INDUSTRIAL ENGINEERING APPLICATIONS IN TRANSPORTATION:THE PARAMETERS AND FUNCTIONS ASSOCIATED WITH TRANSPORTATION

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THE PARAMETERS AND FUNCTIONS ASSOCIATED WITH TRANSPORTATION

There are two basic parameters that affect the design of freight transportation processes: the territory to be covered and the frequency with which the transportation events occur. These parameters are not static. Demand (e.g., number of shipments per week or day) fluctuations make these parameters dynamic in nature. Demand in transportation is often seasonal. The Thanksgiving holiday in the United States is one of the highest demand days for air travel. The Saturday prior to Mother’s Day usually presents a substantial increase in package delivery volume compared to other Saturdays. Demand can vary by time of day or day of the week. Traffic volume in a major city varies greatly between Monday morning at 7:30 am and Thursday morning at 3:00 am. The transportation system must be designed to handle these variations in demand effectively.

It is important to note that what drives demand in the private freight transportation sector is cost and quality of service. The design (planning), execution, and measurement of the transportation system have an impact on the cost and quality of the transportation process. The better the costs and quality of service, the greater the demand and therefore, the greater the need to alter the service territory and the frequency of service.

Transportation planning, execution, and measurement are the fundamental functions associated with transportation and are integral to the success of the transportation system.

Planning is needed across all areas of the transportation system. Planning the overall distribution network, regional (e.g., certain geography) planning, and site (e.g., local) planning are crucial. Asset planning, including buildings and facilities, vehicles, aircraft, trailers, and materials-handling equip- ment, is also required. Demand variations drive decisions for asset quantity and capacity. The use of owned vehicles supplemented by leased vehicles during peak (high-demand) times is an example of the decisions that need to be made during the planning process. The impact of demand on scheduling, vehicle routing, and dispatching drives labor and asset needs. Labor can often be the largest com- ponent of cost in the transportation industry. The transportation planning activity is charged with developing plans that, while minimizing costs, meet all service requirements.

The execution of the plan is as important as the planning of the transportation process itself. An excellent plan properly executed results in lower costs and higher quality of service. This in turn drives demand and therefore the need for new plans.

Finally, the proper measurement of the effectiveness of the transportation system, in real time, offers a mechanism by which transportation managers, supply chain specialists, and industrial engi- neers can constantly reduce costs and improve service. With new technologies such as wireless communication, global positioning systems (GPS), and performance-monitoring technology, mea- surement systems allow the users to improve transportation processes as needed.

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