The document discusses the evolution of logistics and supply chain management from isolated applications to more integrated systems. It describes how planning and execution used to be separate but are now joined up through composite applications. Tomorrow, planning will be more distributed, dynamic and optimized in real-time through increased automation. Two big ongoing challenges are data quality issues and supporting planners amid rapidly changing business environments. The future involves more distributed, adaptive operations through dynamic business webs that can quickly position inventory and leverage different transportation options.

1. The Boundaryless
Value-Chain
Peter Evans-Greenwood
Chief Technology Officer

2. A roadmap…
Yesterday: mass based Today: just in time Tomorrow: dynamic
• More is better • On-time is better • Agile is better
• Mountains of stuff • Inventory is reduced • Virtual supply chains
measured in days of to a minimum and • Inventory dynamically
supply kept moving positioned
• Mass begets mass • Works great, except • Distributed, adaptive
and slows everything when it doesn't operations
down • Metric: Velocity • Metric: Acceleration
• Metric: Mass
© 2009 Unico – All rights reserved 2

3. Yesterday: isolated applications
Planning Planning
Execution Execution
• Separate planning and execution systems
• Logistics planning is actually production planning
• Users forced to deal with business exceptions
• Identify root cause
• Resolve exception
• Manually update production plan
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4. Yesterday: isolated applications
Planning Planning
Iron Mountain
• 1991: Persian Gulf
Execution Execution
• • Out of 50,000 containers,
Separate planning and execution systems
22,000 became ―invisible‖
• Logistics planning is actually production planning
• Users forced to deal with business exceptions
• Identify root cause
• Resolve exception
• Manually update production plan
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5. The heritage of an application centric approach
• Focused on delivering major IT
assets
• Historically, the only
economically sensible
UI
approach to IT
• We‘ve been through a few
Logic generations of technology
• Main frame
Data • Client-Server
• Thin Client (Internet)
We were worried about solving the big problems, but not how these
problems were connected
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6. We‘ve come a long way since then
U.S. software sales in billions of dollars
Source: INPUT
The Past Yesterday Now
WS-*
OASIS SOA Reference
Model
OASIS SOA Blueprints
WS-I founded SAP Netweaver
SAP WS Oracle Fusion
J2ME Web Services JAX-WS
ESB MS Indigo
BPEL BizTalk 2004
Apache Axis Oracle BPEL
JAX-RPC WBI-SF
Apache SOAP Oracle WS WS-Policy and WS-Security
MS SOAP Sun WS
IBM Web Services
WS (J2EE & .NET)
WS-* starts exploding
SOAP 1.0
1999 2000 2001 2002 2003 2004 2005
A standards development timeline
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7. Now we worry about end-to-end processes
• The challenge has
moved
• From delivering more
functionality…
• … to effectively
End-to-End Processes leveraging the
applications we have
End-to-End Processes • Now we‘re focused on
• End-to-end processes
Application
Silo
Application
Silo
Application
Silo
• Supporting users
The gaps between applications are becoming more important that the
applications themselves
© 2009 Unico – All rights reserved 7

8. Today: joined-up logistics
Composite Composite
Planning Planning
Application Application
Execution Execution
• Explicitly connect planning to operations
• Provide users with a single consolidated view of logistics
functionality
• Simplify identifying and correcting business exceptions
© 2009 Unico – All rights reserved 8

9. Today: joined-up logistics
LEAN Composite Composite
Planning Planning
• Small, off site, warehouses
Application Application
withExecution or days of stock
hours Execution
• Explicitly connect planning to operations
• Provide users with a single consolidated view of logistics
functionality
• Simplify identifying and correcting business exceptions
© 2009 Unico – All rights reserved 9

10. Our focus is filling gaps & extending our reach
UI UI UI UI UI UI UI UI UI
Process & Information Integration
Application Services Application Services Application Services
Platforms Platform Platform
Field Operations Back Office Partners & Customers
Mobility Composite Applications & Partner Integration
• Extending the reach of our Mash-ups • Sales and operational data
back office • Enable end-to-end processes • Responsibility for end-to-end
• Providing field workers with • Lower error rates business processes
joined-up IT support • Increased throughput • Facilities and other assets
Sensor Networks • Lower user workload Customer Integration
• No more swivel-chair integration • Self-service
• Leverage technologies such
• Provides the right data, at the
as RFID and smart • More timely information
right time, presented to enable
appliances to instrument users to make better decisions
• Reduce swivel-chair
operations integration
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11. But this is only a consolidation of functionality
Benefits Limitations
• Enables end-to-end • Focused on removing
processes negative-value
• Lowers error rates • Created by application
• Increases throughput silos
• Lowers user workload • Does not deliver new
• No more swivel-chair functionality
integration
• Provides the right data, at
the right time, presented
to enable users to make
better decisions
© 2009 Unico – All rights reserved 11

12. … which is creating a boundaryless environment
The old definitions of inside and outside the business
are beginning to make little sense
© 2009 Unico – All rights reserved 12

13. … which is creating a boundaryless environment
Target Home Depot Amazon
• Handed most of their • Stepped around the • Unlocking their
supply chain to suppliers barrier of supply chain enterprise functionality
• Now considered the completely and providing it as an
most efficient supply • Vendors directly online service
chain in the US responsible for stocking, • Latest installment is
store layout and pricing Amazon Fulfillment
• Provide vendors with a • Allows you to forward
direct feed on sales deploy stock into
• Significantly reduced Amazon facilities
operating costs • Dispatch on demand
• Greatly increased sales
per SKU
The old definitions of inside and outside the business
are beginning to make little sense
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14. Our two biggest challenges
Data Quality Supporting Our Planners
Information that is: • Stuck between silod solutions
• Incomplete and incomplete information
• Inconsistent • Faced with a rapidly
• Uncertain changing business
• Dead environment
• Not enough time to make
good decisions
The emerging environment is only making this worse
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15. Tomorrow: distributed, real-time planning
Automation Automation
Optimization Optimization
Composite Composite
Planning Planning
Application Application
Execution Execution
• Automate day-to-day exception management
• Users move to a supervisory/process-improvement role
• Leverage benefits of technology to optimize the logistics management
• Move from locally acceptable solutions…
• …to globally optimal solutions
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16. Tomorrow: distributed, real-time planning
Automation Automation
Optimization Optimization
Agile
Planning • Inventory
Composite Planning
Composite
Application Application
dynamically
positioned
Execution Execution
• Delivery
―at themanagement
• Automate day-to-day exception
moment‖
• Users move to a supervisory/process-improvement role
• Leverage benefits of technology to optimize the logistics management
• Move from locally acceptable solutions…
• …to globally optimal solutions
© 2009 Unico – All rights reserved 16

17. Three strategies that might help
Supporting stakeholders Better information Buying time
Steal an idea from Extend out data Create more space
Web 2.0 and models and time for users
mashups • Look beyond master • Capture and
• Stop thinking about data automate the easy
applications • Build a model of the 80% of exceptions
• Start thinking about data we‗d like to use • Let the users focus
creating spaces to to make decisions on the hard 20%
support the decision • Leverage external
making process information sources
• Actively integrate
data into the model
© 2009 Unico – All rights reserved 17

18. 1. Supporting stakeholders
From siloed applications... ... to productive planning spaces
Case
Integrating applications
and collaboration Case
Client Work
er
Client Case
Worker Case
Team Partner Team
Partner
Leverage Web 2.0 & mashups to create
a more productive environment

19. 1. Supporting stakeholders
Client details
from CRM
Client Name Contact Address Workflow
12 sad asldrk aslkdja lsdkj al skdjas
the client
Duis autem vel eum iriure dolor in hendrerit in status
vulputate velit esse molestie consequat, vel RSS
illum dolore eu feugiat nulla facilisis at status
Shipment Shipment Status
information Image from
Basldjk 8 asd 8 asd 8
external
asd 8 asd 8 asd 8
GIS
asd 8 asd 8 asd 8
Status Status
Lorem ipsum dolor sit amet, consectetuer adipiscing elit, sed diam
Notes from client nonummy nibh euismod tincidunt ut laoreet dolore magna aliquam
wiki page erat volutpat. Ut wisi enim ad minim veniam, quis nostrud exerci Markup a la
Shipment status Mojito
Status Status comment
Asldkjalsj asldj asldas l
Basldjk 8 asd Aklsd aksdh kashd
Date, Time, Posted by BLAH
Asd 8 asd
Status blog
Tags, tags, tags, … Add
Click through to
connected spaces Tags for semantic
search

20. 2. Create better information
Data Information Knowledge
Data we have, or that Trends we‗ve noticed Making connections
wecan get • Business intelligence • Connecting a pick-up
• Plans • Our partners‗ to a passing truck
• Transactional data performance • Connecting a news
• Operational data • Our customers report to a potential
• Public data behaviour disruption
• Data scrapped from • Observations of how • Connecting our prices
competitive sources our competitors to signals from the
operate market
• ...
• ... • ...

21. 2. Create better information
Let‘s steal an idea from flexible manufacturing
A bike consists of
Handlebars Frame Seat
a frame, two
wheels,
handlebars, a
seat, drive train, Front Wheel Back Wheel
and each wheel
has a tyre. We
also offer three
types of bike:
mountain, racing
and hybrid
Drive Train
… and build a planning component model
© 2009 Unico – All rights reserved 21

22. 2. Create better information
Let‘s steal an idea from flexible manufacturing
Business Rules
A bike consists of • Recognising
Concepts situations
Handlebars Frame Seat
a frame, two
• Drivers
wheels, • Deciding on
• Events
handlebars, a actions Assumptions
• Plans
seat, drive train, Front Wheel Back Wheel
and... • Simplifying our
• each wheel Predictions understanding
has a tyre. We
also offer three • Material prices
types of bike: • Competitor
mountain, racing prices
and hybrid • Events
Drive Train
• ...
… and build a planning component model
© 2009 Unico – All rights reserved 22

23. 3. Buying time
Agents
Planning Role Based Agents &
Mashup Automation Business Webs
Human users
Other Data Planning
Sources Model Clerks
Composite
Composite Solutions
Planning
Application Workflow tools
Scripting languages
Business Transactions
Execution
Service Wrapped
Legacy Applications
3rd party applications
Network services
Automate the easy 80%, letting people focus on the hard 20%

24. 3. Buying time
• We need to support the richness of human
Agents
deliberation
Planning Role Based Agents &
Mashup • non-linear
Automation Business Webs
• trial-and-error
Human users
Other Data • Conventional enterprise technologies are not
Planning
Sources Model
up to the challenge Clerks
• Java, C# etc are too focused on technical
Composite Solutions
Composite
Planning concerns
Application Workflow tools
• BPM & rules engines cannot easily Scripting languages
support the conflicting rules and business
Business Transactions
Execution
exceptions Service Wrapped
• We need to pull in new ideas and concepts Applications
Legacy
3rd party applications
• Adding a layer to our conventional Network services
enterprise toolkit
Automate the easy 80%, letting people focus on the hard 20%

25. The future: dynamic business webs
Monitoring
Generate Identify & Auditing
Demand Sources
3PL 3PL
3PL 3PL
4PL
Deliver Select Marketplace
Material Provider
3PL
Identify Sources Select Provider Deliver Materiel
Traditional •Static default source • Next unit up chain • Only from local units
Boundaryless • Search all providers • Select ―best‖ based on • Dynamic positioning
• All units can supply and readiness within supply chain
consume • Different and larger
transport mix required

26. Where is this leading?
Enterprise Applications Logistics
Yesterday • Applications are silos • Logistics managed by production
• Users mediate between planning
applications • Manual exception management
• Massive inventory used as a hedge
against uncertainty
• Months – weeks
Today • Joined-up systems • Just-in-time delivery
• Users focused on the task • Prediction and static optimization
at hand • Some support for exception
management
• Weeks – days
Tomorrow • Online, real-time, planning • Elimination of DCs& creation of the
• Users focused on tuning moving warehouse
and innovation • 4PLs and dynamic supply chain
formation
• Days – now

27. Conclusions
Organisational Knowledge is key The end game is
boundaries mean little if we want to move on fulfillment network
• Organisational boundaries • Focus on creating the right • Elimination of DCs
are being eroded to create environment for our users • Creation of moving
a boundaryless • Tacit knowledge warehouse
environment • Collaboration • Dynamic, virtual supply
• We now have: • Extend our data models chains
• Visibility across the beyond traditional • Moving our stakeholders
value-chain transactional data to include • from operational roles...
• Influence across the other planning drivers, • ... to process
value-chain business rules and improvement and
• Less responsibility assumptions optimisation roles
• Today, our biggest asset— • Capture the easy 80% of
our people—is holding us decisions, allowing our
back stakeholders to focus on
the hard 20%

28. © 2009 Unico – All rights reserved