Continuous improvement—the ongoing process to improve the products, services or processes of an organization—can create significant advantages for a business. Penske Logistics continually invests in technology, equipment and training to help improve customer operations.
Continuous Improvement Starts with Data
"Continuous improvement has to be driven by metrics that are supported by good data," said Kandice Nadeau, vice president of dedicated contract carriage for Penske Logistics. "We've invested substantially in technology, including our ClearChain® technology suite that is comprised of Tier 1 software that has been enhanced with proprietary applications and customization."
Through technology, Penske provides customers with specific data on the cost to serve each of its accounts. The data enables Penske's customers to evaluate the profitability of their customers based on transportation costs and identify ways to improve. "They may not know that it costs them $500 to deliver for a customer that they're only making $200 of profit on," Nadeau said.
Technology-Driven Analysis
Penske also runs "what-if" scenarios to help its customers find ways to improve each account. "We can look at changing the customer's delivery time from 7:00 AM to 10:00 AM to see how it impacts them financially and if it's worth approaching the customer to get that changed," Nadeau said. "In today's environment, most customers appreciate that information because they may not necessarily know what those changes could mean. Everybody wants lower prices, but lower prices have to start with lower costs."
Identifying how order quantity impacts accounts is also useful, Nadeau said. "We may be delivering to a site X times a week, and our drivers report back that they're delivering on Wednesday, but the Monday and Tuesday shipments are still sitting on the dock," she explained. "We can determine how consolidating orders could reduce cost."
Penske also reviews ways to better sequence delivery times to reduce out-of-route miles.
People, Processes and Equipment
In addition to investing in technology, Penske continues to invest in new equipment. The latest equipment improves uptime, increases driver satisfaction and adds to customers' brand image. Penske has over 700 locations throughout the country to ensure equipment is well maintained and ready to perform.
Driver performance is a top priority, and Penske provides regular training opportunities for drivers, as well as specific training based on specific customer needs.