SCO Logistics' Transportation Management Service (TMS) is an end to end transportation service that utilizes our Web-Based Systems and Processes, and our Carrier Management/Procurement Team to maximize the financial and service performance of our customer's transportation network through the management of the following functions/processes:
Systems Integration
SCO Logistics will facilitate an electronic integration between our customer’s system and our Transportation Execution Center. This integration will have multiple interfaces that will enable the transfer of information between both companies for order information, load plans, freight accruals and proof of delivery.
Shipment Optimization
Shipment optimization is an integrated application within SCO’s Transportation Execution Center, performing the following value-added tasks:
- Direct rates all shipments to the lowest cost provider
- Aggregates lower weight LTL shipments into higher weight LTL shipments
- Builds multi-stop truck load routes
- Builds round trip / continuous move routes
- Returns successful optimizations as master bills with sub-bills to SCO's transportation management system
Costs savings on every shipment optimized are recorded and presented daily, weekly or monthly. Typically savings range between 4-12%.
Shipment Rating
Shipment Rating is an integrated application within SCO's TEC . All Origin/Destination pairs (including optimized orders) are automatically sent to SCO's rating engine. The rating engine pre-rates the shipments based on the shipment criteria. The shipment criteria includes: ship from, ship to, pieces, weight, dimensions, pickup and delivery dates.
The rating engine interfaces to SMC's CZAR DLL rating program for LTL base tariff rating. All other tariffs are loaded directly into the rating application. Interfaces are setup to access Rand McNally's MileMaker, and ALK PC*MILER mileage packages. RGI's GeoMaster geography data is loaded directly into the rating application for geography cross-reference. Commodities are loaded directly into the application and support the NMFC published standards or customer specific commodities.
The rating engine then returns all available carrier rates for the OD pair . The rates are returned stack ranked from lowest cost to highest cost. The returned rates include applicable accessorial charges. Rates from more than one mode may be returned; for example, a high weight LTL shipment (15,000 lbs) would return both LTL and TL rates.
Shipment Cascade Tender
Once the rating engine returns the rates for a given OD pair, the TEC automatically tenders the shipment to the lowest cost provider. SCO's system automatically forwards to the carrier the tender notice via email, fax, or electronically (depending on the carrier's ability to support). The carrier also can view all of its tenders via SCO's carrier web portal.
The carrier then must either accept or reject the tender within the time allowed pursuant to our customer's business rules. If the tender is accepted, the carrier has committed to cover the shipment pursuant to the applicable pick up and delivery requirements (including order specific special instructions).
The carrier can use SCO's carrier portal to confirm pick up appointments, delivery appointments, proof of delivery (POD) and en-route status messaging. If the carrier either rejects the tender or fails to act within the prescribed time frame, SCO's system will automatically cancel the tender to the first carrier and tender the shipment to the second lowest cost provider. The cascade tender process repeats until the shipment is either covered or the entire tender process exhausts.
In the event that a cascade tender exhausts, SCO's system automatically forwards an "exhausted tender" email to SCO's operations personnel (an email can also be sent to our Customer's Customer Service and/or Plant Personnel).
Upon receipt of the "exhausted tender" email, SCO's operations personnel communicate with Customer Service to determine whether the pick up and delivery requirements can be modified to permit a "core" carrier to handle the shipment. If yes, SCO's personnel coordinate the order revision with the applicable (lowest cost) provider. If not, SCO brokers the shipment to a carrier that can meet the original pick up and delivery requirements.
Exception Management
SCO's goal is to automate most processes in an effort to eliminate mistakes, remove human intervention, and lower costs. With the SP&E service offering SCO's operations team manage to conclusion all of the exceptions that can occur throughout the shipment process including:
- Exhausted tenders
- Rush orders
- Carrier turn backs
- Post-tender order changes
- En-route changes
- Eleventh-hour mode changes (for example, rail to truck)
Business Reporting
Critical to any business process improvement is the availability of accurate and timely information. SCO's Data warehouse captures the data necessary to measure carrier, financial and operating performance. Examples of SCO's current performance reports include the following
- Carrier Performance Detail
- Ship From/To Performance Detail
- Delivery Performance Scorecard
- Lane Analysis Summary
- Lead Time Summary
- Delivery Reason Code Summary
- Ship To Performance Detail
- Lane Analysis Detail
- Carrier Lane Analysis Detail
- Tender Performance
- Cost Savings
- Carrier Utilization Summary
- Carrier Utilization Detail
- Core Carrier Compliance Summary
- Financial Baseline Summary
- Operations Activity Summary
- Sourcing Lane Rate/Cost Detail
SCO's system also supports ad hoc reporting.
Carrier Management
SCO views carriers as vital partners to a successful logistics services initiative. SCO seeks to contract and reward carriers that are competitive and committed to safety, service and quality deliveries.
SCO works with carriers to balance lanes, reduce empty miles and improve operating ratios. SCO makes a web-based portal available to all carriers at "no cost".
Part of SCO's Implementation process is to assess the carriers presently working with our customers. SCO traditionally defers recommending carrier changes until after the initial assessment, thereby avoiding potential service interruptions. SCO's ultimate goal is to evaluate the total number of carriers and create a core carrier network. Concentrating shipments with stronger "core" carriers generally results in improved economics and more consistent service.
Contracts with national and regional carriers (that could serve multiple locations) are preferred; but SCO recognizes the need for local carriers in certain markets. SCO continuously measures the performance of carriers. These metrics include:
- Carrier tender acceptance/reject
- On-time pick up
- On-time delivery
- Incident/damage free delivery
- Safety
SCO strives to reward high performing carriers with opportunities for additional business. The performance reports are a critical component of SCO's continuous improvement process.
SCO also manages carrier non-conformance. SCO's process includes a procedure whereby either our customer or our customer's customer could document a carrier non-conformance. Applicable carriers would be required to respond to the non-conformance complaint. The response includes root cause and corrective action. SCO incorporates the non-conformance documentation process into its continuous improvement process.
Our customer's role in carrier management is generally regarded as a "collaborative partner." While SCO would perform the carrier procurement and management process, our customers input regarding the carrier selection/approval and contracting is critical.
Transportation Procurement
In support of continuous improvement, both financially and from a service standpoint, transportation procurement is a core process for SCO Logistics.
- SCO has the capability to manage opportunistic, regional and national sourcing exercises across all carrier modes
- SCO Logistics does not recommend a strategic carrier sourcing exercise until network stabilization has been achieved
- SCO Logistics currently has contracts with over 400 carriers across all modes
