As the director of supply chain at Whirlpool, Kevin O'Meara takes driving out waste seriously. So in 2007 he challenged his team to start thinking differently about fuel expenses. "Every dollar I can reduce in transportation is a dollar that gets freed up in the company," he explains.
His crew zeroed in on fuel surcharges, which transportation providers typically charge customers to off-set fluctuations in fuel prices. "We're paying for something where we didn't really understand all the details," O'Meara says. "Any time I see a blind spot like that, I say, let's dive into that."
O'Meara's division started working with Breakthrough Fuel, which developed technology to help companies calculate their exact fuel costs. Whirlpool had Breakthrough calculate its usage and then brought that data to its transportation providers. As a result, Whirlpool began paying its transportation providers just for the fuel it used, not the additional "industry average" surcharge. Since fully implementing the program in the spring of 2008, Whirlpool has reduced its fuel expenditures by 11%.
The team is now looking hard at loadability of trailers, and how to fit more into the space.
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