Pragmatic advice for rolling out a global TMS; automation, integration, and scalability with Heidi Lovstad, Supply Chain Leader, NOV

The global logistics team is handling shipments on a truly global scale. We’re moving everything from small parcels to complete rigs working with numerous carriers, lanes, modes, and service levels. And we’ve automated the invoice processing and audit. So with greater visibility and control, we were able to reduce the number of carriers we use and better leverage our logistics spend to negotiate for improved pricing. We also connected the TMS application with our existing back-office applications, providing a seamless end-to-end experience for our internal customers, but also for our external partners.”-Heidi Lovstad

Full transcript

Francis Adanza

Welcome to the Down to Freight podcast, where we sit down with transportation, logistics, supply chain and warehouse subject matter experts to discuss digital transformation projects. I’m the host of the show, Francis Adanza, and it’s a pleasure to welcome Heidi Lovstad, Global Logistics Manager for NOV. Heidi, it’s great to have you.

Heidi Lovstad

Thank you so much for having me. I think this is a very exciting initiative.

Francis Adanza

Awesome, glad to hear that you can participate. For the listeners out there, can you share a little bit about yourself, your company and what you’re responsible for at NOV?

Heidi Lovstad

Sure, as you mentioned, I work for NOV. Formerly, I’m perhaps better known to most people as National Oilwell Varco. But we officially changed the name to simply NOV earlier this year. NOV is a leading worldwide provider of equipment, systems, and components used in oil and gas drilling and production, industrial and renewable energy.

My career at NOV first started 18 years ago in Houston, Texas, where I briefly worked for the Hydrolift brand, which was a Norwegian company that was acquired by NOV in the early 2000s. And it wasn’t until I started working in freight forwarding that I truly discovered the dynamic world of logistics. At the time being half Norwegian and having grown up in some [Inaudible 0:01:56] Norway, I was initially interested in pursuing a career in sales, thinking I could somehow leverage my international background and foreign language capabilities to foster professional relationships and further develop business especially with the Scandinavian clientele.

And in the beginning, I’ll admit I had no idea what a freight forwarder was. But through that experience, I never really thought how things move around the world. In doing freight forwarding for a couple of years, I really found a passion for logistics and supply chain, but a real interest in the systems and the technology that supports those operations during that time. And OB was actually one of my key accounts. So when an opportunity rose in 2010 to join the group again, I jumped at the chance. And so now I’ve been with the company for over 10 years, and I manage global logistics for the rig technologies division of NOV, which engineers and manufactures drilling rigs, advanced drilling equipment packages, and related capital equipment.

Francis Adanza

Wow, that’s an awesome story for how you ended up where you are today. Thank you for sharing that background. So we’re here to talk about technology. Is there a particular project that you’d like to share?

Heidi Lovstad  

Definitely. So one thing I really admire about NOV is this culture of continuous innovation and the commitment to investments in our technology. And I think the value of digitalization is recognized at every level of the organization. So as many global suppliers have come to realize ERP and WMS systems are vital components of a comprehensive enterprise operation, they lack the functionality needed for total logistics management.

A TMS or a transportation management system was the solution for us, and we selected Oracle Transportation Management, or OTM, which provides a single platform to manage all of your logistics activities throughout the supply chain. We successfully launched this system in May of last year amidst the global pandemic, nonetheless.

Francis Adanza

Fantastic. What were the issues like specifically, what were the issues that you’re trying to address with this TMS implementation?

Heidi Lovstad   

So initially, we set out to develop an application to store all of our rates from our extensive network of logistics service providers, but also automate the review and approval process for a significantly high volume of invoices.

Francis Adanza

Got it. And why was that important to the business? And how do you or various members of your team actually use this system?

Heidi Lovstad 

The global logistics team is handling shipments on a truly global scale. We’re moving everything from small parcels to complete rigs, working with numerous carriers, lanes, modes and service levels. And we now have a global repository to centrally manage our rates, our spot bids, we can plan shipments, and we’ve automated the invoice processing and audit. So with greater visibility and control, we were able to reduce the number of carriers we use, and better leverage our logistic spend to negotiate for improved pricing.

We also took advantage of the automation programming capabilities. So we increased efficiency and productivity by automating many of our former processes, which subsequently reduced our cost even further. We also connected the TMS application with our existing back office applications, providing like a seamless end-to-end experience for our internal customers, but also for our external partners.

And looking back over the past year, a lot of us have been working from home because of COVID-19. And so with OTM. Our TMS is a web-based application. So our team was able to continue supporting our worldwide logistics operation remotely. That being said, I have to say how extremely proud I am of the entire team that collaborated on this project, especially during what turned out to be the most challenging time of my career. And I know for many others in my field.

Francis Adanza

I bet. So you mentioned that it wrapped up in May of last year. Can you touch a little bit on how long in totality did the project take and especially since half of it must have been all remote because of the pandemic?

Heidi Lovstad   

Yeah, so I would say it took about a year with development, integration and implementation. We started in the US, and we’re expanding to our global facilities.

Francis Adanza  

Got it. And so for those that are thinking about a global implementation for a TMS, what are some like words of wisdom that you can provide so that they can hopefully make new mistakes and have a smooth rollout?

Heidi Lovstad   

That’s a really great question. So my advice to anyone considering a similar initiative would be think big, but start small. So while it’s easy to imagine a system that can do everything, focus on what will add the most value to your operation first. And having a TMS system with scalability gives you the flexibility. You need to expand as necessary to support the global logistics management requirements. While we successfully achieved our initial goal of launching, OTM, for the rate and invoice management piece, we still have further development and implementation efforts are ongoing. So we know it works. But we still need to add more carriers, rates, locations, users, the list goes on.

Francis Adanza  

Got it. I guess, along that thread of thinking of continuous improvement, continuous innovation, I guess the job never ends.

Heidi Lovstad 

The job never ends. And that should always be our focus, continuous innovation. And I think that’s what makes logistics exciting, especially now.

Francis Adanza  

Definitely you touched on it a little bit, but what else is on the horizon for this project or any other projects going on in your world.

Heidi Lovstad   

So obviously we do have our attention on the further expansion of our TMS system within NOV but there are other applications that fall under supply chain that I’m involved in as well. So I’m excited to see where we can take those.

Francis Adanza   

Awesome. Heidi, this was a great episode. I really enjoyed the lessons learned with this TMS implementation. Thank you for your time today.

Heidi Lovstad   

Thank you so much.