Dozens of tools and solutions aimed at making the logistics industry more efficient and profitable hit the market almost daily. With a seemingly infinite number of possible partners, companies within the space are starting to define and refine their core areas of focus. Visibility sits firmly at the top of the list.
Although plenty of companies promise their partners visibility and transparency, DHL Supply Chain takes it a step further by using visibility to drive real savings for customers via its Total Logistics Cost Management (TLCM) approach.
TLCM offers a holistic approach to improving profitability via strategic efficiency improvement and cost reduction across all parts of a company’s logistics operations, including both transportation and warehousing.
“We make a very clear statement on what those savings are, how we’re going to deliver those savings and where they come from within the network,” said Jason Gillespie, senior director of continuous improvement and innovations at DHL Supply Chain North America.
DHL Supply Chain works with new customers to decipher their baseline operating statistics and uncover areas ripe for improvement. From there, DHL works with the customer to develop plans and to define savings opportunities.
“Establishing a baseline is key,” Gillespie said. “I can’t tell you if we’ve done better if I don’t know how you’re doing today.”
DHL Supply Chain keeps customers in the loop from opportunity to delivery with easy-to-understand performance-tracking tools. These tools allow customers to see their baselines, their targets and their actual performance metrics all in one place, making it easy to see what is or isn’t working. This allows DHL Supply Chain to be a true extension of the shipper’s financial team, to ensure operations are tracking toward the customer’s targets.
If a customer is not on track to meet their targets, DHL Supply Chain works to identify — and solve — the root cause of the problem. The logistics provider relies on a sequential algorithm tool, which allows it to do network studies to pinpoint the source of any issues and areas of opportunity.
“We use our proprietary Transport Network Optimizer tool. This is the result of our collective team’s hundreds of years of combined experience to develop a user-friendly tool that can solve large, complex network scenarios at speed,” Gillespie said. “This is part of the secret recipe.”
Gillespie likened this algorithm to a metal detector. It identifies the problem, then the experts at DHL Supply Chain do the digging to find a solution, whether that means changing processes, getting new rates, or standing up a fleet.
“As for where we go with this, this is a path to a true digital twin. I can see a near future where these scenarios or hypothetical models are running in parallel with real data,” Gillespie said. “This can be a baseline for a ‘what if,’ the actual production and a ‘no holds barred’ approach that allows for maximum optimization. Then, we can compare to reality and make adjustments to the network in near real time. DHL Supply Chain has already run customer-facing pilots with this, and additional use cases should be coming very soon.”
DHL Supply Chain doesn’t plan to stop here. Employees across the company have a growth mindset, propelling the entire operation to continuous improvement.
“We have a list of more than 25 standard value levers on which we regularly evaluate the business. We roll this across all our analysts and account teams to make sure we’re all looking for the same things,” Gillespie said. “We use our OMS approach (Operational Management Systems), which is the DHL Supply Chain quality and continuous improvement operational model, to feed new ideas and opportunities from all levels of the team. This is constantly feeding value and new ideas back to our core approach to deliver value for our customers.”
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