1 On Time, On Demand Delivery Chris Kantarjiev Time, Place & Space 20 September 2006.
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Transcript of 1 On Time, On Demand Delivery Chris Kantarjiev Time, Place & Space 20 September 2006.
11
On Time, On Demand DeliveryOn Time, On Demand Delivery
Chris KantarjievChris KantarjievTime, Place & SpaceTime, Place & Space
20 September 200620 September 2006
22
At the tone, the time will be 1999At the tone, the time will be 1999
28.8kbps28.8kbps
640x480 or 800x600?640x480 or 800x600?
What’s a cookie?What’s a cookie?
500MHz? Wow!500MHz? Wow!
33
“Manifesto”“Manifesto”
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Dec 1996: ISRDec 1996: ISR
Oct 1997: Oasis Virtual SupercenterOct 1997: Oasis Virtual Supercenter
Feb 1998: VP Eng hiredFeb 1998: VP Eng hired
May 1998: ChrisK hiredMay 1998: ChrisK hired
Dec 1998: Christmas at the DCDec 1998: Christmas at the DC
May 1999: First deliveryMay 1999: First delivery
Jun 1999: Public launchJun 1999: Public launch
Nov 1999: IPONov 1999: IPO
Feb 2000: 3000 orders/dayFeb 2000: 3000 orders/day
Mar 2000: 2.0 cloned to ATLMar 2000: 2.0 cloned to ATL
Jun 2000: Buy HomeGrocerJun 2000: Buy HomeGrocer
Aug 2000: 2.0 cloned to CHIAug 2000: 2.0 cloned to CHI
Jul 2001: Close the doorsJul 2001: Close the doors
55
Region overviewRegion overview
60 mile diameter60 mile diameter
DC is 330,000 sq ft, costs $30MMDC is 330,000 sq ft, costs $30MM
50K SKUs50K SKUs
4.5 miles of conveyors4.5 miles of conveyors
Frozen ice cream, fresh turkeysFrozen ice cream, fresh turkeys
14 delivery zones, 4+ vans/zone14 delivery zones, 4+ vans/zone
Target 8000 orders/day, $100/orderTarget 8000 orders/day, $100/order
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Lessons, part 1Lessons, part 1
Customers don't know where they liveCustomers don't know where they live
Maps don't know where they live, eitherMaps don't know where they live, either
Couriers are not drivers and don't know areaCouriers are not drivers and don't know area
Letting the customer dictate your schedule is a bad Letting the customer dictate your schedule is a bad ideaidea
Knowing what to measure is hardKnowing what to measure is hard
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The big pictureThe big picture
Front OfficeFront Office
Webstore Customer Relationship Management Transportation Subsystem
Order Management SystemOrder Management System
Order Fulfillment SystemOrder Fulfillment System
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Area WebstoreDatabase
Front OfficeNT WebstoresNT Route PlannersNT MFD2 BackendsNT XPS ServicesNT CRM ServersNT Cross-DocsNT Prep System
OMSPeople Soft TablesUNIX HostsWebvan PL/SQL
OFSDiamond PhoenixSeayco ScannersUNIX HostsNT HostsMoveAMH
Area OMSDatabase
Area OFSDatabase
HQData Warehouse
HQPublishing
99
DCW ebstoreXPSCRM
Oracle
PUB
Oracle
OM SFS
PeopleSoftOracle
OFSAM H
M O VEOracle
Catalog
Custom ersATPs & Prices
OrdersShipm ents
RM AsAdjustm ents
SKUsUPCs
Vendors
SKUsUPCs
OrdersShipm ents
ERsRTVs
Inventory
Rem edy
Oracle
Trouble TicketsCustom er Data
Order Data
Custom ers and CSRsvia Brow sers
Couriersvia
M FDs
Couriersvia
RiM M S
M FDServer
TaxW are
CCServer
PUBW eb GUI
BulkLoader
CSRs via Rem edy GUI
PeopleSoft G UI
RoutePlanner
SearchEngine
M O VEGUI
RFGuns
ConveyorServer
CarouselServer
ScannersConveyors
Carousels
M FG
CSS
Truck RoutePlan
DW S
1010
The PromiseThe Promise
Must consider five things:Must consider five things:
1.1. InventoryInventory
2.2. Van driver time slotVan driver time slot
3.3. Van capacityVan capacity
4.4. Truck capacityTruck capacity
5.5. DC capacityDC capacity
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Delivery flowDelivery flow
1.1. Define zonesDefine zones
2.2. GeocodingGeocoding
3.3. Subzone assignmentSubzone assignment
4.4. Schedule deliverySchedule delivery
5.5. Order confirmationOrder confirmation
6.6. CutoffCutoff
7.7. Fill to orderFill to order
8.8. PickPick
9.9. StackStack
10.10. Truck loadTruck load
11.11. Download routesDownload routes
12.12. Van loadVan load
13.13. Delivery (unpack, returns, receipt)Delivery (unpack, returns, receipt)
14.14. Special situationsSpecial situations
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Scheduling is much harder than routingScheduling is much harder than routing
FTO was very slow, couldn't be started early
truck routes were 'fixed' but changed every week
personnel scheduling was done by hand
van resources were fairly fixed 7 days out
interesting anomalies from van and truck size
never got our heads around driver breaks
1313
Yield managementYield management
Make the map smarterMake the map smarter
Special events Construction Realistic speeds
Variable pricingVariable pricing
Short window but not wide choiceShort window but not wide choice
Remove FTORemove FTO
1414
What went wrong?What went wrong?
too much technology lovetoo much technology love
needed 5/hourneeded 5/hour
couldn't do 4/hour too customer centrictoo customer centric
didn't charge enough for deliverydidn't charge enough for delivery
opened with a too-large service areasopened with a too-large service areas
DC too rube goldberg...DC too rube goldberg...
chill chain/FTO3250/day max, based on 8000seayco server that handled tote diverters would crash
we started with 4000 orders/day, but we poisoned the well.we started with 4000 orders/day, but we poisoned the well.
shifted from carriage trade to basic supplies, shifted from carriage trade to basic supplies,
but never had same day deliverymany SKUs does not match many stores
hard to get customers to plan aheadhard to get customers to plan ahead
hard to shift demand in timehard to shift demand in time
1515
Lessons, part 2Lessons, part 2
Don’t design for perfectionDon’t design for perfection
More vans not necessarily betterMore vans not necessarily better
Open slowly, can’t go backOpen slowly, can’t go back
Think big in the right placesThink big in the right places
Optimize the entire chain, if you canOptimize the entire chain, if you can
Bigger windowsBigger windows
Too much technologyToo much technology
Density matters!Density matters!
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Make the map smarterMake the map smarter
Sample Route: Kennedy Expressway - I-290/Circle --> O'Hare (Chicago)
Actual Travel Times vs. LandSonar Predictions for One RouteBased on 2981 Travel Time observations collected by Illinois DOT (5/27-6/18)
0
1020
3040
50
6070
80
Time of Day
Tra
vel
Tim
e (M
inu
tes)
.
Kennedy ExpresswayTravel Times: I-290/Circle --> O'Hare Based on 2,981 Travel Time observations collected by Illinois DOT (5/27-6/18)
0
10
20
30
40
50
60
70
80
Time of Day
Trav
el T
ime
(Min
utes
) .
Most traffic data companies focus on outliers (accidents, etc.)80% of observations
within dark blue band
1717
Traffic data sourcesTraffic data sources
Government sensorsGovernment sensors
Cell phonesCell phones
Tracked vehiclesTracked vehicles
1818
Traffic data providersTraffic data providers
LandSonarLandSonar INRIXINRIX Traffic CastTraffic CastTrafficTraffic
.com.com
WestwoodWestwood
OneOneState DOTsState DOTs
Flow Traffic Flow Traffic Coverage Coverage (12/05)(12/05)
100% 100% freewaysfreeways
100% 100% arterialarterial
~15% freeways~15% freeways
~0% arterial~0% arterial
~15% freeways~15% freeways
0% arterial0% arterial
~15% freeways~15% freeways
0% arterial0% arterial
N/AN/A ~15% freeways~15% freeways
0% arterial0% arterial
Historical GPS Historical GPS data sourcedata source
GPS data from GPS data from nationwide AVL nationwide AVL
providersprovidersTaxis, othersTaxis, others N/AN/A N/AN/A N/AN/A N/AN/A
CustomersCustomersNAVTEQ, @Road, NAVTEQ, @Road, GEOCOM, ESRI, GEOCOM, ESRI,
othersothersClearChannelClearChannel Yahoo!, GoogleYahoo!, Google
TV & radio, TV & radio, NAVTEQNAVTEQ
TV & radio,TV & radio,
NAVTEQNAVTEQN/AN/A
DOT sensor data DOT sensor data sourcesource
TrafficTraffic
ServiceService
FlowFlow FlowFlow
IncidentsIncidents
FlowFlow
IncidentsIncidents
FlowFlow
IncidentsIncidents IncidentsIncidents
FlowFlow
IncidentsIncidents
Traffic productsTraffic products PredictivePredictive
Real-timeReal-time Real-timeReal-time Real-timeReal-time Real-timeReal-time Real-timeReal-time