North America, and its logistics divisions
operated independently.
The innovation brought to the relationship between Menlo and Navistar was in
gainsharing, says Cunningham and Jeff
Rivera, director of operations for Menlo.
The Strategic Collaboration Model requires
adoption of a shared strategy with shared
rewards driven by clear, common objectives. Within that framework the duo combined the industry and domain expertise of
the in-house logistics department with the
outside knowledge and “inter-discipline
best practice experience” of a logistics services specialist.
ducted, and a visual lean war room has
been utilized.
More specifically, the 19 or more projects that have been launched are expected
to yield validated annual cost savings in the
millions of dollars. They’ve already generated a 5-percent reduction in annual logistics expenses, meaning the goal of a
25-percent cut in logistics spend by 2013 is
well within reach. In addition, the team has
built “foundational logistics capabilities” in
the areas of network analysis and planning,
sourcing and contract management, network execution, performance compliance
and monitoring, and infrastructure.
Sounds great. So what happened? Five
areas saw major changes. In engineering,
total landed-cost models were formed and
an engineering simulation suite was
installed. In procurement, a core carrier
program was launched; operations saw an
enterprise-wide transportation manage-
ment system launched, and metrics and bal-
anced scorecards were rolled out, training
of employees is ongoing, knowledge trans-
fer is progressing, and there is a clear align-
ment to strategic goals; finally, program
governance and stakeholder alignment is in
place, standard templates have been cre-
ated, 10-plus kaizen events have been con-
Look at how Navistar used to do things
before Menlo entered the picture. It oper-
ated its supply chain across three siloed
business units—truck, engine and parts—
working with any number of carriers and
third-party logistics providers depending on
the scope of services required. In analyzing
its total logistics spend in LTL, truckload,
parcel, 3PL and other areas, Navistar found
its internal logistics capabilities were unable
to support corporate goals.
Menlo Worldwide Logistics,
www.con-way.com/en/logistics
Resource Link
