Back in the 1930s, Allan Morgenstern coined the expression to work smarter not harder. We have always embraced this philosophy and looked for ways our customers can work smarter. Over the years, we have created several smarter screens in Ignite. First, we designed Smart Groups, then Smart K, then Smart Routing, and now we have Smart Season Pulling of Automatics. These are all ways to improve the efficiency of your delivery department. Here is a brief description of each of them.
Many software packages in our industry have the ability that if a particular customer pulls for a delivery, then a group of other customers also get pulled. Some software companies called these satellite accounts. We called them delivery groups.
Our initial attempt to make this functionality better was to add a new field that would say to only pull that particular customer if he was going to use more than ‘x’ percent of their optimum delivery. We thought this was pretty smart because we knew some customers in a group wouldn’t need a delivery every time you went to that area because they could go every other time. I then discussed this idea with a customer and after a long discussion, he suggested there was an even smarter approach and Smart Groups was created.
Smart Groups has the ability to analyze the usage of every customer in the group and decide if each account in the group needs a delivery today or if that customer can wait until the next time we need to make a delivery to that group. Traditionally, companies would only group a small number of accounts together (for example, customers on the same street). But Smart Groups removes that limitation and allows you to have significantly more customers in the Smart Group because it is smart enough to figure out which customers needed a delivery every time you went to that area, which needed a delivery every other time, which needed a delivery every 3 or 4 times, etc. The end result is an increase in gallons delivered. You are no longer going to a house and delivering only 25% of their optimum delivery or even 50% of their optimum delivery. Those customers can all wait until the next time you were in the area or even the time after that. The end result is a more efficient delivery department because not only are you making fewer deliveries but they are also more productive deliveries (i.e. for more gallons).
Smart K was our next innovation. We wanted to improve an inherent flaw with the K Factor system which is that K Factors are not linear. What does that mean? Basically, if a customer’s K Factor is 5.0 when your average temperature is 30 degrees, then that customer’s K Factor is usually going to be lower than that when the temperature is 20 degrees. And it also means his K Factor will be higher than that when the temperature is 45 degrees.
Different software packages try to deal with this non-linear problem in different ways but the most common is to have a different K Factor for winter and summer. We initially designed Ignite to have different K Factors for all 4 seasons and while this sounds like it should take care of the problem, we felt the system could be improved further.
Here is why: When it is the middle of the winter and there is a warm spell of 3 – 7 days, the traditional K Factor system is going to use the ‘Winter’ K Factor for each of those days. That is going to result in the system overestimating the customer’s usage during those days by anywhere from one to a few gallons each day. So if for example, that warm spell was 5 days, you could then expect when they get their next delivery in a week or two, that the customer will take 10-15 gallons less than expected (i.e. 2-3 gallons less each of the 5 days). You probably have always noticed that after a week of really cold weather or really warm weather, many customers deviate from their optimum delivery and end up taking 15 or 20 gallons more or less than expected but you may not have known exactly why. Now you do.
But what if you had a system that would automatically know to use the spring K Factor during those warm days? The end result would be more accurate deliveries. That is what Smart K does. Instead of using one K Factor to calculate a customer’s usage since their last delivery, Smart K will use the appropriate K Factor each day. So when it is a cold day, the system uses the Winter K Factor. And when it is a warmer day in the winter, the system knows to use the Spring K Factor to calculate how many gallons the customer used that day. It is just a smarter/more accurate K Factor system.
Next, we tackled routing. Traditional routing of deliveries involved displaying a map that showed all the deliveries. The dispatcher would then circle/lasso the deliveries they wanted to assign to a particular driver. The software would then optimize the order of those selected deliveries. The dispatcher would then repeat this process for the rest of the drivers. The system worked but it was time-intensive – often taking a couple of hours a day. The system also assumed the dispatcher knew the optimal way to split the deliveries and the reality is, they just don’t. Google the traveling salesperson problem and you will see that in order to deliver to 30 stops, you would have to analyze 4,420,880,996,869,850,000,000,000,000,000 possible combinations and a dispatcher just can’t do that for a multitude of reasons. To solve this problem, we introduced Smart Routing.
Now your dispatcher just tells the system which drivers/trucks you have available and then he/she clicks a button. The system then automatically routes the deliveries based on the drivers, how many gallons those trucks can hold, what fuels they hold, and the urgency of the deliveries. The end result is yet another way you can have a more efficient delivery department. This time we did it by increasing the # of deliveries that can be made in a day.
Smart Season Pulling of Automatics
Our latest creation is Smart Season Pulling of Automatics. This time the problem we are tackling is that your business is seasonal and as a result, you have a very, very busy season and then a slower season. But what if you could spread some of your work to outside of that busy season? You likely already do this with preventative maintenance work. Many of you schedule tune-ups outside of the busy season. Why? Because then your service department then has the bandwidth during the busy season to handle all the incoming service calls. So, what if you could do something similar in your delivery department?
Well, now you can! Smart Season Pulling of Automatics searches for customers that, if you did nothing, would pull for a delivery in the winter. But what it realizes is that if you instead move their delivery to just before the winter, the customer doesn’t take a lot less but more importantly, the customer won’t need another delivery until after winter is over. The end result is you are doing the same # of deliveries to that customer each year but none of them are done during your busy season because we moved the delivery to right before the winter and now the customer won’t need another delivery until the spring.
How does this work? In the fall, you run the Smart Season Pulling of Automatics function and Ignite will find all the customers that qualify. It then assigns each of them a suggested delivery date based on their usage.
As you suspected, most of your customers will not qualify because most of them can not go through the winter without any deliveries. But other customers will qualify and they will be assigned a suggested date. What kinds of customers will qualify? Sometimes it is customers that have large/1000 gallon tanks. Other times it may be a customer that just doesn’t use a lot of fuel.
Finding the customers that qualify is just the 1st step. If you think about it, you don’t want the system to drop an extra 200 deliveries for you to do in 1 day. So that is where the recommended date comes in. By analyzing the customer’s usage, we can figure out the earliest date a customer can get a delivery and still not need a delivery until after winter is over. For example, that date could be December 15th for one customer but it could be December 5th for another customer. And if you think about this even further, you still don’t want a customer in the zone of ‘x’ to have a ticket created today if you aren’t going anywhere near that zone the next couple of days. So the final reason it is a suggested date is that the system will only suggest that customer get a delivery if you are already going to that area (i.e. you have already pulled tickets for that zone).
There are many advantages to doing this. The first one is a better management of your salary costs (we all know salary can be one of our biggest expenses). You can reduce driver overtime in the busy winter months. You also have better management of your seasonal drivers because you don’t have to worry about having them start and not having a full day’s work for them. You now have the flexibility of adding in as many of these suggested deliveries as you want to. And just because they are suggested to be done on December 10th or 15th, doesn’t mean you have to do them then. Unlike your other automatic customers, you can wait a week or two and still make these deliveries without the fear of them running out (this is where the ‘Urgency’ field on the fuel orders can help you).
In summary, the Smart Season Pulling of Automatics will move deliveries out of the middle of the winter, when you could be in the middle of a cold spell or a snow storm, and puts them before the peak season. You will already have trucks going to these areas and while you will be making that delivery in December for a little less than the customer’s optimum delivery, overall you are making your delivery department more profitable (remember, hitting your optimum deliveries is just one aspect of your delivery department’s efficiency and profitability).
We are in a pandemic. There is a real possibility one of your drivers could get Covid-19 and not be available for one to a couple of weeks this winter. If it is a normal winter week, you may have the resources to handle that. But what if it coincides with a week where there is a blizzard or a cold spell? How would you keep up? One way would be to have fewer deliveries in that timeframe. And one way to do that is with Smart Season Pulling of Automatics.
Smart Season Pulling of Automatics should only be run a month or so before your winter season. If you haven’t run it yet this year, now is the time to do it!