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Supply Chain Management Solution
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Abstract: Geography is irrelevant in today's world. How
did this happen? Who changed it? The Web, of course! The Internet and its
related technologies are redrawing the boundaries of organizations today.
Business headlines herald a revolution in the way businesses are conducted
leveraging the Internet. This article is a case study about a freight carrier
that has become a leader in Supply Chain Management (SCM) today. By using the
net to manage inbound and outbound flows from the time an order is made to
mapping out a complete distribution plan, they are recognized for their EZTDBW
(easy-to-do-business-with) customer orientation.
Haven't we heard enough about how nearly all web sites were founded (or
cofounded!) in garages? We've also seen how many of them relapsed into near
oblivion. A few years ago business sites used to simply be places for companies
to enthrall their visitors with marketing material and histories. But today
customer expectations have outstripped the rate at which web pages are created
- believed to be about 30 pages per sec. Customer requirements have morphed
into something more complex; customers have turned architects while companies
are mere contractors. Interactive and informative web sites - places to track
orders and confer with online help desks and access records of buying histories
are what the customer demands.
Let us review a brick and mortar company who leveraged Internet technology to
Enhance their "core competencies".
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Company Profile
Viking Freight Services, Inc. is a company that specializes in
next-and-second-day-door-to-door less-than-truck-load (LTL) services through a
network of 66 centers in the Western United States. A leading freight carrier
recognized by their on-time delivery performance record, they have developed
into a premium global provider of transportation, e-commerce and supply-chain
management services. A part of the FedEx group of companies, they are
headquartered in San Jose, California. Founded in 1966, their work force of
about 5000 handles 13,000 shipments in a day. The American Trucking
Associations Presidents Trophy handed them a safety record award in 1999, one
among the many that adorn their shelves.
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Opportunity Identified |
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The need for a dynamic Web presence:
Until a few years ago, the only information that Viking's customers were aware
of was when their shipments left and when they arrived. The black hole that
existed between origin and destination wasn't easy to eliminate. Also, ageing
legacy systems had become costly and difficult to maintain. Customer records
urgently needed to be updated and integrated with information from other
departments. Electronic Data Interchange (EDI) helped them develop an efficient
Document Imaging System, but this still didn't address all their customer
requirements.
The Challenge
Viking's customers ranged from Fortune 100 companies to smaller businesses with
revenues under $2 million. The former required highly integrated information
exchange while the smaller enterprises were comfortable with rapid and frequent
communications. With such varying information needs, the IT challenge was to
provide a solution that met the needs of customers at all levels. Web-based
applications became the undeniable solution.
The Solution
They realized that a data storage center that provided a consolidated view of
all customer activities and was universally and instantaneously accessible was
essential. A net-based infrastructure seemed to be the answer and therefore
Viking collaborated with Sun Microsystems and deployed their iForce initiative
to leverage the power of the Internet. Sun helped them strategize their
services and forge a well-defined supply chain, entirely dictated by customer
requirements.
Satisfying customers in newfangled ways gave them a competitive edge, not to
mention the added benefits of reduced costs and the seamless flow of data
within heterogeneous levels in the company. Web-based transactions afforded
greater efficiency levels that ensured a tighter supply chain.
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Solution |
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What did their web enabling process entail?
An infrastructure upgrade with the use of a new suite of e-tools, EDI
(Electronic Document Interchange) and satellite tracking was what they aimed
for. Using the web enabling services provided by their Application Source
Provider (ASP) they accomplished this in a swift and low-risk manner. Achieving
the same internally within their own company meant higher risks and costs. An
outsourced solution proved to be more cost-effective.
EDI helped record freight invoices, shipment status and load tenders thereby
eliminating severe backlog. Data marts and Data warehousing were thus made more
proficient, but static data wasn't of much use. In an era where the customer is
king, critical data delivery to customers over the web using state-of-the-art
technologies was imperative. Satellite tracking, bar coding helped their
customers track shipments with pinpoint accuracy on a real-time basis.
Establishing more than a simple web presence meant dynamic and interactive web
pages. IShipViking.com was launched with this in mind. More than just a pretty
web site, it was a mini data center that gave customers immediate access to all
transactions. It allowed proactive tracking of the pipeline, the kind of
tracking that helped decipher problems much before they disrupted a shipment.
On the whole it was a site that furnished greater visibility.
All that a customer needed to do was enter a password and then travel with his
shipment, albeit virtually! A drop-down address book helped users enter
information about their shipments and destinations. This eliminated both the
need for reentering data and also the introduction of errors. A customer could
create, print and email bills of lading using the bill of lading generator and
send these forms to multiple consignees at remote sites.
Instant access to shipping activity reports, collective summary reports and
email delivery notifications helped improve operations and inventory thus
achieving an optimal value chain. Visibility of the product at all levels meant
a greater degree of transparency in all operations. Employees performed more
efficiently and shipments began reaching destinations in record time.
All shipments could be traced and tracked until their delivery. Trucks were
equipped with satellite modems to ensure 100% nationwide coverage. Calculation
of customized rates and customer-scheduled pickups became more of a reality. On
arrival, the driver scans the bar code on the package with his handheld
computer that transmits this information to the company's headquarters from
where an email message with the dates and times of delivery and receiver's
signature are sent automatically to the customer. To quote Keith E. Lovetro,
Viking's VP of marketing, the iShipViking.com web site "gives customers an
integrated set of account-level information tools that help simplify their
daily work processes."
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Benefits |
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Returns on upgrading to the Net:
Upgrading their fragmented data centers and linking them with the web helped
Viking to bridge the technological distance that existed between origin and
destination. A united web-based infrastructure also equipped them for future
e-commerce expansions.
Internal access and relay of real-time information - package, driver and routing
information and then linking this information to their freight tracking system
ensured that shipments reached on time. New Internet technologies using XML or
eXtensible Markup Language helped in the smooth flow of data between disparate
systems both within and outside the organization.
The company could now respond with off-hour pickup and delivery systems and
build 24-hour terminals to handle freight at a moment's notice. Fostering an
intimate and long - term relationship with customers helped them offer a string
of services that weren't possible before.
Armed with the new e-business model, a trucking company that moved goods from
one point of the highway to another strategically transformed itself into a
dominant provider of a large piece of the supply chain. Incidentally, in August
this year, they extended their second-day delivery areas thus shortening the
supply chain!
What does this confirm? That Internet ROI isn't an oxymoron. It is dependent on
your customers and how well you treat them
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Technologies
In Use
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.NET Languages
Microsoft® ASP.NET (Web Forms) , Visual C++.NET, Visual C#, and Visual Basic
.NET
Client software
Windows XP, Windows CE, and Microsoft Office XP
Development tools
Microsoft Visual Studio® .NET
Servers
Microsoft Windows® 2003, Microsoft SQL Server™, and Microsoft BizTalk® Server
XML
XML Schema, SOX, RELAX, XSD, XHTML, XPATH, SOAP, XML-RPC, WSDL, UDDI, SAX, DOM,
JDOM, Xerces, Xalan, SAXON
Methodologies
UML, Design Patterns, OOAD/OOP, XProgramming
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