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UPS Optimizes Delivery Routes

Author

Listed:
  • Chuck Holland

    (UPS, Atlanta, Georgia 30328)

  • Jack Levis

    (UPS, Timonium, Maryland 21093)

  • Ranganath Nuggehalli

    (UPS, Timonium, Maryland 21093)

  • Bob Santilli

    (UPS, Timonium, Maryland 21093)

  • Jeff Winters

    (UPS, Timonium, Maryland 21093)

Abstract

UPS, the leading logistics provider in the world, and long known for its penchant for efficiency, embarked on a journey to streamline and modernize its pickup and delivery operations in 2003. This journey resulted in a suite of systems, including a meta-heuristic optimization system, which it called “On Road Integrated Optimization and Navigation” (ORION). Every day, ORION provides an optimized route for each of UPS’ 55,000 U.S. drivers based on the packages to be picked up and delivered on that day. The system creates routes that maintain the desired level of consistency from day to day. To bring this transformational system from concept to reality, UPS instituted extensive change in management practices to ensure that both users and executives would accept the system. Costing more than $295 million to build and deploy, ORION is expected to save UPS $300–$400 million annually. ORION is also contributing to the sustainability efforts of UPS by reducing its CO 2 emissions by 100,000 tons annually. By providing a foundation for a new generation of advanced planning systems, ORION is transforming the pickup and delivery operations at UPS.

Suggested Citation

  • Chuck Holland & Jack Levis & Ranganath Nuggehalli & Bob Santilli & Jeff Winters, 2017. "UPS Optimizes Delivery Routes," Interfaces, INFORMS, vol. 47(1), pages 8-23, February.
    • Handle: RePEc:inm:orinte:v:47:y:2017:i:1:p:8-23
    DOI: 10.1287/inte.2016.0875
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    References listed on IDEAS

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    8. Michael Fairley & David Scheinker & Margaret L. Brandeau, 2019. "Improving the efficiency of the operating room environment with an optimization and machine learning model," Health Care Management Science, Springer, vol. 22(4), pages 756-767, December.
    9. Vidal, Thibaut & Laporte, Gilbert & Matl, Piotr, 2020. "A concise guide to existing and emerging vehicle routing problem variants," European Journal of Operational Research, Elsevier, vol. 286(2), pages 401-416.
    10. Toni Greif & Nikolai Stein & Christoph M. Flath, 2023. "Information Value Analysis for Real-Time Silo Fill-Level Monitoring," Interfaces, INFORMS, vol. 53(4), pages 283-294, July.
    11. Zhang, Juan & Campbell, James F. & Sweeney, Donald C., 2024. "A continuous approximation approach to integrated truck and drone delivery systems," Omega, Elsevier, vol. 126(C).
    12. B. Madhu Rao & Petros Xanthopoulos & Qipeng Phil Zheng, 2020. "Case Article—DeLand Crayon Company: An Application of the Traveling Salesman Problem to Production Scheduling with Sequence-Dependent Setup Times," INFORMS Transactions on Education, INFORMS, vol. 20(2), pages 93-98, January.
    13. Haoyuan Hu & Ying Zhang & Jiangwen Wei & Yang Zhan & Xinhui Zhang & Shaojian Huang & Guangrui Ma & Yuming Deng & Siwei Jiang, 2022. "Alibaba Vehicle Routing Algorithms Enable Rapid Pick and Delivery," Interfaces, INFORMS, vol. 52(1), pages 27-41, January.
    14. Max Leyerer & Marc-Oliver Sonneberg & Maximilian Heumann & Tim Kammann & Michael H. Breitner, 2019. "Individually Optimized Commercial Road Transport: A Decision Support System for Customizable Routing Problems," Sustainability, MDPI, vol. 11(20), pages 1-21, October.
    15. Tamara Adams & Alessandro Ferrucci & Pedro Carvalho & Sothiara Em & Benjamin Whitley & Ryan Cecchi & Teresa Hicks & Alexander Wooten & John Cuffe & Stephanie Studds & Irvin Lustig & Steve Sashihara, 2023. "Advanced Analytics Drives Reengineering of Field Operations for the 2020 U.S. Census," Interfaces, INFORMS, vol. 53(1), pages 47-58, January.
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    17. Peters, Koen, 2024. "Operationalizing analytics to improve food security," Other publications TiSEM 4e63a46a-29eb-4845-b136-2, Tilburg University, School of Economics and Management.
    18. Ellegood, William A. & Solomon, Stanislaus & North, Jeremy & Campbell, James F., 2020. "School bus routing problem: Contemporary trends and research directions," Omega, Elsevier, vol. 95(C).

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