MISPERCEPTION #3: Your status updates from intermodal freight carriers are real time
There’s a big, fat lie being told to shippers of intermodal freight.
Carriers and brokers alike are complicit in communicating and reinforcing the idea that status updates on intermodal dray moves are real time. Everyone knows it, yet the charade continues.
The truth is that most “real time” updates are educated guesses on both location and arrival time, despite the fact that technology exists to pinpoint the driver’s exact location and ETA with no need for phone calls, or any human involvement.
But when it comes to intermodal freight, the industry doesn’t seem ready to embrace technology in a meaningful way.
Here’s a typical scenario: a shipper calls an IMC to check on a critical inbound container; this broker calls the intermodal freight carrier, who then reaches out to the driver; the carrier calls the broker back with the update; finally, word gets back to the shipper that “The driver left the terminal about 30 minutes ago and should be there in about an hour.”
In other words, “we don’t know.”
For brokers whose systems are integrated with intermodal freight carriers, updates are typically via an EDI protocol, which pulls new data every 15 to 30 minutes into the TMS. Better than playing phone tag, but certainly not the precise response shippers look for.
The lie does not stop with one-off status updates. On-time performance reports are, at best, inaccurate and, at worst, made up. When carrier performance is self-reported, it creates problems. Here are couple of examples:
A major railroad contracts with both brokers and intermodal carriers to handle dray shipments. The company maintains a portal where providers enter the time the driver arrived at/left the rail yard. If that time is after the agreed target time, the broker or carrier cannot proceed with the online update until they enter a reason for the lateness and contact the railroad. After a while, it became common practice for late-arriving carriers to…you guessed it….lie and enter a time before target time. No cumbersome extra steps and, best of all for the carriers, their on-time performance numbers look great! The only problem: they’re not real.
Sometimes, performance reports are fabricated.
A large-volume IMC asks its carriers to complete a spreadsheet noting on-time performance for each load. Because it’s self-reported data, carriers goose the numbers to get to something they deem respectable – let’s say 96%. But this broker increases even these overstated carrier numbers because the company feels shippers expect to see 99% or better performance.
As an industry, how can we think that this behavior is acceptable? The emperor has been without clothes for a very long time, and we all know it. It’s about time the big lie gets exposed.
What Shippers Really Want, and Why
Shippers of intermodal freight ask for on-time reports because it’s the only type of performance validation they can get. But what they really want is an accurate answer to these two questions:
· Where is the container?
· When will it arrive?
These are not “nice to know” requests. In today’s just-in-time supply chains, shippers plan a sequence of actions in advance, assuming no disruption in supply lines. When shipment delays throw that sequence out of whack, money goes up in smoke.
For example, let’s say three containers are en route to an Amazon fulfillment center for a 10 am arrival. 100 people have been scheduled to unload these containers and scan them into inventory, and merchandising managers are anxious for product to be received so they can actually appear on the site as available for sale. If the shipment arrives at noon instead of 10, you’re paying 100 people to do nothing for two hours and Amazon shoppers are getting a “not in stock notice” for their item, driving them to another website.
So, yes, shippers want and need accurate, real-time status updates on dray moves – and for very good reasons. In fact, one major consumer goods manufacturer recently told its broker: “We want to know where the container is every five minutes.”
Brokers that want to keep customers happy, and keep customers period, will need to leverage technology in ways they have not done, traditionally.
The good news is that solutions exist to satisfy shippers’ visibility demands for dray moves, while giving brokers a host of other advantages.
DrayNow’s Intermodal Freight Marketplace Brings Capacity and Real-Time Visibility
DrayNow is the first and only marketplace for intermodal dray capacity. When IMCs use DrayNow’s marketplace to source and manage dray shipments, the process is completely transparent. Drivers’ phones are loaded with the DrayNow app and location updates are automatically recorded every minute, with accuracy within 5 meters.
In response to shipper status requests, brokers simply type a reference number into their DrayNow portal and can see the rail yard location, the destination location and the exact driver location, along with an accurate ETA estimate that, through integration with Google Maps, considers any traffic delays.
Weekly report cards to brokers detail the performance of intermodal freight carriers – and the numbers are 100% accurate. There is no self-reporting. Tracking technology makes reporting a totally transparent process.
Of course, to leverage this technology, brokers need take a different approach to sourcing dray capacity.
Instead of relying on a small group of carriers, they need to leverage the power of the marketplace to connect them with 1500 reliable drayage carriers in the seconds it takes to enter a load.
Instead of using email, phone and (gulp) fax to communicate with carriers, brokers can book loads, monitor status, and access paperwork through an easy-to-use app, embracing cloud-based workflow technology that is already transforming other parts of the supply chain.
Embrace the Future
What’s the best way forward?
Here’s a crazy idea. Let’s stop lying.
Shippers are already wising up the flaws of self-reported carrier data. Brokers need to STOP parading these reports as evidence of on-time performance history. It’s just not credible.
Instead, brokers need to start promoting the technology that can give shippers accurate answers to the questions “Where’s my shipment?” and “When will it arrive?”
That’s what shippers want.
Transparency. The truth.
If brokers don’t embrace technology to deliver this customer benefit, shippers will find others who will.
This is the 3rd in a blog series addressing common misperceptions about intermodal freight. Read our other entries: Misperception #1: When Carriers Say “Yes,” the Load is Covered and Misperception #2: The DrayNow Marketplace Can’t Work for Consistent Freight.