Can shippers and carriers benefit from more robust transportation planning methodologies?

Abstract

The analysis of transportation contracts using optimization software may yield higher actual freight expenditures due to unplanned events during execution. This thesis explores new methods for developing robust transportation plans leading to lower total cost by developing a transportation plan minimizing unplanned events and quantifying a cost of service for use in existing optimization models. Robust transportation planning methodology requires the analysis of a variety of transactional related data, the application of analytical tools and performance measurement techniques. This thesis explores analytical techniques utilizing shipment, accept-reject, bid, and planning data. This analysis is then used to augment optimization software capabilities, develop simulation models and provide performance management frameworks by making assessments of shipper- carrier interactions as they occur within the design of an optimized plan. The results of this thesis include analysis and methods focused on quantification of carrier performance considering various classes of transactional data, bid data, and market data. Methods to determine the amount of additional freight expenditures as a result of the frequency and severity of unplanned freight are provided and supported with simulation output.