A Tactical Planning Simulator (TPS), created by Schneider National and Princeton University, has been awarded the 2009 Daniel H. Wagner Award for Excellence in Operations Research.
The award, presented by the Institute for Operations Research and Management Solutions, recognizes the development of new methodology in the context of real-world applications with a focus on quality and coherence of analysis. Previous winners of the award have included IBM, Intel Corp., Merrill Lynch and General Motors.
The tool, is being used internally by Schneider as a planning device to study policies that affect the network, including hiring locations, driver time at home, setting appointments and cross-border driver management, all of which improve company driver recruitment and retention by creating strategies for where to hire.
In addition, TPS takes some of the guesswork out of supply chain management, improving the decision-making process. Schneider engineers Ted Gifford and John Nienow along with former Schneider associate Jeff Day spent three years working with Princeton’s Hugh P. Simao, Abraham P. George and Warren B. Powell in developing the tool.
It also troubleshoots the freight flow and determines the business impact federal regulations and customer shipping requests have on the supply chain. TPS optimizes the movements of Schneider’s 6,500 drivers, who haul 13,000 loads per week over a four-week planning period.
“With the TPS system, we are able to represent the large, complex problem of efficiently transporting various types of freight across a nationwide network, while taking into account specific driver and environment characteristics,” said Gifford. “By accurately modeling the human-decision factors of our dispatch process, we are able to create a realistic simulation from which we draw conclusions about the potential impact of various conditions and strategies.”
The simulator treats drivers as “resources” and truckload shipments as “tasks.” It matches a driver’s location, domicile, capacity type, scheduled time at home, days away from home, available time, geographical constraints and DOT hours of service with a shipment’s origin and destination. Using that information, the TPS will generate metrics on how Schneider can efficiently and effectively utilize its resources within the network.
“Application of our analyses has resulted in increased efficiency and cost reductions, improvements to internal processes at Schneider, and valuable insights and feedback provided to government regulatory officials,” said Gifford. “In one specific example, we used the tool to demonstrate to a customer how a modest reduction in the customer’s delivery windows would force an increase in the number of trucks required and number of empty miles driven to serve the account and a decrease in the utilization of available driver work hours. This kind of insight is invaluable to shippers.”
By including driver’s available work hours, Schneider is able to determine the real-world impact federal regulations on hours of service – both current and proposed – will have on its supply chain.
“Schneider National is able to use the TPS to assess the myriad impacts of proposed changes to the HOS rules,” said Don Osterberg, senior vice president of safety and driver training. “We were given the HOS proposal on a Tuesday morning and had to provide projections to the American Trucking Assns. by Thursday. We ran the simulator and were able to provide timely and credible projections on a critical topic. The TPS provides decision support tools that project the first-, second- and third-order effects of contemplated decisions and help remove emotion and conjecture from the debate. It’s a powerful tool to have.”