Toshiba Case Study

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Toshiba Increases Cost Savings, Deepens Their Collaboration with C.H. Robinson through Domestic Freight Consolidation

After nearly ten years of collaborative innovation spanning the globe,
C.H. Robinson and the Toshiba International Corporation’s (TIC’s) Social Infrastructure Group continue to work together to drive supply chain efficiencies and uncover new opportunities for cost savings.



The relationship between C.H. Robinson and TIC began in 2010, when TIC chose to outsource a majority of their global logistics to C.H. Robinson. TIC sought improved account management, automation, and efficiency to support their aggressive growth plans and commitment to high-quality service standards. C.H. Robinson offered comprehensive supply chain consulting, documentation and development of standard operating procedures, and the introduction of automated technology.

Together, C.H. Robinson and TIC drastically increased TIC’s supply chain visibility and efficiency, helping TIC become not only a best in class worldwide manufacturer but also a best in class worldwide shipper. Now, focused on continuous improvement of an already robust integrated logistics network, TIC has turned their attention to optimizing their domestic supply chain as well. To do so, they are leveraging
C.H. Robinson’s deep experience in less than truckload (LTL) shipping and freight consolidation.

Opportunity

TIC needed to be able to ship high-quality industrial motors and drives to both distributors and end users at many different locations in North America, from large cities with developed infrastructures to remote job sites with limited resources. With freight loads varying substantially day by day and even hour by hour, TIC also needed dynamic solutions that optimized thousands of LTL shipments to mitigate costs, improve shipping agility, and build a network infrastructure that could accommodate a wide variety of multimodal needs.

“We were looking for a way to reduce cost while increasing customer satisfaction.”
—Jim O'Day, director of supply chain management at TIC

The conversation began in 2012 when TIC, impressed with C.H. Robinson’s handling of their global freight operations, asked C.H. Robinson to propose further solutions for their domestic shipping activities. TIC was interested in the data solutions C.H. Robinson could provide; the manufacturer sought broad visibility into their current shipping timeframes as well as the ability to forecast different scenarios. “We were looking for a way to reduce cost while increasing customer satisfaction,” says Jim O’Day, director of supply chain management at TIC. “Trying to fulfill all orders as quickly as possible just wasn’t a sustainable model, but at the same time, we needed to continue to support our customers.”

After comprehensive research and documentation of TIC’s existing logistics network, C.H. Robinson provided a transportation optimization analysis that detailed opportunities to balance cost savings and customer satisfaction. “Taking care to ensure that service metrics would not be impacted, we analyzed TIC’s order shipping patterns, frequencies, and destinations to determine the potential for cost avoidance based on holding freight for certain amounts of time,” says Scott, general manager, transportation at
C.H. Robinson.

A natural extension in the business relationship between the two companies, the analysis indicated that through daily dynamic order optimization, TIC could reduce transportation costs and significantly increase service.

Solution

Implementation began in Houston, Texas, at TIC’s main distribution center (DC). Because this DC handles roughly 60% of TIC’s North American freight, it was vital to demonstrate that a consolidated solution could work at a high-volume facility.

Using Navisphere®, C.H. Robinson’s single global technology platform, C.H. Robinson dynamically reassessed and adjusted TIC’s freight load plans. Through detailed, near real time analytics and a complex network of contract carriers, consolidation of TIC’s LTL operations merged several orders, moving in similar lanes, into the lowest number of LTL shipments or multistop truckload movements. This strategy reduced overhead and streamlined shipping through intricate, responsive calculations; now, four times every day, the system automatically uses the latest order information and carrier availability to combine and optimize orders for maximum cost savings.

C.H. Robinson worked across multiple departments at TIC to ensure execution of this new dynamic order optimization proceeded smoothly. With C.H. Robinson developing new process flows and coordinating across affected parties in IT, analytics, project management, customer service, and more, TIC was able to draw on C.H. Robinson’s expertise not only for logistics technology but also in change management.

Under the new model, C.H. Robinson also began to work closely with TIC to develop new insights into comprehensive, multimodal solutions, testing and evaluating different shipping scenarios to find opportunities for even greater efficiency. This allowed TIC to reinforce their decision making with concrete evidence: “Whenever we have a request for data,” Jim shares, “we’re very confident that the information we get from C.H. Robinson is accurate.”

“That commitment has driven our solution design and is a huge reason why our warehouse on time performance has improved close to our target of 95%.”
—Jim O'Day

Outcome

C.H. Robinson’s optimization and consolidation of Houston freight operations gave TIC heightened insights into the contents and methods of each shipment passing through the facility. The new logistics model offered not only detailed tracking continuity but also direct data regarding how optimization was positively impacting the bottom line. As a result, TIC invited C.H. Robinson to plan freight for all nine of TIC’s domestic distribution centers across the United States.

By utilizing daily dynamic order optimization across their entire domestic freight network with
C.H. Robinson, TIC saw even greater decreases in transportation costs and broad improvements in efficiency across their whole supply chain. The benefits were immediate, with consistent visibility and dynamic modeling helping TIC to plan and get ahead of future shipments. “We have daily order reconciliation meetings to ensure orders were shipped and troubleshoot if they didn’t. We want to be sure we’re meeting TIC’s customers’ needs,” says Scott. Jim also shares, “That commitment has driven our solution design and is a huge reason why our warehouse on time performance has improved close to our target of 95%.”

But rather than rest on their success, C.H. Robinson and TIC continue to iterate and adjust proactively, promoting constant improvement and innovation. An updated network design analysis was completed in 2017, and C.H. Robinson has begun working on an entirely new project with TIC to execute strategies that mitigate shipment damage.

Future

“C.H. Robinson always has powerful business intelligence on the latest trends in the marketplace and what our customers expect from us."
—Jim O'Day

With C.H. Robinson operating as an extension of TIC’s logistics group, the close relationship between the two companies has generated a widespread culture of teamwork and shared expertise. Jim notes that “the collaboration between our two companies is very tightly interwoven. On a daily, even hourly, basis, our ability to work together has been essential, and C.H. Robinson is so responsive. Regardless of what our requests are, I always get a response in a matter of minutes. Being able to pass on that time savings to our customers is absolutely critical.”

C.H. Robinson's solutions have also spurred more internal partnerships between different departments at TIC. Moreover, TIC’s holistic thinking in close connection with C.H. Robinson has uncovered new opportunities both related and unrelated to logistics. That trust and dedication to service has helped TIC create a best in class, worldwide supply chain that provides an advantage over competitors.
“C.H. Robinson always has powerful business intelligence on the latest trends in the marketplace and what our customers expect from us. That perspective is vital for us when we think about how to stay connected and stay ahead,” says Jim.

With nearly a decade of progressive, cooperative problem solving behind them, both TIC and
C.H. Robinson look forward to continuing to develop strategic advantages in the marketplace.

Jim shares, “For us to be able to remain competitive, it’s critical for us to work with someone like
C.H. Robinson to continue to innovate and provide continuous value to our customers instead of sticking with the status quo.” Scott agrees, “It’s a never-ending journey. Right out of the gate we brought a lot of value in a lot of different ways, but we’re constantly learning and working together to uncover new opportunities to lower cost and improve service. Our people, processes, and technology really have been at the heart of our close work with TIC, and we’re excited for what the future holds.”