She’s So Heavy!*
Even if you don’t know the Beatles reference, you can probably appreciate that Mill & Mining products/commodities tend to be very heavy items. As such, moving these goods from point to point offers a host of challenges. Doing so economically is one of the biggest issues for Mill Products and Mining companies. It is not uncommon for transport costs to account for 10% of the total cost of a Mill Products or Mining Company’s product price. For years, these customers have been very savvy at looking at how and when they ship product in order to stay competitive. In more recent years, with the rise in fuel prices, transportation topics have become mission critical to stay alive!
As a Sales and Logistics consultant, I spent much of my consulting career helping Mill Products and Mining customers with SAP software options to get to the best ERP design. Customers never ceased to amaze me with the scenarios and challenges they brought to me. I must say, it was not always easy. I think the average person would be very surprised at the amount of movement and storage of products and intermediate products that occur in our everyday consumables. Each one of those movements and storages is an opportunity. The more that software solutions can intelligently direct and locate product, the less likely the product will need to have unnecessary movements before it reaches its final destination (you!). There were so many times, that on the surface it seemed like there was too much complexity and unneeded product movements at these projects. As we would detail the new configuration, the consulting team would be faced with deciding how much of these traditional practices made business sense in the new system.
Recently, metals producer ArcelorMittal invested in SAP TM. After careful design and setup, they achieved some really cool results. My experience is that while transportation topics can be detailed and challenging, the results often vary widely. Not just within the company, but with all parties in the supply chain. Vendors are often freed up to focus on value added processes; customers benefit with more reliable shipping information and even lower prices, and the company itself sees benefits across many of its departments.
“ArcelorMittal’s first TM implementation for Truckload planning allowed for process automation,
better reporting, and reduced freight spend. Implementation included a custom dock appointment scheduling
application where carriers can schedule pick-up appointments via the Collaboration Portal immediately after accepting
the load tender”.
If you are interested in further information about challenges and opportunities, consider attending an upcoming event in Chicago. More than 30 manufacturing companies will gather to talk about these issues and more at the SAP Manufacturing Industries Forum June
22-24 in Lombard, Il. Companies speaking include ArcelorMittal, Johns Manville, Chicago Faucets, EMC, Caterpillar and more.
Use #SAPMIF15 to find out more on Twitter.
* The Beetles – I Want You (She’s So Heavy), Abbey Road, 1969