The Benefits of Continuous Improvement
Continuous improvement—the ongoing process to improve the products, services or processes of an organization—can create significant advantages for a business, and Penske continually invests in technology, equipment and training to help improve its customers' operations.
Continuous Improvement Starts With Data
"Continuous improvement has to be driven by metrics that are supported by good data," said Tom Scollard, 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 its use of technology, Penske Logistics can provide 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," Scollard said.
Technology-Driven Analysis
Penske can also run "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 in the morning to 10:00 in the morning to see how it impacts them financially and is it worth approaching the customer to get that changed," Scollard 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, Scollard 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," he explained. "We can determine how consolidating orders could reduce cost."
Penske can also look at ways to better sequence delivery times to reduce out-of-route miles.
People, Processes and Equipment
In addition to investing in technology, Penske is continually investing in new equipment. The latest equipment helps improve uptime, increases driver satisfaction and adds to customers' image. Penske has more than 700 locations throughout the country to ensure equipment is well maintained and ready to perform.
Driver performance is also a top priority and Penske provides regular training opportunities for its drivers, as well as specific training based on the particular needs of its customers.