Challenge

In the beginning of the 1990s, Aalborg Portland had a fleet of more than 100 vehicles and 18 dispatchers who handled order entry and planning. The company decided that transport costs had grown too high and that it was necessary to initiate a cost reduction process. However, it was important that customer service did not suffer from such cost reductions. As cement is delivered according to the just-in-time principle, delivery accuracy and efficient handling of urgent orders were crucial.

Solution

As a result, Aalborg Portland decided to implement a system that could support the transport planning process. It was required that the system would be able to cut operational costs, improve the level of customer service, and free up resources in the planning department.

Transport planner at Aalborg Portland, Knud Erik Busk, says, “Before we implemented the planning solution from AMCS, we were not centrally organized. This meant that every site handled planning in its own area.”
“This set-up was no longer optimal for us because it led to disproportionate planning and poor optimization of the transport fleet in each local area. On this background, we started a dialogue with AMCS.”
“With their planning solution, we believed it would be possible to centralize our order entry and planning  procedures in Aalborg and reduce our planning staff significantly.”

“At the same time, we saw an opportunity to break up our historically based local regions and make it possible for our vehicles to drive between the sites across the old regions, thereby increasing our capacity utilization vastly.” “We made calculations which showed that the investment would be returned within one year. In practice, it went much faster.”

Results

Improved customer service

“When we receive an order, the system immediately calculates which site is the cheapest to deliver from. The system knows all vehicle positions and qualifications at any one time, as well as the vehicles’ distances to the sites. We are therefore able to choose the optimal vehicle for order fulfillment very efficiently”, explains Knud Erik Busk.

Major benefits from implementing the system:

• A reduction in the number of planners from 18 to 4.
• Significant reductions in empty running and a break-up of inefficient and rigid regions.
• Great improvements in capacity utilization.
• Large administrative savings due to process automation.
• Improved customer service through automatic warnings and faster response times