Barcelona, July 12, 2022.- The MIT FreightLab mission is to drive innovation into the freight transportation industry in order to reduce cost, minimize risk, and increase the level of service. Freight transportation is subject to highly volatile demand and costs that are typically outside of a firm’s ability to control or even influence. This is compounded by a dominant design in terms of how freight is historically procured and managed. FreightLab research focuses on working with companies to develop and implement real-world solutions to these challenges.
The MIT FreightLab convened its first research update and discussion of 2022. The virtual session, entitled “What Works and What Doesn’t at Truckload Freight Appointments?” convened a group of 55 shippers, carriers, brokers, solutions vendors, and others to consider common problems in modern truckload pickup and delivery.
First, I wanted to get a sense of the group’s expectations for average and maximum duration for different types of freight appointments, so before the event, I sent out a survey to all attendees and showed the results:
This is where we began discussion, with some commentary about the patters in the data and the wide diversity of the group’s expectations. In general, the audience felt that the numbers in this summary slide were representative. However, participants also offered several important nuances from their own experiences that could explain the variability in the expected dwell time of live load appointments. Several participants brought up that the day of the week explains some of the variability in live load duration estimates. Individual participants also offered that (1) the balance of live loads to drop and hooks scheduled at a facility, (2) the time of day of the appointment, and (3) the facility’s position in the value chain could all also explain some of the variation in live load expected appointment durations.
The group then explored the idea that better information sharing could help to solve this problem. I walked the group through the basic journey that a freight load takes from its origination to its final delivery. The group rode along on each phase of this journey, dissecting what detailed freight appointment information each player knows at every step of the way:
This elicited a wide array of responses. Generally, participants reported feeling underinformed — or worse yet — misinformed, about freight appointment details at several steps along the way. Before pickup at the origin, carriers and brokers reported problems with knowing (1) accurate facility addresses, (2) accurate instructions for accessing the property, and (3) realistic origin dwell times for planning purposes. Regarding destinations, carriers and brokers noted those same problems, and added that sometimes delivery appointments automatically generated by computer planning systems are scheduled for hours when the receiving facility is closed. However, no one is alerted to the problem until the truck reaches its destination.
Luckily, we had shippers attending the session who heard these concerns, and some even took the opportunity to acknowledge those problems. The shippers also raised complications of their own, namely that (1) late truck arrivals wreak havoc on their scheduling and staffing at warehouses and DCs, which also contributes to longer dwell for everyone; (2) not every shipper, receiver, and carrier are are using modern and compatible TMS systems with integration capabilities, which is how the detailed appointment information would best be shared and updated; and (3) their facilities are built with hard space and equipment constraints, which slows their ability to expedite loads or to dynamically adapt to plans as they change.
Two more general problems came out of the discussion that seemed to cross the boundaries of shippers and carriers: (1) shippers and carriers would like to work together to solve these freight appointment problems, but don’t know how to effectively collaborate and incentivize one another across firm boundaries; and (2) that there is disincentive to both parties to share unflattering performance information which could negatively impact the terms of their business relationship. Nevertheless, several respondents reported feeling that, despite these obstacles, planners across the supply chain would rather get bad news from their providers and customers right away and be able to plan for it, than to be kept in the dark until it was too late to act.