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Project delivers savings for UPS

UPS wraps up a multiyear project to speed package deliveries and save millions of gallons of fuel.

By Robert L. Mitchell
April 21, 2008 12:00 PM ET

Computerworld - Neither snow nor rain nor heat nor gloom of night stays these couriers from the swift completion of their appointed rounds. But, as United Parcel Service can attest, the back-end logistics can keep them from ever getting started.

This year, the world's largest package-delivery service is expected to finish the rollout of its Package Flow Technology project, an ambitious 10-year effort to revamp the way packages are received, loaded onto delivery trucks and routed to the appropriate destinations.

Best in Class

This story is the fourth in a series showcasing the best projects of this year's Premier 100 IT Leaders.
United Parcel Service
With $7.5 billion in sales last year, UPS is the world's largest package-delivery company.
IT Staff: 5,466 employees worldwide
IT Champion: Mark Hilbush, vice president of information services
Project Payback: Ten years in the making, UPS's package-flow technology rollout has increased productivity of package loaders by as much as 50% and increased route efficiency for drivers, shaving 29 million miles off delivery routes last year and saving 3 million gallons of fuel. UPS won't give exact dollar figures but says savings have been "in the millions."

UPS's old system relied on workers loading the trucks to match the address on each package to the right truck and shelf location. To do their jobs, loaders needed to memorize a list of between 50 and 2,000 addresses and map them to the associated location ID number, truck number and shelf location within the vehicle. New hires required 35 days to get up to speed; route changes involved retraining.

The new system synchronizes the dispatch planning system containing package delivery data with a database of U.S. Postal Service addresses.

UPS receives information on incoming parcels before they come in, and matches up the appropriate loading and routing data. When packages arrive, they're scanned and a sticker is affixed with the proper loading information. Loaders simply read the label.

The system also helps drivers by providing, for every stop, a more accurate list of packages and where each is located on the truck. It used to take 19 seconds to pull packages. "We reduced it a good bit," says Chuck Findora, dispatch planning supervisor at the Westchester, Pa., package center. "They're spending more time delivering and less time looking for the package."

The system also allows for far better route optimization, saving 29 million miles of travel and 3 million gallons of fuel in 2007.

Filling Trucks Faster

Package loaders are also more efficient. "Before, a loader might have been able to load two vehicles a day. Now, it's not uncommon for them to load three," says Mark Hilbush, vice president of information services.



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