Transport Management & Theory Practices (12)

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Transport Management & Theory Practices (12)

  1. 1. Management of Transportation Seventh Edition Coyle, Novack, Gibson & Bardi © 2011 Cengage Learning Chapter 12 Information Management and Technology © 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
  2. 2. 2 Introduction • IT use in supply chain explodes in ’90s – IT use enables reduction of assets – IT use enables better management of • Information flows • Product flows • Cash flows – Cost of IT declines significantly © 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
  3. 3. 3 Information Systems • Purpose – Collect, organize, and portray meaningful data to decision makers • Challenge: vast volumes of information – Serve multiple organizational levels – Facilitate integrated decision making within firms and across supply chain • Core components – Common databases, hardware, software – Enterprise resource planning (ERP) systems © 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
  4. 4. 4© 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Figure 12- 1
  5. 5. 5 Information Systems, cont’d • Ex: info needed to manage transport transaction – Pre-transaction phase: info needed to plan carrier movement • Shipper needs purchase order, forecasts, POS data, equipment availability, possible pick-up times – Input to carrier selection decisions • Carrier needs bill of lading info., preferred pick-up and delivery times • Receiver needs advance shipment notice, scheduled delivery times © 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
  6. 6. 6 Information Systems, cont’d • Info needs for transport transaction, cont’d – Transaction phase • All parties need shipment status info – Carriers typically provide on exception basis – Post-transaction phase • Shipper and receiver needs depend upon terms of sale – Proof of delivery and carrier performance – Freight bill – Claims, if necessary • Carrier needs payment info, claims info © 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
  7. 7. 7© 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Table 12-1
  8. 8. 8 Information Sources • Prime sources were paper documents – Many transactions are now paperless • Bill of Lading (BOL) – The single most important document. – Initiates shipment, typically generated by shipper – Provide all the information the carrier needs to accomplish the move – Stipulates the transportation contract terms including the scope of the carrier’s liability for loss and damage – Acts as a receipt for the goods the shipper tenders to the carrier – Shows certificate of title to the goods © 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
  9. 9. 9 Information Sources • Bill of Lading (BOL) – Serves five legal purposes • Receipt for goods • Description of shipment • May be evidence of title to goods • Operating document • Defines terms of contract between carrier and shipper © 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
  10. 10. 10 Information Sources, cont’d Bill of Lading, cont’d – Minimum information required: 1. Origin/destination of shipment 2. Carrier designation 3. Special operating instructions 4. Shipment description 5. Billing instructions © 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
  11. 11. 11 Information Sources, cont’d Bill of Lading, cont’d – Minimum information required: 1. Origin/destination of shipment – Carrier to identify freight lane that will be used for shipment, availability of equipment and personnel to provide transportation, to determine pick-up and delivery times 1. Carrier designation – Determine carrier-routing process – Helps identify the initial contact with the pickup carrier 1. Special operating instructions – Temperature control, loading/unloading requirements, blocking/bracing, pickup or delivery requirements © 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
  12. 12. 12 Information Sources, cont’d Bill of Lading, cont’d – Minimum information required: 4. Shipment description – About the commodity, quantity, weight – Hazardous material 4. Billing instructions – Information on the identity of the party responsible for paying the transportation services © 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
  13. 13. 13 Information Sources, cont’d Bill of Lading, cont’d – Two types of bills of lading • Straight or non-negotiable – The carrier must deliver the goods only to specific receiving organization and destination in return for freight charge payment • Order or negotiable – The owner of the goods has the right to transfer title to the goods to another party and reroute the shipment to a location other than the one listed on BOL © 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
  14. 14. 14© 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Figure 12-4
  15. 15. 15 Figure 12-5 © 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
  16. 16. 16 Information Sources, cont’d • Waybill – Operating document for railcar movement • Assigns car to train, contains billing info – Describes car’s contents – Most are now electronic • Manifest – Trucking equivalent to waybill – Documents weight loaded in each trailer quartile – To address axle weight restrictions on the highway system © 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
  17. 17. 17 Figure 12-6 © 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
  18. 18. 18 Information Sources, cont’d • Freight bill – Purpose/function • Carrier’s invoice for transport services and related charges • Notifies buyer of charges and means of assessment • Can serve as proof of delivery – Efforts to shorten freight bill payment cycle • Many buyers require proof of delivery (signed freight bill) before initiating payment process – Delivery proof matched with BOL and packing list – Carriers supply electronic delivery proof to speed process © 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
  19. 19. 19© 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Figure 12-7
  20. 20. 20 Information Technology • A leading and constant concern of logistics and transport managers • Areas of application – Top application: connecting to supply chain – Drivers • Information can substitute for assets, services – Ex: Satellites, inventory visibility, safety stocks • Cost of IT continues to fall and capabilities rise – Hardware, software, networking communication and data exchange capabilities © 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
  21. 21. 21 Information Technology • A leading and constant concern of logistics and transport managers • Areas of application – Top application: connecting to supply chain – Drivers • Information can substitute for assets, services – Ex: Satellites, inventory visibility, safety stocks • Cost of IT continues to fall and capabilities rise – Hardware, software, networking communication and data exchange capabilities © 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
  22. 22. 22 Information Technology • A leading and constant concern of logistics and transport managers • Areas of application – Top application: connecting to supply chain – Drivers • Information can substitute for assets, services – Ex: Satellites, inventory visibility, safety stocks • Cost of IT continues to fall and capabilities rise – Hardware, software, networking communication and data exchange capabilities © 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
  23. 23. 23 Table 12-2 © 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
  24. 24. 24 Table 12-3 © 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
  25. 25. 25 Information Technology, cont’d • Areas of application, cont’d – Drivers, cont’d • Supply chain partners demand more info – Ex: Collaborative planning, forecasting and replenishment (CPFR) requires sharing/collaborating on demand forecasts • Managing information flows well is critical to meeting customer demands and to efficient operations and profitability – Info flow necessary for managing relationships and product and cash flows © 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
  26. 26. 26 Information Technology, cont’d • Types of information technology – The basics: comprehensive, quality electronic data interchange (EDI) • Definition: the application-to-application exchange of standard format business transactions – One of oldest IT forms, now nearly a standard requirement • Advantages – Eliminates human intervention and errors – Reduces transaction costs by reducing labor costs – Improves customer service – auto. exception alerts © 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
  27. 27. 27© 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Table 12-4
  28. 28. 28 Information Technology, cont’d – EDI, cont’d • Requires protocols and standards to define data, its order, field lengths, etc. – Universal standards set by ANSI – Industry-specific standards – Proprietary standards • Most popular uses – sending/receiving orders, ASN, invoicing, and electronic funds transfer • Institutional and technical barriers – Capital investment, hardware/software compatibility – Consistent formats, security, top mgmt. support – Internal ownership © 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
  29. 29. 29© 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Figure 12-8
  30. 30. 30© 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Figure 12-9
  31. 31. 31 Information Technology, cont’d – EDI, cont’d • Role of third-party value added networks (VANS) – Translates proprietary and industry-specific EDI standards – Enables EDI user to develop a single EDI transmission network rather than multiple networks direct to customers » User to VAN to customers – Saves on capital and operating costs compared to multiple networks • Internet: possible substitute for VANS and dedicated EDI networks – Extensible mark-up language (XML) mitigates standards requirements – Capacity can be a concern © 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
  32. 32. 32 Information Technology, cont’d • Types of technology, cont’d – The basics: automatic ID - bar coding • Patterns of dark bars and spaces that when coupled with other IT provides info on product movement throughout supply chain • Requires standard formats of bar/space patterns – Code 39 and Code 128 are most popular formats • Developments – 2-D bar codes – Matrix bar codes – “License plates” for pallets © 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
  33. 33. 33 Figure 12-10 © 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
  34. 34. 34 Figure 12-11 © 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
  35. 35. 35 Figure 12-12 © 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
  36. 36. 36 Figure 12-13 © 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
  37. 37. 37 Figure 12-14 © 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
  38. 38. 38 Figure 12-15 © 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
  39. 39. 39 Figure 12-16 © 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
  40. 40. 40 Information Technology, cont’d • Types of technology, cont’d – The basics: track and trace • Provides in-transit shipment visibility • Greatly enhanced by satellite technologies coupled with EDI and radio frequency (RF) technology – Carriers can monitor vehicle positions, better manage vehicle utilization, and be more customer responsive • Classification of shippers by track/trace capability – Lagging edge – Mainstream – Leading edge © 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
  41. 41. 41© 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Table 12-6
  42. 42. 42 Information Technology, cont’d • Types of technology, cont’d – Emerging: electronic product code (EPC) tags • Bar code info: static and requires readers to capture • EPC or “smart” tags – Info can be updated, carrying more info than bar codes, and can transmit info via RF technology • Wal-Mart requirements for RFID • Issues in universal adoption – Cost – Standards – Compatibility with current software systems © 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
  43. 43. 43 Information Technology, cont’d • Types of technology, cont’d – Emerging: the Internet • Principal current uses – Information resource: ex: track and trace – Communications purposes » Share demand, production forecasts » CPFR, collaborative transportation mgmt. (CTM) – To accomplish transactions • Challenges – Capacity – Security © 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
  44. 44. 44© 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
  45. 45. 45© 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
  46. 46. 46© 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
  47. 47. 47© 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
  48. 48. 48© 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
  49. 49. 49© 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
  50. 50. 50 Information Technology, cont’d • Types of technology, cont’d – Emerging: the Internet, cont’d • Many future applications – Sales interface – Customer service utility – Load-matching services – shipper/carrier without broker • Trends in e-business capabilities to support transport © 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
  51. 51. 51 Information Technology, cont’d • Types of technology, cont’d – Emerging:Transportation Requirements Planning • Sharing of info regarding movements – Improves flow efficiency/effectiveness – Using data inputs from shippers and carriers, develops optimal shipment plans/schedules given shipper requirements and carrier constraints – Includes “what if” planning analysis capabilities – Given shipment plan, provides status/performance reporting • Penske LMS system as example • TRP may be stand-alone or linked to ERP system • Transportation management software development and implementation © 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
  52. 52. 52© 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Figure 12-17
  53. 53. 53© 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Figure 12-18
  54. 54. 54© 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Figure 12-19
  55. 55. 55© 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Table 12-9
  56. 56. 56 Information Technology, cont’d • Types of technology, cont’d – The future: Internet-intelligent applications • Heuristics designed to reduce degree of manual interaction – Ex: event management – The future: Transparent EDI – Reducing EDI cost via more flexible standards – The future: Data warehousing – Aggregation of a firm’s functional databases into relational databases © 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

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