How Scrum methodology should be applied to freight management processes
Post-pandemic fate of international logistics management lies in the hands of supply chain experts embracing digitalization and innovation. The pandemic-induced disruption of the industry is casting clouds over global trade in the coming years.
The application of innovative technologies and methods to the management process is the sole savior for logistics service providers.
One of the methods that can be utilized for the freight management process is the agile scrum methodology.
The scrum team consists of a Product manager representing the stakeholders and, who is the voice of the customer, a scrum master enforcing the process, and an agile team consisting of people working toward completing the projects and delivering the product.
Scrum methodology entails the implementation of a 4-stage process. The first stage is Sprint planning, which commences the sprint by planning the deliverables and objectives of the project and takes no more than 2 hours per week. The next stage is daily stand-up meetings attended by all team members, allowing them to discuss daily progress for 15 minutes. Sprint review is a subsequent stage attended by all team members, including managers and stakeholders, taking up to 2 hours. The principal purpose of the review is to present the outcomes of the process.
Finally, the sprint retrospective is participated only by the scrum team. The main purpose of the meeting is to analyze the sprint process and discuss optimization strategies during the next sprints.
Applying the same technics specifically in controlling intermodal freight movements will facilitate the process management. Before the project starts, the team consisting of the project and operations manager and the operations team should implement sprint planning. The responsibilities should be delegated to meet the customer’s delivery time and terms, packaging, insurance, routing, and documentation demands. The operations manager must orchestrate the task division among the operations team under the project manager’s delegation. Routing of the transportation, selection of subcontractors based on payment and delivery terms, and risk assessment must take place during the first sprint planning. In subsequent sprint planning, the team should audit the process and act proactively in the event of process malfunctions by replacing the routing, subcontractors, and shipping terms to comply with the customer’s delivery terms and conditions.
Daily stand-ups provide the opportunity of keeping up with the transportation process. The team should spend 15 minutes inspecting the latest status of the shipment, validity of the documents, and if necessary, amendments to the transport terms and conditions. Daily stand-up will help the operation team act proactively in the event of unexpected changes in the planning and the client’s preferences. During daily-stand ups, the project manager’s task will be to pass on any requirement by the client to the operation team, and the operation team should communicate the updates associated with the transportation process and planning.
Finalized transportation process or project should be followed by sprint reviews, attended by other team members of the company.
The project’s outcomes presented by the scrum team will help the management team formulate the company’s supplier relationship management, providing the management team bird’s eye view of the cracks in the transportation chain. The Scrum team’s project outputs are also an invaluable source of data for forecasting shipping costs and optimization of routings for upcoming transportation projects, yielding incremental improvements in the whole process with cost reduction, time optimization, and visibility improvement.
Sprint Retrospective is an ideal way of building the strategy based on the lessons learned from the previous transportation process. The operations team and project manager should analyze the transportation flow by breaking the process down into the transport modes and routes. The team should assess every transport mode and routing based on KPIs of the transportation process developed by the project manager, complying with contract terms and conditions. Sprint retrospective will also allow the operation team and the project manager to reassess the performance of each subcontractor and to assign performance-related risk scores. Risk scores should be formulated based on planned vs. actual delivery time, quality of the service, and the amount of insurance coverage per cargo damage. Furthermore, finding alternative suppliers as a backup plan should be decided by the team members, avoiding the risk of dependency on a single supplier that can underperform at any time.
The freight management process requires proactiveness and resilience as missing out on minor but significant detail may yield a chaotic process. Using agile scrum methodology will help companies sustain supplier relations management, reduce time and cost of the transportation process, lessen damage probability, and analyze each step of the process comprehensively, leading to increased competitive advantage for an organization using the method.
