Many companies still manage their fleets manually. But switching to intelligent planning software can improve their operations – and boost profits.
The quality of their route planning mainly determines the profit of logistics companies. Therefore, company planners (dispatchers) need better tools to plan logistics routes.
However, many transportation companies still rely on the manual planning of logistics routes. Is it still responsible when there is excellent software for automatic planning?
In some logistics company offices, a map still hangs on the wall. Planners use sticks to map routes to loading and unloading addresses. The quality of this route planning method depends mainly on the knowledge and experience of the planners. They know the addresses and bottlenecks along the route, often because they have sat behind the wheel for years.
However, the human brain can’t always calculate all trips accurately, down to the mile or the minute. They don’t have the tools or the time.
Switching to Logistics Route Planning Software
The first logistics route planning software brought relief. Planners suddenly had a digital planning board in their hands. It allowed them to link transportation orders to trucks and drivers easily.
They could add uploading meters per trip to see if the truck had room for extra cargo. Route planning software could calculate distances and travel times for each trip. This has improved and accelerated the route planning process.
But when using a digital planning board in a logistics management system or other administrative systems, the quality of planning still depends on the knowledge and experience of the planner. It is up to planners to allocate orders to routes.
Since planners cannot break their heads endlessly, they have to rely on intuition and rules of thumb.
At the same time, they must consider a host of requirements and wishes, such as time agreements, vehicle specifications, driver certifications, time windows, and environmental restrictions.
Greater Profits from Better Route Planning
The question is whether today it is still optimal to rely solely on the knowledge and experience of planners. After all, planning quality determines a transportation company’s load factor. And the higher the utilization factor, the higher the profit margin.
This requires logistics route planning based on reliable facts rather than an often deceptive gut feeling. This is especially important for the logistics sector, where profit margins have been shrinking for years.
In addition, logistics route planning is becoming increasingly complex. Customers are making more and more demands and wishes, which leads to an increasing number of constraints that planners have to consider.
And if that’s not enough, many governments are placing more and more demands on logistics companies. These include limited time windows, environmental zones (low-emission zones), and mandatory access roads in city centers.
It has become almost impossible for planners to take all restrictions into account. The risks for a company relying on a single planner for its operations are too significant.
Automatic Planning of Logistics Routes
With an intelligent automatic route planner, we can take the next step in transportation planning.
With such a system, planners can increase the automation of their work. For example, they can project orders on a digital map and then create their own routes. The system checks whether all limits are met, and the maximum payload is not exceeded (semi-automatic scheduling).
Schedulers can also choose to plan logistics routes fully automatically. Advanced algorithms assign orders to routes and create a proposal plan at the touch of a button.
Automated route planning software has many more advantages. Schedulers complete planning earlier, make fewer errors and stay on top of constraints. The algorithms calculate many more possibilities in seconds that planners take hours to complete; automated scheduling results in higher utilization rates and increased profits.
Finally, most of the data and constraints are written into the system. Therefore, if the scheduling person leaves the company, the knowledge and experience remain available.
Will Route Planning Software Replace Planners?
What does this mean for the future of planners working in logistics companies? It seems that route planning software will not replace dispatchers! Companies are still discouraged from blindly relying solely on a plan proposal made by algorithms.
There are exceptions to the rules and limitations of logistics route planning software almost every day. The planners’ job is to check the plan proposal for such exceptions.
In addition, planners know better than algorithms where there is room to maneuver and refine the proposed plan. As overall planning time decreases, planners have more time to optimize. This can improve efficiency by a few percent each day-and every percent counts.
Iskedez Solutions offers innovative and robust planning tools that will bring your logistics to the next level.
Check out our products, and please feel free to contact us for further information.