Managing Resources

Module 11:
Information Technology for
the Transport and Logistics
Sector
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The Concept Of Transport
 Basic Definition..
Movement of Goods: shipping, air, rail, roads
Movement of People: tourism
 Transport requires Infrastructure
Airport/Seaport/Station/Warehouse/Roads
Movement of documents
An established set of rules (Protocol)
 Parallels with IT
Based on presence of infrastructure
Concerned with the movement of “messages”
Mimics the concept of “protocol”

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 Squeezing Time & Space
“In the new mental geography created by the
railroad, humanity began to master distance. In the
mental geography of eBusiness, distance has
been eliminated.”

Peter Drucker

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IT & Transport
 Transport is an age old industry that has been
one of the great hold outs against the wave of
computerisation that has swept the world.
 Some entrepreneurs recognising the massive
synergy created by IT have created “new”
business e.g.
Amazon.com: the movement of goods
Expedia.com: the movement of people
Egg.com: the movement of capital

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Benefits of Deploying IT in Transport
 Increased efficiency (in distribution,Inventory,
routing, Supply Chain Management)
 Better forecasting: Supply& Demand
 Speed to market
 Reduction of the business cycle
 Facilitation of adapting to new compliance
regimes
 Improved Risk management

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 Driving Forces
 Increased efficiency
 Rising costs associated with transport
 Difficulty of forecasting demand
 Increasing international competition
 Turnover of inventory is crucial
 Cost of disposal of inventory
 Compliance & regulation requirements make it
impossible to avoid investment in systems.

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A Typical Computer System

Company
Network
Fax
Server

PC Workstation
Specialist Modem/Router
Bridge Corporate Server
Printer
Scanner / Devices Public Network

ASCII Printer

Weighing
Scales
Hand held computer
Printer
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Handheld (Barcode, RFID,mobile apps)
A Traditional Shipping Cycle
1.Create an order

7. Receipt
2. Record the details
of the order 5.Goods
Receipted
6.Payment (GRN) /
Invoice

3. Prepare the goods

(Issue from stock) 4. Dispatch
(dispatch note)
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Imagine The Manual Processing !
 Filling in an order form
 Faxing it
 Physically checking whether in stock
 Altering stock level
 Writing an issue note
 Writing a dispatch note
 Delivering a goods received note
 Delivering an invoice
 Filing the invoice
 Processing the payment etc etc
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Imagine It Done Automatically !
 Filling in an order form
 Faxing it
 Physically checking whether in stock
 Altering stock level
 Writing an issue note
 Writing a dispatch note
 Delivering a goods received note
 Delivering an invoice
 Filing the invoice
 Processing the payment etc etc
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However Before IT Re-engineer!
Recognising the need to re-engineer when:
 Having paper intensive process;
 Recording information which appears to be useless;
 Tasks which are repetitive;
 Documents that are always the same;
 Even with IT in place there may be the need to re-
engineer
 A Common problem having to re-key information
multiple times;
 Having to re-key information that originally came out of
a computer in the first place.
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 IT & Still Having To Re-Engineer?! (1)
Despite massive advances in IT, there remain the
issues of the difficulty of integrating different
systems within organisations:
On a technical level
On an organisational political level
Financial barrier & risk

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 IT & Still Having To Re-Engineer?!(2)
 Ironically IT has a nasty knack of becoming an
obstacle to growth and re-engineering if not
planned and handled properly.
 ‘Good enough’ syndrome

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 IT & Still Having To Re-Engineer?!(3)
On A Technical Level
 Different systems built by different vendors;
 Introduced at different times within the
organisation;
 Different data models;
 Different standards ;
 Differing technologies – obsolete systems,
proprietary

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 IT & Still Having To Re-Engineer?!(4)
On An Organisational Level
 Lack of coherent IT strategy to support the
business
 Lack of understanding of the issues
 Different “power bases” or “fiefdoms” supporting
their own projects and not communicating
 No desire to share information (thus
undermining the company’s investment)
 Unwillingness to depend on each other’s data.
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 IT & Still Having To Re-Engineer?!(5)
Financial Barrier & Risk
 Different systems can be integrated;
 Integrated solutions (e.g. ERP solutions) exist;
 Cost is significant due to specialist knowledge
required;
 Risk is high since integration effectively “glues”
two or more operational systems for example
Accounts and Stock Control.

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Re-engineering
 Don’t automate , Obliterate!
 A massive rethinking of not only HOW we do
business, but WHY we do it the way we do and
HOW we can do it better…
More efficiently;
With less resources;
With out exposing the business to unnecessary risk;
In a way to not only catch but to overtake the
competition.

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 Specific Technologies Which
Impact the Transport Sector

ERP Systems
EDI/eCommerce
Networks
RFID Systems

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 ERP Systems
Distribution &
Sales
Warehousing
& Marketing

Supply Chain MRP

Management System

HR &
Internet Corporate Integrated
Database Payroll
Customer/
Order
Supplier/
Processing
Partner
CRMWeb Server Accounting
Inventory
System
Control
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 ERP Systems
 Typically used by large scale enterprises
although economic versions are appearing on
the market targeting Small and Medium
Enterprises:
Navision
Great Plains
SAP
BAAN
Peoplesoft/ JD Edwards
Oracle Applications
 Key Feature is Integration!

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Networks
There are a multitude of different types of networks
that we hear about, including:
LAN/WLAN
WAN
Internet
Mobile Networks – GSM/GPRS/UMTS
(3G)/WiMAX
Virtual Private Network (VPN)
Public Telephone Networks
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 Background :EDI (1)
 Electronic Data Interchange was the forerunner
of e-commerce.
 Utilised to allow the transmission of data
between a variety of often incompatible systems.
 Key factor was exchange of data using standard
messages.

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 Background :EDI(2)
 These standard messages were very much
specific to an industry or sector.
 A number of international standards such as
EDIFACT
BACS
SWIFT

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Advantages Of EDI
 Allowed suppliers & customers
(distributors,agents) to electronically exchange
information e.g order processing etc.
 Secure & often administered through legal
agreements - interchange agreements
 Portable - standards adopted internationally

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Disadvantages Of EDI
 Normally operated by Value Added Network
Providers (VANS)
 Operated on Proprietary Private Networks
 High cost of entry for small players

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RFID Systems
What is Radio Frequency Identification (RFID)?
A basic RFID system consist of three
components:
An antenna or coil
A transceiver (with decoder)
A transponder (RF tag) electronically programmed with
unique information

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RFID Systems (1)
 The antenna emits radio signals to activate the tag and
read and write data to it.
 Antennas are the conduits between the tag and the
transceiver, which controls the system's data acquisition
and communication.
 Antennas are available in a variety of shapes and sizes;
they can be built into a door frame to receive tag data
from persons or things passing through the door, or
mounted on an interstate toll booth to monitor traffic
passing by on a busy road.
 The electromagnetic field produced by an antenna can
be constantly present when multiple tags are expected
continually. If constant interrogation is not required, the
field can be activated by a sensor device.
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RFID Systems (2)
 Often the antenna is packaged with the
transceiver and decoder to become a reader
(a.k.a. interrogator), which can be configured
either as a handheld or a fixed-mount device.
 The reader emits radio waves in ranges of
anywhere from one inch to 100 feet or more,
depending upon its power output and the radio
frequency used.

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RFID Systems (3)
 RFID tags come in a wide variety of shapes and sizes.
 Animal tracking tags, inserted beneath the skin, can be
as small as a pencil lead in diameter and one-half inch in
length.
 Tags can be screw-shaped to identify trees or wooden
items, or credit-card shaped for use in access
applications.
 The anti-theft hard plastic tags attached to merchandise
in stores are RFID tags.
 In addition, heavy-duty 5- by 4- by 2-inch rectangular
transponders used to track containers or heavy
machinery, trucks, and railroad cars for maintenance and
tracking applications are RFID tags.

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eCommerce (1)
 Different business models & architectures
 Basic elements:
 Product Catalogue
 Search engine
 Authentication
 Payment gateway/clearing house

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eCommerce (2)
 Key technology
 Standard Message formats
 XML
 Documented interfaces

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IT & Human Resources
 The infusion of IT as a tool at the heart of a
transport organisation brings new demands on
the kind of skills that must be an integral part of
the organisation.

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IT & People – Common Mistakes
 Assuming that an IT technical guru or expert is
what you need;
 Looking at the person’s technical qualification
and forgetting the business expertise part of the
CV;
 Recruiting a technician when in fact you may
require a strategist;
 Assuming you can do things cheap & dirty:
ignoring security, reliability etc;
 Assuming your IT person(s) knows everything.
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Options To Consider
 Outsourcing: developing a strategic partnership;
 Co-development with an IT company;
 Selecting an IT company that has done it before;
 Or putting the “right” sort of individual at the
head of your IT department.

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