Seeing further down the line is key to understanding and developing a worthwhile transport management system, says Alex Whiteman.
Long-term visibility is a priority, but not yet a reality for retailers when it comes to their transport management systems. The ever-evolving nature of retail, and consumer demand for convenience is driving the way people shop, and customer service.
Fab Brasca, vice president of global logistics at JDA Software, says: “When it comes to world-class transport and logistics management, companies must strive to deliver on two critical features: containing costs and sustaining service. With the unprecedented power of the omni-channel consumer driving behaviour in the global market place, companies — regardless of where they sit in the supply chain — must find new ways to achieve efficiencies and operational control, and accomplish these objectives with the agility necessary to competitively serve today’s end consumer.”
Robert Byrne, CEO of Terra, says that his firm wants to provide transport managers with the same visibility that their colleagues have along the supply chain.
“The challenge in TMS is the lack of long-term visibility, transport managers aren’t provided the same information as other members of the chain. For example, they may not be aware of impending promotions,” he says.
Byrne notes that this sort of information is invaluable for transport managers as it allows them to consider lane, mode, number of vehicles, and the capacity required.
“With information like this, transport managers can think anywhere up to three months in advance, it improves collaboration between all parties, and indicates what will be happening next,” adds Byrne.
Byrne and Jason Price, sales and marketing director at Isotrak, say that the ideal is to turn transport management from a reactionary to a pro-active division. Historically, goods were shipped from distribution centre to store, but now retailers are sending goods to multiple destinations.
“The rate of change in customer delivery is growing all across the place,” says Price. “You cannot send a 44-tonne truck down a country lane to convenience stores used as click and collect points.”
Byrne says that focus for transport management systems providers has pulled away from just the delivery trucks, with Terra focusing on warehouse management too, including the make-up of orders and pallet sizes.
“To some extent this came out of work we did with Campbell Soup,” he says. “We wanted to be able to understand the warehouse as this assists with staffing.”
This desire to understand the complete end-to-end journey of goods is one shared by Brasca, who says: “End-to-end planning control enables dynamic diversions if demand changes for in-transit goods. Companies gain flexibility and can re-plan an in-transit container distribution centre destination from one region to another in response to a demand surge.”
Geoff Taylor, managing director of Route Genie, says that consumer sophistication, driven by evolving technology including online order systems and smartphone apps, is a key force behind these changes, adding that it is placing a huge demand on shops.
“It is requiring retailers to provide nimble delivery services,” says Taylor. “Either via their own networks or through leveraging the networks of others.”
For Route Genie, provider of software as a service routing applications, the key hurdle is to ensure that technology makes the right decisions and continues to provide the service regardless of courier chosen.
“Our full suite of technology services selects the correct, and a consistent, customer service when different carriers are chosen,” he says. “Through being able to do this, it maintains the same retail experience and maintains customer loyalty from shoppers for our clients.”
Last year, Logistics Manager highlighted the need for transport management tools to provide more than a mere delivery roster (Real time roll-out, Logistics Manager, November 2013). The systems, it said, needed to identify relevant data and use it to add real value.
Price believes there is a mountain of data that can be obtained by the on-board experience of freight in motion. Isotrak’s 3iS software system can monitor in-cab experiences regardless of hardware used.
“We track driving style, as well as vehicle location,” he says. “This allows us to keep stores updated on vehicle location, and expected time of arrival. And tracking the driving style provides information that can be analysed to improve the service. As a result, customers and clients can be assured of a consistently improving quality of service.”
Isotrak market presence is increasing, with Price noting that the firm serves two key delivery firms in the UK, one of which serves a retailer with 60,000 deliveries a day. Price says this is a number that has surged in recent years as home delivery services have reported significant growth.
This data driven product of Isotrak’s has led it firmly down the software-as-a-service route, according to Price.
“Historically we installed a device in a vehicle and then monitored data from there,” he says. “But more recently our focus has firmly been on leveraging the information from the device. The black box itself has become irrelevant, and our system can be downloaded as an app compatible across multiple devices.”
Byrne backs software-as-a-service, adding: “Yes, you can definitely use it, and it is entirely feasible.”
However, it is important for the client to know that the software is making the correct calls, according to Taylor: Price says that he hopes software-as-a-service is taken up across the board by major retailers. Primarily, this hope is down to Isotrak being in the position to host a whole solution for their clients in a single software package.
“Our system integrates and optimises,” says Price. “It enables clients to have a central point of control and a single level of expertise.”
He points to the history of mobile operators in the UK.
“20 years ago, each operator built its own mast at great expense,” says Price. “But then they realised they could share one, and save on costs without jeopardising product quality. And in the bigger picture, we are providing visibility across the supply chain.”
CASE STUDY: Managing transport in the cloud
Transport management is one of the technology areas that has been moving into the cloud with customers increasingly looking for TMS to be operated on a software-as-a-service basis.
Oracle has just launched a cloud-based version of its Transport Management and Global Trade Management applications, highlighting the fact that these are not cut-down versions of the existing systems but contain the full functionality.
And Kewill last month acquired the IBM Sterling Transport Management System (TMS), a SaaS-based multimodal transport management system.
Derek Gittoes, vice president, value chain execution product strategy at Oracle, said the move reflected the demand for cloud-based versions of these applications. Demand was coming from companies of all sizes, he said.
He highlighted the fact that the cloud versions contained all the functionality of the existing on-premises versions – they are not cut-down versions, he said.
“Oracle Transport Management and Oracle Global Trade Management have long demonstrated their ability to deliver strong ROI and enhanced customer experiences, and are recognised as industry-leading solutions. With this announcement, companies can now leverage the advantages of cloud to achieve these same benefits without compromise, while also accelerating deployment timelines, reducing IT capital costs, and controlling their long-term cost of ownership,” he said.
Oracle will continue to offer on-premises versions alongside the cloud versions.
Kewill has renamed the IBM platform to Kewill Transport. This will become a part of the Kewill MOVE transport management platform. Alongside acquiring the system, a team from IBM will be transferred to work with the Kewill team.
Kewill Transport plans and executes inbound and outbound transport processes. It connects a collaborative logistics network of carriers, shippers, and customers, automating the entire transport management process. Kewill points out that by delivering it as software-as-a-service, means fewer IT resources, no upgrade costs, easy connectivity, and low total cost of ownership, delivering a fast impact on the bottom line.
Bob Farrell, president and CEO at Kewill, said: “The acquisition of the IBM Sterling TMS enhances Kewill’s position in the multimodal transport management space, and in particular in the North American marketplace, enabling us to extend the range of solutions we offer to shippers and retailers.”
CASE STUDY: A trouble shared is a trouble halved
Online sales in the UK grew 16.8 per cent in 2013, up to £38.8bn, and are expected to grow again in 2014, by 15.8 per cent to £44.97bn, according to marketing firm Retail Research. Online retail is expected to amount to 13.5 per cent of total retail market share this year. And not only is online retail growing, so too is the way in which shoppers approach online shopping, with Retail Research expecting online retail sales made through mobiles to grow by 62 per cent this year, and account for 17.6 per cent of all online sales.
Jason Price of Isotrak believes that this surge in growth has been catching retailers out, and exposing areas that could be exploited on a co-operative basis to cut costs without cutting on quality.
“A garden centre knows that summer is its peak period, while a toy shop, or a supermarket knows that the peak season is in winter,” says Price.
“Transport management systems provided on a software-as-a-service basis can provide visibility across a co-operative fleet to show who’s using what and where.”
Price’s point being that if retailers shared such information with other local retailers that they could pool resources and share their available fleets with one another.
“If you can get visibility at times of peak for those retailers in your local area, you can use each others’ resources,” he says.
Originally printed in Logistics Manager 11/2014
