Faster, Better, More

Faster, Better, More

Copyright 2003, Traffic World, Inc.

UPS is spending $30 million to improve the last mile of delivery. The transport giant is rolling out new truck routing and package delivery technology that it believes will improve customer service, including handling in-transit changes and unusual delivery instructions.

But those benefits to customers are really a byproduct of UPS''s real goal, which is to improve the efficiency and cost of its own operations in what parcel industry experts say is the most expensive part of any delivery: the final leg.

The company expects the solution, encompassing software, hardware and process changes, will save some 14 million gallons of fuel annually and, more importantly, rapidly improve new employee productivity, a huge benefit to a company with 360,000 employees globally delivering 3.4 billion packages and documents annually.

The person who puts packages on the truck can get up to speed in an hour using the new system, when before it would "take weeks to learn the job," said Reynold English, project manager for information services at UPS.

And the new technology promises to dramatically improve driver productivity. The software plans the driver''s daily delivery route and tells the driver about the loads on the route, said Cathy Callagee, vice president and UPS operations portfolio manager. The information is downloaded to the driver''s computing system, the DIAD, giving the driver instant access to delivery order and where the packages are in the truck, eliminating the need to manually plan truck loading and routing. Giving the driver instant access to information reduces the time he needs to select packages and the miles required to complete deliveries, she said.

Under its long-standing system, UPS planned its delivery routes and loaded the trucks manually, said Jack Levis, director of package process management. The company had a large load chart posted near the door of the truck so employees loading the truck would know how and where to stack the boxes. Drivers would look through their packages and determine how best to deliver them, he said.

The more automated loading and routing system will be completely installed by 2005 in UPS''s 1,700 package centers globally. Today, the internally developed system is in 50 package centers worldwide with plans to be in 85 by the end of the year, said Callagee. Drivers operate out of these package centers, picking up loads and determining their routes.

A core piece of the new system is PAL, which stands for Pre-load Assistance Label. This label, in addition to UPS''s standard label, "helps tell where the box goes," including which specific shelf on the truck and specific handling instructions, and whether a delivery address is valid, said Levis. The information also is stored in a database for tracking purposes and statistical analysis.

PAL can be used to preprocess address information and correct information if necessary before the physical arrival of the package at the sorting center, improving delivery operations.

The route and load planning software part of the system determines how many packages a driver has and how many stops, said English. The system uses historical data to determine how long it will take to drop off a package for premium, saver and standard services; how many packages a driver should handle for a route; and what that route should be, he said.

The project started more than three years ago with a small prototype version, said English. The new version includes customer "geocodes" - the location of the delivery address by longitude and latitude - uploaded into the system to map where customers are, balance loads among drivers and define the best routes for a driver to take, he said. The system also allows the company to have different types of plans, say for making seasonal adjustments.

Today it is similar to a big spreadsheet but in the next version of the software UPS plans to include algorithms for route optimization, said English. The information from this software then is sent on to the drivers and truck loaders, he said.

The load planning software determines where on the truck to place packages based on when they will be dropped off, not according to how the packages would best fit into the truck, said English. UPS does not anticipate using software to address that problem any time in the near future, he said.

UPS did not install the technology earlier because of the cost of buying personal computers and servers that could handle the technology requirements of the system. English says they are acting now because the technology has gotten cheaper and because previously it was difficult to capture the data to do this type of planning.

Another part of the new system involves a new computer for the driver, the DIAD IV, currently in pilot testing. New features of the DIAD IV include three different types of radio communications, a color screen, the ability to display urgent customer pickup messages, and 20 times as much memory as the previous DIAD.

And there are new wireless scanners to improve truck loading. UPS had been using ring scanners with a cable attaching the scanner to the data collection and transmission device to read barcodes of packages as they were being loaded on to the trucks. The problem was the cables kept breaking, said John Killeen, global network systems manager.

Now UPS is going wireless. Information from the ring scanner will be sent to the data collection and transmission device wirelessly, eliminating the cable breakage problem. Fifty-five thousand scanners will be installed in 118 countries, said Killen. "We will be the largest WiFi department in the world," he said.

UPS anticipates a 30 percent reduction in repair costs, 35 percent improvement in scanner usage, a 35 percent reduction in spare equipment needs and twice as much battery life with the new scanners.