SEPTEMBER/OCTOBER 2019
3PL, Carrier Communication Is Improving; More Progress Will Maximize Benefits
It’s always been a challenge for those who don’t own assets but are paying the freight bills to effectively work with intermodal transportation providers to make the most productive use of a container, trailer or chassis.
A total of 15 business leaders with expertise about 3PL/carrier information sharing from the intermediary and supplier perspectives shared their views with Intermodal Insights about how to improve communications and asset utilization.
In general, they believe the relentless advancement in technology is making notable strides in the ability of 3PLs to better manage the information interchanged with carriers in order to move customers’ cargo. At the same time, there was broad agreement that much more needs to be done to update and streamline the information-handling process.
Kristy Knichel, CEO of Knichel Logistics, and others provided the 3PL perspective.
"Ensuring that the right information is flowing timely to the appropriate parties can be challenging and at times, not as operationally effective as one would like," she said.
"With just one intermodal shipment, there can be as many as six or seven parties (information givers or receivers). One of the challenges from an IMC perspective using rail assets is to provide timely and accurate information and having to rely on various stakeholders in order to do that. TMS can be further enhanced for intermodal, she added.
'Seeing improvements'
"Continuing to build out their network of strategic partners where IMC’s can seamlessly utilize other vendors in an easy, streamlined fashion is important," Knichel noted. Automating routine tasks will enable IMCs to concentrate more on proactive information sharing with customers. An important advancement will arrive when drayage providers make greater use of technology to share information, she said.
"We are seeing improvements in how drayage providers get data and in turn, send it to the various stakeholders, but the adoption is still very fragmented." Knichel said.
Adam Rodery, vice president of intermodal and rail for MODE Transportation, said asset providers are better positioned than IMCs from an information sharing perspective because owners see their equipment at all times, which 3PLs cannot necessarily do.
Intermodal providers need to work harder to provide better information integration, Rodery said, since 3PLs are having more success with OTR carriers that "are able to know where carriers are going and match up future loads with the same driver
"Railroads need to be better at predicting when containers will ground/notify," Rodery said. "Most TMS can handle the EDI passing events, but lack of being able to predict when containers will actually notify with any kind of confidence is rather disappointing."
A specific solution would be the creation of off-site chassis and container pool locations more than 100 miles from a rail terminal to reduce long-distance dray costs, he said.
Senior Vice President of Marketing at Cornerstone Systems Ron MacDonald offered a similar view, saying there needs to be more sharing of information between 3PLs and asset providers, to provide specifics about the cargo location within a terminal and for load-matching opportunities.
"TMS systems do have the ability to manage the information internally for the 3PL," the Cornerstone official said. "However, I am not aware of the ability to input draymen’s time, locations and type of equipment as well as when [it becomes] available in order to help match loads. If and when all carriers and equipment have GPS capability, then matching loads will become easier."
One potential improvement could be made among 3PLs themselves.
Rodery advocated steps to create visibility sharing among 3PLs to improve utilization for them and their customers.
MacDonald believes there only could be sharing of cargo information among 3PLs to enhance utilization if there was a way to suppress sensitive commercial information.
Samantha Duehren, senior intermodal specialist at Zipline Logistics, believes that,
"If systems from multiple service providers could more aptly talk to one another and operators had fewer platforms to log into, work could be completed quicker and more time could be spent finding proactive solutions."
There is more to effective interaction than actually having the data, she said.
Understanding the Data
"We are made aware of the provider’s wants, needs and limitations daily," Duehren explained. "This information is usually automated or sent to large mailing lists, so 3PLs must understand how to best use information to make pricing and booking decisions."
She praised railroads that use GPS tracking and satellite tracking to provide real-time location and arrival data, while identifying the need for greater one-on-one contact with drivers.
Asset owners also need the flexibility of 3PLs, said Ted Prince, chief operating officer of Tiger Cool Express.
Because there is no free-running refrigerated intermodal fleet, Tiger Cool needs to have 3PL expertise to run its 730 temperature-controlled containers most effectively by blending contract moves with over-the-road runs.
"We need to be in truck brokerage," he said. "[Refrigerated] is much more asset-intensive than dry van. You need a commercial strategy that focuses on balance and velocity."
The ability to effectively utilize the refrigerated asset is more complicated in an intermodal setting, he said, because most intermodal moves are drops, where the equipment could remain in place for days at a time. Tiger Cool mostly does live loads, which keep the equipment moving faster, while at the same time demanding close monitoring to maintain service levels.
Like others, Prince believes that technological advancements are needed. Specifically, he notes that information systems and product identification for refrigerated cargo often doesn’t even have a barcode when it is packed and readied for shipment.
"The traditional method has been to be in the crow’s nest of the ship and staring out at the horizon, trying to see things," he said. "We need to be more like an air traffic controller, and let the system highlight the exceptions so we can prioritize responses.
It’s about having technology that is able to track multivariate issues simultaneously and being proactive in identifying them."
Evan Armstrong, president of Armstrong & Associates, said innovation tied to technology is spreading as 3PLs seek to augment their existing TMS to offer enhancements in visibility or other customer requests. One particular focus is the use of artificial intelligence, or machine learning, to upgrade functionality.
"We use AI and machine learning to provide a deeper analysis of shipping operations and recommend solutions based on the insights we gather from that data," said Michael Zamost, vice president of intermodal at Echo Global Logistics. "These automations allow us to elevate our intermodal service offering. The more we collaborate with partners, the more everyone experiences the benefits of information sharing by getting in front of issues and solving them in a proactive way."
Jeffrey Leppert, senior vice president of capacity solutions at Redwood Logistics, made a similar point. He stressed the importance of technology in building partnerships in comments made at EXPO. At the same time, he insisted that the human element of customer interaction cannot be overlooked.
"It’s not just e-mails and cool dashboards," he said.
Supplier Perspective
Six suppliers whose businesses offer a variety of information technology solutions provided additional perspective on how data sharing can be improved.
Remy Diebes, president of Remprex, underscored the importance of a new approach to information handling so that those who don’t own assets also can reap the benefits of better management, whenever possible.
"People have to be willing to share information," he said. "My experience is that there is a TMI problem. There is more focus on generating information than there is on doing something with it. There is too much concern about what is this information worth to me, so I won’t share it [with others]."
He believes IANA can be a change agent by identifying common interests in the benefits of information sharing and encouraging industry participants to "take a leap of faith" in that direction.
"By creating programs designed for the greater good of the industry rather than the greater good of one company, everyone wins. All stakeholders need to recognize the value of collaboration and join the effort, including BCOs, 3PLs, terminals, chassis providers and port authorities," Lidia Yan, CEO of NEXT Trucking, told Intermodal Insights.
Chris MacDonald, vice president of North American sales for Orbcomm, emphasized the importance of understanding how the intermodal process works, and providing data at the right time for the user.
"Equipment may change hands two or three times," he said in an interview at EXPO. "[IEPs or others] want to have the information when they have control of the asset. You have to be able to offer actionable data to the owner of the asset and whoever is leasing or controlling it at a particular time."
An important feature that is needed is the ability to make the distinction between a load’s location and the cargo itself, which requires the ability to track assets down to the pallet level.
Intermodal still has to catch up with truckload carriers that have developed effective visibility systems, Yan said. However, the number of TL carriers that have such systems remains relatively small because many small fleets and owner-operators, which dominate that segment of the industry, have lagged behind in making visibility technology investments.
Hunter Yaw, vice president of product management and business development at Loadsmart also said intermodal needs to catch up with truckers’ information systems. Those still working on spreadsheets will benefit from a TMS.
At the same time, he told EXPO attendees that increasing the flow of information between 3PLs and carriers, such as cargo whereabouts, has to be presented in a customer-friendly manner. That means, he said, asking whether how often and how timely the receiver actually needs the information being sent to them.
Tom Burke, CEO of TCompanies, which owns Draymaster, said there is significant room for improvement in the billing for accessorial charges, as reflected in the fact that as much as 70% of bills sent to carriers are rejected by them because the additional, accessorial charges such as detention aren’t accurately shown on the invoice.
There is another information-related issue, Chris MacDonald said. It’s the fact that asset providers are looking for technology that will last 10 or 15 years, or more, to match the life of the box, chassis or trailer itself. However, technology is evolving and improving far faster, creating a challenge to match the most advanced tracking technology with overall asset life.
'Digital Transformation'
"The industry is primed for a digital transformation," Burke said. "Forwarders, carriers and brokers all want the same thing — control, efficiency and better use of technology."
For intermodal, Burke believes there is a clear path away from fax and other older technology to move billing information. The solution he favors is APIs, or application program interfaces via the internet, which he said his company has used for 10 million rate searches.
He maintained that intermodal providers have the capability to use internet communications methods, though they may not be aware of the fact. The reason, he said, is that those who still use paper billing actually have internet skills and capabilities that they use for other purposes, such as travel or retail purchases.
"There has been a lot of good progress made in information interaction," said Christopher Plaat, senior vice president of BlackBerry Radar. "There is a lot more to be made. This industry can be revolutionized in 10 years with the elimination of paper [transactions] and phone calls."
The key, he said, is to recognize that the multiplicity of participants in intermodal moves makes the movement of information more complicated, which heightens the need for a pragmatic approach that is done on a customer-by-customer basis.
