Logistics Best Practices: K-C's Triumphant Trailer Tracker
By applying modern technology and problem solving to one of the oldest problems in the book, Kimberly-Clark has reduced trailer detention, cut back significantly on third-party jockey services, practically eliminated the need for trailer rentals, and turned simple data collection into an operational tool.
By John D. Schulz, Contributing Editor -- Logistics Management, 6/1/2009
It's an age-old problem in logistics: How do you manage a yard full of trailers and eliminate the costly, manual, labor-intensive method of driving around the lot looking for a specific load?
That was certainly the problem Scott Buss, research manager of corporate research and engineering at Kimberly-Clark Corp. (K-C), was facing at the company's 1,200-acre site at Beech Island, S.C.—K-C's largest manufacturing site in North America. The site is open 24 hours a day, 365 days a year, and holds nearly 900 trailers a day. From entrance to exit it's a 1.3-mile loop—plenty of space to "lose" a trailer on the site's multiple graveled parking lots.
And loosing trailers was something that K-C particularly wanted to avoid, especially when one quarter of the world's population has come to rely on its stalwart products like Kleenex, Scott, Pull-Ups, and Depend undergarments. "I worked at that site and I was aware of its complexities," says Buss, who is based at K-C's Neenah, Wis., office. According to Buss, managing those trailers and yard jockey services manually had become labor intensive, inefficient, and of course, costly. Workers were using outdated paper logbooks and old data that made finding the precise location of any single trailer nothing more than a crapshoot.
"When you have nothing, all your sins come to the top," Buss said.
In response, Buss and his team started planning back in February 2007 to roll out a pilot program utilizing a system from a small company called PINC. Buss thought if there was a way to design an inexpensive automated trailer tracking methodology in real time, many of the decades-old methods of visually tracking trailers could finally be discarded. PINC Solutions came through on the technology front. Its Web-based, yard management tool utilizes passive RFID, GPS, and Wi-Fi to provide real-time asset visibility to both users and outside parties, including carriers. The eight-month pilot focused on testing system functionality, developing capability, and demonstrating a reliable return on investment. The pilot began in January 2008 and has since been rolled out to its entire Beech Island yard. "Today, we just kept it running," says Buss.
In less than a year Buss' work has achieved a 19 percent cost reduction in trailer detention, a 6 percent reduction in yard checks, a 31 percent reduction in third-party jockey services, and a 23 percent reduction in trailer rentals. For this high-tech solution to an age-old problem, the editors of Logistics Management award Scott Buss and Todd Armstrong this year's Best Practices Gold Medal.
How They did it
So how does it work? Yard jockey trucks are fitted with RFID reading, GPS tracking, and Wi-Fi communication capability. As they move through the various yards, they collect reads from semi-trailers tagged with temporarily attached passive RFID tags.
In action, the K-C system is impressive. As trucks move through the various yards they collect reads from semi-trailers tagged with the RFID tags. This information is collected along with data from the trucks themselves and it is overlaid on a "virtual" site map and made available through dashboard displays, on-line data, and reporting capability. All this enables Buss and his team to gain better visibility in real time of exactly where assets are located throughout the sprawling South Carolina yard.
Buss says by leveraging real-time information coupled with historical information, K-C's logistics team is able to make better decisions more quickly. As a result of this improved business process, the company has enjoyed improved flow, workload was reduced, and overall efficiency has improved, officials say.
Buss says that PINC's software advantage was its ability to offer a targeted solution that provides actionable data and reliability without excessive functionality to avoid what Buss called "bird-hunting with a bazooka." Some software was so heavy on the functionality side and lacked the auto-ID functionality that was really needed. "We didn't want any overlap," Buss says. "We were looking specifically for location-finding functionality along with work direction capability. We didn't want a lot of extra costs."
Of course, there were challenges to overcome. Electronic equipment had to be made rugged enough to handle rough trailer yards; that was resolved with product fixes and upgrades. Temporary tag attachment was better than anticipated, but Buss said improvements in design and alternative attachment methods increased success in temporarily attaching passive RFID asset tags to a wide variety of asset types.
The Benefits
According to Buss, the project has certainly validated the use of an RFID-based asset tracking solution for supply chain and logistics management applications. "They can be installed incrementally, one distribution center or manufacturing plant at a time, which pays for itself within the first year just from the savings it generates at the installed site," says Buss. As more deployments are rolled out at multiple facilities in the K-C distribution system, Buss adds that the end-to-end visibility of the system offers potential additional savings.
The immediate return from the project has allowed K-C to quantify its savings and justify further investment. As a result of the successful pilot and implementation, Buss says ROI expectations have been exceeded significantly by:
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Eliminating the daily manual yard check. That four-hour operation has been replaced with a real-time electronic yard check report available at any time;
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Discontinuing the manual process of color coding trailers and rehandling trailers in order to manage trailer status by location in the yard;
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Developing a new trailer parking plan to improve the flow of trailers. This has greatly reduced site traffic, travel distance, and improved safety;
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Enhancing processes to more effectively locate and utilize selected materials (on trailers) to minimize materials and eliminate the potential of expiration or spoilage;
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Reducing third-party yard jockey services by establishing operation metrics and tracking to them. This ability to match third-party services with site needs down to the shift level offers K-C the ability to more cost effectively and efficiently plan;
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Customizing alerts/notifications and the ability to obtain actionable data and information at any time. K-C is now able to monitor yard activity from anywhere, anytime.
Todd Armstrong, K-C's director of distribution operations, says there are plans to roll out similar systems in five to seven other large manufacturing sites. Two are planned for this year in Jenks, Okla., and Paris, Texas.
"Other companies are using a similar approach, but we're the one taking it the farthest," Armstrong said. "We're making it an operational tool rather than just for data collection management."
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