The Payoff

The line-haul automation system routinely manages to extract efficiency improvements of 1 percent to 3 percent over results achieved with manual route planning. For example, comparing two single nights moving similar tonnage, Con-Way Central used 111 fewer trucks and 68 fewer drivers, drove 26,530 fewer miles, and boosted the average truck's load by 370 pounds. Stotlar says he initially guessed the differential would have been higher, but Kucinski and Robinson, not surprisingly, expected only this modest improvement. But all would agree, given Con-Way's volumes, that the incremental gains would tip any weigh station scale. They add up to between $4 million and $5 million in savings annually from paying fewer drivers, moving trucks fewer miles, packing more freight per trailer and reducing damage from rehandling freight. Con-Way Central has been able to reduce its dispatch personnel by three people (through attrition) and can keep the group small as it adds business.

Customers, in the meantime, benefit in a couple of discreet ways. One is improvement in on-time delivery. While Con-Way is reluctant to attribute its 99 percent on-time performance directly to the line-haul automation system, there's no doubt freeing dispatchers from the tedium of routing has given them more time to prevent delays.

Another customer benefit is the later cutoff time for submitting orders. "It's a huge advantage over the competition, and it's also a great psychological advantage because it's the end of the business day," says Kathleen F. Curley, research professor in Information Systems at Boston University's School of Management and a member of the Enterprise Value Awards application review board. Con-Way doesn't market the extended time to its customers; it wants to avoid being overwhelmed by last minute calls. But when an urgent situation comes up for a customer, "you have until the end of the day to call Con-Way and say, I really need this shipment to be picked up," Curley says.

According to Enterprise Value Awards judge John Glaser, in businesses like Con-Way's, there are only a small number of variables to maximize for strategic value. "Truckload fill rate is the name of the game for them, and they improved it," says Glaser, vice president and CIO of Partners HealthCare System in Boston.

When it came to bringing the new line-haul system to other regional operating groups, Con-Way also took its time. The system, undergoing constant tweaks and upgrades, ran in parallel to the manual way of doing things for a year at Con-Way Central. Then for more than a year, the live system was monitored to see how consistently it handled Central's workload. The deliberate pace and choice to implement first at Con-Way's biggest operation bulletproofed and validated the system. "Nothing is more critical to this company than line-haul; no system failure could bring us to our knees more quickly than line-haul," Stotlar says.