Towards a Model of Lean Freight Transport Operations

Abstract: Freight carrier operations are increasingly squeezed between intensified competition, a changed market structure, increased customer preferences, financial pressure from the owners and the influences from technological innovations. Despite an extensive work to coordinate individual resources, the results are not satisfactory. Freight carrier planning today mainly relies on estimated demand and fixed production plans, while the customers' ever faster changes in transport relations and in frequency lead to overcapacity in assets as well as overtransport. Emerging solutions to this problem is addressed in this dissertation.This dissertation contributes to the knowledge on the management of freight transport operations through developing a conceptual model of lean freight transport operations. With 'lean' we here mean physical and information value processes, which flow without overcapacity or other 'slacks', that are customer driven, and with the aim to pursue perfection. These issues have previously mainly been addressed in manufacturing of goods. The design of transport operations and its management, planning, control, coordination, and measurements are hence studied.The methodology is theory generating case studies. Five international freight carriers, two rail, two intermodal and one road, with a door-to-door responsibility for the transport have been studied. Two different, but related, patterns have been identified; the cost and the service pattern. The service pattern has many similarities to the characteristics of lean production of goods. We have discussed how other parts of the lean production paradigm can be adapted to freight transport operations. However, none of the studied carriers has fully implemented the lean production paradigm in their operations management. Implementing the lean production paradigm could be beneficial but the differences between transport and manufacturing have to be considered.Transport operations, as well as other services, have open-ended characteristics involving parallel production processes. Transport production is also geographically spread out and involves many parties, including customers sending and receiving the goods. Service products and production processes therefore have to match perfectly in real time and space. This calls for more extensive design considerations and systems for planning and control of demand and supply.To summarise, we have extended the empirical findings with lean manufacturing theory into a proposed lean transport operations model with the following characteristics:• long term partnering, extensive real time executive communication, and coordination with customers and partners in the transport chain instead of arm's length transactional relations,• geographically decentralised cross functional units with high controllability through innovative use of information technology, which leads to high flexibility in time and space, cost effective operations and high service quality in contrast to centralisation,• core competencies and skills supporting dynamic design and production management enabling frequent changes based on high built-in flexibility in the transport network through the use of partners instead of own assets and only functional skills,• resource coordination that focuses on the 'role' of resources and assets in the services and production processes rather than as something solved by computer algorithms for each resource separately,• physical and informational processes which handle strategic considerations and operational activities as a dynamic entity in contrast to static ones.