Lean Management Boosts Freight Forwarding Efficiency

March 7th, 2016

Companies that adopted efficiency-improving lean management practices have begun demanding their business partners embrace similar performance-enhancing methods.

That has served as the basis for transport and logistics service providers to revamp the way they operate, too.

“It’s really the same process of increasing value by standardizing process and eliminating wasteful or less productive steps,” explains Christian Teillet, corporate director of Quality, Health, Security, Safety & Environment at Bolloré Logistics in Paris. “That improves the quality and reliability of services to our clients.”

Bolloré Logistics began implementing its lean management plan in 2015 in Singapore -- its main Asian hub with 150,000 square-meters of warehousing operations and over 1,250 employees.

Weeding out ineffective procedures and reorganizing warehouse configuration were used to boost efficiency and create a faster pace of goods flowing. That required employees to alter familiar work habits, and embrace changes that bring more efficiency to their daily tasks.

The effort has increased the site’s logistics and freight forwarding productivities, and created effective synergies between the two activities.

“Innovation and productivity improvement are at the center of our company strategy”, says Fabien Giordano, managing director of Bolloré Logistics in Singapore. “The success of our solution team in logistics nurtured the development of a similar approach in our freight forwarding operations.”

Lean Manager in Singapore, Ronan Le Gall, notes that human resistance to such change is natural – but also essential to overcome. To do so, he insisted on full dedication of senior managers in introducing, explaining, and observing new methods, and from operators to adopt and enhance them. Follow-through and continuing exchange of advice was critical.

“Successfully developing lean processes requires true commitment from everyone involved,” says Le Gall. “That should involve reworking incentives and bonus structures to reward behavior and ideas that reduce costs, process time and waste.”

In Singapore, modifications involved structural rationalization that streamlined packing, storing and scanning procedures. It also introduced 5S projects to develop standardized work, clearer progress status of processing by deploying performance measuring tools. Loose packing and anchoring, for example, was revised by introducing motorized conveyors between work areas to reduce transport time. The overall organization of the warehouse was also reconfigured to enhance efficiency of the chain of activity in it.

Each work area was also rearranged to improve productivity. The measures allowed labor required to complete packing jobs to be sliced by 300%, and by over 3,300 hours annually in anchoring alone.

Time gained with that has also reduced the volume of inventory at any given time, further lowering operating costs.

The same effort went into increasing performance on the transport side of business, says Camille Jozon, head of international freight forwarding solutions at Bolloré Logistics in Singapore.

The transport activity required the Bolloré Logistics team to improve information flows between partners along the supply chain – including shippers, freight forwarder, customs, airline or shipping line/consignee etc. -- by implementing new IT applications and tools.

“Previously customers placed orders to Bolloré via email or phone, but a year ago we implemented an online booking tool interfaced with our internal Transport Management System (TMS),” explains Jozon. “This development gives higher shipment tracking visibility to shippers/ consignees, and improves internal productivity within Bolloré organization.”

The company also developed an electronic data interchange between its TMS and brokerage vendors for export/ import permit submission and retrieval. That has augmented productivity on both sides.

“Regarding shipments milestones updates, our main trucking companies are now using hand phones to update pick-up and delivery events via QR code scanning technology,” Jozon says. “Meanwhile, 90% of our airlines are interfaced to our TMS for flight take off. These new solutions avoid manual entry by Bolloré staff and increase data accuracy to customers.

The wider Bolloré Logistics organization has also improved communication from sales to billing teams by standardizing sales rates -- tender and ad-hoc -- into the group’s TMS. The information was previously shared on an Excel spreadsheet.

That successful effort in Singapore was just the first-step in a company-wide management revolution. Bolloré Logistics has begun extending similar changes to other activity centers, particularly where integrating management systems into those of clients enhances efficiencies for both.

“It’s been introduced in places like Toulouse, where aeronautic clients applied the method in their own businesses with good results,” Teillet says. “We’re expanding that to hubs worldwide.”

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