Investing in APS is worthless without execution management

Thu | 6 Oct 2022 | News

Investing in APS is worthless without execution management

Scheduling a road transport operation is becoming an increasingly complex puzzle. Therefore companies put a lot of money into sophisticated advanced planning & scheduling or APS systems, but unfortunately, they yield far too little. Traffic jams, incidents and other dynamics render the 'optimal plan' obsolete as soon as the first truck starts driving. Good scheduling & planning software is only of value if you can also monitor progress and actively adjust it. Welcome to the new and promising field of 'continuous replanning'.

Planning scheduling can help a transport organisation boost its logistics performance. Or to put it in other words: without a good planning schedule, it becomes extremely difficult to deliver all consignments on time, meet all restrictions and still make a profit. These restrictions are becoming increasingly strict: window times are becoming smaller, more consideration has to be taken of a trucks' technical specifications (fuel, size, loading weight, etc.) and drivers have personal preferences or licence for one type of vehicle. They cannot be assigned to every trip. To keep things financially healthy, capacity utilisation must also be kept above a certain level. After all, equipment is expensive - and will only get more so with the arrival of EV trucks - and drivers are scarce. So you want to deploy both as well as possible, and without a proper planning schedule you won’t succeed.

Investing in APS

It is quite understandable that organisations have invested massively in planning & scheduling software over the past decades. This is because these Advanced Planning & Scheduling (APS) systems are perfectly capable of calculating mathematically optimal schedules based on every conceivable regulation and restriction. In theory, in this planning schedule, all transport orders are delivered exactly on time and every vehicle and driver is deployed to the maximum. Such APS software is certainly not cheap, but the idea behind these hefty investments is more than recouped by what they bring to an organisation. Besides, there is no alternative. With a physical planning board; spreadsheet software like Excel, or from memory, such a complicated puzzle is simply no longer possible.

Obsolete in advance

The potential benefits of an APS are obvious, but the problem is: these benefits are not achieved in practice. The cause lies in the extreme dynamics, characteristic for logistical operations. The standard times on the basis of which an APS creates a schedule, such as the duration of a trip from A to B, the loading time at location A or the unloading time at location B, are actually obsolete from the outset! This is because an APS assumes that in the time between making a plan and the real time execution, the world does not change ... but it does. Congestion makes driving times longer, an occupied loading dock requires more waiting time, due to illness a driver becomes unavailable, and so on.

Practice is more recalcitrant than theory. What seemed like an optimal schedule during the moment of planning - in jargon: the cut-off time - is no longer realistic as soon as the first truck has left. There is a reason why planners and trip supervisors are shuffling orders, texting with drivers and calling charters all day. Because that wonderful beautiful planning schedule made the night before has gone completely or partially haywire, and they nevertheless want to ensure that all orders are delivered that day. If you look back at the end of the day, you will see that the completed trips are different from what was originally planned.

Dogmatic planning

'But what about our new and expensive APS software,' you'll hear managers exclaim. 'Can't we just stick to the planning schedule for once!' This is a typical expression of what we also call 'dogmatic planning thinking'. To remove all uncertainty and stick to the schedule as much as possible, extra buffer time is built into the APS. Extra driving time in case of congestion is then calculated by default, or extra waiting time for possible problems during loading and unloading ... but wait a minute: then you wouldn't have had to buy that expensive APS software, would you? Fiddling with dates and lead times makes planning suboptimal from the outset and you might as well have kept your Excel. An APS that assumes fixed lead times that are variable in practice has little added value.

Making execution 'smart'

To harness the true power of an APS and use it for increasingly complex detailed planning, it is necessary to link to execution. This goes beyond the 'execution monitoring' that many APS vendors offer these days, as an add-on to their planning software. On these apps, an end user sees what the status of the planning is or the location of a vehicle (via GPS). But with all due respect: that's not of much use to you. What you need is smart execution management, we will call this SEM for short. A system that will not only let you know the status of a trip but will also make a real-time forecast of all new arrival times, while taking into account current conditions. Smart execution management also means communication and interaction between chain partners. Carriers, charters and receivers can respond in case of recalculated arrival times and make (limited) adjustments. After all, logistics is working together and what looks like optimal planning for one shipper may be unfavourable for another.

Planning and execution 'in sync'

Whether a company needs only an SEM, only an APS, or a combination of both, varies in each situation and depends, among other things, on the dynamics and complexity. In cases where both systems are deployed, it is important that they are 'in sync' with each other. If planning and timeliness are not linked you are just following facts and cannot learn from practice to improve your next planning. To address this, Simacan offers its customers a number of advanced solutions in the field of continuous replanning. The most ultimate form is called continuous planning. Compared to now, with this an APS has no cut-off time, the planning is updated based on every change, however small. Another form of integration, the most basic, is that an APS creates a schedule once, but with real execution data. So not based on regular standard times but on actual data and forecasts from the SME platform. This format is also known as an intelligent or 'learning' APS.

Practical intermediate form

Continuous planning is ideal in theory but has some practical drawbacks. Consider what happens when planning can be changed at any time of the day... drivers would go mad. An intermediate form is that you ‘freeze’ trips after the cut-off time but can still make changes within those trips, during execution. This so-called continuous replanning can be useful if there is a traffic jam somewhere that you can avoid by changing the route (and thus the order of stops). In doing so, it is of course important to take into account customer expectations, agreements made with your clients and, for instance, fuel consumption. This makes this form of rescheduling quite complex. Planners and trip managers do this off the top of their heads, but you would actually want to use some form of automated support for this as well. After all, changes within a trip have so many consequences and are subjected to so many restrictions that you need to be a chess grandmaster to be able to calculate all possible outcomes. A computer can help us do that just fine.

Promising development

Presently the transport sector is on the eve of what could well be a great development and another step towards the physical internet. Integrating planning and execution and continuous replanning can give companies an enormous boost in performance. As an execution specialist, Simacan is acutely aware of this, which is why we are fully committed to cooperating with APS suppliers. In fact, with innovative APS suppliers such as Greenplan and Conundra, we have already taken tangible steps in this regard. Want to know what that looks like? And do you want to know how to get more out of your APS with smart execution? Then feel free to contact us. We would be happy to help you further in this promising new field.

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