Different logistics companies won different pieces of the work for the
American joint venture and used their own approaches to cross-dock
management. That is why it was so important to have “plug and play”
capability—each logistics company used different software. The soft-
ware was the connection between the U.S. automaker and the logistics
provider. For Toyota, there was a lock-tight umbilical cord connecting
the processes of the suppliers, cross-docks, and the assembly plant.
Through common processes and common IT, it was not necessary to
have plug and play capability.
A comparison of eight cross-docks of the U.S. automaker and five cross-
docks of Transfreight on key performance indicators was conducted
using measures like labor productivity, utilization of forklifts, trailer/tractor
ratio, and number of time windows successfully achieved. The results
showed that the Transfreight cross-docks had overall superior perform-
ance to the U.S. automaker’s cross-docks. Apparently, technology was
not the answer.Tailor Technology to Fit Your People and Operating Philosophy
In the cross-dock case example above, Transfreight certainly is not using very
sophisticated “supply chain solutions” software. Does that mean this software
is not “lean”? On the contrary, over time Toyota has been carefully evaluating
various software solutions and is gradually incorporating them into the process.
But it must be carefully screened. Bringing new software into the system is a bit
like transplanting an organ into the body. If it is not a match, the body might
reject the organ and shut down.
Glenn Uminger has responsibility for much of the logistics system for Toyota
in North America. He believed there was a role for more advanced information
technology in optimizing pickup and delivery routes of trucks. A good part of this
system involves Transfreight, which uses the traditional manual systems that have
worked for Toyota for decades. Truck routes basically are developed manually
with data from simple in-house IT systems that visually display data and routes.
It is comparably easy to develop truck routes because of Toyota’s passion for hei-
junka. If the assembly plant has stable, leveled production, it will place a stable,
leveled demand on all its supply systems. If you know the quantity that will be
shipped every day to the assembly plant, and the frequency of delivery, it is rela-
tively straightforward to put together routes that will be the same every day. Yet
there still are unexpected fluctuations in assembly plant production, and enough
supply points that Glenn thought planning software could be faster and perhaps
do a better job than the manual process. As he explained:
Chapter 9. Make Technology Fit 203