The total volume of international merchandise trade in the year 2015 across the world stood at US$32.2 trillion with US$15.9 trillion of exports and US$16.3 trillion of imports.The same figures for international trade in services stood at US$4.7 trillion and US$4.6 trillion, respectively. As per a recent McKinsey report, the total volume of international trade is expected to rise to US$70 trillion by the end of 2025.
We are in the times of rapid globalization, and almost all developed and developing economies of the world are promoting international trade for a host of economical and geopolitical reasons. As of today two of the world's largest proposed trade agreements -- The Trans-Pacific Partnership Agreement (TPP) and Transatlantic Trade and Investment Partnership Agreement (TTIP) are being negotiated.
Some robust trade agreements like The North American Free Trade Agreement (NAFTA), Association of Southeast Asian Nations (ASEAN), Gulf Cooperation Council (GCC), European Free Trade Association (EFTA), and such are already in place for a number of years. Still, a large number of exporters and importers across the world fail to avail the benefits of these treaties.
What is a trade agreement?
A trade agreement is a treaty between individual or groups of countries through which they aim to boost exchange of products and services. This is usually done by offering rebates in duties and/or simplifying business procedures for each other. For example, if a buyer, based in the US, imports an electric boiler made in China, it will attract a duty of 3.3 percent. However, if the same buyer imports the same product with its origin in Canada (made in Canada), it will be duty-free, since Canada and the USA are part of a trade agreement called NAFTA.
Another noteworthy point is, if the US buyer imports goods from China that have their origin in Canada, they will still be eligible for the duty rebate as per NAFTA since most trade agreements tie the duty benefits to the country of origin. Country of origin is usually the country where the goods have been manufactured or where a sizeable value addition has been done to the goods.
How does a trade agreement help?
If an enterprise gets insights into the applicable trade agreements while buying goods, then it can avail the duty benefits that its products are eligible for. A rebate or a removal of duty will directly cut down its overall expenditure and, hence, will enhance the overall competitiveness of the enterprise. To avail the benefits of a trade agreement, the business needs to provide certain documents like the country of origin certificate, etc.
Do exporters / importers avail the benefits of the trade agreements?
A recent study conducted by leading consulting company KPMG, revealed that only 41 percent of the enterprises in the US avail the benefits of all trade agreements that apply to them. The figure stands at 19 percent for India. The same study suggests that 79 percent of the enterprises in the US believe that a lack of awareness and the complexity in the regulatory documentation are the primary reasons due to which they miss out on the benefits from trade agreements.
How can Oracle GTM help avail the benefits and make organizations more competitive?
Oracle Global Trade Management (GTM) can easily identify the applicable trade agreements and generate the documents required to avail benefits. The following lists the key features of Oracle GTM:
Identifying the applicable trade agreement: Oracle GTM with its out-of-box (OOB) feature of Landed Cost Management can let any enterprise know about applicable trade agreements and their benefits. All it takes is entering the classification code of the product along with the source and destination country. With this much information, the enterprise will be made aware of the applicable trade agreement and the duty benefits tied to it.
Generating the documents required for availing the duty benefit: Once the applicable trade agreements are found, the required documents can be generated out of GTM using the feature of document generation. These documents can be further submitted to the customs authorities to avail the monetary benefits directly.
Please meet us at the Infosys Booth during the OTM SIG APAC 2016 Conference (Singapore) and we shall be delighted to showcase our GTM solutions.
*Date Source - World Bank - https://www.wto.org/english/news_e/pres16_e/pr768_e.htm
Written by: Mohammad Haider Talat and Ravikiran Narayan Khobragade
We often hear about the trade compliance issues with small and medium enterprises (SMEs) more frequently as compared to the larger organizations. Small companies are impounded with many challenges attributed to their limited trade management staff and tight budgets. In spite of their small size, there is no exemption from compliance requirement for these SMEs. The cost of non-compliance for these enterprises is very high since it may result in loss of privilege to export or import, financial loss, and disruption in the supply chain.
Some basic challenges that these enterprises face are of the following nature:
· Lack of know-how in trade compliance due to lack of experience
· Failure to ramp up for the export compliance requirements of highly regulated products when they expand their product lines from products of low regulatory controls
· Absence of senior trade compliance leadership
· Not being aware of export / import procedures
· Lack of trade compliance charter and in-house training program
· Untimely fulfillment of trade documentation
· Dependence on third-party vendors such as freight forwarders and customs brokers for trade compliance-related activities
To mitigate these teething or persistent trade compliance issues, these enterprises need a simple but comprehensive in-house program that ensures the following:
Hiring an experienced trade professional to design, plan, and implement a trade compliance program from a domestic or international trade perspective
1) Concisely written trade compliance policies and periodic reviews that enable the staff to understand about the day-to-day compliance activities and take the best decision when faced with difficult situations
2) Product classification and the applicable regulations knowledge, including duty deferment / subsidies and trade agreement benefits
3) Government authorizations / permits requirement for export / import of products and their maintenance to reap the short / long term benefits
4) Periodic audits and refresher training programs
5) Informed pricing and investment decisions for sourcing the product considering regulatory requirement and free trade agreement benefits or duty reduction program evaluation
6) Appropriate monitoring and enforcing of compliance program
7) Preparation of systematic trade compliance mechanism to overcome trade challenges by implementing a global trade management system as per the available and allocated budget
How Oracle GTM can help SMEs to become trade compliant?
In the newer world of cloud-based compliance, systems may offer a solution that fits these SMEs needs, but the foremost and important thing is to get senior management to understand the importance of a trade compliance management program. The manageable fee structure of cloud software allows small and medium companies to make smaller upfront investments (such as license fee, annual maintenance fees, hardware procurement, etc.) and avail all the benefits of the software. These cloud implementations are usually faster than the on-premise ones. Oracle Global Trade Management (GTM) cloud-based software addresses almost all trade compliance related needs of an SME at an affordable cost.
Using Oracle GTM's cloud-based application will lead to a trade-compliant atmosphere within the company for less than a few hundred dollars a month. Cloud-deployed Oracle GTM is a multi-tenant version of the on-premise Oracle Transportation Management (OTM) where Oracle hosts the software and handles all the routine maintenance and upgrades of the system giving ample return on investment (ROI) against total cost of ownership (TCO) without any security concerns.
To know more on GTM Solutions, please meet us at the Infosys Booth during the OTM SIG APAC 2016 Conference (Singapore) and our experts shall be delighted to explain the details.
Written by: Ravikiran Narayan Khobragade and Mohammad Haider Talat
The European Union (EU) controls the export, transit, and brokering of dual-use items within its territory and jurisdiction of its 28 member states*. It considers this control as an important instrument in contributing toward global peace and security.
What are dual-use items?
In simple words, a dual-use item is referred to as a good, software, or technology meant to be used by the civilian population for legitimate purposes; but can also be misused for terror attacks, international crimes, human rights violation, or the development of weapons of mass destruction.
For example, a substance that reacts chemically to release vast amounts of energy can be used in a regular college chemistry lab for educating students. At the same time, it can be possibly used in an explosive or a missile warhead. Here is another example: An electric motor that is used for generating electricity for domestic households can also be used in an armored military vehicle like a battle tank.
According to the available statistics, export of controlled dual-use items from EU was around EUR59 billion, in 2014 alone, which is approximately 3.4 percent of the total EU exports.
How is the export in dual-use items controlled?
Through EU Regulation (EC) No 428/2009, a common EU list of dual-use items is in place and it is binding on all member countries of the EU to control the items in the list. The member countries usually place a license requirement on any enterprise involved in international trade of these items.
What is the proposal to modernize the existing dual-use regulation?
In September 2016, EU presented a proposal for a regulation to modernize EU dual-use control. The proposal aims at modifying or rather expanding the current list of items to adjust for the technological and scientific developments that the world has witnessed in the recent past.
The main agenda of the proposal is to prevent human rights violations associated with certain cyber surveillance technologies. It is believed that if such technology is exported and falls into the wrong hands, then it could be used by repressive and authoritarian regimes to spy and intercept international communication which can pose a serious security risk to various nations and their citizens.
Which industries will be impacted and require a centralized trade management system to comply?
If this proposal is approved and enter into force, EU companies trading in cyber surveillance technologies will be required to obtain an export license and follow new procedural requirements.
Under such circumstances, it will be imperative for all those enterprises which export any of the following products to manage their trade through a robust centralized system.
The proposal also talks about a catch-all mechanism that allows member states to ask any exporter to apply for an export license because of human rights considerations.
This 'catch-all' clause is in contrast to the current provision according to which only the states are authorized to monitor the export. Hence, any exporter might be asked to procure a license before exporting the goods that are similar to any other goods existing in the dual-use list. Under such a circumstance, identifying and assigning the license and keeping a trail of the same manually will be an extremely challenging task for enterprises.
How can Oracle Global Trade Management help?
With its out-of-the-box (OOB) feature for license management, an enterprise can easily configure a number of licenses based on quantity or value. These licenses can be automatically assigned to the export orders involving the affected goods and makes the process hassle-free.
Further, once the quota or the value of any of the licenses reaches a critical level, the system can notify the business and the business can further apply for new / additional licenses with the relevant government authorities.
In addition, all scenarios that require any kind of export / import control measures can be modeled in the system and the entire process of screening, rescreening, and releasing sales orders can be made automatic using another OOB feature of trade compliance management.
Please meet us at the Infosys Booth during the OTM SIG APAC 2016 Conference (Singapore) and we shall be delighted to showcase our GTM solutions.
*28 member states since no formal process of UK to exit from the EU has started as on today.
Written by: Mohammad Haider Talat and Ravikiran Narayan Khobragade
Oracle Transportation Management (OTM) is designed to support both shippers and logistics service providers (LSPs). In fact, OTM can be configured to manage all transportation activities in the global supply chain. It integrates transportation planning and execution, freight payment, and business process automation through a single application across all modes of transportation -- road, air, ocean, and rail shipments.
OTM's integrated option--Oracle Transportation Operational Planning--supports all transportation operations, including inbound, outbound, simple point-to-point, complex multi-modal, multi-leg, and cross-docking. It also enables us to validate a shipment through an optimized route.
Network routing is an additional enhancement in OTM version 6.3 through which the shipping cost can be reduced. It also maximizes consolidation opportunities by routing orders from different origins to destinations through a network. Network routing is a new approach to model multi-tier transportation networks. The network routing logic of OTM is a solution for different multi-leg journey problems.
When is network routing recommended?
A network is a combination of locations that represents possible routes for order transportation from a source to destination. Network routing allows multiple cross-dock facilities and also consolidation of orders when appropriate. The flow of orders through a particular network can be determined by many factors like cost of the route, time constraint of an order, equipment constraints if any, and consolidation opportunities available. Network routing can be the best solution when:
In network routing the orders flow from a source to a destination via cross docks. Every region will have a representative location. Itineraries and rates need to be created for each leg in a network. An itinerary can have multiple legs and each leg can form a network. When there is a network on the itinerary leg, the network leg substitutes for the itinerary leg.
Let's take an example of orders flowing from one source region to destination via cross dock,
Within the source region, multiple locations have to be created and each location should be a part of a network leg for the network routing to work efficiently. The routing should be decided based on cost effectiveness, route availability that accounts for order routing constraints, and time constraints on orders if any. Each location will have either ship-from / ship-to / cross-dock roles.
Let's see the locations within the regions and how the network legs are formed. In the below table we can see different regions and the locations from those source / destination regions which are acting as Ship from / ship to or xdock roles and how the network will be designed.
Ship from / ship to
Ship from / ship to
Ship from / ship to, x dock
Ship from / ship to
Ship from / ship to
Ship from / ship to, x dock
Ship from / ship to
Ship from / ship to
Ship from / ship to, x dock
The orders and their transportation legs would be similar to the below:
From manufacturer in Anand to consumer in Mysore
From factory in Surat to showroom in Hubli
From warehouse in Ahmedabad to retailer in Bengaluru
From manufacturer in Udaipur to consumer in Bengaluru
From factory in Bikaner to showroom in Mysore
From warehouse in Jaipur to retailer in Bengaluru
Thus, in the above flow of orders from source to destination region, Oracle's network routing can dynamically make an intelligent decision on when it is ideal to go directly from Ahmedabad to Bengaluru and when it should be routed via cross-dock. If a freight is already scheduled via cross-dock and to the same destination, then it would be a free ride in that case.
Let me elaborate this with the following examples:
The network routing feature in OTM has many more features, which makes it the ideal option to model multiple pathways in a very simple manner. This modeling of routing also provides greater flexibility in the approach and design of networks. By making simple changes in the design of the network, any variations in operation can be accommodated as well. Thus, network routing is set to offer huge optimization benefits in OTM's routing process.
To know more, please attend our session on Network Routing at OTM SIG 2016 APAC Conference (Singapore) and we will be overwhelmed to take you through our solutions.
Written by: Julie Jose
Eventually, every business must optimize its processes. Every organization has goals - be it improving revenues, increasing its customer base, or even sustaining itself in a competitive environment. Organizations incentivize their employees to achieve their annual goals and it often works out very well. But in certain cases, such as the logistics industry, where multiple organizations collaborate and compete at the same time, and where forward integration is always looming right around the corner, the simplified focus of improving profits year-on-year may not be the best approach.
Forward Integration is ruthlessly executed by Freight Forwarders and Custom Brokers whereby they add a long list of logistics services to their portfolio, eroding the customer base from existing logistics players in the market.
An order placed by the end customer is typically subjected to multiple iterations of optimization by the manufacturer, carrier, third-party logistics (3PL) service provider, freight forwarder, etc. This article presents the downside of optimization in the logistics industry, in favor of a single meta-optimization.
Can companies collaborate to optimize total supply chain costs? Can a company forego its immediate margins for a sustainable future?
Let us consider a supermarket in a country like Australia where land-based transportation is ubiquitous. This supermarket has its own fleet but primarily depends on 3PL service providers for most of its transportation needs. This supermarket, like most players in this segment, thrives on stocking fresh consumables and moving the items off the shelves in the quickest manner possible. To ensure this, two things need to happen:
Its transportation management system enables the supermarket to place orders, optimize, track the movement of goods, and so forth. Goods move from the vendor's location to the distribution center. This comprises the first leg of the movement. Here, workers reassemble the cartons / pallets into smaller trucks to deliver goods to all the supermarkets in a particular zone. This second leg is usually executed in the form of a multi-stop model.
It may not be obvious at first, but it is really challenging to optimize costs on first leg movement because transportation is carried out by a 3PL. This 3PL consolidates all the orders they receive from multiple customers (supermarkets, manufacturers, and other retailers) in a way that is beneficial to them. The 3PL users initiate their load plans / shipments on top of whatever optimization was already made at the customer's site.
So, for instance, the supermarket in question has a 100 orders on a given day, which are to be picked up from 10 pickup locations and be delivered to their DC within three days. The supermarket's TMS takes these 100 orders and optimizes them based on:
Based on these factors, the supermarket's TMS arrives at say, four load plans / shipments. These are transmitted via Electronic Data Interchange (EDI) to the 3PL's TMS system.
The 3PL TMS system receives multiple load plans / shipments from multiple customers. This system also receives unplanned orders placed by smaller customers who don't have their own TMS systems yet.
The 3PL TMS performs an additional consolidation. It considers the very same factors that the upstream TMS has already considered, thereby disputing the original plans. The following scenarios are then possible:
Let us consider a 3PL in the same region as above. They would have their own fleet but a majority of their business operations are based on established contracts with multiple carriers. Some carriers specialize in providing line haul services between states while other carriers are more focused on regional deliveries.
A 3PL's buying behavior could be best described as follows:
Let us look at 3PLs in Australia. The 3PL's TMS receives thousands of orders every day. These orders are planned based on fixed routes that make use of their depot locations across the country. The depot locations serve as cross-dock facilities for line haul movements, typically carried out by TL carriers. Optimization is ruled out in line haul scenarios owing to the way contracts are negotiated with these carriers. The first mile and last mile carriers usually charge the 3PL based on each consignment's weight and volume.
With this in mind, let us look at their planning / optimization model. On a given day, let us consider that a 1,000 orders were placed by different customers, with each order also bearing a carrier and service nominated on them. The nominated service is used by the 3PL as a reference point for charging their customers. The 3PL's TMS can only optimize the first leg movement and the line haul movement. The last mile cannot be optimized because the customer has already nominated a carrier and the service.
Since the last mile cannot be optimized, the 3PL creates a load plan / shipment based on the requested delivery date (RDD) alone. So, the TMS segments all available orders and delegates different shipments based on what has to be delivered in N days, N+1 days, N+2 days, etc.
It is not the most efficient of planning scenarios. These load plans are then electronically submitted to the last mile carrier. The last mile carrier takes these shipments and consolidates them with other shipments / orders that it receives from other customers. So the downstream carrier's TMS essentially discards the planning that was performed in the upstream 3PL's TMS system.
In this case, the following scenarios are possible:
Residual cargo carrier's perspective
Containerization has evolved from a novel idea to a global phenomenon over the last century. Container freight stations may be owned by carriers, the government, or a third party warehousing player. When it comes to ports, the port authority of that country plays a crucial role in determining the inbound and outbound volumes.
In the international movement of goods, the sea ports, the respective container freight station (CFS) locations, the availability of residual cargo carriers, and the distance between them influences the extent of optimization. For instance, a shipment from Shanghai to New York can be achieved in:
Ships usually have dedicated routes with the vessel schedules being fixed. There are simply far too many documents to fill out at each port and the volumes are just too high to be able to carry out a multi-pickup or a multi-delivery mode of transportation. There are also cutoff times for goods to arrive at all the ports, beyond which goods may not be considered for documentation purposes. For these reasons, all ocean-based modes are direct shipments, from port to port.
Let us consider the CFS in Singapore. Singapore is a cross-dock facility for many carriers. For instance, if a retailer in North America is planning to stock the goods before Christmas, they may place their orders with their supplier in Shanghai as follows:
Now, let us add similar orders with similar time windows from Beijing to a Latin American retailer to this mix.
Since the routes are fixed between Shanghai and North America, and between Beijing and Latin America, the only scope for optimization is in cross-docking at the CFS in Singapore. When the carrier's TMS receives the orders listed above, they would be consolidated with other orders into 20FT or 40FT containers on the next outbound vessels from the respective ports. Of course, the urgency of sending an order outbound depends on the requested delivery dates by the customer. Having said that, the first leg movement's objective would be container capacity utilization. If there is an outbound vessel that can carry about 80 percent of all the orders placed, they will be shipped right away, without considering the delivery dates. These shipments would reach Singapore and hibernate in the CFS based on the urgency, as dictated by the delivery time windows.
When the next vessel is scheduled to leave after, say a month, the residual cargo from earlier orders would be shipped in it. But if all the shipments can only make up to 10 percent of the ship's capacity, the original carrier would outsource it to another carrier. This outsourced carrier would take all such residual cargoes and reach the Singapore CFS where the goods are deconsolidated to be warehoused / shipped for the future.
Herein lies the problem. The original cargo carrier would have his own dedicated ships and would try to optimize in order to achieve the highest container utilization. So, the original carrier would wait until a cutoff time in order to give himself a decent chance at accumulating multiple orders into a single vessel. After the said cutoff time, the original carrier would make the decision, either to ship it himself or to outsource. During this time, the residual cargo carrier is also giving himself a decent chance to consolidate shipments.
Thus, the following scenarios are possible:
This brings us to the question of seamless optimization. Can the logistics industry evolve to overcome the above predicaments? Can multiple TMS systems interact and collaborate to benefit everyone involved? Can upstream and downstream systems intelligently predict the optimization of each other, without having to work in isolation?
In the case of the retailer in Australia, instead of committing to load plans / shipments created in their TMS system, they could submit a draft of their shipment plans to the downstream TMS. The downstream TMS can run a consolidation plan on all the draft shipment plans received from multiple customers. After a certain period of time, profit, margin, and other key performance indicators (KPI) can be compared between consolidation plans executed on draft shipments and the same plans executed on committed shipments for better planning.
In the case of the 3PL, instead of sharing the processed shipment plans with the carrier, raw orders can be submitted to the carrier. The carrier can run a draft iteration of optimization on the orders received from the 3PL for a given month and submit the draft shipment plans back to the 3PL. The 3PL can review this output. The original orders usually drop in with constraints such as their compatibility with other stock keeping units (SKU), whether to refrigerate, to be handled carefully for fragility, etc. The original orders also have the delivery time window, nominated carrier, and type of service specified on them. If the carrier's submission of the draft optimization satisfies all these conditions, the 3PL can accept the draft shipments or make amends to these draft shipments before finalizing. Initially, this may have to be handled by transportation managers from either side. But as the interface evolves, the carrier's TMS can be made intelligent to track the acceptance ratio of all the draft plans that it submits to a certain 3PL. These acceptance indicators can be used in predicting the acceptance from the upstream or downstream TMS', and adjusting the plans accordingly to gain better acceptance and so forth.
The residual cargo player can request submissions from all the original carriers in the area. A constant feed of all the residual cargoes can be submitted via an automated interface between all the carriers. The residual cargo carrier can execute an iteration of optimization at the end of every day to verify container capacity utilizations. The system can track the percentage of utilization of containers and the next outbound vessel. A notification can be sent to all the carriers once the residual cargo carrier's iteration yield exceeds a certain percentage. This will enable all the original carriers in the area to plan and execute their shipments in a much more efficient manner.
TMS systems working in isolation are inferior to TMS systems collaborating, thereby achieving an all-encompassing system. An omniscient TMS system like this can iron out inconsistencies over a period of time, rule out uncertainties, and may even prove to be resilient in times of unforgiving global economic changes.
To know more on optimizing logistics, please meet us at the Infosys Booth during the OTM SIG APAC 2016 Conference (Singapore) and we shall be delighted to showcase our solutions.
Written by: Kranthi Sagar Askani
In today's competitive world, real-time data and innovative service methods are vital for field service enterprises to ensure customer delight, increase revenues, and expand profit margins.
The Internet of Things (IoT) allows machines to communicate with each other (M2M communication). It is built using a combination of networks that comprise of data-gathering sensors, devices, big data, analytics, and cloud computing, which communicate via secured and encrypted channels. Connected devices enable efficient predictive maintenance by constantly providing information on a machine's performance, environmental conditions, and the possibility of failures. IoT can connect machines on the field in order to record incidents in real-time into a semi-intelligent 'Gen-X' FSM system.
Field service organizations always strive to consistently provide the best service experience to their customers, by ensuring immediate repair and maintenance of their equipment and machinery. By collecting data about the machine's health and performance from IoT sensors, organizations can leverage predictive and preventive field service to minimize device downtime.
Three primary traditional FSM challenges
Here are three primary issues that challenge the current reactive scenarios:
• Field technicians execute the job and fix the equipment after the issue is reported. However, the delay can impact business continuity, which in turn affects the operating profit margins
• Adding more field technicians and service trucks to the field comes at a cost and sometimes the increased capacity remains under-used
• Assigning more work to existing field teams can have a negative impact on SLAs and first-time fix rates. Even worse, it can increase the cost of travel and overtime
Essentials of a new-age FSM solution
field service management system that integrates device sensor data,
technicians, customers, and technology is the key to address these issues. It
should function in a predictive and preventive mode with the following
• The FSM process, which includes issue identification, communication, incident creation, scheduling, and assignment can be automated, thereby ensuring zero disruption in machinery operations and no or negligible downtime. This not only increases productivity, but also expands operating profit margins
• Most FSM products can also automate incident creation, scheduling, assignment, and invoicing processes. Using IoT, we can predict upcoming issues based on sensors data analysis and auto-creation of incidents based on preset threshold rules
The workflow of a FSM system with IoT integration
is an outline of the flow of incidents in a typical IoT-enabled FSM system:
1. Data from the equipment's sensors is collected and transmitted, using secured and encrypted channels, to a big data storage
2. Big data management and analytics is used to parse and analyze for refined sensors data
3. The IoT command console is configured with predefined threshold rules to identify errors and monitor the device's health and performance
4. Incidents are auto-created in the FSM system whenever errors are detected
5. Auto-scheduling, routing, and dispatching of field service technicians against the incidents is done based on customer entitlements, location, product, skills required for the job, technician's availability, parts availability, etc. via the FSM system
6. A field technician performs the job at the customer's site; records the effort, parts used, travel time, and any expenses incurred; and then bills the customer
Workflow of Field Service Management application using IoT.
Six Solution benefits
Near-real-time analytics provides data so that FS teams can react faster and address the issues before they become mission critical, thus reducing impact and avoiding downtime.
The wind turbine's sensors collect real-time data that is analyzed and through which, auto incidents are created, service scheduled, and an agent assigned to fix the issues. Wind turbine sensors are also used to continuously collect operating temperature, rotor acceleration, wind speed and direction, and blade vibrations - all of which can be used to optimize the turbine's performance, increase its productivity, and execute predictive maintenance to ensure reduced downtime.
*** Authors: Haresh Sreenivasa and R.N.Sarath Babu **
In an increasingly competitive and globalized world every organization has to attempt novel methods to stay ahead of the competitors. Enterprises constantly strive towards improving their revenue, profitability and operating margins. It is no more possible for the enterprises to record a positive Year or Year (YoY) growth just by increasing the sales volume and thereby increasing the revenue and profit. Most of the successful enterprises today have started looking within rather than outward to achieve their growth targets. The focus is on reducing the inventory (safety stocks), carrying and operating costs to improve the profitability without having to impact the productivity. The key to success is to optimize the overall supply chain inventory which reduces the cost of inventory and carrying costs eventually reducing the overall operating costs and contributing to improved margins.
The biggest challenge that looms over the inventory managers in large enterprises is how much inventory we should carry such that we do not compromise on the customer service level. In a global enterprise spanning across multiple geographies with multi-level and multi-layer supply chains, it is not an easy job to decide upon the ideal stocking locations and stocking strategies. With increasing number of competitors retaining the loyalty of the customer is increasingly difficult which leads to high demand variability and forecast inaccuracies. The variability in the lead times committed by our suppliers, transportation contractors and our own production engineers due to the unforeseen events, adds fuel to the fire. Given the circumstances and complexities the use of an IT tool is inevitable. Oracle Inventory Optimization is one amongst the tools available which could assist the enterprise managers in formulating and executing their inventory stocking strategies.
Oracle Inventory Optimization is part of the comprehensive Value Chain Planning Suite of applications from Oracle. The module provides a seamless integration with oracle e-Business suite transaction modules to get a snapshot of the supply chain and master data setups. It also integrates other supply and demand planning modules in VCP for further planning. IO provides the businesses with time-phased safety stock figures under the complex supply chain network.
The key advantage of IO is that it does a multi echelon inventory planning there by optimizing the inventory in the entire supply chain network as a whole in contrast to the conventional inventory planning techniques/tools which does a local optimization of the inventory. Businesses can now plan their entire supply chain network in a single plan. Along with the flexibility in fulfilment lead times and in-transit lead times between various levels of the supply chain network, IO recommends ideal stocking location of the inventory through postponement. Based on the supply chain network, it attempts to pool the risk of variability at higher levels in supply chain to a level lower in the supply chain network which would considerably lower inventory levels and costs without affecting the service level targets.
IO takes into account not just the demand variability and the forecast inaccuracies but also accounts for the variability of your manufacturing, in-transit and supplier lead times. It provides an insight on the contribution of each of those variability towards the overall proposed safety inventory levels.
Illustration 1: Time-phased safety stock analysis in analysis workbench
IO allows the users to perform different inventory simulations with different business objectives such as target service levels, budgets for different category/class of items for different customers/geographies. Inventory planners can perform different what-if scenarios and compare the outcomes related to target safety stock levels, budgets, inventory costs etc in Analysis workbench. The workbench provides the comparisons in both tabular and graphical formats with different types of graphs which are easy to interpret. The users can perform budget, cost break down, profitability analyses along with the safety stock and postponement analysis using the analysis workbench.
Illustration 2: Bar chart comparing safety stock recommendations for different IO Plans
Illustration 3: Line chart comparing safety stock recommendations for different IO Plans
Once the planners have arrived at ideal safety stocks in line with business objective, this information can be input to Advanced Supply Chain Planning (ASCP) for supply planning.
To conclude, Oracle Inventory Optimization is a very handy tool to enterprise managers which acts both as a strategic tool to decide upon the inventory stocking locations and as a tactical/operational tool once the strategy is formed. Its seamless integration with other Oracle demand and supply planning tools make it easy to implement and use.
Oracle Transportation Management (OTM) manages all transport activity across the supply chain cycle. It provides features to enable users to manage master data like location, corporation, equipment, item, commodity, rates, etc., and also monitor transaction data like order release and shipment data. However, OTM cannot work as a standalone system, as most organizations maintain their master / transaction data in enterprise resource planning (ERP) systems. Integration helps bring ERP systems and OTM consolidate data, which is critical for a comprehensive logistics system.
OTM exchanges information in the form of XML (GLogXML), thus making it mandatory for the interacting system to process XML also. An ERP system, on the other hand, has its own methodology to store and communicate information. For example, Oracle E-Business Suite (EBS) stores data in an Oracle Database, SAP stores it in the 'Pivot' format, and Electronic Data Interchange (EDI) stores data in a predefined format. For these systems to interact with OTM and exchange messages, a middleware that can appropriately translate messages between them is required.
Exchange information from ERP systems to OTM
Exchange information from OTM to ERP systems
Although OTM is compatible with most middleware software's currently available in the market, Oracle Fusion Middleware is recommended for integrations. Additionally, Oracle also offers its Process Integration Pack (PIP), which seamlessly integrates EBS and OTM using Fusion Middleware.
The GLogXML schema is the back bone for integration and consists of the 'Transmission Element,' which is the primary document for inbound / outbound integration. The 'TransmissionAck' element represents acknowledgement from OTM for the sent / received transmission. Transmission Report presents the summary of errors encountered during the integration process.
Transferring Information from ERP systems to OTM
Messages can be posted to OTM in one of the following four ways:
o WMServlet: Default servlet to post transmission to OTM
o TransformerServlet: Applies XSL transformation to XML data in order to generate a valid transmission XML and upload it to OTM. The XSL file should be uploaded in OTM, which will be used for inbound transmission
o DirLoadServlet: Bypasses application server to upload data into OTM. This will be used when data is loaded into OTM and processed later
OTM authenticates the username and password specified in the transmission XML.
Username and password can be specified in the HTTP header, when GLogXML is posted via HTTP post to WMServlet.
When GLogXML is posted via web service, username and password can be specified in the web service security token.
Transaction Code in GLogXML helps OTM identify the operation to be performed on the received transmission. Transaction Code I (Insert) creates a new record; II (Insert Ignore) creates a new record if the record does not exist; U (Update) updates the existing record; D (Delete) deletes the record; NP (No Persist) does not persist data in the database; and R (Replace) replaces the parent and child objects.
Transferring data from OTM to ERP systems
A message can be posted from OTM in any one of the following ways:
At the same time, an external system can be configured to post data from OTM to:
Out XML Profiles help exclude portions of XML while posting out of OTM. This also reduces the size of the XML file and improves performance.
Although OTM provides multiple options to send / receive information, a web service is the recommended approach to interact with OTM as it is highly scalable, can handle huge volumes of data, and supports multi-threading.
Written by: Ravi Kiran Gurujala
Most fleet managers face challenges in day-to-day operations to optimize load, improve driver productivity, reduce fuel expenditures, check wear and tear of assets, and more, which ultimately leads to revenue losses. At the same time, increased fuel costs, low customer satisfaction, and an excessive maintenance bill compounds their problems. As a result, companies spend nearly 10 - 15 percent of the total cost of the goods per annum (on an average) to ensure that their fleet management gains efficiency.
Oracle Transport Management (OTM) with Oracle Fleet Management -- bring together all stakeholders on one platform, optimize resources, reduce transportation costs through better consolidation of orders with regard to resources, and also provide visibility into fleet resources.
Six key features of Oracle Fleet Management that improves efficiencies
Implementing Oracle Fleet Management enables your business to have real-time visibility of fleet resources, reduced IT development and support costs, and improved cash-to-cash cycle time. The direct result of this is the decrease in transportation costs by 5 - 25 percent with better consolidation and resource optimization. Business productivity shows a marked increase of 5 - 30 percent as all stakeholders function via a single platform. This also helps in enabling better service time and improves customer satisfaction.
Written by: Pratik Udhishter Sharma
Oracle has come out with Oracle Transportation Mobile app version 1.1 which is compatible with Oracle Transportation Management (OTM) 6.3.X version. This app provides a very natural mobile experience as the user can work with this application using the swiping, scrolling, and rotating mechanism. You can download this app from the App Store or Google Play. While reviewing this app, I will be analyzing it based on the following criteria:
1. Ease of use: Mobile app should be intuitive and easy to use
2. Functionality to review tendered shipments / accept tendered shipments
3. Ability to add events
4. Feature to add signature
5. Capability to add damaged item's condition / photo
6. Functionality to view contact details of consignee
7. Ability to work offline as connectivity can be missing in remote locations such as Alaska / Hawaii
8. Feature to review invoices
9. Ability to add multiple events across multiple shipments
Having reviewed the OTM mobile app, this application is easy to use and fun to work with. From an initial setup perspective, it is quite easy to get started. The transport carrier needs to login using an email ID and password. The admin needs to provide certain access control lists to the service provider, to provide permission to access the application and to be able to enter events. When connected to internet, you can begin with onboarding carriers on this app within a week by doing necessary setups and providing the login/password info to the carrier.
As soon as shipment is reviewed for execution and tendered to carrier, the carrier can view it immediately by refreshing his data on the App user interface. The carrier can review shipment information such as shipment stops, weight, order information, item information, equipment information, and consignee contact information. This helps create a complete paperless experience, thus aiding the cause of green transportation.
The application provides the ability to accept / reject the tender, and the response is immediately available to be seen by shipper. Thus, there is no translation (B2B) involved in between. Carriers can cut down on the cost of B2B implementation with this app.
Once the carrier is ready with the pickup, he can add events like pickup, in transit, delay events with date / location. The application provides the capability to add an event based on the shipment's stop location or current location. The application also provides the capability to add photo / signature for the event where the set-up is defined in OTM. Hence, it should be known to the carrier that he/she can add a status on certain events only.
This application comes with a local Structured Query Language (SQL) database which allows relevant data associated with the shipment to be stored on the mobile. However, in case connectivity is an issue, the carrier must be able to only view the shipments but will not be able to add events till the connectivity issue is resolved.
The application does not provide the capability to review invoices as an out-of-the-box feature. It could, however, be possible to add it via Representational State Transfer (REST) application programming interfaces (APIs), but I am yet to review REST APIs. Also, the application does not provide the capability to add multiple events in its current state, and only one event can be added to one shipment at any given time. Overall, this application helps in providing enterprises with quick onboarding capabilities to their carriers /drivers.
OTM Mobile app Features
Rating ( 5/ 5)
Ease of Use
Review Tender / Accept Tender
Ability to add events
View Contact Details
Ability to work offline
Ability to add multiple events
Written by: Vipin Kumar Madan
In today's world, global economy can be erratic and businesses around the world need to adapt to ever changing scenarios. Moreover, growing competition and tectonic shifts in technology have forced businesses to re-think their supply chain and logistics strategies. Supply chain professionals around the globe are exploring possibilities and leveraging cutting-edge technology to gain competitive advantage. We discuss here top-two disruptive technological breakthroughs, which are crafting the next generation of supply chain and logistics.
Device mesh: Hyper-integrated, Automated and Responsive supply chain
Let's face it! In the last couple of years, an explosion of technologies is transforming the way supply chains will function in the coming years. Trending technologies include automatic identification and data capture (AIDC), Internet of Things (IoT), Bluetooth connectivity, electronic sensors, radio-frequency identification (RFID), cloud computing, mobility and many more! Together, these technologies create a digital mesh of devices, which transform the supply chain and logistics processes. This enhances the information flow and communication between various supply chain units and stakeholders.
Device mesh is gaining popularity because they are able to address the gaps between ground realities and planning estimation in a volatile business scenario. In addition, they enable decision makers to respond to situations in a fast and efficient manner and avoid delayed communication. Also, we can't discount the valuable feedback we get from customers via various means such as customer service contact, social media platform, online interaction etc. - Just imagine the possibilities if we can have all of it almost real time!! Device Mesh unlocks such possibilities.
Especially logistics providers around the world are early adopters of cutting-edge technologies and have been able to improve logistics visibility, ensure on-time delivery, and enhance customer service through device meshes.
Three pronged benefits of Device Mesh in Logistics space
Other areas such as enterprise wide visibility, warehouse and yard management, and fleet management have immediate benefits of adapting to such technologies. Businesses can have better control over their assets across inventory and transportation, reduce operational costs, or improve data accuracy.
Advanced Machine Learning and Analytics: Smart supply chain solutions
We live in an era of data explosion such that by the time you complete reading this line over 2.5 million pieces of content are shared on Facebook. With every second more data get created, but there are limitations to amount of data a human alone can analyze. Machine learning algorithms viz. supervised and unsupervised help us analyze such big data explosions and spot trends, behaviors, and possible bottlenecks in supply chain and logistics.
Machine learning remains a consistent technology trend, which is bound to stay valuable in the coming years. Though a recent entrant in the trend hype, it has quickly evolved to capture attention across businesses. In fact, machine learning replaced big data last year in Gartner Hype Cycle.
For comparison here is Gartner Hype Cycle for 2014
Whether we talk about IoT, digital mesh, automation agents, user experience or smart machines; machine learning has an important role to play. Organizations around the world are waking up to the possibilities and insights that machine learning has to offer and are using it to gain competitive advantage. Logistics providers are saving millions of dollars each year by learning from data they generate.
Machine learning goes hand-in-hand with analytics. Data science as depicted on Gartner Hype Cycle is classified under innovation triggers -- businesses now have tools at their disposal to generate intelligence from historical data and to take it to next level. The advent of predictive analytics and advanced business forecasting techniques are helping businesses to mitigate risks, trigger early warning systems in supply chain, manage manufacturing better and anticipate demand beforehand.
Speed, agility, responsiveness, smart, and efficient are adjectives which define next generation supply chains. Evidently over time it will change the way business is done but there are extra costs which are involved in incorporating these technologies to your existing supply chain. Before embracing such disruptive changes, it's recommended that pros and cons are weighed rationally to have more benefit out of such enterprise.
Written by: Deepshikhar Tyagi
The Trans-Pacific Strategic Economic Partnership Agreement (TPP) is a proposed trade agreement signed initially by the four Pacific Rim countries of Brunei, Chile, New Zealand, and Singapore, and later by Australia, Canada, Japan, Malaysia, Mexico, Peru, the United States, and Vietnam.
The main objectives of the agreement are:
- Inclusive trade and development
- Regional integrations
- Addressing new trade challenges
The signing of the trade treaty is bound to usher in the following changes:
1) More cumulative rules of origin
Countries that are a part of the same Trade agreement can share production/manufacturing of goods and can comply with the concerned laws of origin together if the Trade agreement allows for 'Cumulative Rules of Origin'. It simply means that a manufacturer in a country can use raw materials from another manufacturer in another country (that is a part of the trade agreement) without losing the actual status of the input.
How Oracle GTM will help: Using Oracle Global Trade Management (GTM), any import (to be used as an input in the manufacturing of an item) coming to a member country from another member country can be flagged, and the final item created can still bear the country of origin as the one where the plant is located.
For example, Oracle GTM is being implemented for a customer in Canada (member country) who is importing some parts from Malaysia (another member country) to create an item. This customer further exports to Israel and wants to enjoy the benefits of the agreement that Canada separately has with Israel. Using Oracle GTM, the customer can change the origin of all incoming parts from member nations to 'Canada' and enjoy the desired benefits. At the same time, it can also ensure that the parts coming from non-member nations still show their actual country of origin.
This can be done by simply creating a compliance rule set-up that screens the origin locations of all the incoming parts and checks them against the list of member and non-member nations.
2) Non-discriminatory trade liberalization
Non-discriminatory trade liberalization will be a byproduct of the TPP. With this agreement, more modern, simpler, standardized and more transparent regulations will come into existence to facilitate trade. This will be very similar to the case of European Union (EU), where customs procedures have been standardized across all 27 member states.
This simply means that a lot of countries engaging in trade with TPP members will be exempted from certain mandatory documents that were required earlier. A long list of documents will most probably be reduced to just a few documents. Some of these documents, however, will be demanded by customers and will have to be produced only when asked for.
How Oracle GTM will help: Oracle GTM's feature of 'document generation' offers high degree of customization (unlike other GTM solutions) and can be made to create a single document that contains all the information required by various regulatory bodies. With its next release, Oracle also plans to introduce a readymade, customer-driven 'document request' feature that will allow customized documents to be created as per requests made by the customer.
3) Landed cost calculation to become a decisive factor
In the non-discriminatory environment that TPP will bring, various countries will be treated alike by importers. There will be no or minimal non-tariff trade barriers like 'export subsidies,' 'import quotas,' 'determination of the eligibility of an exporting firm by the importer,' 'preference to domestic suppliers,' etc. Under such conditions, 'landed cost' of import / procurement will play an important role in deciding which country to import from.
For instance, an importer in Canada, interested in importing from a TPP member country, will treat all members alike and will not give any special treatment to a particular member nation. Thus, deciding whether to import from Thailand, South Korea, Vietnam, or even Mexico will depend heavily on the 'landed cost in Canada' for all these options. In earlier times, Mexico would have received preference due to North American Free Trade Agreement (NAFTA) and its proximity to Canada, resulting in lower logistics cost. Now, however, that will not be the case.
How Oracle GTM will help: Oracle GTM's 'landed cost estimator' feature allows any customer (importer) to create test scenarios that allow imports from various nations and then comparisons of the results. It also allows the importer to add tentative costs like freight, insurance, duties, etc. After creating and analyzing different scenarios, the customer will be much better placed to decide which country to import from.
4) Duty drawbacks / rebates by the government to see growth
Exporters based in the member countries outside of the free trade zones (FTZs) will also increase in number. A number of local manufacturers and merchants who will export to other TPP member countries will claim duty drawbacks / reliefs from their governments. This will give rise to a need for quick and accurate document generation.
How Oracle GTM will help: Usually, to claim the benefits of duties, a 'proof of export' has to be made. The 'document generation' feature of GTM, once again, will help exporters produce these 'proof of export' documents and will help the exporters reap the benefits of duty drawbacks / relief faster.
Written by: Ravikiran Narayan Khobragade and Mohammad Haider Talat
In today's rapid globalization, most successful organizations operate in more than just one country -- for sourcing raw materials, importing goods, exporting finished products, and more. However, while operating in international markets, organizations need to abide by complex international trade laws that might require them to do some or all of the following:
1) Classify their products based on an international system or source / destination country-specific system. For example, Harmonized Tariff Schedule of the United States (HTSUS) for American goods
2) Avoid trade with people / companies suspected of being involved in international crimes / terrorism
3) Avoid trade with countries that are under embargoes. For example, Sudan, Syria, etc.
4) Comply with the trade treaties that the involved countries are a part of. For example, mandates issued by Nuclear Suppliers Group for a member country such as Australia
5) Comply with country-specific trade obligations. For example, no Israeli-origin goods are to be allowed for imports in a member country of the Organization of Islamic Cooperation (OIC), such as Saudi Arabia
6) Assign license numbers to goods that are controlled / in dual-use -- for example, Export Control Classification Numbers (ECCN) for US exports
7) Create and provide regulatory / commercial documents that need to accompany goods -- for example, commercial invoices and bills of lading
8) File relevant documents electronically with the local customs authorities -- for example, 'Paperless Customs and Excise' or PaperLess Douane en Accijnzen (PLDA) in Belgium
It is crucial to note that all these requirements vary drastically from one country to another.
For instance, in a member country of the European Council (EC) -- like Germany -- the exporter needs classification codes that are specific to EC (HTSEU), customs filing that is specific to Germany (Automatic Rate and Local Customs Clearance System / ATLAS), and other similar trade compliances specific to the trading bloc or the country. However, when you consider an APAC country -- such as New Zealand -- the exporter needs classification codes specific to the island nation (NZHSC, in this case) and customs filing with electronic cargo information (ECI), which is again country-specific.
Standard Oracle Global Trade Management (GTM) implementation
Any GTM software -- or to be precise, Oracle GTM application -- provides a tool that can be configured and customized to suit the trade-specific requirements of a customer. It comes with absolutely no data of its own. Hence, any system integrator (SI) working for a customer has to first provide country-specific data to Oracle GTM, followed by the industry-specific data, and then the company-specific data. Once the master data is fed into the system, one needs to further build the configuration by writing rules, business flows, and many more complex equations. Once this is done, the SI performs the testing, fine-tunes the system, and finally takes the configuration live for the customer. This activity usually takes months of effort, numerous exchanges of information, and several rounds of testing.
Infosys readymade solutions
At Infosys, we have walked an extra mile in the Oracle GTM space by creating what we refer to as 'Infosys Edge: Plug-Tune-Play Oracle GTM solution.' With a dedicated team of over 150 consultants from the 'supply chain' and 'global trade' spaces, Infosys performed extensive research on certain key geographical pockets and has now come up with pre-loaded and pre-configured solutions for various trading regions / countries of the world.
As a direct result, this set of solutions has drastically reduced the time and effort that it takes to deliver a GTM solution to a customer. Where a routine solution requires loading, configuring, customizing, testing, and fine-tuning before the application goes live; with Infosys, the process simply comes down to testing and fine-tuning. We have already implemented the system readymade for various countries in North America; Europe, the Middle East and Africa (EMEA); and Asia-Pacific (APAC) regions.
Furthermore, if you are a defense equipment-manufacturer based out of Australia, we already have a system prepared for you that does the following:
1) Checks classification of your items as per the Australian Harmonized Export Commodity Classification (AHECC)
2) Screens your business processes / transactions as per the list provided by the United Nations Security Council (UNSC) sanctions and additional Australian Autonomous sanctions
3) Checks if any of your exports fall under the Defense and Strategic Goods List (DSGL) and whether licenses like a Restricted Goods Permit (RGP) or Defense Export Permit (DEP) are applicable
4) Creates shipment data for customs filing with the integrated cargo system (through CI / customs interactive facility or EDI / electronic data interchange)
5) Flags all transactions that fall under any of the trade agreements that Australia is a part of -- for example, China-Australia Free Trade Agreement (ChAFTA)
Since our readymade solutions already have most (if not all) of the capabilities that a business such as yours might need, it drastically brings down the total time and effort required by us to provide the right solution to you.
For enterprises, running operations on cloud has come a long way from being just a cost saver to a rapid business enabler.
In today's fast-changing dynamics, chief information officers (CIOs), who are keen to implement transportation management solutions for their organizations, are immersed in the following dilemma:
Do I buy a transportation management system (TMS) product and implement it on-premise or do I rent the services over cloud for my TMS?
At the same time, CIOs of companies that already use TMS systems are in a different dilemma over the following:
Do I continue investing and upgrading to a newer version or do I move the processes to cloud?
The answers to the above questions are not simple! In this blog, we will elaborate on how Oracle Transportation Management (OTM) cloud solution and Infosys help CIOs make this decision.
We, at Infosys, strive to understand customer needs and their existing processes before we provide a recommendation. Towards this, we evaluate the client capabilities across the following:
a. IT landscape
b. Objectives and pain points
c. Current TMS solutions
d. Solution complexities and dependencies
e. Existing business processes
Based on our evaluation, we try to categorize the client in the following buckets :
a. Entrants: No
TMS and transportation processes are small-scale and adheres to industry standards
without much deviations.
b. Intermediate: No TMS or client has homegrown applications with complex business processes
c. Complex: OTM is already implemented but running on an older version or is highly customized leading to significant expenses on infrastructure and licenses
Infosys can help companies transform from a state of legacy or no systems to one with future-proof systems. Our evaluation process for each of the above categories differs. We believe in the basic mantra that software must compliment the business and not define it, but somewhere Oracle has put most, if not all, of the best practices into the software. Hence, it is always best to see if the processes can be made lean and mean. Infosys puts the effort in understanding the business and the criticality of the process implemented before any recommendation is provided to the client.
a. Entrants: There are some smaller companies which do not own comprehensive
transportation systems. Moving to OTM solution is the best option for them.
They get industry best practices at the least cost possible. It kick-starts the
redefinition of their processes, improves their business, and paves the path
for growth. As a result, they get to own industry standard processes at a much
lower investment. We also enable them to choose from a range of
pre-configured solutions to rapidly reduce implementation life cycles by using
standard processes and valuable, bolt-on applications
b. Intermediates: The best option is to move to OTM to make their systems future proof. We provide an assessment of the solution and a recommendation based on the complexity and client objectives. If after careful evaluation, it is still found that certain customizations are absolutely necessary, then OTM can be complemented with the Oracle Platform as a Service (PaaS) solution. The combination of OTM and PaaS helps to bridge the gap between customizations and standard features
c. Existing: Many companies run on legacy transportation management solutions. This requires additional investments for upgrades and continued support from software vendors. This is where the move to OTM Cloud will also be helpful. We can migrate the solution to OTM Cloud and complement it with Oracle PaaS solution
Each industry has it specific nuances and any solution has to be reflective of that. Our solutions are industry-specific and take care of these nuances. In addition, they can be rapidly implemented with pre-configured OTM instances, documentation, mobility, etc. The solution suite from Infosys can include the PaaS solution as well, if the standard features of OTM do not fulfill all requirements.
The combined benefits of implementing our solution along with OTM Cloud are as follows:
1. Low cost which makes the OTM Cloud proposition very
attractive. There is no investment on infrastructure
2. Rapid implementation methodology helps customers gain faster return on investment
3. Upgrades are managed by Oracle and Infosys, which ensure that the client's technology infrastructure remains current. Cost-effective license fee as customers avail a subscription based model
4. PaaS solutions are provided for functionalities that do not have a standard OTM feature
Amidst a multitude of enhancements over previous versions, Oracle Transportation Management (OTM) v6.4 has caught the attention of OTM practitioners and users with its improved fleet management, rate maintenance, and mobility features. Considering the criticality of rate maintenance function and also the frequency with which OTM rates need to be updated, it won't be an exaggeration to conclude that the rate maintenance tool is poised to stand out as one of the key driving factors for OTM 6.4.
Global economy today is highly dynamic, complex, and competitive. Businesses strive hard to synchronize their offerings along the crests and troughs of the economic indices. In such an uncertain terrain, logistics service providers and carriers are left with no other option but to frequently update their service offerings with revised pricing structures. In today's world, rates and accessorials are in constant flux while service providers and transportation lanes are constantly being added or removed from supply chains. Thus, from the perspective of OTM users as well as those responsible for maintaining the IT infrastructure, these fluctuations emerge as one of the most complex, time and resource consuming activities. Let me begin by listing down the key reasons that favor this improved rate maintenance tool:
However, before jumping to conclusions, it's important to understand the 'hows' of the conventional rate upload process. Basically, rates in OTM, be it buy or sell, are configured through either of the following methods:
The manual entry method mostly involves business users and is used only for a small number of records. The CSV upload method is more popular for editing and uploading large number of records, but on the flip side, the tables have many dependencies and unless correct values are inserted, it would lead to complex errors. To illustrate this point, I would like to quote a few interrelated tables such as X-Lanes, Rate Versions, Rate Offerings, Rate Geos, and so on. Also, each of these tables consist of umpteen attributes, which correspond to a totally different set of values.
In such a situation, OTM v6.4 seems to have brought a much needed intervention in the form of its Rate Maintenance feature. However, as all good things come at a cost, this feature too requires a license for OTM Sourcing. Its user interface leverages the Oracle Application Development Framework (ADF), which is being used to enhance overall user experience throughout OTM.
The Rate Maintenance feature comprises of the following key processes:
Thus, in this manner, users are able to easily upload and maintain rates in a logical and user-friendly way. The interface and workflow shall undoubtedly play pivotal roles in shortening the quote to contract process. In a nutshell, this Rate Maintenance feature of Transportation Sourcing v6.4 leads to improved productivity by enabling business users to manage rates without requiring technical knowhow of the OTM rate tables.
On a similar note, prior to v6.4, Infosys OTM competency too had developed a homegrown service solution in the form of a mass upload tool to facilitate such requirements.
Written by: Prayash Baruah
The transportation of every shipment requires collaboration with carriers. Carrier collaboration can be achieved in various ways with Oracle Transportation Management (OTM):
Communicating through EDI with carriers that have EDI transmission capabilities
Email and fax-based communication
Offline communication on phone followed by manual entry of response into the system
Carrier collaboration using the OTM Carrier Portal
We will focus on the simplest and the easiest approach to implementing carrier collaboration, which is the OTM Carrier Portal. OTM provides a carrier domain named SERVPROV. Every service provider in the operational domain creates a user ID in the SERVPROV domain. In most cases, this is the user ID provided to carrier. The most commonly used features in this domain are:
Responding to the tender sent to the carrier (normal as well as spot tender)
Adding shipment tracking events for visibility
Apart from the above there are several other very useful features that can enable more effective communication with carriers. Let us take a look at some of the important ones.
Many of the shippers and 3PLs, have different carrier IDs created in their ERP systems. In reality, however, these multiple IDs represent the same carrier. Especially for 3PLs depending on the OTM domain strategy they have, the same carrier IDs created in multiple domains. When the tender is sent, it is the same carrier user that responds. It can be frustrating for carrier users if they need to use a different ID for every carrier ID created in OTM. The "Manage User Association" feature helps overcome this problem by creating a single ID for all carrier IDs.
The reverse is also true where there are various users for the same carrier, depending on the location from where the shipment is being dispatched. "Manage User Association" again comes to the rescue by associating dispatch locations with users based on the source location of the shipment.
Carrier Capacity Limits
Carrier capacity is usually used to denote the capacity provided by the carrier. But the capacity keeps changing depending on the situation. With OTM, the carrier can override the capacity for any lane(s) so that the actual capacity available is used for planning.
The self billing process is fast catching on with shippers. More and more shippers are creating carrier invoices themselves and asking carriers to validate the invoices. This can be easily implemented by tweaking the existing Virtual Private Database (VPD). There are two ways of achieving this:
Provide access to view the shipment and ask carriers to verify the cost on the shipment and provide feedback
Generate the invoice and provide access to carriers to verify the invoice. If the carrier accepts the OTM generated invoices, only then is the invoice approved to create vouchers
The invoice view has a placeholder for comments if the invoice is not acceptable. The operational user can then change the invoice based on the feedback.
This speeds up the carrier billing process and provides complete visibility on the current status of the transaction including the current responsible party.
Response to Bids
OTM provides a sourcing feature which can be used to attract bids from carriers. As a part of this process, an Excel sheet is sent for the carrier's response. The Carrier Portal is an effective platform to upload response bids. The upload of Excel files reduces time for the response and also helps with ongoing data integration. While uploading, the system verifies the structure of the Excel file allowing the carrier to rectify it in case an error occurs.
Since, not all carriers are EDI-enabled and communication using phone, email, fax, etc., is difficult to track, visibility into the transportation chain is impaired. In this scenario, the OTM Carrier Portal with its robust features including custom menus and screen sets provides a highly efficient and convenient way of communicating with carriers.Do drop in to meet with us at the Infosys booth during the OTM SIG APAC Conference. We will be happy to discuss how you can improve your carrier collaboration.
Posted by Ashish Verma, Senior Consultant, RCLORC-SBL
The word "Things" rang a bell when I heard this term for the first time. I researched and found that "Things" can be any tangible object that can be represented by an IP address and has capability to communicate with world of internet. This excited me a lot as it looked to be an upcoming revolution. The "Internet of things (IoT)" is at its early stages of development and will keep on evolving with the convergence of technological advances in sensing devices/microelectronics, telematics and analytics. This whole thing of "Things" looks amazing and paves way for immense possibilities of data sources and its flow.
Recently I started working for a retail client and this gave me an opportunity to ask myself how this new concept will change the purchasing behavior or rather purchasing experience of customer (read "connected customer")? How retailers are going to react to the "IoT"? Will they adopt it or not? Will it have an impact on their processes? Will it help them regain what they have conveniently lost to online retailers? Let's explore in the below few lines.
Going by the definition of "IoT", it is evident that it has capability to allow products and shelves to communicate with inventory management system, order management system, billing system or with any other IT system. This brings a lot of interest and if we further ponder upon its applications in "in-shop" retail house, it opens a gate for the whole new shopping experience. Customer will no longer be needed to stand in a queue for billing at a retail store....looks like I am kidding? But next few lines will let you know how it is possible. Customer will take a product from the shelf and put it in a "Smart Cart". The smart cart will have the scanning capability attached to it. This smart cart will update the billing system and the smart shelf will keep updating the replenishment system as well. The same smart cart will keep updating you about your billing amount to allow you to make further purchase decision. Auto checkout counter will generate bill to your credit/debit card for the items in your shopping cart. Fabulous! Customer's waiting time at billing counter has almost been reduced to naught.....bang on........customer is happy.
Another interesting application of "IoT" is in retail apparel house. We all have seen that almost every apparel house has fitting rooms located at the corner of their store........what if we have connected fitting rooms enabled with "IoT". It will be really interesting to see how connected fitting rooms will help customer choose the right cloth in case he has picked up a wrong size or colour. A connected fitting room will know which items you have picked up, what you are trying on and will let you request different sizes and colours from the room itself. But let me add a word of caution here, though this idea looks very promising and interesting but the cost of such fitting room is a factor that needs to be evaluated vis-a - vis the RoI that it will generate. Real challenge will be to see if supporting staff is able to provide needed support for the customer sitting in a connected fitting room when store is crowded and other customers need equal attention on the floor as well.
After learning about "IoT", one thing is very clear to me that upcoming digital technologies have open many floodgates for innovation in retail industry. There pros and cons can be evaluated by retailers before going for "IoT" enabled store but it is sure that this new way of shopping experience will be a key competitive differentiator for the retailers and a way to increase foot fall in their stores. At least at the outset, this looks an attractive proposition both for the customer and the retailer. Isn't it?
Guys, this topic has opened a new gate of thoughts for me something like Pandora's Box and I am going to explore more on this in coming days. So, do look out for my next blog on "IoT" wherein we will check out how it is changing not only the "things" within the shop but beyond as well.
One of the most frequently asked questions by Enterprises all over the world today is - Should their Applications be on the Cloud or On-Premise?
My 3 part Blog series tries to answer this question by looking at various aspects of Cloud and On Premise solutions and then coming up with the best suited model as per Customer Business requirements.
In the first part of this blog series, we will be taking a deeper look into the features of both the Solutions.
E-Fulfillment and Promise for the same day delivery of Grocery and certain Durable Items are the areas where all most all the Retail Chains are trying to build their Competitive edge and grab the wallet share
In my previous blog titled 'Multiple Time Zones in Single Global Instance - A Business Perspective', I have discussed about the key business requirements and challenges in implementing multiple time zones in a single global instance from Finance and Accounting perspective. In this blog, we will discuss on How Oracle LETZ (Legal Entity Time Zone) Solution could address these challenges for Global companies that operate in multiple time zones in single global instance.
What is LETZ?
LETZ is a standard, but controlled Oracle feature introduced in 11.5.10. In LETZ, Oracle has identified certain transactional events and enabled conversion of legal date and period of those events from server time zone (Corporate Time Zone) to the time zone of the legal entity in which the event has occurred.
Guest post by
Shantanu Bedekar, Senior Consultant, Infosys
Anyone who has visited a manufacturing plant or a warehouse knows that there is always a time-lag between physical movement of material and recording the same in the system. The unavoidable reason of this is: material is stored in racks, bins, containers spread across the warehouse or shop-floor but computer terminals on which Oracle forms are opened to enter data are far and few.
Guest post by
Kamaljeet Singh Bhatia, Lead Consultant, Infosys
The last few decades has witnessed numerous examples of significant competitive advantages through supply chain integration. Information sharing through superior technology is making enterprises capable to innovate and integrate in the complex networked environment. However information integration in supply chains is limited to large enterprises and small to medium scale enterprises (SME's) significantly lag to leverage technology for supply chain integration.
With the business expanding across globes and with manufacturing organizations resorting to sub-contracting, there is a need for organizations to look at procurement beyond their current markets. This introduces the need for a centralized procurement function for better purchasing efficiency, better control over organization spend, and central and simpler management of contracts with suppliers. Oracle Fusion Procurement introduces new and better features that aid organizations to better manage their procurement functions. The following are the advantages of a centralized procurement function:
Every country is making its Food and drug administrative control laws more and more stringent. Each country has a different requirement to get the products in specific labels formats, label colors, holograms, compositions etc. Issue is more challenging if item life cycle is short and old SKUs are getting replaced by new SKUs
What is MES ?
ERP (Enterprise Resource Planning) acts as central repository for all the data transacted, but there is no way of controlling the operations or passing the information between plant control system & ERP in integrated manner.
MES (Manufacturing execution systems) help in detailing the process and also controlling the operations through the systems. MES uses the data and provide results on the plant activities in minimal time. MES Collects the data from plant system, store them, and the output are used to control the functions in enhancing productivity and process on the whole.
MES for Oracle Process Manufacturing (OPM):
MES for Process Manufacturing adds new batch execution functionality and increases usability for manufacturing operators.
Out of Stock is a common problem that has smitten retailers immemorial. It is a part and parcel of the industry dynamics. One of the core WMS concepts can come in really handy and act as a panacea.
Most Retailers have by now embraced the Internet's effect on their businesses. Earlier versions used to see Retailers creating a different entitity such as XYZ Online or XYZ.net for their online sales. But with the recent phase of Multi Channel Commerce initiatives Retailers are quickly merging operations for procuring, selling and shipping items across the multiple channels. This meant that the IT applications had to quickly adapt and integrate with each other to serve the growing business needs of a seamless enterprise. Oracle has taken a big step in acquiring or developing solutions to meet this growing need of Retailers! This post describes what these new products are and why they are called Edge!
There are many ways to achieve Leaner ERP implementation, and I have discussed some of the strategic levers for it in my previous blogs Go Lean (Part 2) and Go Lean (Part 1) like senior management and executive sponsorship, robust decision making framework, effective change management approach, upfront planning for middleware and reporting platforms, solution design workshops, selection of appropriate edge products and leveraging localizations. However, there are many tactical and operational levers also available for enterprises to adopt, which are primarily part of implementation execution cycle. I am discussing here some of these levers and best practices to minimize customizations:
In this information age, with increasing awareness, consumers are becoming health conscious & want surety that the food product they consume is Safe. They are not happy with just to know the location of manufacturing plant, but are interested to know from where the raw material is originally sourced. Dairy industry, which typically produces a range of products for a variety of markets, faces even greater challenge in tracing individual product. This calls for tighter Integration between all the channel partners across the supply chain.
The dairy industry is a vertically integrated industry with both upstream and downstream trade partners of the supply chain dependent on each other to ensure quality food. I will discuss some of the challenges dairy industry is facing and Oracle's Solution for the same.
In maintenance world when we talk of "Zero Break down" most of the time maintenance crew says that it is not possible to achieve zero break down. So is it really possible to achieve "Zero Break down" for a Machine /Equipment? The answer is "Yes".
What is breakdown? :- When a Machine (M/c)is working and suddenly something fails for e.g. in case of CNC M/c hydraulic hose pipe rupture and it leads to heavy oil leakage, thus Beak down due to hydraulic leakage occurs on the M/C.
On the EBS R12 Roadmap, retailers with an existing Oracle product portfolio and operating globally across multiple business units and having multiple oracle instances face the everlasting dilemma whether to Upgrade for achieving the new package benefits at a relatively lesser cost versus - to Re-Implement a fully re-engineered R12 based solution bringing in maximum benefits but probably at a relatively higher cost.
Merchandise Accounts Payable, a mouthful isnt it? This blog explains and simplifies the complex area of Merchandise Accounts Payable, often seen in Retailers or Wholesalers. It also presents a point of view on various Oracle Products and their fitment to this business area.
To remain competitive in today's environment, manufacturing companies are looking at boosting their supply chain performance. One of the key levers for improving supply chain is 'cost reduction' at various stages of the entire chain.
Now we have established that Retailers are a special breed of organizations (see here) and their financials definitely deserve a special look. I think this difference in their operations has tremendous impact on their choice of applications. Some of the common notions of Oracle Applications such as Procure to Pay do not work for retailers.