BCG launches xChange to improve shipping efficiency

30 December 2015 Consultancy.uk

Unnecessary waste in the shipping container supply chain, where empty containers are ferried to places of demand, is costing carriers money, time and effort, while also affecting the environment. In a bid to reduce waste, BCG launched the xChange. This web-based platform allows carriers to pool their equipment resources to lower the number of wasteful container transactions. According to the firm, a reduction of up to 30% in the movement of empty containers can be achieved, with a reduction in cost for carriers, as well as to environmental externalities.

Waste in supply chains because of idle or poorly placed equipment can create considerable costs for companies. When a significant amount of resources need to be expended to reuse equipment, environmental externalities too come to bear. In the shipping and container logistics industry, recent Boston Consulting Group (BCG) analysis places the cost of moving empty shipping containers at between $15 and $20 billion annually. In addition, it generates an extra 19 million tons of carbon dioxide globally, which is the equivalent of driving more than 90 billion miles in a standard car.

One area in which large costs are being created, due to the linear use nature of the industry, is shipping. Inefficiencies can quickly enter the supply chain due to business practices, geography and poor information exchange. For instance, a carrier moves a container full of wares from A to B, a perfectly good transaction. However, if there are not enough goods for the carrier at B to fill the container, the empty container needs to be shipped to where there is demand, at location A-Z – creating the potential for waste. At location B, however, there might be another supplier that lacks the containers require to shift its goods, because their containers (leased or otherwise) are currently in transit to, or at, location A-Z. If the two carriers were to work together and pool all of the available containers into the most efficient pattern – such that the need to ship empty containers tends towards maximal reduction – then their associated costs, and environmental externalities, can be as far as possible removed from the system.

BCG launches xChange to improve shipping efficiency

xChange
In a bid to facilitate between carriers, with respect to their over- or under-supply of containers, BCG has launched the ‘xChange’. The web-based service will provide container owners with end-to-end functionality, enabling them to directly exchange containers, as well as other equipment, with other market participants. The service will provide a range of functionalities, including global transparency into equipment needs and the availability of other players in the industry to provide easier, more streamlined coordination; end-to-end online supported processes, which reduce complexity and facilitate communication among deal participants; live-updates, which can help demand find supply seamlessly; a well-designed interface to make finding requirements straight forward; an integrated data management system, and logging, to reduces recurring workload; as well as a way to rate agreement and reward performance between participants.

According to BCG, the xChange will improve the exchanges among logistics companies and reduce the movement of empty containers by as much as 30%. The xChange officially launched in November 2015 and a number of the largest container carriers in the world are already active on the service.

xChange

Ulrik Sanders, a Copenhagen-based partner at BCG and the global leader of the firm’s transportation and logistics practice remarks that: “The main goal in developing BCG’s container xChange is to facilitate exchanges of idle equipment between ocean carriers, container leasing companies, intermodal operators, and other logistics companies.”

Jens Riedl, a Munich-based partner and the firm’s head of transportation and logistics in Europe, adds that “Through a comprehensive end-to-end process management system, we are introducing a ground breaking solution that addresses very real exchange needs.”

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How data insights helped Network Rail improve the South-East route

11 April 2019 Consultancy.uk

Amey Consulting has leveraged data insights to assist Network Rail with the improvement of its South-Eastern route. Using the Quartz tool, which monitors train movement, Network Rail will now be able to commit to data-enabled interventions to quickly improve underperforming train stations.

With rail services in the UK coming under strain from the demands of modern commuter life, while the infrastructure and service delivery of the nation’s railways has come in for sustained criticism in recent years, a period of regeneration is on the cards at last. Network Rail is the owner and infrastructure manager of most of the railway network in Great Britain, and has subsequently tapped the consulting industry on a regular basis to help find areas of improvement.

The group recently drafted in consultancy BearingPoint to conduct a thorough organisational evaluation and advise Network Rail (High Speed) on attaining a ‘fit for purpose’ organisational standard – for which the consultancy was nominated at the 2019 MCA Awards. Meanwhile, ArupArcadis and Aecom have been contracted to help Colas Rail and Babcock Rail implement a decade-long framework for Network Rail, aimed at supporting the delivery of the next generation of rail systems, with the contracts said to be worth as much as £5 billion

How data insights helped Network Rail improve the South-East route

As Network Rail further aims to improve its performance and customer service offering, another area it has sought help from the consulting sector for is its South-East route. The network of railways connects London with the southern parts of the country, as well as with Europe, making it the busiest in the country, with more than 500 million passenger journeys per year. This crucial expanse of rail was plagued with small minute delays, which were impacting millions of passengers every day, while reducing the efficiency and capacity of the overall network – something Amey Consulting was selected to help solve.

Amey Consulting soon determined that with the sub-threshold delays to services only lasting for 1 or 2 minutes, most were not the subject of detailed root cause analysis, and this made their corrections almost impossible – with dire consequences. Without addressing these delays, passenger satisfaction would fall, while the capacity and efficiency of the network would be reduced, stinging the income of Network Rail even before a host of delay-related fines would hit the company.

In order to help the client gain a better understanding of where, how, when and what these small delays occur, Amey Consulting looked to demonstrate the value of data-led consulting, with a significant reduction in delays within the first month of rolling out changes to key stations. The consultants embedded themselves in Network Rail’s team, helping them learn the key skills needed to support and apply data-driven solutions.

Agile transport

This involved the deployment of the Quartz tool. The system utilises to-the-second train movement data to present the performance of individual stations across the South-East route. It allows users to effortlessly understand station performance with a high level of detail, and use this information to identify losses caused by small-minute delays. The granular data allows for targeted actions to drive efficiency savings and performance improvements. More importantly, it allows users to understand the impact of small process changes on performance. 

Steve Dyke, an Executive Partner at Amey Consulting, said of the project, “We looked to identify the physical root cause on the infrastructure, building a case for change then managing that project implementation and tracking the benefit/value.  In doing so we are working to define a data performance improvement service to the operational and infrastructure owners.”

Just as important for the project as the technology, however, was teaching the Network Rail team how to leverage it after the consultants were gone. The Amey Consulting team worked to develop an agile working culture within Network Rail’s South-East division, helping staff to be confident in using data to improve the journeys of millions of people per year by attacking the problem from the ground up.

Dyke concluded, “This is less about the tools and about the approach to managing performance.  It meant using by-the-second analysis, data science, and then agile development to visualise and identify areas where improvements can be made.  We then worked with NR to change the way they approached the management of the infrastructure changes.  So rather than pass the information down the value chain, any of which could have been missed, we managed the change end-to-end.”

The project was so successful that Amey Consulting was also among those honoured at the recent MCA Awards. The firm scooped the Performance Improvement in the Public Sector prize for its work with Network Rail, at the 2019 ceremony in London.