Challenge
For one of Prime 3 Software's shipping clients, preparing price quotes was an iterative process and time-consuming effort, taking a minimum of 45 minutes to complete per instance. Data needed to be gathered from multiple sources, reviewed and then a quote could be sent to the customer. Accepted offers were then entered into the centralized ERP system.
The process of pricing required multiple systems with serving a different function. The four primary systems were used to:
1. Determine the fitness of the lane within the service network.
2. Find historical and existing prices and volumes aligned to the quote timeframe.
3. Find the total cost of each move by lane and competitive and market metrics.
4. Record negotiated price in the in-house ERP.
Observations
A single lane RFQ could take an hour to complete. Larger bids could take a day, and multiple days were needed for bids with hundreds of lanes. If the contract included thousands of lanes, it took weeks to complete. Compounding the problem was the increasing frequency of multiple rounds of pricing negotiations, further adding to the workload. From the original bid, generating the offer document took over 20 minutes.
Strategy
We started with the offer sheet. In doing so, we focused on the final product and eliminated the busy work associated with transferring the quotes to a document and emailing it to the customer. This freed the pricing agent to focus more on the analysis of the prices offered.
Next, we reviewed the data requirements necessary to determine a price. The customer initially requested to have all pricing data on a single screen. We presented a different view as we found this user experience would be less than ideal. Working closely with the customer, we determined the exact data required for each lane and used that for the basis of the application. Our objective was to aggregate the information used to price 80% of the company's lanes. We then gave the customer the ability to drill down on each lane for more pricing details without leaving the dashboard page.
We found that the customers quickly adopted the new system and stopped using the legacy systems shortly thereafter. Pricing agents could rapidly process a bid and make offers in a fraction of the previous time.
Results
The processing of single lane bid was reduced to less than two (2) minutes, and users are able to process bids on thousands of lanes in minutes. Additionally, while the customer's procedures require analysts to manually check each quote, the system is ready for process automation.
The improved system now gives the pricing agent more time to focus on the quality of their prices and more capacity to price new opportunities.
By working closely with the customer, we were able to identify the true system requirements. Our knowledge of shipping, pricing and software were instrumental in creating an optimal system, process efficiency and an outstanding user experience.