hutto, Truckstop.com’s chief relationship manager, said the “data revolution” opening the door to freight-matching technology to transform how carriers, brokers and third-party logistics providers optimize loads is “changing our entire industry.”
Hutto turned to data to update the audience on one key human element of the marketplace. He said that “the average age is going down and education level is going up for owner-operators and that tells us this audience [for freight-matching applications] is willing to be tracked,” and that, in turn, will help boost the visibility of freight for everyone in the supply chain.
He said recent polling of owner-operators showed that 88% are willing to be tracked, that on average they work with 18 brokers each month, and that they view rates as their top challenge.
“We have to get used to massive change that started two years ago [with tight trucking capacity], ” said Kevin Abbott, vice president-- North America Truckload Services for C.H. Robinson, the mega non-asset based 3PL. “We’re now seeing more balance in the market because of digital solutions” that make moving freight more efficient and transparent.
Shelley Simpson, EVP, CCO, and president of J.B. Hunt Highway Services, said that, thanks to technology, “everyone can now be a broker. Because of that, J.B. Hunt has gone through a big disruption. Every person [involved] is asking how can we do business differently? So, there’s pressure from both sides [competitors and customers]. But that creates opportunities.”
“A big change that the capacity crunch brought was to bring in private equity and venture capital money to try and tackle it,” said Jim Tucker, president and COO of Tucker Company Worldwide, the oldest privately held freight brokerage in the U.S.
He also said that in the last few years, the customer has started to “want more visibility while the customer’s customer wants 10% of the invoice price at the end of the quarter if shipments are late.” The upshot being that since it’s more important than ever to be on time, more must be invested in electronic solutions.
“Intelligent freight-matching means getting at the heart if the issue by managing drivers and [vehicle] assets,” said Hunt’s Simpson. “Once we identified the amount of wasted driving hours, we could see need to create visibility around trucks and shipments.”
She said the whole idea is to build “a digital freight network,” which the Fortune 500 transportation and logistics firm did by creating an online load-management system and accompanying mobile app dubbed J.B. Hunt 360, which was launched in late 2014.
The system has an interface for managing loads that provides users access to published rates and get pricing for new shipping lanes as well as tender shipments and use real-time load tracking. Among other features, there’s a centralized dashboard that can assess transportation spending, on-time service and shipment status.
Simpson allowed that Hunt “doesn’t think we are the only ones to do” something like this. More importantly, she said that even with digital freight networks, “technology won’t replace people… [trucking] is a people business. But technology will create speed that will make transportation more efficient.”
Data-driven – or, if you prefer, digital—freight matching is a realm trucking and logistics providers began arriving at just in the last two to five years. To be sure, it’s a key part of the brave new world of fleet logistics.
This early on, your guess as to where all this is headed is as good as mine. But one thing is certain. “Old Blood and Guts” Patton would see it as paving the way to victory.
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