UPS using data from customers, drivers, vehicles in new route guidance system aimed at saving fuel, time, money; On-Road Integrated Optimization and Navigation, or Orion, launching this year to 10,000 of company's 55,000 US delivery routes
October 30, 2013
(United Parcel Service Inc. (UPS))
– Innovative software cuts miles, reduces fuel and sets stage for more personalized customer services
UPS® announced the launch of its impactful route optimization software known as ORION, which stands for On-Road Integrated Optimization and Navigation. ORION has a team of 500 dedicated resources to move the U.S deployment forward as UPS nears its busy holiday season. The rollout of ORION will optimize 10,000 delivery routes by the end of the year, reduce miles driven and reinforce UPS's sustainability efforts.
Most routes implemented with ORION have shown a mileage reduction. By the end of this year, the company expects to save more than 1.5 million gallons of fuel and reduce carbon dioxide emissions by more than 14,000 metric tonnes. A reduction of just one mile each day per driver over the course of a year saves the company up to $50 million annually.
ORION consists of more than 250 million address data points. The sophisticated software combines customer's shipping requirements with customized map data the company has compiled to provide UPS drivers with optimized routing instructions that meet service-level requirements, while reducing miles driven.
Tom Davenport, International Analytics Institute co-founder and Babson College professor states, "UPS is one of the best examples of pushing analytics out to front-line processes - delivery routing in particular. This initiative, ORION, is arguably the world's largest operations research project. It relies heavily on online map data and optimization algorithms, and will eventually reconfigure a driver's pick-ups and drop-offs in real time."
"The development and deployment of ORION is one of the strongest examples of our company's commitment to continual investments in operational and customer technologies to deliver significant operational benefits, taking advanced mapping and route optimization to new levels," said Dave Barnes, UPS senior vice president and chief information officer. "These benefits range from cost savings to positive environmental impacts and enable our company to raise the bar even higher on efficiency and customer service."
ORION is the result of a long-term operational technology commitment, more than a decade in the making. To gather the necessary data, UPS operations research scientists began piloting telematics technologies with the installation of advanced GPS tracking equipment and vehicle sensors in 2008. The integration of these technologies allows UPS to capture data related to vehicle routes and performance and driver safety. The driver's handheld mobile device and telematics technologies combined with custom mapping data and ORION algorithms provide more efficient routes for UPS drivers.
UPS prototyped ORION technology at 11 different sites between 2008 and 2011 and engaged senior UPS drivers to "beat the computer." This challenge helped to identify business rules to bolster the algorithm. UPS driver Tim Ahn said, "I get options that I would have actually never thought of before. It's a new way of thinking to make me more efficient."
The number of route combinations a UPS driver with an average of 120 daily deliveries could make is a number far greater than the number of nanoseconds the earth has existed. ORION is constantly evaluating routing options up to the moment a driver leaves the UPS facility. At full deployment it will be running tens of thousands route optimizations per minute.
ORION will enable future enhancements to the popular MyChoice service, providing close to six million consumers with the ultimate flexibility over their home deliveries by way of rerouting shipments and adjusting delivery locations and dates.
U.S. deployment to nearly all 55,000 routes is planned to be completed in 2017 and global deployments are planned for the future.
UPS (NYSE:UPS) is a global leader in logistics, offering a broad range of solutions including transporting packages and freight; facilitating international trade, and deploying advanced technology to more efficiently manage the world of business. Headquartered in Atlanta, UPS serves more than 220 countries and territories worldwide. The company can be found on the web at ups.com® and its corporate blog can be found at blog.ups.com. To get UPS news direct, visit pressroom.ups.com/RSS.