The Connected Carrier

Jo Godsmark

Trade Extensions

Multimodal

Jo Godsmark FCILT Director, Labyrinth Logistics Consulting & Founder, Supply Chain Design

2nd May 2012

The Connected Carrier

Integrating and exchanging data is fundamental to transport collaboration and outsourcing.

What should a modern carrier be providing to its customers in this area and what benefits should their customers expect to receive?

Business Structure

Labyrinth Supply Chain

Logistics strategy

Logistics procurement

Labyrinth Operational

Support

Health & Safety

Training

S

e

r

v

Labyrinth Logistics Consulting Ltd

Labyrinth Logistics Consulting

3PLs

Manufacturers & retailers

Logistics procurement

Network design

Performance reviews

Data exchange projects

Training

Vendor Assurance

Operational reviews

Quality Management

Dangerous Goods

“O” Licence assistance

Environmental reviews

Haulier interface hub (SCD)

Manufacturers, retailers,

distributors

Buyers of logistics services

v

i

c

e

s

Clients

The Connected Carrier

Integrating and exchanging data is fundamental

to transport collaboration and outsourcing.

Business StructureData in logistics – what has changed?

Previously paper based data

is now being captured electronically ..

..and in real time

Previously paper based data

is now being captured electronically ..

and demanded by customers in real

time, without manual intervention. requiring

integrated solutions

Business StructureData sharing versus EDI & integration

Non-integrated

Paper documents

and web portals

share data across

the supply chain

Semi-integrated solutions

give one party a hands-

free solution to data entry

or extraction – but the

other party still has

Integrated solutions

allow rapid, high

volume data exchange

including real time

feeds of dataother party still has

human inputfeeds of data

Rising cost & time of implementation

Increasing opportunities for supply chain benefits

Benefits of integration & EDI

Business StructureChallenges of EDI & integration in logistics markets

• Medium to short term contracts – challenging for investment in data capture and integration

– Buffer, seasonal and shared warehousing

– Transport – particularly palletised, full vehicle

• Sub-contracting can lead to gaps in data provision• Sub-contracting can lead to gaps in data provision

• Data a customer or supplier requires may be held across multiple systems or vary by site

• Many logistics suppliers have limited IT resources; few focussed in this area

• Different EDI & integration standards for different markets and different customers

Standards and acronyms of EDI….

Tradacoms

OdetteUN/EDIFACT

XML

FTP

AS2

CSV

ANSI (ASC) X12

UN/EDIFACT

VAN

FTP

EDI

GS1

Benefits – a distant dream?

The Connected Carrier

What should a modern carrier be providing to its customers in this area? What should to its customers in this area? What should buyers be looking for or demanding to obtain the benefits for their organisation?

Business StructureTender journey

SpecificationReview

market

Assess BidsReview

performance

Award

Business StructureSpecification – questions for buyers

• What benefits could my business get from increased data exchange with my suppliers?

• Are my suppliers’ systems sophisticated enough to meet these requirements? Are they offering this to other clients?

• What contract lengths am I offering – is the investment in integration realistic?• What contract lengths am I offering – is the investment in integration realistic?

• Is sub-contracting compatible with my requirements?

• How many suppliers will I be using? Is the solution realistic for this number?

• What are my standards for file format and communications protocol?

• Will I offer any support to my suppliers in complying with my requirements?

Business StructureFoundations for deriving benefits

Stable relationships

Customer

systems

maturity

Carrier

systems

maturity

Business StructureAssessing bids for integration capability

• What experience does the supplier have of semi-integrated & integrated solutions? Are they familiar with my standards?

• Who will be providing the integration/EDI?

– Internal IT resource (sufficient capacity/skills level)

– Specialist integration company (cost/solution)

– Supplier’s main software provider (cost/capacity/skill)– Supplier’s main software provider (cost/capacity/skill)

• What comms monitoring is there? What alerts are given if there are problems? If document sending fails once is there an automatic re-send? Is there a support desk for issues?

• What data integrity checks or business processes can be applied to the data automatically?

• Is there a fixed time and cost for the implementation? Is there an ongoing cost of exchanging data?

Business StructureSolution options for integration

Internal solution – one to one

3rd party solution – many to many

Recommendations for shippers & buyers

• Put data exchange at the heart of your specification of services – tell bidders what you expect from them and specify this in detail including timescales

• Ensure that your integration requirements match your tendering and outsourcing strategy: provide portals and upload solutions for new and less sophisticated suppliers

• When evaluating capability look for evidence of integration solutions & capability; ask for references in this area

• Be clear whether integration costs should be quoted separately or embedded in price

• If considering 4PL ‘control tower’ services look for evidence of their integration capability with subcontractors or their alternative solution in this area

Recommendations for carriers

• Sharing real time data with your customer is a competitive edge – have a strategy for data collection and transmission

• Don’t rely exclusively on web portals for customer access for data – integrating the data with their systems will increasingly be a condition of service

• Check the capability and resource of your software supplier(s) in the area of EDI and integration – can they handle multiple implementations quickly?

• Decide whether EDI & integration is an in-house service, provided by your main software supplier or you wish to use the services of a 3rd party integrator

• Use integration to lock-in your customers – better data, integrated without issues will increasingly be core to winning & retaining customers

‘The future is already here‘The future is already here

– it's just not evenly distributed.’

William Gibson, December 4, 2003

Any questions?