Automated Routing Streamlines Deliveries, Lowers Distribution Costs

Published: February 24, 2009

by Andy Hedrick

When Southland Sod Farms decided to automate its fleet routing operations, the company knew that two years worth of coding mathematical algorithms and integrating various geographic tools were not in the plans. The order data needed for planning delivery routes was already in place on the AS/400. The goal was adding an optimization tool that would streamline route planning and reduce the miles and hours needed for making deliveries.

Among the options was Appian Logistics' Direct Route system. It became the choice partly because of its track record: two decades in the transportation business and more than 800 locations installed.

Southland Sod Farms is the exclusive grower of Marathon Sod. The company has built a reputation as Southern California's premier sod producer providing customers with the highest levels of quality and customer service. Its target market is residential landscape through nurseries and landscape companies. Up to 100 trucks are dispatched daily and the company prides itself on the ability to take an order in the morning for delivery the same day.

Route planning had become an overwhelming task for two full-time dispatchers. So management decided to improve the process with automated fleet routing. They believed this technology would also increase trucking efficiency while improving customer service levels.

The company's back-office system resides on an AS/400 model 9406-270 running OS/400. Two part-time consultants manage the custom-developed order entry system and IT infrastructure. Like many companies that utilize the AS/400 for back-office applications, Southland Sod Farms had a good handle on customer addresses, order volumes, and equipment requirements needed for creating effective route plans. However, combining this data with truck capacities, delivery time windows, equipment restrictions, road network distances, and other business parameters that are needed to solve the fleet routing equation posed a unique obstacle.

The Direct Route software from Appian Logistics was a good fit for Southland because it was able to quickly combine the existing order data with customer service parameters, and calculate optimized fleet routing plans using geographical data and optimization algorithms. The system runs on a Windows platform, but provides built-in imports for AS/400 order information and exports of the geographic and route schedule data. These features combined with route optimization capabilities provided the toolkit that Southland Sod Farms needed to streamline fleet routing, ensure maximum use of valuable fleet resources, and provide even better customer service.

In preparing for deployment, ILE RPG programs were written to extract and update order information from the order entry system and to create an interactive display screen showing route information from Direct Route. The company also developed a custom application to assign any last-minute orders to the nearest route with capacity available. This assignment was based on road network distance calculations from the automated system.

Orders are collected on the AS/400 throughout the day via call-ins. The order system scrubs the addresses using the U.S. postal database while the customer is on the phone with the order staff. A "Thomas Guide Book" map page and grid is automatically assigned to the order at that time as well. After the order is taken, it is sent to the Direct Route address mapping engine to assign the longitude and latitude coordinates. For new areas not yet plotted, Direct Route incorporates a geographical interface that allows users to point to a location on the map. This is an important aspect for companies delivering to new subdivisions and developments that are not yet included in geographic map databases. The coordinates for the delivery locations are stored on the AS/400 and are able to be used when delivering to these locations again.

The AS/400 is on a workgroup network with AS/400 Client Access on the PCs. The Direct Route application resides on four PCs and the server version resides on one PC. To initiate the fleet routing process, a file is created on the AS/400 containing orders already assigned to trucks and orders that need to be routed. Route planners download the orders to Direct Route and use the system to calculate an optimized route plan for all trucks to be dispatched. The truck routes along with delivery times, volumes, mileages, and other route data are then uploaded to the AS/400 and made available to other personnel.

Prior to having the automated route planning system, dispatchers printed and sorted delivery invoices into routes by hand using the "Thomas Guide Book" map pages. The total pallets and square feet per truck load were calculated manually to ensure that trucks were not overloaded. Estimated delivery times were also manually calculated and then keyed into the order entry system so they would be available via the Web site, voice phone, and interactive voice response applications on the AS/400.

Viewing routes interactively on a map and reviewing total miles, hours, and volumes as routes were created or changed was not possible with the manual process. And, given the time requirements needed to generate the calculations and route maps, the process did not lend itself to generating an optimized fleet routing plan.

As new orders arrived, routes were adjusted and the data was calculated and re-keyed based on the route updates. There simply was not a way to view all delivery locations and quickly generate an optimized route plan for the entire fleet

The optimization engine brought the advantage of minimizing total miles and hours, plus detailed delivery schedules with stop-by-stop times and mileages. These tools help the company make the most use of its fleet and lower distribution costs.

Because truck loads need to be calculated quickly to begin loading and dispatch functions, route calculations were previously compiled and updated throughout the day. Several personnel were involved with adjusting and recalculating work hours, mileage, and truck capacities as routes were created. With the automated system, the company is able to select a cutoff time later in the day and generate optimized routes that maximize the loads on the trucks to be dispatched.

According to Dick Maulhardt, lead IT manager for the Direct Route system, "routing can be started later in the day, and changes and additions to orders are easier to add to a route. The program also allows us to create larger loads since the weight and space capacity of each route is calculated automatically and checked against the maximums."

The program includes utilities for adding orders received late in the day and optimization tools for finding the best routes for add-on orders. This allows more orders to be considered during the route optimization and helps the company minimize total transportation costs.

The Direct Route program provides a graphical interface showing the mapped routes, delivery volumes, and schedule information for each truck route. Once the route plan has been finalized, the data is uploaded to the AS/400 and made available to customer service and dispatch personnel. This capability allows the company to postpone the fleet routing process rather than adjusting and recalculating delivery times as orders are added to routes.

Southland Sod Farms now views route schedules on the AS/400 knowing that calculations are based on road network miles and drive times. Delivery information can be reviewed and personnel are able to see where trucks should be at any given time during the day. Customers are provided with their delivery times and know when to expect delivery rather than having to go through the normal loop of communication with dispatchers and drivers and waiting for a response.

"The delivery invoices are printed in route sequence and sent to shipping with the estimated delivery time," Maulhardt says. "The delivery times are also made available to the Internet, interactive voice response, and sent via e-mail or cell phone text message to customers depending on the requested delivery method."

Drivers are provided with route schedules showing the stops, miles, and hours for their deliveries and the information generated is accurate using detailed drive time and unload time parameters. Using the automated system helps the company maximize fleet resources while providing better service to its customers.

Andy Hedrick is a supply chain consulting and software specialist. He has helped hundreds of companies reduce distribution costs and has worked on software implementations and business development with Appian Logistics Software for nine years.

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