James K. Higginson

Markovian Decision Processes in Shipment Consolidation

Shipment consolidation is a logistics strategy that combines two or more orders or shipments so that a larger quantity can be dispatched on the same vehicle. This paper discusses a discrete-time Markovian decision process (MDP) approach for determining when to release consolidated loads. We assume that the shipper controls the timing of each load dispatch. Thus, whenever a customer places an order, a choice must be made between dispatching this order (plus all others waiting) immediately, or continuing to consolidate until at least the arrival of the next order. Our MDP models of shipment consolidation consider movement by for-hire transportation (common carriage) or by a firms own vehicles (private fleet). Small but realistic numerical examples illustrate the application of these models and the data-aggregation issues that must be resolved. Two minimization criteria are considered: cost per unit time, or cost per hundredweight per unit time. For private carriage, the optimal policy is of the control-limit type; for common carriage, it may not be. These potential differences in form of the optimal policy are true for either objective function. The possibly contrasting optimal policies are interpreted in light of the costs encountered by an industrial firms private fleet compared to the freight charges of a public trucking company.

SUPPLY CHAIN MANAGEMENT TECHNIQUES IN MEDIUM-TO-SMALL MANUFACTURING FIRMS.

Discussions of supply chain management (SCM) techniques have focused on large manufacturers and retailers. Smaller firms are part of a larger supply chain(s), and also experience market uncertainties and difficulties in maintaining efficient material and information flow. This paper reports on a study of the use of SCM techniques in medium‐to‐small manufacturing (MTSM) firms. The study consisted of interviews with executives, and a mail questionnaire asking participants to indicate the extent of their firms use of specific techniques identified in the literature as contributing to the success of SCM. The study found that the use of SCM techniques vary in extent and between industries, and that the organizational structure of MTSM firms has both helped and hindered the implementation of SCM. Greater education about the benefits, costs, and techniques of SCM is required at all levels of organization.

Distribution Centres in Supply Chain Operations

A supply chain consists of all flows and transformations from simple raw materials to purchase of end-items by consumers. Various network nodes perform component fabrication, product assembly or sales. These activities, however, require logistical support, e.g., storage of intermediate or finished goods; consolidation of orders; and transportation. The term, Distribution Centre (DC) denotes a supply-chain node that furnishes coordination of that sort.

Recurrent decision approaches to shipment‐release timing in freight consolidation

Discusses “recurrent approaches” to determining when to despatch a consolidated load. Unlike a “non‐recurrent approach” (which sets a target time or weight prior to accumulating orders and despatches when the target is reached), recurrent approaches re‐evaluate the shipment‐release decision several times within an order accumulation cycle. Presents two probabilistic recurrent models, one assuming private transportation and the other common carriage. Compares the performance of these models with the nonrecurrent rules of despatching the “economic shipment weight” or, in the case of common carriage, the minimum volume weight. Concludes that with both forms of transportation, the decision heuristic outperforms despatching the economic shipment weight when that weight is close to vehicle capacity. Shows that, with common carriage, the use of the more sophisticated model does not yield better cost results than the minimum volume weight despatch rule. Discusses the reasons for, and implications of, these results.

Modeling shipper costs in physical distribution analysis

A common objective of analytical modeling of a shippers physical distribution system is the minimization of costs. As a result, many cost expressions relating to distribution activities have appeared in the literature. This paper discusses the modeling of shipper costs through an examination of these expressions and their relevance to actual costs. Some conceptual background to the modeling of logistics costs is presented, and general cost classifications relevant to a shippers distribution system are outlined. The components of each classification are discussed and summarized by reviewing cost expressions in the literature. A decision table is presented to assist modelers in developing such expressions. Specific and general conclusions are given, and issues regarding these conclusions are discussed.

Cross-Border Issues and Research

Activities at an international border are meant to ensure the security of the residents of a country. The inevitable results are “cross-border issues”—challenges, decisions, and responsibilities not encountered when movements of freight or people are entirely within one nation. This chapter discusses the most common cross-border events that carriers, shippers, importers, and exporters encounter when products move across an international frontier, with an emphasis on academic research on border issues and operations.

Planning load dispatch with CuSum quality control charts

An important question in a freight consolidation programme is: When (or how often) should a vehicle transporting a load of orders consolidated over time be dispatched? Dispatching too early results in higher per-unit transportation costs, while continuing to accumulate decreases customer service and increases inventory holding costs. This paper presents a heuristic decision model, based on concepts of CuSum quality control charts, to decide when to dispatch a consolidated load. The model recognises that target-based dispatch policies derived from analysis of long-run average performance may not perform well for individual realisations of the order accumulation process. Testing, via computer simulation using various order input distributions, shows that several variations of the basic model perform as well or better than target-based approaches in terms of shipment delay, although typically at higher average costs. As well as being a unique approach to the dispatch timing question, this model emphasises the importance of monitoring the accumulation of orders.

Windsor-Detroit Border Crossing Problem: Conflict Analysis of the Schwartz Report

Prior to 11th September 2001, the route leading to the main international crossing from Canada to the United States between Windsor Ontario and Detroit Michigan frequently saw trucks queued up to one kilometer to enter the USA. Following the terrorist attacks of that day the queues extended to some 80 km, and lineups of up to four km remained common for several years thereafter. Anxious for relief from the effects of constant truck lineups, the City of Windsor engaged a well-known traffic engineering consultant, whose report called for the governments of Ontario and Canada to spend C

Policy Recommendations for a Shipment-Consolidation Program

1.5 billion developing a new route that would take international truck traffic off of city streets. The present paper employs the graph model for conflict resolution to predict, in advance of any announcement, the most likely outcome of the proposal given the preferences of the governments of Canada, Ontario and Windsor, and of a pooled body of three competitors vying to become the key new route between the two countries