Canadian Tire goes yard with a YMS
Mega-retailer Canadian Tire bought its yard management system as a scheduling aid. Now, it's using the software to manage virtually every aspect of its yard operations.
It's safe to say that nearly all yard management software (YMS) purchases are made by companies looking to keep tabs on equipment or handle dock scheduling. But the fact is, these apps can do much more than that. When used to their full potential, they have the capacity to streamline virtually any yard- and equipment-related task in a distribution operation. Just ask the folks at Canadian Tire Corp. Ltd., one of Canada's largest retailers.
"The original objective of our YMS was to put in a scheduling solution to increase door utilization," says Gary Fast, associate vice president for domestic transportation operations at Canadian Tire. But once the system was up and running, the company began finding other uses for the software. "Over the past five years, our YMS has evolved from an integrated scheduling tool to a business-critical execution tool," says Fast.
Canadian Tire today uses its YMS for a wide range of distribution tasks, including oversight of yard operations, providing shipment visibility, and tracking equipment utilization. The result has been a marked increase in trailer throughput at all of the yards where the software is in place.
Putting the software to the test
Based in Toronto, Canadian Tire is one of Canada's largest publicly traded companies, reporting $10.3 billion (U.S. dollars) in total retail sales for 2009. Its name notwithstanding, the company is more than a purveyor of tires. It operates about 470 general merchandise retail stores throughout Canada, selling automotive, home, and leisure wares. It also owns an apparel retailer, a chain of automotive parts stores, and some gasoline stations.
To support its retail operations, Canadian Tire operates four distribution centers—two in Toronto, one in Montreal, and another in Calgary. (The Toronto-area DCs are run by Canadian Tire, while the Montreal and Calgary facilities are operated by Genco Supply Chain Solutions.) All of the DCs except the Calgary facility use the YMS.
The YMS purchase was part of a wholesale supply chain redesign and overhaul that dates back nearly a decade. In 2001, Canadian Tire began taking steps to expand its distribution network's capacity and streamline operations in order to keep up with burgeoning sales. As part of that initiative, it installed a new order management system, upgraded its warehouse management system (WMS), established a new DC in Calgary, and, in 2005, implemented the yard management software. "The YMS was part of a broad initiative, called Customer Link, that was about upgrading technology and increasing capacity," says Fast. "It [the YMS] was a capacity requirement."
The purchase was the culmination of a yearlong YMS selection process that concluded with a one-week pilot with the two finalists. During that week, Canadian Tire evaluated both systems' performance on a variety of scenarios, including unloading and scheduling, trailer positioning and staging, tracking trailers in the yard, and viewing the location of equipment in real time. "The service providers had a chance to demonstrate how their software would address our business needs," says Fast. "We sent the vendors a binder with various scenarios that we wanted to see the software execute."
Based on the results of the pilot, the company chose Yard Smart, a yard management package from Montreal-based C3 Solutions. That application has since been integrated with Canadian Tire's WMS as well as the legacy systems used for general business.
More than a scheduling tool
What prompted Canadian Tire to consider a YMS in the first place was the growing complexity of its yard operations. The two Toronto DCs have more than 450 doors and a combined yard capacity of 5,600 trailers. The Montreal DC has parking for 1,750 trailers and 452 spaces for containers, which can be stacked up to three high if necessary.
All three yards are a hive of activity, with trucks arriving and departing on a steady basis. Some of those trucks are operated by for-hire carriers; others are part of Canadian Tire's private fleet. (The company operates one of the largest private fleets in Canada, with more than 13,000 pieces of equipment.) On an average 10-hour shift, a team of 10 to 12 "shunt" drivers moves four to five hundred trailers in each yard, repositioning the equipment. And as the operations have grown busier over time, the more complicated the scheduling has become.
Today, the YMS automatically assigns and schedules those shunt moves based on deadlines and other requirements. Back in the pre-YMS days, prioritizing all those trailer moves would have been a headache and a half, so Canadian Tire simply adopted a policy of giving shipping precedence when it assigned trailers to dock doors. But the software has allowed it to take a much more sophisticated approach. With the YMS, the company can now prioritize all trailer moves—both shipping and receiving—based on when the equipment is needed at a door to meet a specific loading or unloading schedule. Improved scheduling has reduced driver wait times considerably.
Based on its success using the YMS to boost dock door utilization, Canadian Tire began casting about for other uses for the software. "We realized that there's a lot more to it than just putting a trailer to the door and improving our receiving and capacity utilization," says Fast.
One of the applications the company came up with for the software is improving its maintenance scheduling. Essentially, the software has taken the guesswork out of the process. Because the YMS keeps tabs on equipment utilization, it's easy for the company to identify which trucks, tractors, or trailers are due for servicing. "Now that I have all this data, operations can figure out what things need to be maintained and when," says Fast.
The retailer is also using the YMS to obtain better supply chain visibility. The software gives Canadian Tire advance notification of incoming truck and rail shipments and manages all intermodal equipment—whether that equipment is owned by the company or a third party. Visibility enables the retailer to better plan the daily workload at the DC and keep track of what merchandise is en route to specific stores.
Since installing the YMS, Canadian Tire has seen improvements in both equipment utilization and driver productivity at all three facilities where the software is deployed. Driver wait times have been reduced by six to seven minutes on average, and equipment throughput in the yards has increased by 10 percent. "This is one piece of technology that has allowed us to manage our yards as our business has grown over the years," says Fast.
What advice would he offer to other managers considering the purchase of a YMS? "You want to make sure that the application has the right open architecture to be able to integrate properly [with other software]," says Fast. "And you need to approach it with a mindset of improving and changing and adding new processes rather than having the YMS fit into an existing process. There's always a way to do things better, and technology can aid in that."
About the Author
James Cooke is a principal analyst with Nucleus Research in Boston, covering supply chain planning software. He was previously the editor of CSCMP’s Supply Chain Quarterly and a staff writer for DC Velocity.
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