combinenet webcast 2012: delivering better transportation procurement to your tms environment
TRANSCRIPT
Speakers and Agenda
Copyright © 2012. CombineNet, Inc.
Greg Holt Director of Product Marketing Topic Introduction and Case Studies Rob Achtzehn Director of Account Development A Look at Transportation Sourcing Best Practices
and How Advanced Sourcing Solutions Can Complement your TMS
CombineNet Company Overview
Established in 2000.
Global: Offices in Pittsburgh, PA; London, UK; Hamburg, Germany. Partners for Latin America, Middle East, APAC
Customers: Global 2000 spanning CPG, Food & Bev, Retail, Manufacturing, Transportation, and more
The Company The Technology Customer Value
Copyright © 2012. CombineNet, Inc.
Capture >2X spend under E-Sourcing management Address complex spends with advanced functionality Fast implementation and broad adoption for any type of user Nearly 100% see full payback after 1st sourcing event
Best of Breed Solutions that improve Strategic Sourcing Software-as-a-Service (SaaS) delivery model for ease of adoption and scale Easy integration into your environment to complement existing applications
We Do this for Companies Just Like Yours
Copyright © 2012. CombineNet, Inc.
A Wide Variety of Customers across All Industries
Best of Breed E-Sourcing Solutions
Copyright © 2012. CombineNet, Inc.
CombineNet Spend
Analysis
CombineNet Contract
Management
CombineNet ASAP
Create RFxpress for E-RFX or E-Auction
Bid Expressive Bidding® Expressive Feedback Event Management
Award Scenario Analysis & Bid Optimization
Supporting End-to-End E-Sourcing for All Spend Categories with Advanced Technology Solutions
Increasing Spend Under Management
>1,000 e-sourcing events conducted annually
E-Sourcing Suite user since 2007
Adopted CombineNet in Jan. 2011
More than 2X Increase in Corporate Spend Managed between years 1 and 2
$7.5 Billion E-Sourced in 2012
(projected)
E-Sourcing Suite CombineNet
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2010 2011 2012
$ Billion in Spend Managed Annually
Copyright © 2012. CombineNet, Inc.
Large European Conglomerate
Advanced Sourcing Events within CombineNet ASAP
Very broad application across the enterprise
Transportation is still one of the largest focus areas of E-Sourcing events in CombineNet ASAP
Copyright © 2012. CombineNet, Inc.
Transportation 42%
Direct Materials
21%
Indirect Materials
13%
Packaging 12%
Services 12%
Customer Events by Category: January 2011 - June 2012
CombineNet ASAP for Transportation Sourcing
400+ Transportation Sourcing Events per Year
More than $30 Billion in Annual Transportation Spend
All Modes: Truckload/IM, LTL, Ocean, Airfreight, Parcel, Multi-mode
Shippers, 3PLs, Freight Forwarders and Logistics Consultants of all sizes, across all industries, use CombineNet ASAP
Best in Class e-Sourcing for Transportation
Copyright © 2012. CombineNet, Inc.
Transportation Sourcing Best Practices
Leverage as much of your network as possible – Show carriers all the opportunities that exist within your business
– Enable carriers to match their network/assets to yours
– Enable carriers to pick and choose which pieces of the business they want, and express how they can best support that business
Focus on balancing rates with the capacity, service levels, & carrier mix that suits your business
Find the right mix of carriers based on business strategies & needs
Evaluate the impact of regional or lane-level decisions on your network as a whole
As much as possible, reduce sourcing cycle time and implement results quickly
– Time is money!
Copyright © 2012. CombineNet, Inc.
Challenges of Transportation Sourcing
Consolidated spend is a large, complex challenge
– Potentially 1,000’s of individual lanes; 100’s of carriers
Regionalized decisions vs. center-led team/strategy – Business unit/regional rules & preferences
– Site rules
– Customer delivery requirements
– Incumbency preferences
Balancing cost/coverage/service levels/strategic carrier decisions – Rates – Capacity – Transit time
What’s the right number and mix of carriers – At the Network & Lane level – Price compression between primary and secondary carriers on high volume lanes
Internal resources constrained – focused on daily execution
Not supported by standard technology tools
Copyright © 2012. CombineNet, Inc.
CombineNet ASAP
Advanced Sourcing in Transportation
Carrier Measurement
• Flexible RFI • Assessing Carrier Capabilities, Equipment, Drivers, Carbon Footprint,
Insurance, DOT Ratings
Expressive Bidding
• Expressive, Creative & Alternative Bids • Equipment type, transit time, mode, capacity, service, volume
offers/discounts
• Total Cost of Ownership Models • Rates, assessorials, fuel…
Scenario Analysis & Optimization
• “What If?” Scenario Models • Regional preferences, network-wide contracts, corporate business goals
• Robust Reporting on Impact of Decisions
Copyright © 2012. CombineNet, Inc.
CombineNet Customers’ Strategies
Copyright © 2012. CombineNet, Inc.
Consolidating Freight Spend for Negotiation Leverage
• Network-wide bids vs. regional bids • Outbound + Inbound shipments • Common carriers, dedicated, LSPs, NVOs • Dry, Refrigerated, Bulk, Container, Intermodal
Mode Switching
Explore options for moving from LTL to Truck to Intermodal to Rail; Review mode-
mix for Ocean and Air
Review Carrier/Network Options
For efficiencies, service & equipment alternatives
Carrier Collaboration: Understanding Business Strategies & Needs
Look for mutual value/win-win opportunities that match your shipments with their assets
and existing business
• Continuous loops/ backhauls/ multi-stop • Carrier business/expansion plans • Utilize imbalance between inbound/outbound & import/export in certain regions
Scalability
Responsiveness to changes in volume
TMS Benefits: Operations Execution
Cost savings through automated carrier selection, route planning and load consolidation.
Process efficiency gains with the automation of global freight movement and the ability to better adapt to changes. Improved asset utilization. Service performance management in real-time. Access to historical carrier performance and cost information.
Copyright © 2012. CombineNet, Inc.
TMS solutions provide a number of operational benefits
Sourcing with TMS: The Limitations
Good enough for collecting rate information, but what about engaging carriers in real negotiations?
Carrier capacity is often an afterthought in the sourcing process – evaluated after bids are collected and analyzed
Service and Equipment mirrors what is available in the execution system, but how can your carriers add value?
Simultaneous analysis of all key decision criteria (Capacity, Service, Sustainability, Mode Conversion, Safety/Risk, etc.) is non-existent, so how do you get the “Big Picture”?
Copyright © 2012. CombineNet, Inc.
Strategic sourcing capability is often an extension of shipment tenders or spot buying functionality
Advanced Sourcing Complements TMS
Copyright © 2012. CombineNet, Inc.
Enables carrier collaboration with Expressive Bidding
– On lanes, alternate service/mode/equipment/O&D pairs – Capacity on a lane, region, and network level – Volume discounts and carrier-defined packages
Price compression tools to reduce rate variability on lanes between primary and secondary carriers
Powerful, Flexible and Efficient Bid Analysis and Optimization
– All key decision criteria and savings levers considered at one time
Extensive & efficient negotiation support
Reporting capabilities that quickly provide clear insight into Cost Tradeoffs, Stakeholder Alignment, Negotiation priorities & Routing Guide Development
Easy data migration to/from TMS
Process Control: Launch same RFX structure on like events
Flexibility: Easily configurable to incorporate outside data
Case Study: AstraZeneca
Customer since: 2011
Initial project: Global Air-Ocean Freight
Strategic initiative to transition more product from air to ocean
“The additional insight we were able to capture and use in negotiations thanks to CombineNet ASAP would not have been possible before with other solutions, especially in the accelerated timeframe and global scale of this spend category.”
James Shaw, Global Lead, Freight & Logistics, AstraZeneca
1,000 + global lanes.
95% of volume on 250 lanes.
Special handling requirements, including temp-control.
12% + savings.
70% reduction in sourcing cycle time.
10% mode switch from air to ocean.
Key Stats Global biopharmaceutical company.
Copyright © 2012. CombineNet, Inc.
Case Study: Bayer
Bayer MaterialScience AG global ocean tender performance improvement.
Customer since: 2009
Initial project: Transportation - Global Ocean Tender sourcing
Growth: Continue to extend/expand CombineNet for ocean sourcing.
Benefits delivered:
23% in savings over prior bid rounds.
50% time reduction to manage data and process: Tender executed in 2 months vs 4.5.
Awarding based on multiple criteria.
Supports global strategy while considering regional requirements.
One interface to the carriers.
“CombineNet lets sourcing teams concentrate on the analysis of differentiated scenarios instead of mainly managing the data and process.”
– Lars Blüthner, Lead Ocean Buyer, Bayer MaterialScience AG
Nearly 80,000 containers in 2010.
4 regions, 3 subgroups, and 3 silent partners.
45 carriers involved.
15,000 bids to manage.
Key Sourcing Stats
Copyright © 2012. CombineNet, Inc.
Case Study: SABMiller plc
One of world’s leading brewers with 200 beer brands and 70,000 employees in 75 countries.
Customer since 2011
Initial Projects: Aggregate ground transportation (2,500 lanes); and improve Ocean freight (up to 30,000 TEU of standard containers)
Results:
– Road Freight: 8% savings and achieved one consolidated sourcing process
– Ocean Freight: 10% savings and major efficiency gains
“With more data under one tender event, there was the need to support the process with a strong e-sourcing solution. We chose CombineNet based on its intuitive handling of large data sets, the flexibility in defining tender variables, and the strong analytical engine to assess and visualize different implementation scenarios." – Flavio Gall, Global Category Director – Freight and Fleet, Trinity Procurement/ SABMiller
Road Freight
(mostly FTL)
Ocean Freight
Spend Under Management
Copyright © 2012. CombineNet, Inc.
Next Steps
Download the CombineNet ASAP Transportation Solution Kit
www.combinenet.com/TransportationKit
Read the latest Transportation Sourcing Case Study:
“SABMiller Brews Up Impressive Transportation Sourcing Improvements with CombineNet”
http://www.combinenet.com/resource-center/index.php
Copyright © 2012. CombineNet, Inc.
Next Steps
Download the CombineNet ASAP Transportation Solution Kit
www.combinenet.com/TransportationKit
Read the latest Transportation Sourcing Case Study:
“SABMiller Brews Up Impressive Transportation Sourcing Improvements with CombineNet”
http://www.combinenet.com/resource-center/index.php
Copyright © 2012. CombineNet, Inc.
Questions & Discussion Contact Us www.combinenet.com [email protected] 1-877-293-5480