Optimization as a counter to driver shortage

Supply chain design software provider LLamasoft says use of network modeling can help shippers decide whether other modes or private fleet makes sense.    The long-pending driver shortage is well and truly upon the freight movement industry, and is hitting shippers and trucking companies alike.
   Shippers are finding capacity scarce, while carriers are having to turn down loads and are struggling to recruit new drivers even while providing bonuses.
   According to an executive with supply chain design software provider LLamasoft, shippers can help mitigate the affect of the driver shortage by looking at their network on an end-to-end basis.
   “Many shippers make the mistake of continuously using an inefficient approach, or adjusting parts of the transportation network in isolation,” Rebecca Koke, product manager for LLamasoft’s Supply Chain Guru product, wrote in the Logistics Viewpoints blog Thursday. “Instead, take a deeper look at your end-to-end distribution and transportation network. Maybe it needs a redesign to better respond to current conditions and costs, and a method of continuously re-evaluating the supply chain and transportation network to adopt the optimal structure and routes.”
   “Building a baseline model of the as-is supply chain can open your eyes to inefficiencies and opportunities to consolidate shipments, increasing shipment sizes to maximize your use of truckloads,” she wrote. “Organizations can also utilize modeling to analyze the possibility of decreasing costs through the use of hubs, cross-docks and pool points to build larger loads as well as the reassignment of sources.”
   Koke said network design can also help shippers consider the viability of using other modes, or of switching some of their volume to a private fleet.
   American Shipper’s November cover story, “Supply chain by design“, examined the state of supply chain design and modeling.