Three Principles of

Transportation Optimization

www.jda.com

Introduction

Demand for advanced transportation

management systems is on the rise
With mounting pressure on businesses
to contain costs, address capacity
constraints, lower their carbon
footprints and streamline movements,
a flexible, agile and functionally rich
transportation management system
can help support their service goals.

Introduction

Pinpointing the optimal solution is challenging

and complex.
One factor adding confusion to the search is the
manner in which vendors use or overuse the
term optimization.
Optimization techniques are proven to drive the
vast majority of the business value realized from
the use of transportation management solutions.

Introduction

However, not all optimization strategies are

created equal and thats where the confusion lies.
Vendors too often take a simplified approach and
focus on just one function to optimize, which can
lead to more harm than good.
A comprehensive approach takes many factors
into consideration.

Three Key Principles of

Transportation Optimization
1.

One size does not fit all.

2.

The details matter.

3.

Concurrency is king.

Principle 1: One Size Does Not

Fit All

For the best possible answer in the shortest

amount of time, companies must apply both
heuristic (experience based) and deterministic
approaches that use a series of logical and
common-sense decisions along with network
constraint considerations.
Transportation management systems should offer
a flexible configuration that adapts to each
companys unique strategies, as well as network
constraints and variables.

Principle 1: One Size Does Not

Fit All

Companies that follow optimization best

practices constantly monitor and tune
their strategies to address any changes
in their network, supply chain, market
and customer demands. Capacity, for
example, tends to ebb and flow with
economic changes, and shippers must
be prepared to adapt their strategies to
capitalize on market opportunities.

Principle 2: The Details Matter

Intertwining planning and execution processes

makes transportation functions unique among
other supply chain.
It is critical that all of the details from network
and dock scheduling to asset capacity and
granularly defined rates are expertly modeled.
Ensuring accuracy and visibility into all of the
details also confirms that a company is not
missing out on opportunities to get the same
results at lower overall costs.

Principle 2: The Details Matter

A company must also have visibility into the

details of the load that it is moving. Rather than
making assumptions that can lead to added costs
and stoppages, the company needs
containerization capabilities to model the load at
a finer level of granularity.

Principle 3: Concurrency is King

Shippers must rely on an optimization engine that

considers all elements of the problem
strategies, details and levels of granularity at
the same time in order to produce the best
answer.
A best-practices transportation management
system can consider all aspects of the problem
concurrently including rating, routing, scheduling
and capacity constraints.

Principle 3: Concurrency is King

Throughout the process of constantly adjusting

and incrementally optimizing the orders to be
executed, shippers must have visibility across
time into already executed orders. This enables
them to continually refine any network
constraints or carrier commitments.
It also ensures that they have the required
resources to realize their service goals as
efficiently and effectively as possible.

Optimizes
Transportation to Reduce Costs
and
Improve Customer Service

Ambev is a leading Latin American brewer and

PepsiCo International, Inc.s bottler outside of the
United States.
Ambev and its subsidiaries produce, distribute
and sell beer, carbonated soft drinks and other
non-alcoholic and non-carbonated products in 14
countries.

Real-World Success: Ambev

Ambev experienced a significant spike in order

volume across its operating regions, and began to
search for better transportation solution that
could handle increasingly complex demands.

In addition to cost and efficiency concerns,

Ambev also needed to ensure that customer
service levels kept pace with increasing demand.

Real-World Success: Ambev

Ambev sought to improve asset utilization and

processes while positioning itself for continued
future growth.

Ambev decided to replace its legacy systems with

industry-leading transportation and logistics
management technology to better plan and
manage its transportation network.

Real-World Success: Ambev

BENEFITS:

o100

percent return on investment in less than 12 months

oImproved

network-wide visibility

oIncreased

asset utilization

oEnhanced

dock scheduling, resulting in reduced dock

congestion

oImproved
oBetter

customer service while decreasing costs

overall transportation efficiency and performance

Top 10 Optimization Capabilities

JDA Software offers its list of top 10 optimization

capabilities to more effectively contain costs,
reduce miles and increase utilization:

Top 10 Optimization
Capabilities

Top 10 Optimization
Capabilities