New Damco solution helps shippers to adjust to unexpected supply chain developments

By Jeff Berman, Group News Editor
April 05, 2012 - LM Editorial

Damco, a third-party logistics (3PL) subsidiary of A.P. Moller-Maersk Group, recently rolled out a new Web-based service that it said enables shippers to increase flexibility, respond quicker to changes, and reduce manual work.

Entitled Damco Dynamic Flow Control, company officials said this offering provides shippers with the ability to constantly re-plan shipments based on priority, whether it is delivery date, cost, or carbon footprint and not have to deal with the typical complexity and manual workload typically required when changing purchase orders. What’s more, it allows shippers to adjust to last-minute demand and supply changes which can lower inventory levels, allow for higher levels of customer service, and quicker responses to market needs.

“Our customers want more responsive supply chains,” said Erling Nielsen, global head of supply chain development at Damco. “In the last couple of years the need for speed and quick adjustments has increased a lot, bringing a higher need for more speed as well as flexibility and efficiency.”

This sentiment is particularly true when it comes to inventory management and demand planning and forecasting, given the efforts shippers are making to maintain tight inventory levels and be able to flex inventories up or down as needed.

A typical example of Damco Dynamic Flow Control at work could involve a U.S.-based retailer buying clothes or apparel from a China- or India-based manufacturer, said Nielsen. The retailer would tell Damco when it needs a shipment with a copy of the purchase order, which contains delivery dates for when it is needed in its U.S-based distribution center.

“If there was a supply disruption such as a port strike, Dynamic Flow Control can automatically contact all of the retailer’s service provider partners (such as an ocean carrier or freight forwarder) that are involved in transporting the shipment, which eliminates many phone calls and e-mails and keeps everyone on the same page,” said Nielsen. “In the old model, when something unexpected occurs, it required manual adjustments to deal with something unexpected. In Dynamic Flow Control, these things are already defined so that if it becomes clear a delivery date cannot be met, we can provide an alternative mode of transport for the shipment to still be delivered in a timely manner or re-book a shipment.”

Damco officials likened Dynamic Flow Control to a GPS in that it can dynamically recalculate the optimal route for a shipment when a change in demand or supply occurs and subsequently provide shippers with a revised estimated time to destination based on current speed and traffic information.

And they added that Dynamic Flow Control’s planning optimization engine generates plans on predefined business rules and criteria like delivery time, cost, carbon, mode, and carrier mix at purchase order and SKU levels. When an unexpected change occurs, shipments are then re-planned and automatically executed with Damco’s proprietary decision tree methodology.

Nielsen said that less than ten customers are currently using Dynamic Flow Control and was piloted by a large global shipper he did not name over the last year, and he said it has been up and running in different forms for the last two years.

“As most leading 3PLs understand, it has become critical to have leading IT to increase overall customer satisfaction and loyalty,” said Evan Armstrong, president of supply chain consultancy Armstrong & Associates. “Information flow and business intelligence reporting has become almost as important as the physical movement of goods. Damco’s ongoing systems development seems to be headed in the right direction. Being able to maintain shipment visibility throughout extended supply chains and having the flexibility to change orders prior to tender and while in transit are significant functionality pluses. It will be interesting to see how tightly the links are between Damco’s freight forwarding operations and its domestic U.S. distribution operations. This systems and operational coordination has been a key for 3PLs such as UTi Worldwide and APL Logistics.” 



About the Author

Jeff Berman headshot
Jeff Berman
Group News Editor

Jeff Berman is Group News Editor for Logistics Management, Modern Materials Handling, and Supply Chain Management Review. Jeff works and lives in Cape Elizabeth, Maine, where he covers all aspects of the supply chain, logistics, freight transportation, and materials handling sectors on a daily basis. .(JavaScript must be enabled to view this email address).


Subscribe to Logistics Management magazine

Subscribe today. It's FREE!
Get timely insider information that you can use to better manage your
entire logistics operation.
Start your FREE subscription today!

Recent Entries

The PMI, the ISM’s index to measure growth, increased 1.8 percent to 57.1 in July. This is 1.8 percent higher than the 12-month average of 55.3. The PMI has grown in 18 of the last 20 months, with economic activity in the manufacturing sector expanding for the last 14 months as the overall economy was up for the 62nd consecutive month.

YRC Worldwide, whose regional and long-haul units provide the second-largest LTL capacity in the trucking industry, narrowed its second-quarter loss to $4.9 million on $1.32 billion revenue, compared with $15.1 million loss on $1.24 billion revenue in the year-ago quarter.

With NFL training camps in full swing, it stands to reason that Congress must be replete with football fans, given how it basically has elected to punt on federal transportation funding yet again, with the Senate yesterday signing off on a ten-month bill to keep federal surface transportation funding intact through May 2015 through a nearly $11 billion stopgap measure.

Carload volumes were up 4.3 percent at 306,988, and intermodal volume for the week ending July 26 was up 3.3 percent at 264,809

About the Author

Jeff Berman, News Editor
Jeff Berman is Group News Editor for Logistics Management, Modern Materials Handling, and Supply Chain Management Review. Jeff works and lives in Cape Elizabeth, Maine, where he covers all aspects of the supply chain, logistics, freight transportation, and materials handling sectors on a daily basis. Contact Jeff Berman.

Comments

Post a comment
Commenting is not available in this channel entry.


© Copyright 2013 Peerless Media LLC, a division of EH Publishing, Inc • 111 Speen Street, Ste 200, Framingham, MA 01701 USA