Chapter 10 Flashcards
1
Q
Transportation
A
- Involves the physical movement of goods between origin and destination points
- Transportation systems links geographically separated partners and facilities in a company’s supply
- Transportation facilities the creation of time and place utility in the supply chain
- Has a major economic impact on the financial performance of businesses
2
Q
Roles of Transportation in SCM
A
- Provides the critical links b/w these organizations, permitting goods to flow between their facilities
- Transportation service availability is critical to demand fulfillment in the supply chain
- Transportation efficiency promotes the competitiveness of a supply chain
3
Q
Challenges of Transportation Role in SCM
A
- Supply chain complexity
- Competing goals among supply chain partners
- Changing customer requirements
- Limited information availability
- Synchronizing transportation with other supply chain activities
- Transportation capacity constraints
- Rising transportation rates
- Governmental requirements for transportation industry
- Regulation is growing in areas where the transportation industry has the potential to impact the quality of life, safety of citizens and growth of commerce
4
Q
Modes of Transportation:
A
(in order from most common to least)
- Truck
- Rail
- Air
- Water
- Pipeline
- Intermodal Transportation
5
Q
Truck Mode:
A
Role: Move smaller shipments in local, regional and national markets
- Low fixed costs, high variable
- Best at Accessibility, worst at Cost
Strengths:
- Accessible - Fast and versatile - Customer service
Weaknesses:
- Limited Capacity - High Cost
6
Q
Rail Mode:
A
Role: Move large shipments of domestic freight long distances
- High fixed costs, low variable
Strengths:
- High capacity - Low cost
Weaknesses:
- Accessibility - Inconsistent service - Damages rates
7
Q
Air Mode:
A
Role: Move urgent shipments of domestic freight and smaller shipments of international freight
- High variable costs, low fixed costs(due to fuel, maintenance and salaries)
- Best at transit time, worst at cost
Strengths:
- Speed - Freight protection - Flexibility
Weaknesses:
- Accessibility - High Cost - Low Capacity
8
Q
Water Mode:
A
Role: Move large domestic shipments via rivers and canals and international shipments via oceans
- High fixed versus low variable
- Very bad at reliability and security
Strengths:
- High Capacity - Low Cost - International Capabilities
Weaknesses:
- Slow - Accessibility
9
Q
Pipeline Mode:
A
Role: Move large volumes of domestic freight long distances
- High fixed versus low variable
- Good reliability, security and cost
Strengths:
- In-transit storage - Efficiency - Low Cost
Weaknesses:
- Slow - Limited network
10
Q
Modal Selection (Accessibility, Transit Time, Reliability, Product Safety & Cost)
A
Accessibility
- adv: Motor
- dis: Air, Rail & Water
Transit Time
- adv: Air & Motor
- dis: Rail, Water & Carriers
Reliability
- adv: Motor & Air
- dis: Water & Rail
Product Safety
- adv: Air & Motor
- dis: Rail & Water
Cost
- adv: cost of transportation service varies greatly b/w and w/i the modes
- dis: Motor & Air
11
Q
Modal Selection
A
- Nature of a product
- Durability
- Product Value
- Shipment characteristics
12
Q
Carrier Selection
A
- Selecting the individual transportation service providers within the mode
- Major difference between modal and carrier selection is the number of options
- Difference is the frequency of the decision
- Type of service provided within a mode impacts carrier selection
- Most carriers have the capabilities to provide a similar level of service
- Core Carrier( limited # of carriers, leverage its purchasing dollars)
13
Q
Rate Negotiations
A
- Centralized freight rate negotiations
- Developing contracts with carriers for a tailored set of transportation services at a specific price
- Leveraging volume with a small set of carriers
14
Q
Shipment Preparation
A
- Corporate transportation routing guide
- Last-minute, cost-saving decisions
- Consolidate freight
- Coordinate shipment deliveries
- Take full advantage of container capacity
- An accurate freight count should be taken
15
Q
Freight Documentation
A
- Bill of Landing
- Freight Bill
- Freight Claims Form
16
Q
Bill of Landing
A
- Originates the Shipment
- Provides all the information the carrier needs
- Stipulates the contract terms, including carrier’s liability for loss and damage
- Acts as a receipt for the goods the shipper tenders to the carrier
- In some cases, shows certificate of title to the goods
17
Q
Freight Bill
A
- Carrier’s Invoice for carrier charges
- Lists:
- Shipment
- Origin/Destination
- Consignee
- Items
- Total weight
- Total charges
18
Q
Freight Claims Form
A
- Filed with the carrier to recoup monetary losses resulting if carrier fails to protect the shipment
Carriers are not liable for freight claims if the damage is attributable to:- Natural disaster or “act of God”
- Military attach or similar “act of public enemy”
- Government seizure of freight or “act of public authority”
- Failure to adequately package the freight or negligent “act of the shipper”
-Extreme fragility, perishability or similar problematic “inherent nature of the goods”
19
Q
Maintain In-Transit Visibility
A
- Manage key events as product moves across the supply chain
- Technology facilities the ability to monitor product
- Visibility tools must be linked to other capabilities and processes to have an impact on supply chain event management
20
Q
Monitor Service Quality
A
- Analyze the outcome of all their transportation strategy, planning and decision-making
- Key requirement for service quality monitoring is information
21
Q
Transportation Metrics
A
- Key Performance Indicators (KPIs):
- Evaluates:
- Current Performance vs. historical results
- Internal Goals
- Carrier Commitments
- Challenge lies in narrowing down metrics available to monitor performance to a mangeable number of KPIs
- Primary categories of transportation KPIs include service quality and efficiency
- Evaluates:
22
Q
Transportation Management Systems (TMS)
A
- Critical applications include the following:
- Routing and Scheduling
- Load Planning
- Status Tracking
- Appointment Scheduling
