"Net Gains: Optimized Inbound & Returns over Internet for Four Seasons Automotive with Shippers Commonwealth TMS" (from April 2004 edition of Inbound Logistics magazine)

Net Gains

By Leslie Hansen Harps

Here's a look at how several companies have successfully tapped the Internet and the web to improve their logistics and supply chain operations.

"The web is the next evolution in technology,"says Richard J. Sherman, president, Gold & Domas Research, Austin, Texas. "The name of the game in logistics is reducing latency in the supply chain. The Internet provides seamless, low-cost communications -- virtually in real time -- from any point to any point at that time.

"Web-based technologies today are where PC-based technologies were five years ago," he says. "It's only a matter of time and cost before all companies are able to upgrade their work stations, user access and telecommunications to fully implement web-based applications."

The combination of the Internet plus web-based applications "offers significant productivity and communication gains," which reduces the time to move product and information, he explains. Sherman suggests thinking of the Internet "as the communications infrastructure -- the plumbing -- and the web as the human interface to the information coming from the Internet."

Much of the time, data can be transmitted via the Internet, application to application, with no interaction. "If humans do need to see the data, they'll go to the web via a browser -- a user interface or window into the data that's being carried over the Internet," Sherman explains.

While some technologies are still web-based, a growing number are web-native -- designed from the ground up using web architecture. Web-native applications are designed so that information is available to users "anywhere, any time, via the web," Sherman says, without any restriction on type of device, whether Blackberry, work station or PDA.
"Web-based technology, on the other hand, provides the capability to create a graphic user interface (GUI) on top of an application that hasn't been designed specifically for Internet deployment", Sherman says. "Instead of using a traditional screen-based display, web-based technology uses an HTML or web-based screen."

In addition to offering robust functionality through web architecture, the web provides alternatives to the traditional method of deploying software: buying a software application and installing it on a mainframe or in a client/server configuration.

Four Seasons: Learning the ABC's of ASP

"We needed a transportation management system, especially for inbound," says Ben Carbo, logistics manager for Four Seasons, a division of Standard Motor Products Inc., Lewisville, Texas. "We service thousands of customers throughout the United States who we ship to, and who return product to us."

Returns account for a big part of Four Seasons' transportation, with customers making core, warranty, and overstock returns. Carbo put out routing guides for customers to use, but, with national contracts with various LTL carriers expiring at different times of the year, these were soon out of date.

"Customers using obsolete routing guides or using carriers with which we did not have pricing agreements resulted in extra freight expense each year," Carbo explains. So the company began looking for an alternative.

However, "our freight dollars weren't enough to justify the cost of buying a licensed TMS robust enough to handle our needs," he says. So Four Seasons explored the application service provider (ASP) model. ...

Next, Four Seasons learned about Shippers Commonwealth, Richmond, VA. Shippers provides automated TMS solutions via its Inbound Vendor Logistics Portal and full TMS provider offered on both ASP and licensed software basis.

Four Seasons went live with the inbound portion of the TMS with Shippers Commonwealth in June 2003. Today, "all our inbound vendor shipments and customer returns go through a vendor portal," Carbo says. Four Seasons also went live with the outbound transportation component (which went live in Novermber, based on Four Seasons current outbound process).

"The ASP model lets medium-sized companies get in a TMS and prove its value and payback," Carbo says. "It allows you to prove the concept with minimum risk. "Success with an ASP can lay the groundwork for expanding the TMS, he notes. "This way, you get a real feel for what works for you . . . before you put out the capital for a licensed copy."

Selecting Successful Systems

While there are unique aspects to sucessfully selecting and implementing web-based technology, many of the lessons learned hold true for virtually any systems implementation.

These include:

Do your homework. "Don't rush into anything until you make sure it works," advises Ben Carbo, logistics manager, Four Seasons, a division of Standard Motor Parts Inc., Lewisville, Texas. "We did some testing before we went in with the Shippers Commonwealth solution. We asked them to show how their solution worked with our data in real time."

Make sure your data is clean -- or allow time to get it that way.Whether you're operating in a web or client/server environment, don't underestimate the effort required to clean your data, Carbo recommends.

Four Seasons Automotive, subsidiary of Standard Motor Products, is another of the highly satisfied and referencable Shippers Commonwealth clients who have documented major savings on optimized mode selection and carrier assignment using the Shippers Commonwealth Logistics Portal and TMS program.

For further information email us at info@shipperscommonwealth.com

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