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IT Delivers On Time

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DQI Bureau
New Update

In ancient Greece soldiers used fire signals during the night and smoke
during the day to send messages from remote locations. For this purpose, Greeks
built manned communication towers on mountaintops called “Fryktories.” These
were put to the best use in the great Trojan War, way back in 1200 BC. Many
centuries have passed since the Trojan War, and with the passage of time
mankind's zest for communication has manifested itself in many forms-the
grandest of all inventions, without doubt, being the Internet-and
communication has never been the same again. Riding on this digital backbone are
businesses that have redefined the very face of its operations, logistics being
one.

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The most common and accepted definition of the logistics vertical is that it
is seen as a tool for reaching products and services when they are needed. In
that order, every enterprise, big to small, needs logistics support without
which it is impossible to reach the end consumer. Logistics is seen as a mission
critical function and its seamless execution lies in integration of information,
managing inventory, warehouse management, material handling, and packaging. Take
a look at the courier and cargo industry, in which a plethora of players battle
it out. The one common thread that all these logistics companies rely on is IT,
that provides proactive services in real time basis.

Top
5 IT Challenges
1 2 3 4 5
Non-availability
of ready-made ERP software for the vertical.
Designing,
developing, maintaining and upgrading custom developed applications
Non
availability of IT infrastructure, like the terrestrial links available at
the outskirts of cities and far-flung locations as express cargo and
logistics units are usually situated in the outskirts.
Integration
with customer applications for data exchange
In
this vertical the RoI on technologies such as hand-held devices and RFID
etc is not yet justified, although they are fast becoming the need of the
hour.

IT in Logistics

Says SR Malella, CTO AFL, “In the service industry operational integrity
and reliability is the key factor for any company. Also, a strong technology
driven process is a must to compete globally. Providing the right IT
infrastructure and software is a key enabler. Customer care and differentiation
of services is enhanced by the use of IT.” However, logistics being a dynamic
industry, things are always on the move and this calls for a highly agile IT
backend, which can dynamically capture all data and translate into customer
service. Take the case of consignment tracking using the waybill number, which
is the most commonly used customer service. One of the pioneers for tracking is
global logistics leader FedEx, which uses a proprietary tracking and billing
application called COSMOS (Customer Operations Service Master On-line System).
This system works by collecting huge amounts of data: where was the consignment
picked up, its destination point etc. COSMOS is a real-time package tracking
application that monitors every phase of the delivery cycle at FedEx. The system
gets updated as employees keep inputting the data and, hence, every document is
mapped until it's delivered to the consumer.

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Constant tracking allows FedEx to maintain positive control over shipments
every step of the way. The FedEx network is designed to provide 100% customer
satisfaction. At FedEx IT has indeed taken center stage; recently the company
has launched a new technology called Power Pads. The new technology will be
rolled out across the region in the UK, Belgium, Germany, Italy, Spain, France,
and the United Arab Emirates, as part of a global plan to deploy 50,000 devices
to FedEx Express couriers in more than 60 countries, by 2007. FedEx PowerPad
will replace the current hand-held courier devices, the FedEx SuperTracker, and
will act as a personal gateway to convey data directly to and from the FedEx
internal network.  Bluetooth
wireless technology and a General Packet Radio Service (GPRS) connectivity
network provide immediate information access, revolutionizing the level of
service offered to customers by facilitating faster and reduced transit times.
On this development Eric Keane, vice president and CIO for Europe, the Middle
East and Africa, FedEx said, “We have always been a front runner in the
wireless technology area, and were the first company to make shipping and
tracking information available to customers online through our website.”

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Commonly
Deployed IT Solutions

Warehouse Management
System: to help manage inventory levels at optimum levels

Transport Management
System: for end-to-end visibility

Freight Forwarding
System: handling custom clearance for International movement

Bar coding of
shipments: to enhance efficiency

Shipment Tracking over
the Web/ Mobile/SMS-based: to provide end-to-end visibility

Vehicle tracking
devices like Global Positioning Systems (GPS)

Collaboration with
Agents and Vendors over the Web

Forecasting software
for forecast demand

Homegrown Solutions

Closer home in India, the Indian logistics companies do have a proactive set
up. One classic example is Gati, which has put in place a slew of IT
initiatives. In the year 2000 Gati decided to move away from the decentralized,
legacy system into a complete web-based, integrated, and centralized
state-of-the-art system. Gati, during its evaluation, had firmed up that there
were no ready made software package (ERP) which will suit its requirements, and,
hence, decided to design and develop an integrated software to meet its needs.
At the same time the company wanted to utilize and interface ready made software
modules available.

'On peak days around
1000 concurrent users work on GEMS'

                                                     Â
-GS Ravikumar, CIO. Gati

Gati is one of the
leaders in the express cargo movement and a pioneer in distribution and
supply chain management solutions in India, since 1989. Turnover: Rs 3,613
mn. Employee strength: 6,400. Gati has the largest fleet with over 2,000
vehicles on the road, and has an extensive network and reach.Â
Gati services 594 out of the 602 districts in India, with services
ranging from express cargo distribution to complex end-to-end integrated
logistics and supply chain management solutions. The company also has a
well-structured multi-modal service system and a 6-lakh sq ft mechanized
warehousing facility. It also has a strategic tie-up with Indian Airlines,
which provides it unmatched reach. Its international wing, Gati
International, takes care of the SAARC countries and the Asia Pacific
region, with a highly specialized India-centric perspective. CIO, GS
Ravikumar speaks to Shrikanth G of Dataquest about how Gati has
strategically used IT in its operations.

How has IT evolved in
the company?


In the year 2000 Gati decided to move away from the decentralized, legacy
system into a complete web-based, integrated, and centralized
state-of-the-art system. We decided that no ready-made software package
will suit our requirements. Hence, we finalized on an integrated software
to be developed on Oracle Forms and Report and interfaced with Oracle
Financials for accounting modules, and with Oracle CRM for contact center
and marketing modules.

Can you talk about your
in-house solution?


The design and development work started in January 2001 and it took two
and half years  (200+ man-year
effort) to complete the Gati Enterprise Management System (GEMS). GEMS
covers the entire end-to-end requirement of Gati.

In order to implement
Gati@web, a WAN connecting 100 plus major locations on terrestrial links
(leased lines) was set up and the balance locations were connected to the
central server using dialup, broadband, cable or ISDN connections. WAN is
used not only for data but also for voice communication through IP phones.Â
Voice over IP is used not only within India but also to Gati
locations in other countries. Gati has built a highly redundant data
center and server-storage architecture to host GEMS and apps and CRM.

On the benefits...


On peak days around 1000 concurrent users work on GEMS from across the
country plus international locations. This number does not include our web
site concurrent usage, which runs into few hundred hits.Â
GEMS is an online application, and Gati's entire activities
depends on IT. For instance, the vehicles cannot move out without the trip
challan being generated from the system, customer queries cannot be
handled without the availability of this application.

Gati allows customers
track their shipments on their web site-they can check the detailed
transit information, and also view the scanned copy of the
Proof-of-Delivery. Gati also provides various options to customers to
track their shipments (mobile, e-mail).

What other solutions
have you deployed?


We have deployed a Warehouse Management Software (WMS), which is
integrated to GEMS. This software provides reports to customers in terms
of slow, fast moving stocks. We use Lotus Notes for mailing and instant
chat. Around 70,000 mails flow through the central server in a day. Since
Gati's entire operation is highly dependant on IT, a business continuity
plan has been put in place.

What are your plans,
going forward?


Some of the major plans for this calendar year would be a vehicle-tracking
system using GPS/GPRS for monitoring the movement of vehicles and
optimizing capacity utilization and routes; workflow automation, moving
toward a paper-less office; and implementing a work from anywhere/anytime
solution for the senior management team.

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Opinion

Need For Speed


A robust software application is required for the logistics industry, as
business processes demand a 24x7x365 operation

Logistics is one of the
fastest growing industries in India. It has assumed greater importance due
to ever-shrinking time, space, and profit margins for the producers of
goods. Advancement in Information Technology has played a major role in
transforming this Industry, which in turn provides the competitive edge to
producers of goods, distributors, or dealers.

It is imperative that
logistics companies have a strong Information Technology and automation
backbone. One of the key components is to have robust software, which will
cater to the lifeline processes of the Industry such as pickups,
deliveries, routings, track & trace and the necessary documentation
etc.  Though it may sound
strange, there are hardly any ERPs available in the market to meet these
specific requirements. It is a fact that most companies had to custom
develop their own software to meet this specific need. This means that a
huge investment of time and money has to be made in developing the
applications, and also to maintain these applications while keeping pace
with the latest trends in technology. Probably the time is right for major
ERP vendors to look at this industry and develop a solution with a focus
on Indian market requirements

Tech Boosters


New technology initiatives in the logistics Industry


GPS/GPRS-based tracking system of vehicles on
GIS, in order to monitor and track the movement of packages

RFID will eventually become the order of the
day.  In all
probability, to begin with, the logistics industry in India might
start tagging the packages but as RFID technology becomes viable for
all, the tagging will start at the manufacturer premises and will
continue throughout the product life, eliminating the tags to be put
by the logistics service providers.

The major players in the industry are shifting
to real time capture and exchange of information with the help of
hand-held devices, warehouses etc.

Since application is mission critical,
24x7x365, the disaster recovery solution will fast become a hygiene
factor in this industry.

In addition to the
point above, in India, for this industry, there are no standards or EDI
through which customers-manufacturers, distributors, dealers-could
exchange information with the logistics service providers seamlessly.Â
This results in a lot of time and money being spent in converting
information from electronic form to manual and back to electronic. It is
likely that “Web Services” in the months to come might help to
overcome this shortcoming of interfacing seamlessly between the logistic
service provider and their customers.

With the impressive
growth of export/import, the retail explosion, and FDIs flowing in; and
with many a global players setting shop in India, the logistics industry
is set to boom, and Information Technology will be the key enabler to
handle this growth in this Logistics Vertical.

-By GS Ravi Kumar
CIO, Gati

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Case Study

All About Service


Like any other vertical logistics faces some unique IT challenges. Of the
many challenges I consider geographical reach to be the key one. Also are
collaboration with partners, data integration and availability, and
technology awareness among employees. Since logistics is all about
service, it becomes imperative to maintain a high degree of operational
integrity and reliability. IT has to provide the key-enabling role. At AFL
we made a conscious decision to move from the decentralized to a
centralized architecture, which has brought in strong controls and
speedier MIS to the business.

Business Apps


AFL has implemented a customized ERP called AGRANI that offers complete
integrated solution for logistics operations like warehousing, domestic
transportation, and international cargo movement. AGRANI comprises of the
following modules:

The Warehouse Management System: It
encompasses the inbound movement of materials and components to a
warehouse, storage of intermediate stocks pending order by the end-user,
outbound movement of material from the warehouse. It provides a
sophisticated system for controlling goods in the warehouse, and can
eliminate the need for warehouse paperwork. Shipments are bar coded and
scanners are used in the WMS process.

Package Express: It is a high
performance, integrated, transport management system which caters to
domestic door-to-door movement for multimodal transport (surface, air,
rail) providing pickup, booking and manifesting, in-transit and delivery
status, invoicing-receipt preparation, shipment and trip tracking, MIS
reporting etc. 

International Cargo: The software
automates the entire freight forwarding and international cargo movement
processes, right from contract management to order processing to shipping
to report generation. It also takes care of all support activities, which
go along with it. Web-based shipment tracking available to monitor
shipment and also creating visibility with customer-based tracking and
email-based tracking is also available to customers to track their
shipments.

Meanwhile, consolidation in a SAN
environment has enabled easier integration with different applications,
and less administrative hassles. Centralized servers have lead to easier
management and maintenance. Clustering for risk mitigation has enabled
high systems availability. We manage the network complexities by way of
highly resilient and redundant layer 3 LAN setup with Gigabit Ethernet
backbone for Centralized Data Center, and use Citrix to enable users to
make optimum use of available bandwidth and defer client hardware
upgrades. On the business continuity front we have deployed, in the
networking arena, a partial mesh topology, implemented on the backbone
with a mix of RF and terrestrial lines on the last mile. Also, a DR site
(cold site) at Chennai was established through on-line replication of data
from the central data center.

We have adopted Open Standards to reduce
TCO by using an amalgamation of PA-RISC and Intel platforms, and
implemented open source tools. Using Java technology for business
applications and moving towards Linux-based environment, 64-bit
architecture and thin clients have improved our RoI on technology. Going
forward, we have planned more IT solutions and the task at the top of our
agenda is a vehicle tracking system using GPS, for longer routes. We will
also be exploring the possibility of RF Scanners for large warehouses. I
believe this will optimize the receipt and dispatch processes in bigger
warehouses.

Data warehousing and BI are also on the
cards. An architectural change is also on the anvil as we plan to move
parts of the application to a web-based solution, which will help remote
locations to connect over the Internet. We will also be giving priority to
other tasks like web-based order booking, route planning and sales force
automation in the ongoing year.

SR Mallela, CTO, AFL

As told to Shrikanth G 

shrikanthg@cybermedia.co.in
 

Let us look at another company which is also a pioneer in many ways AFL. The
company came into existence way back in 1945 and launched the first courier
service in India through its tie-up with DHL Worldwide Express in 1979. It
launched the first of its kind door-to-door surface express in 1988, and brought
Logistics services for the first time to customers in India in 1996. In such a
backdrop, IT has to be playing a crucial role. Says company CTO, SR Malella,
“AFL has implemented a customized ERP called AGRANI, with which it was able to
leverage the IT infrastructure to the hilt and is today able to counter
competition and provide world-class services”.

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The Road Ahead

What emerges at the end is that the Indian logistics companies have gone
mostly for in-house developed solutions, mainly because there is not one
integrated solution available in the market right now. It is mostly a mix and
match strategy they have adopted and, in the bargain, created highly custom
specific solution that's tailor-made for their operations. From FedEx's
Cosmos to Gati's GEMS, IT has ushered in the much needed business traction for
these companies. But still, as logistics as an industry further evolves, so does
challenges in terms of IT. As Shirish Gariba, vice president IT, Elbee Express
says, “Yes, there are challenges in front of us. I feel the major ones are:
high availability and scalability of systems since this industry is driven by
high volume transactions; reach, as our pickup and delivery locations are spread
across the country and capturing transaction information on the move;
integrating customer applications to have visibility of information through the
portal; faster deployment of solutions to the organization as requested by
customers; and managing end-user customer expectations.”

Shrikanth G

shrikanthg@cybermedia.co.in

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