Norfolk Southern Corp., one of the largest railroads in North America, has saved more than 100 customers millions of dollars a year in fuel and transport costs using a supply chain management solution. The software, SCM Network Design from Infor, has been in use at the company for ten years. It provides Norfolk Southern the ability to model its customers’ supply chains to determine where to make, buy, store and move product through the supply chain network and by the optimal mode of transportation.
“Green is a big customer focus, and rail offers the most fuel-efficient means of transporting goods – moving a ton of freight over 450 miles on a single gallon of fuel,” states Andy Piper, manager of supply chain development, Norfolk Southern Corp. The Infor solution allows the railroad to reduce cost and carbon output, and answer various ‘what if’ questions from its customers regarding the design of their supply chain networks.
SCM Network Design helps drive business decisions for Norfolk Southern in more than 30 ways, including modal selection, network analysis, site selection, drayage optimization, and inventory and competitive analysis. The solution enables the company to determine the resulting impact for customers of converting to rail from truck mode, including the reduction in carbon footprint and freight transport cost.
According to the American Association of Railroads (AAR), if 10% of long distance freight from truck moved by rail instead, fuel savings could reach at least $1 billion.