Operations Management Presentation

1. Optimizing Highway Transportation at the United States Postal Service

3. Home Page

5. Deliver via air and highway

6. 36,496 total retail and delivery facilities

7. 218,684 vehicles

8. 599 processing facilities

9. 584 million pieces is the average volume per day

10. 1,258,025 total work hours

11. For the past few years operating expenses have been more than revenue which has resulted in a net loss

13. In 2009, transportation expenses decreased 13.4%

14. In 2009 highway transportation expenses were $3,044 million which decreased 13% from 2008 (mostly due to lower fuel prices)

15. June 1st, 2009-the General Services Administration (GSA) purchased $210 million worth of fuel efficient vehicles from Chrysler, Ford, and GM using money from the ARRA

16. USPS replaced over 6,500 vehicles from its current fleet with more fuel efficient models

18. Different types

19. Letters

20. Flats

21. Parcels

22. Periodicals

23. Different levels of service

24. Priority

25. First Class (overnight, 2-day, and 3-day)

27. Bulk Mail Centers (BMCs)

28. Service Transfer Centers (STCs): consolidates mail into aggregate volumes

29. Processing & Distribution Centers (P&DCs)

30. Priority Mail Processing Centers (PMPCs)

31. Air Mail Centers (AMCs)

34. Highly flexible for application across a wide range of components

36. It is essential to the service and financial goals of USPS to deliver these items in a timely and efficient manner.

37. The transportation network of the USPS is large and complex so the planning process for transportation is extremely important and also very challenging.

39. Facilities - locations

40. Deliveries – items to be transported

41. Represented by volume of mail to be transported

42. Trips

43. Legs

44. Assignment Constraints

45. Capacity constraints

46. Minimum CostMETHODOLOGY

48. Commercial Routing Software

49. Routing-specific Software Libraries

50. Heuristic Approaches

52. Solution time

53. Optimality

54. Expandability

57. Used to identify cost saving opportunities

58. Robustness of model allowed for varied application

60. IBM & USPS worked together with model for implementation in Pacific area

61. Savings have been approximately $3.7 million annually to date

63. Resulted in annual savings of $1.3 million to date

64. Also used in Eastern U.S. operations

65. Adopted for local transport at a P&DC in North Carolina

66. Also for STC transport in Pennsylvania

69. Helpful diagrams

70. Helpful headings and titles

71. Presentation

72. Professional

73. Diagrams could have been better

74. 12 pages is good length

75. Subject Content

76. Good, but

77. Repetitive

78. Lacked detail

79. Subject Matter

80. Interesting

81. Overall Article

82. Good articleCRITIQUE