5 Facts About Tactical Transport Planning

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Tactical Transport Planning - 5 Crucial Facts

A transport plan is often structured around a long-term operational plan, designed around demand estimates, based on data of past 12 months. A current transport plan involves running of every part, every two days, assuming that this will keep the production plans moving, without overloading the inventory planners with too much stock. However, the inventory still piles up anyway, and there is a risk of exceeding the storage capacity, leading to adding of extra fees.

The question is how should such a situation be handled, and which tools and tactics should one use. In the past, when there was no technological support available, the most common solution was to stop the transport routes altogether, till things stabilized. But this resulted in costly stock-outs.

 Another way out was to decrease the frequency with which every part was delivered, and then wait to figure out whether the tactic was fruitful, with intended result or not. However, today, there are more advanced planning tools available, with analytics capabilities that help immensely.

 But, even with these tools, however, there are no guarantees. In order to get the most out of the available technology, it is important to understand Tactical Transport Planning, and the role it plays in optimizing logistics operations.

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1. Tactical Transport Planning – A Bridge between TMS and Daily Operations

Transportation logistics disruptions often tend to crop up when the long-term operational plans are not realistic. There may be a probability of less demand for certain parts, than anticipated, or maybe weather conditions are causing a slow-down of all transportation logistics.

 Irrespective of the factors or reasons, there may occur a situation wherein things do not unfold exactly as sketched out or envisioned in the initial plan. This is the exact spot where Tactical Transport Planning comes into play. Tactical Planning enables you to get a minutely detailed view of transport operations, on a shorter time scale than the time scale of a long-term operational plan, in a manner that helps to respond to emerging conditions, in a tactical way.

 Keeping in mind that the transport management system gives a slightly broader planning horizon, Tactical Transport Planning acts like a bridge between transport management system, and what is actually happening day-to-day in the supply chain.

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2. Tactical Transport Planning - A Fundamentally Data-Driven Process

 The core idea of tactical transport planning is to prevent over-reactions and under- reactions to the emerging conditions within the logistics chain. Hence it is imperative to have a clear view regarding the manner in which conditions will evolve. The best solution for this is Data Integration.

 Live data streams, incorporated into the planning software and workflows, enables the use of advanced predictive and prescriptive analytics, to find the optimal route, tour, or network change, for a given set of parameters. 

Thereon, it becomes possible to continually adjust those parameters, as new circumstances emerge, and thereby stay one step ahead of the disruptions that often plague logistics processes. Real-time data isn’t something that just happens

overnight or by just wanting it. To acquire real time data, a software integration is needed, that prevents silos and promotes connectivity. It is important to ensure that right amount of data is being gathered. This needs integrating with the IT of suppliers or clients, or of the implementing IT devices, and RFID chips, throughout the value chain.

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3. Proactive, Responsive, Real-Time Planning Powered by Information Technology

Advanced analytics can be used to optimize decision-making, after silos have been broken down and crucial operational data has been introduced into the planning workflows. Use of advanced analytics empowers tactical transport planning, and makes the entire system proactive, rather than reactive, with regard to making short-term logistics decisions. 

In a scenario where the only way to make plans was based upon assumptions made on past conditions, these IT powered analytics workflows makes logistics planning dynamic and enables the logistics operations system to prepare and be ready for ever-changing scenarios. It may seem as though transport routes are not finalized until the last minute, but this non-rigid structure gives the planners room for adjustments.

 It also means a closer consideration of backhauls and LTLs based on the data. Whatever the scenario, The IT powered tactical planning and its ability to swiftly adapt to changing scenarios, gives one a competitive advantage over those who just plow forward with existing plans, even when those plans are not working.

4. Tactical Transport Planning Puts the End to Excel Spreadsheets

It is correct to understand that tactical transport planning primarily involves software solutions in sophisticated digital environments. Tactical transport planning is not overtly complicated. Powered by technology, the spreadsheet loses its relevance in tactical planning structure.

 Plans created in spreadsheets are unconnected, difficult for stakeholders outside of the immediate vicinity to access, and incapable of analytics integration. Switching from Excel file in short-term logistics plans, to a more digitized process brings in great advantages and benefits in the bigger picture.

 Even though at first the costs associated with transport logistics disruptions jump up, digitized tactical planning ushers in smooth, efficient and well integrated logistics operations. Tactical transport planning module makes the Excel-based plans seem like quaint relics of the past.

5. Tactical Transport Planning - A Key Component of Logistics 4.0

An analytics-driven process of tactical planning is of significant value. But that’s not all. Once a system, based on connectivity and interoperability, has been established, it can easily slot into larger logistics and transport planning workflows that prioritize responsive, data-driven planning. 

Hence, tactical transport planning is a key piece of the puzzle when it comes to adoption of Logistics 4.0. Discrete improvements in short, medium, and long-term logistics planning, all accumulate to create a smart logistics

chain that does upgrades and transforms the transport management in the same way as Industry 4.0 is poised to do for factories. As Logistics 4.0 technologies and paradigms gain momentum and become more mainstream, the organizations, committed to connectivity, transparency, and data-integration, will be poised to reap the benefits and stand ahead of all competition.

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