Describe the importance of global route planning

Answer 1

Routing planning and delivery scheduling activities are not trivial—they affect costs, impact customers, and can cause major headaches if not properly managed. Globally, over $1 trillion is spent on freight transportation services. Carriers must develop more efficient routes that maximize equipment capacity utilization. They also need to use routes that minimize tolls, port costs, and route-related surcharges.

Conceptually, these are not difficult problems to understand but they can be challenging to solve, particularly with the long distances and multiple route options involved in global transportation.

It would be easy to assume that route planning is the responsibility of the carrier. In general, that is true, but global transportation managers must not take a total hands-off approach to this topic. They should be involved because effective routing impacts customer satisfaction, supply chain performance, and organizational success. Transit time and on-time performance depend heavily on proper scheduling and sequencing of stops. Effective routing also helps avoid risky locations, poorly equipped ports, and congested border crossing points that may drastically delay cargo flows. Product safety is the third concern when developing routes, particularly for surface transportation. Major trouble spots for hijacking and product theft such as the Gulf of Aden and the South China Sea should be factored into route planning. Land routes with poor quality roads and freight handling capabilities also pose problems. Sometimes a more expensive indirect or circuitous route is used to mitigate these safety risks.