Infosys’ blog on industry solutions, trends, business process transformation and global implementation in Oracle.

Main

October 4, 2017

If carriers use OTM mobile...

 
Picture a carrier's user tweeting and texting, his fingers poised earnestly on his mobile, his eyes awash with colorful imagery, and his mind dizzy with an abundance of sensory stimuli.

Now imagine the same user hunched up at his desk, his shoulders drooping like the wilting branches of a neglected roadside tree, staring at his monitor, responding to tenders in OTM, his brain nearing the point of self-imposed hibernation.

Before presumptuously advocating the use of OTM mobile for everyone - in this case, the carriers - let us look at the benefits if there are any

 

1.Shuffling order movements


A carrier receives multiple shipment tenders from his manufacturing or 3PL partners. The carrier proceeds to accept some of these tenders. Once the tenders are accepted, the carrier sends his trucks to fulfill the transportation services that he has hitherto accepted. At this point, the shipment is frozen, that is to say, the shipment cannot be modified by way of adding or removing orders from it.

But of course this is far from practical. Drivers assigned to the trucks can't make any rearrangements, namely, swapping a whole order or part of an order with other drivers. Once the tenders are accepted, the process is quite rigid and inflexible. If it is the same carrier who is operating in the same lane and his fleet comprises of multiple trucks, it should be possible to rearrange, isn't it?

Consider this - Truck 'A' with shipment 'A' onboard set off to its destination. But there is a breakdown and the truck is unable to deliver the goods. The driver swishes in his pockets and pulls out of his mobile, pinches his screen to locate his truck. Now, on the map, he can see a couple of other trucks just around the corner. He extracts the equipment utilization report and finds that the other trucks are underutilized and that they can carry some of his orders, the ones that are labeled 'overnight' or 'expedited.' He quickly summons the trucks and unloads few items from his truck, scans them judiciously as he hands them over to the other drivers.

Wouldn't it be useful to be able to do achieve this in a mobile application?

To make this happen, the carrier's transportation system, OTM or otherwise, must be able to send an actual shipment XML to the source OTM instance that has the planned shipment. The planned shipment is associated with order movements via the shipment equipment. Once the actual shipment XML is received, agents can be used to identify the order movements that were offloaded from the truck that broke down in transit and remove them from the shipment equipment. Similarly, the planned shipment of the truck that carried order movements in addition to what was accepted in the tender has to be modified by adding ship units to its shipment equipment.   


 2. Carrier invoices with delta cost


Some carriers invoice their partners regularly as and when the shipments are delivered. But most carriers invoice periodically, namely, month end invoicing. Now, a lot can happen between the first and last day of a month - the sun may run out of its hydrogen atoms and the earth may be plunged into eternal darkness! There is very little that OTM can do to handle sun's demise...

But, OTM of course can be configured to handle other miserly exceptions that arise purely out of the way the logistics industry operates. For instance, by the time the carrier invoices its 3PL or manufacturing partner, the contracts would have been renegotiated or the surcharges could be updated. The way we handle these delta changes between the invoice and the matched shipment is by configuring the service provider to copy delta costs at the time of approving the invoice.

Now, let's add a bit of flavor to this. Let's say the driver is unable to take the usual route due to unforeseen accidents on that route. He takes a different route and ends up paying for driving thru multiple toll gates, and even booking for an overnight stay at a roadside inn. These additional expenses are usually 'customer recoverable' and the driver should be able to flag them on his OTM mobile application.

If the driver also decides to get his truck's headlights fixed or change the brake pedals, it is hardly a case for recovering from the customer though. 

At the end of the month, before invoice is made out to the customer, the drivers' supervisor receives a notification on his mobile while he is on the site, busy assigning shipments to this fleet. On his OTM mobile, he gets to review the additional costs incurred against each invoice, the estimated and actual invoice amounts paired for quick reading.

Other examples of these accessorial costs could be the original driver enlisting help of other truck drivers. So, for instance the truck has left location A and is on its way to location D via locations B and C. This is a multi-stop shipment. On his way, the driver is alerted on his OTM mobile of another truck driver in his vicinity who is on his way to location D, this being a direct shipment. The second driver is shipping a return delivery which happens to be completely unplanned. Owing to the nature of this return delivery, his truck now appears as a notification for other truck drivers near him on the integrated Maps application. The original driver can now choose to offload some of his orders onto the return delivery truck depending on the other truck's equipment capacity.  Now that some of the orders have been offloaded, the original truck may not need to visit few locations on his route, thereby reducing the overall cost. The original driver should be able to indicate this on his OTM mobile which must transpire as a negative cost line item of his truck's invoice. The return delivery driver may incur an additional fuel surcharge which would correspond to a new accessorial cost on his truck's invoice.

To achieve this, we would have to add invoicing functionality to OTM mobile. Picture this interface alongside the standard set of screens that we are already getting in standard OTM mobile -

Carriers can select/deselect few order movements with the click of a button and promote the changes all the way to invoices. We can trigger invoice XML from the OTM mobile once the driver makes his edits and logs a delivery event at the destination. This way the information between orders and invoices is always in sync and few invoices would fail auto-approval. Also, the invoice-generation itself will be real-time thereby eliminating manual reconciliation which is taxing and prone to errors.

In short, making carriers more inclusive in the digital transformation.

 

Engage with our experts at #OOW17 booth 1602 & learn how you can transform your #digital capabilities infy.com/2vSljwe #InfosysAtOOW


Written by: Kranthi Askani


September 7, 2017

Analytics and the APP!

Introduction:


Mobile devices have brought about a giant leap in the modern world, providing myriad combinations of services to be leveraged by users depending upon their need, or more so, creating opportunities for different needs. While stamping their presence in most avenues of daily life, there are still some areas where their application is recognized but has yet to catch up to their full potential. One such area of opportunity, especially in the world of IT, would be the use of analytics on mobile devices. The following scenarios are discussed to study this prospect in further detail.



Mobile Analytics dashboard (Kronos & Oracle)


Case Study 1:

Scenario - The client is a leading global sports gear and apparel manufacturer and among the first to keep up with latest trends in technology and business. Apart from adopting new technology, the organization is also keen to pilot cool initiatives and gauge customer responses towards the same.

Background - The organization uses Kronos - a leading Workforce management product to capture time and attendance and also drive forecast and schedules of its workforce. With the introduction of Kronos Tablet they have also planned for a pilot rollout to select stores. Salient modules in use on the tablet include basic employee time and attendance, scheduling and forecasting along with advanced analytics.

Problem Statement - The client needed to explore the analytics app offered by Kronos for their store managers to leverage the real time trend update functionality offered by the same.

POC details - The tablet version (iPad only) app for analytics was tested and deployed as a pilot to select doors across the US region. The app was shared with both senior management and store level users. Being a retail domain the primary metrics on the app included volume drivers such as consumer traffic, sales amounts and employee demographics like coverage, shift effectiveness, etc. Focus groups were setup with pre-built dashboards to monitor various trends and daily heads up on metrics. Dashboards had roll-up, roll down functionality, real-time update of data and trend-analysis algorithms enabled using back end ETL (Extract Transform Load) jobs. The real time metrics would be updated on a preset frequency through the day as and when a threshold data point was reached. App used on the tablet was a readily downloadable app from the Apple store, developed by Kronos and integrated with the on premise application.

Pilot & Feedback - As a pilot, the app was made available to senior management and leadership in select stores. A preview of the analytics functionality, comprising a dashboard customized to the look and feel of the retailer's other existing apps, was highly successful. The core functionality and use case scenarios were also well received. This was followed by the rollout of the real time option, which again was very successful and instantly popular.

  • At a store leadership level this provided unprecedented control and rapid decision making ability.

  • For example, if in a large store area there is a shortage of employees in a section OR if there is a dip in forecasted sales in a department then the stakeholders can immediately get to the problem zone and plan alternatives with the aid of mobile analytics.

  • Frequent back office planning meetings were eliminated.

  • With access to all the necessary inputs in the tablet and with tools like heat maps and trend-analysis charts, they are able to simulate the next available options and also validate its success criteria immediately on the shop floor.

Taking a realistic scenario, during peak hours like Thanksgiving or Christmas, these actions save tremendous amount of time, not to mention an exponential increase in productivity/flexibility during day-to-day operations.


End of part 1... in parts 2 and 3 we will see more case studies and inferences.

Continue reading " Analytics and the APP! " »

June 2, 2017

HR Analytics in Retail Industry

HR in Retail Industry
Retail industry is one of the fastest growing industries in the world, and is evolving rapidly due to the  continuously changing market economy, digital competition, new product launches and demanding customers. With an extremely competitive scenario of market growth, workforce has become one of the key factors in the growth of any retail organization.

So, why is HR critical in Retail?
  • Service oriented and people driven industry
  • Constantly evolving and competitive growing environment
  • Large manpower employed
  • Skill set requirement varies based on the market type, it involves both skilled and unskilled manpower

HR Challenges faced by the Retail industry:
Due to the global economic changes, Retailers face competition with the new entrants from other countries in the domestic market and hence strengthening their talent portfolio is critical for success. Consequently, along with business leaders, the HR strategist role requires to forecast the industry trends to identify future business needs and build the right talent pool. 

Key HR challenges in Retail include:
(a) High turnover:
Retail industry faces a talent crisis especially at middle and senior management level. Though entry level resources are available, retaining the talented manpower for the long run becomes a challenge. 
The management needs to know the reasons of attrition and take corrective actions accordingly.

(b) Lack of skilled workforce:
An important challenge in Retail industry is getting professionally educated workforce. As there are very few courses that offer a professional degree in Retail industry, getting skilled staff is a challenge. 
Organizations need to identify training needs and accordingly plan for training and development programs to enhance the skill set.

(c) Diversity: 
Diversity in workforce is crucial as it helps a retailer connect with its market that leads to better ideas and results. Hence, HR needs to promote team building programs and initiatives to connect people to avoid conflicts, promote teamwork and collaboration among resources. 

(d) Seasonal Demand:
Retailers experience seasonal demand fluctuations and hence hire temporary staff during this period which do not have appropriate skills to serve customers. So, forecasting the resource demands and planning for training the existing resources or hiring strategy becomes critical.

(e) Employee engagement and communication
The Retail industry is distributed across sectors and locations. It is very important for management to engage and motivate the resources in distant locations and make them connected with the organizational goals and objectives. It is important for leadership to connect and engage with employees at regular intervals.

HR: Cornerstone for business growth
Human Resource Management means managing the employees of an organization. There are two aspects to it, one is revenue generation by providing efficient service and second is the cost associated to manage human resources - the primary concern for leadership is to strike a balance between the two.
Putting down a well thought strategy, predicting and forecasting the future trends and taking the right decisions. 
Correct in-depth analysis of HR data at regular interval. 
Evaluation of various aspects of HR in varied situation
Quick view and Spot on decision making

The next part will discuss the software solution that can empower Retail Industry - HR Strategists to take effective decisions for their businesses. 

April 30, 2017

Reverse Logistics For A Forward Thrust To Sustainment Quotient

One of the key technology focus areas in Green Supply Chain Management that enables an organization to transition into a sustainable organization is Supply Chain Network.  Logistics Optimization also goes hand in hand with this. It is true beyond doubt that a responsive supply chain is also a responsible supply chain, it is more environmentally and socially responsible. Not only is it plausible it is also more financially viable resulting in a higher sustainment quotient as well as higher benefit factor. Logistics Optimization and Supply Chain Network can lead to reductions in empty and circuitous miles, and also increased warehouse capacity utilization. Organizations need to look at the process and operational best practices to improve upon their sustainment quotient. The higher the quotient, the greener the supply chain and hence the greener the dividend pastures as mentioned earlier.

Continue reading " Reverse Logistics For A Forward Thrust To Sustainment Quotient " »

March 29, 2017

Cross Docking - An Enabler to Quicken Turn-Around in QSR Industry

QSR Industry and the concept of quick turn around

The success of the QSR (also known as fast food industry) is driven by the timeliness with which the products are delivered, without compromising on the quality. The name itself, Quick service restaurants, suggests the fact that the delivery of products in this industry needs to be quick and the lead time involved in minimal. Organizations need to be ready to fulfill the orders in short notices which can even be a few hours. Also, given the dynamics and competition in this sector, along with the strict rules and regulations for any food products, organizations have an ever increasing pressure of quickening the delivery without any compromise in quality. Long term sustainment of growth and success are only possible if the above criteria are not neglected. Some very common QSR names like McDonalds, Starbucks etc have diligently followed these rules to become what they are today.

 

Nature of order placing in QSR industry

Most of the orders in the QSR sector which are placed to the warehouses comprise food products and preparations which are highly perishable in nature. Items like burgers, pastries, sandwiches etc which cannot be prepared and stored in the warehouse like other packaged items. These items are made to order and arrive in the warehouse only a few hours before the actual shipment needs to leave from the warehouse to fulfill the orders. Most of the QSR players have their company owned stores and hence the nature of orders is very similar for all stores. In ideal cases, these stores place their orders with the warehouse a day before the actual delivery.

The nature of the items is such that the warehouse doesn't have these items stocked in the premises beforehand and the order is passed to the manufacturing unit / supplier only after summing up the cumulative quantity of each item asked by all stores.

There are certain scenarios, especially during festive or holiday seasons when the stores place a lot of emergency orders with the warehouse where the lead time is only a few hours. These are the times when the warehouse has to ensure that there is quick turnaround of the order and needs to facilitate quick supply of the items from the vendor and then quick delivery of the same to the store.

 

Pain Points: How to Reduce Turn around

Given the nature of business for the QSR Industry, the efficiency and productivity are dependent on the fact that how quickly the turnaround is done or the turn around time reduced for the orders to the stores. However much the regular picking process is expedited, there is a fair bit of delay expected in the process of picking the items from the receiving area after they have arrived and bringing them to the shipping area. This can cause delay in the delivery deadline and business can suffer. Also, there is high labor cost and transportation cost which distribution centers want to reduce especially for these items where there is no storage and items are directly sent out for shipping.

 

Recommendation: Cross Docking

An optimum solution for this type of situation can be Cross Docking. Cross docking means skipping the receiving and temporary storage part and unloading the goods directly in the cross dock area from where they are loaded into the delivery trucks. This can serve as a good opportunity in case of QSR warehouses as the items themselves don't require storage. Hence they can be sent directly to cross dock area. Also, this will help in quick turnaround of orders from supplier till the actual store and increase the supply chain velocity.


For efficient cross docking, there are a few important points which need a special mention:

·         Physical layout of the warehouse: Cross docking will not make any sense if the distance between the receiving and the shipping area is very huge. Although in most warehouses, the layout is such that the receiving and shipping are at two ends of the warehouse. But that is more suitable to industries where storage forms a major activity in the warehouse. In case of QSR sector where storage is minimal, it would be ideal to have the receiving and shipping in close proximity to facilitate easy cross docking.

·         Carrier routing information: As mentioned earlier, the nature of orders from various stores in the QSR industry is very similar to each other. More often than not, the shipments are clubbed based on the carrier's route for the various stores. If this information is available much ahead of time, the items can be bulk picked from the cross dock area and put into the respective trucks as per the routing schedule.

·         Task management can serve as an effective enabler to avoid stock out situations and facilitate cross docking. Task management when linked to employee scheduling helps optimize staff requirements, based on sales history and other factors. This could even be linked to overall employee productivity and a number of reports could be made available to determine it. RF devices when paired with a WMS could be used effectively to avoid inventory shortfall situations for a retailer. What is needed is an inventory source of record, wireless infrastructure and a WMS with a Task Management engine.

 

There are a few impediments for the cross docking process as well. These are:

·         Inventory levels in the warehouse system: One major barrier in cross dock process is that during cross docking, the items are not actually received in the WMS system of the warehouse and hence the inventory levels are not brought up to show the entry and exit of the items from the warehouse. Since the orders are sent and pick / ship documents are created a day prior to the actual transit of items, the warehouse has to find a way to capture the information of these cross dock items arriving and leaving the warehouse for auditing and tracking purpose.

 

One way of doing this is to bolt up the warehouse inventory with dummy values via receiving screens and then bring them down through the pick screens.

The other way can be to make the cross dock location a valid receiving as well as shipping location of the warehouse. So from one screen, the inventory level in the WMS can be increased by receiving items from the cross dock location and from the other screen, the inventory can be brought down by shipping them out from the same location.

·         Merging of cross dock product with products coming out of picking belts: Though most of the items from the stores would be the highly perishable, JIT items, there can be certain items which are non JIT in nature and are stored inside the warehouse. For ex: packaged foods, liquids, lids, cups etc. These are picked and shipped via the conventional picking method and are brought to the shipping area via the conveyor belts or manually. If the warehouse is doing cross dock of some items which have arrived externally from the supplier and is also picking items from the shelves for the same order, care needs to be taken to properly pack all the items of a single shipment of a store together and nothing should get missed or mixed with other orders. Also timing of the arrival of items from the two sources becomes important in a way that the shipment doesn't get delayed.

 

A New Beginning

Cross docking has still not gained its fullest popularity in the world of distribution centers and is still a vast area to explore. Cross docking can greatly reduce the turnaround time of delivery of orders and can act as a trigger to increase the velocity of the logistics system of the QSR industry. No customer likes to hear that the dish or item they have ordered from the menu has still not arrived and will be there in a few minutes. Customer delight in terms of time and taste is the key to the success of this highly competitive QSR world and can only be achieved with the combined efforts of all participants in the supply chain. Cross dock can be once such contribution from the distribution center.

Continue reading " Cross Docking - An Enabler to Quicken Turn-Around in QSR Industry " »

March 22, 2017

***Chart of Account (COA) Design Considerations***

Chart of Account (COA) structure is the heart of an ERP implementation enabling business to exercise its day to day operations. This has very influence on how an organization wants to record monetary, contingent and statistical impact of different transactions taking place across the line of businesses, report it out to external entities to fulfil regulatory and statutory requirements, leverage it internally to gain insight on performance of different departments on both top and bottom lines. In order to be able to embark efficiently on these essentially require a modern chart of account mapped to different business modalities and dimensions that does not only takes care regular requirements as said but helps facilitate automation, rein in need of creating duplicate segment value pool, one segment does not override others i.e. maintains uniqueness of purpose mapped to each segment etc. Investing enough to lay down the foundation of COA structure would be the first step to lock down a successful ERP implementation and to drive innovation for businesses throughout the life of application. Note: Combination of segments (e.g. Company, Department/Cost Centre, Account etc.) forms a Chart of Account.

There are numerous essential characteristics including, but not limited to, below 5 that must be considered while designing COA structure:

Selection of business modalities/dimensions as segments of COA:

The selection of modalities as segments is not an objective matter but a very subjective in nature. While some are mandatory one irrespective of everything and anything but some are invariably vary based on types of industries, organizations and products or services offered, geographies where businesses have its operations, internal and external reporting needs, future considerations and volume of inter or intra company transactions etc. Each one of these are key drivers to design an idealistic, futuristic and holistic chart of account. For an example, manufacturing organizations may want to consider cost type as a segment to represent say fixed and variable cost in order to better assess contribution margin at the product level. They may look at a segment exposing sales destination location of a product to clearly articulate the strategy for multi-fold growth in determined geographies. In banking industry, companies may choose to introduce reference to a relationship manager/cost centre in order to measure performance at product portfolio level. In retail industry, looking at product categories instead of individual product can be the favourable option.

One segment should not override or make other ones redundant:

This is one of the vital discussion points while designing a COA structure in any ERP systems. While a thought leadership on this can offer long term benefits to organizations in account of easier maintenance, minimal master value pool for each segment, no duplication etc. On the other hand immature decisions, however, may erode the benefits eventually. A COA structure and value set for each segment should intelligently be designed in such a way that one segment does not make other one redundant, does not enforce introduction of similar type of values for a segment and most importantly they must be structured "relative" to each other. To understand it better, let's take an example of a COA structure that has 4 segments called Company, Cost Centre/Department, Natural account and Sub-Account. There are 3 companies COMP1, COMP2 and COMP3 and each company operates with its 4 own departments as Sales, IT, Purchase and Inventory. As a strategic and sustainable approach, a) one would recommend only 4 different cost centre value sets representing each of the 4 departments. These 4 can be associated with either of the 3 companies while actual transactions are taking place. On the other side as a poor design, b) organization can undoubtedly be enforced to introduce 12 different cost centre codes representing 4 departments working for 3 different companies. It is self-evident that option "a" firstly cascades the behaviour of relativity where Cost Centre is relative to a company and thereby does not lead to a redundancy and secondly avoids creation of duplicate codes for similar type of departments. This can further be well understood with postal code numbering system where it navigates through State, District and finally City. Here City is relative to a District and a District itself relative to a State for a given country. In regards to option "b", shortcomings are clearly countable as creation of duplicate codes while departments are of similar nature for each company, can't share segment values, certain to experience huge volume of cost centre values over the period of time etc.

Automation for Intra/Inter Company Transactions:

Organizations like GE who has leading business presence almost all over the world deal with huge volume of transactions b/t two or more internal business units. Transactions taking place b/t 2 business units ideally lead to inter/intra company transactions and that is where it is essential to consider a placeholder for inter/intra company segment in the COA in order to efficiently track referencing inter/intra company and enable opportunities for automation. ERPs like Oracle Application R12/Fusion Cloud offers an automation to create inter/intra company accounting entries by introducing pre-configured rules. For example, Oracle Fusion Financials automatically creates Intercompany Payable accounting entry corresponding to the Intercompany Receivable inter/intra company accounting entry by looking at the rules. Such entries have a counterparty reference in the COA code combination as in company (balancing segment) and designated inter/intra company segment.

Give meaning to each digit/character within a segment rather than just treat as code:

While a business meaning is tagged to each segment, a COA design can further be advanced by injecting an appropriate meaning to digits or characters within a segment. For example instead of just coding a company as COMP1 with no meaning to individual or set of characters, one can strongly advocate for "013060" where first 2 digits represents Country, next 2 region and last 2 State. Such logical combination may take away the need of an individual segment in a COA to signify location. This is additionally very helpful for easy reference.

Business Rules With Valid COA Code Combinations:

In regular business practice while creating different transactions, allowing only valid COA code combinations is usually the core business requirements. For example, although a COA code combination with Cash Account does not require any specific product code however the same would be needed while booking revenue. Thus, identification of such scenarios and implementing rules accordingly in the system is the key to rein in undesired code combination values.

March 3, 2017

Why a Global Trade Management system is Integral to an International Supply Chain!

 

A Multinational Organization in any country across the world needs to abide by a set of export and import control regulations that governs the movement of goods, services and technology across international borders.

These Export/Import regulations impact enterprises operating in almost all industries.

Various regulatory bodies that keeps a check on manufacturing and international movement of goods like US CBP (in case of USA), Taxation and Customs Union (in case of European Council) etc. penalize companies that violate these controls.

These penalties can be monetary or legal in nature. In certain cases even criminal proceedings can be initiated against the company.

As a result of these penalties, enterprises also face significant business loss and damage to reputation.

In any International supply chain the role of trade-compliance starts from supplier/vendor selection, when the importer must ensure that he is not dealing with any denied/blacklisted individuals or entities. Further the imports needs to abide by the trade and customs laws of the source as well as the destination country. Subsequently when the business (importer) exports its products to an overseas destination it must again ensure that the legal requirements related to country of origin/destination and various international treaties are met. Also the customs filing must be done in due course of time and the relevant transportation and regulatory documents must be produced as and when required.

Any smart business should also ensure that it is availing the benefits of the trade agreements its products falls into.

 

Various aspects of Global Trade Management

 

A.  Item Classification and contact screening

 

Each item that is exported or imported internationally must contain certain classification codes for:

 

  1. Tariff Calculation (HTS US, HTS EU etc.)

  2. Licensing purpose (ECCN US, ECCN EU etc.)

 

These codes depends on the source and destination country as well as the product attributes. E.g. any item being exported out of UK must contain HTS codes specific to UK for tariff determination, ECCN Code if it is a dual-use item, and even the HTS codes of the country to which it is being exported to.

 

Similarly every enterprise which exports or imports has to ensure that none of its international customers/suppliers fall under the denied list of people/entities as prescribed by UNO.

 

Oracle GTM, performs the item classification and also screen the contacts/orders of the business through its standard functionalities.

 

Cummins Inc., an American heavy equipment company, which operates in more than 190 countries. It has more than 600 distributor facilities and over 7,200 dealer locations across the world implemented Oracle GTM in year 2013-14. They mainly did so to classify their items (goods) and also screen their customers and suppliers against the denied party list. And here is what they have to say - "Through the use of Oracle's Global Trade Management solution, we have achieved new heights of product classification accuracy, consistency, and compliance efficiency in all Cummins locations globally."1 - Dante Monroy, Director Global Trade Operations, Cummins Inc.

 

B.  Embargo and Compliance rule screening

 

As per the UNO mandate all Multi-national enterprises across the world are required to completely refrain from doing any kind of trade with certain embargoed countries from time to time. Several countries including North Korea, Iran, Syria, Sudan, Myanmar etc. have been embargoed time and again by the UNO.

In addition to these blanket bans by the regulatory bodies there are often country-specific requirements based on the international treaties that your home country is a part of. E.g. - Any materials, equipment and technology related to nuclear science can only be trade between countries that are a part of the NSG (Nuclear suppliers group).

 

Oracle GTM configures these rules and ensures adherence to international compliance rules through its standard functionalities of 'Sanctioned territories screening' and 'Compliance rule screening'.

 

 

 

General Electric (GE) a US based multinational enterprise, implemented Oracle GTM in 2013-14 for one of their key businesses P&WE and ensured that they do trade as per the international law abiding by the International embargoes requirements and various other multi country treaties including NSG, MCTR (Missile control technology regime) , Wassenaar agreement and Australia group agreement.2

 

 

C.  License Management

 

It is often seen that certain items, before they can be exported, are required to be accompanied by regulatory licenses. It is often done to ensure that the items are only used for their intended purpose and do not end up in the wrong hands and be misused.

These licenses can be quantity or value based. Any enterprise dealing in items that needs licenses must keep a continuous track of the authorized quantity/value and keep replenishing the same with concerned regulatory authorities. Any item if exported without the required license can attract severe penalty and/or legal action by the international/local law enforcement agencies.

 

Using Oracle GTM's License management functionality one can set up and manage all licenses that are applicable to its items and can also keep a continuous track of the inventory levels of the same. Through this feature the business can also ensure that it never falls on to the wrong side of the law by non-deliberately trying to export an item without the applicable license.

 

                 

 

Cypress Semiconductor Corporation, an American semiconductor design and manufacturing company, needed to centrally manage 30,000 customers in 200 countries complying with all international and country specific regulatory environments.

 

In addition to this they also needed to ensure that few of their export controlled products specifically in countries including US, Malaysia and Japan always have the required licenses before they are exported.

 

They implemented Oracle GTM in 2015-16 to manage their global trade and as per them, using the product they could fully automate their global business and make themselves 100% trade compliant with 0% errors.3

 

 

D.  Customs Filing

 

Any enterprise exporting goods outside a country must file for customs clearance with the national customs authorities. This process has become electronic in most countries and is usually done by establishing a two-way electronic communication to transmit data related to the export items and further receive a response regarding the same.

E.g. in UK every exporter must file with CHIEF customs system, in Germany ATLAS, in Belgium - PLDA and similarly in US every exporter must perform the customs filing with the AES (Automated Export System).

 

Oracle, in 2013, got authorized by the U.S. Census Bureau (Department of Commerce) to enable its customers to perform the AES filing though its product GTM.4

Since then a lot of US based enterprises have used the product to extract the custom specific information from their existing business processes and transmit the same to the authorities to get clearance for their exports.

 

Oracle GTM simply screens the existing business processes of the customer, create customs shipments to prepare the filing data and then transmit an electronic document to the AES system. It also further receives and processes the response that it might get as an acceptance or rejection of the filing.

 

In various other countries Oracle partners with 3rd parties like Descartes to perform the customs filing.

 

 

 

 

E.  Latest developments

 

Oracle recently came up with a new feature 'Landed Cost simulator' that helps enterprises decide the most suitable vendor and the most economical sourcing scenario for their business. It also lets them know if their business is eligible for any duty benefits under any trade agreement.

E.g. - If a Canadian importer has several sourcing options for a product that it is looking to import, Oracle GTM can calculate the cost that each option will incur for the import, including the duties. Additionally if any of the vendors happens to be from a country that Canada has a trade agreement with (say Mexico/US which are a part of NAFTA) it will identify and calculate the duty benefits that the importer will be eligible to claim.

 

 

 

 

 

 

 

Global-Trade-Management is not just a regulatory but a strategic issue for any growing enterprise. If not managed systematically it can result in irreparable losses financially, legally and also on an organization's brand image.

It should be a part of a company's vision and long term growth strategy and hence any enterprise with such an attitude must consider having a robust & comprehensive solution like Oracle GTM!

 

 

References

1 - http://www.oracle.com/us/corporate/customers/customersearch/cummins-1-gtm-2602121.html

2 - https://www.oracle.com/webfolder/s/delivery_production/docs/fy14h1/doc1/ovcs2014-fovce.pdf

3 - http://www.oraclemsce.com/tracks/global-trade-management

4 - https://blogs.oracle.com/scm/oracle-global-trade-management-achieves-aes-certification-to-support-end-to-end-customs-filing-process 

                                                                          Written by: Ravikiran Khobragade & Mohammad Talat

Continue reading " Why a Global Trade Management system is Integral to an International Supply Chain! " »

Omni-Channel Warehouse Management using Oracle Logfire & the Infosys advantage!

 

What is an Omni-channel business?

An omni-channel business is one that provides its customers various ways of buying its products and services. The purchase can be made through an ecommerce website or by placing an order over a telephone or by simply walking into the brick-and-mortar store and picking up the product of your choice. With the increasing competition in the retail industry most enterprises across the developed and the developing world are now considering going omni-channel. It is an effective way to ensure that you don't lose out on your existing customers and that the new age tech savvy customer doesn't give you a skip.

Why visibility of inventory is important to serve customers in an omni-channel business?

When a customer decides to buy an item from your e-store/website etc he needs to know by when can he get it delivered. Also if an item is not available currently he likes to know by when it will be made available.

Often stores that have a Warehouse management system get their inventory replenished in batches. The only visibility that they have is within the store/warehouse. This often leads to a business either not having the right clarity to provide the correct timings to the customer or it providing a sizably high time. In order to be able to provide the shortest time by which the item will be made available, the business needs to have a clear visibility of the inventory lying in the store, in the DC, in the manufacturing location and also in-transit.

How can Oracle logfire prevent loss of sales and customers in an Omni-channel business?

Oracle logfire has a comprehensive approach to the warehouse management system. It keeps a track of all inbound and outbound orders destined to the DC, the stores and any other fulfilment centers in the supply chain. On the basis of this information logfire can clearly tell the business representative at the POS by when the item can be made available to him. Once the customer is apprised of the same his chances of going to a different business/store to buy the same item comes down sizably.

What kind of an End to end visibility is obtained using logfire?

1) The system captures the actual P.O.s and DC replenishment orders to get visibility into expected future shipments and the dates of arrival.

2) System also captures the inbound shipments from the suppliers that provides the inventory.

3)  The system manages the outbound transportation to the store from the DC, and also the receiving and managing of the goods in the back of the store.

4) Based on the real time data captured, the system maintains accurate inventory information pertaining to each stock-location from where fulfilment can be done. It also understands which inventory is on the way towards these locations and also when will it arrive. Hence it becomes possible for the business to tell the customer exactly about when the item will be made available to him.

Additionally like any other new age WMS, the system also manages the replenishment of inventory to the sales floor, and also the returns and reverse logistics to a store, a DC, or to the supplier.

Why Infosys is the ideal choice for an Oracle logfire powered Warehouse management system?

Being a diamond partner of oracle for cloud implementation infosys brings to the table a robust expertise of implementing all of Oracle products.

Oracle practice of Infosys comes with the capability of not just deploying a warehouse management system but also Transportation management & Trade management systems which can be exploited to make the customer's business optimized for movement of inventory and also trade-compliant in case of any international orders.

                                                                                                                           

Written by: Ravikiran Khobragade & Mohammad Talat

February 16, 2017

Oracle Service Cloud - One Product for Multiple Service Needs in Multiple Industries

'The world is becoming smaller' is the catch phrase which I get to hear nowadays pretty often. What does it mean? Of course, the world has not shrunk but the communication channels have expanded in their mode and reach thereby bringing people together and closer to give them a feel that no matter where you are, smart channels of communication will keep you connected to your family, work and needed SERVICES. In line with this boom in communication channels the expectations from the Customer Service industry has increased manifolds with the connected customer demanding service ANYWHERE and on ANY CHANNEL.

Continue reading " Oracle Service Cloud - One Product for Multiple Service Needs in Multiple Industries " »

February 10, 2017

Centralized Vs Decentralized VCP Architecture

 

One of the critical decisions that businesses considering VCP implementation have to make is to choose between the centralized and decentralized architecture of VCP. This decision is very crucial not just from the operational perspective once they have implemented, but also due to the fact that the cost of the overall project is dependent on this. For a decentralized environment, business have to invest in new infrastructure and hardware required for the new VCP instance. For smaller businesses, these costs could be higher than the overall implementation cost itself.  Through this article, I would like to discuss the pros and cons of each of those approaches and throw light on the aspects which businesses need to consider for making an informed decision.

A centralized architecture is where both the EBS and the VCP reside on the same server. In a decentralized architecture EBS and VCP reside in two different servers connected through the database links for exchange of data.

Before talking about the pros and cons of these architectures, let us understand the need for a decentralized architecture when by default we have the centralized architecture enabled.

Unlike most of the transactional systems, where the transactions are done at database level, the planning in the VCP modules happen in the application server memory. The planning engine processes are highly memory intensive and the plans require great amount of memory while the planning engines are running.

One of the most common issues encountered in ASCP (one of the important module of VCP), are the plan failures related to the application memory where the plans fail after exhausting all the dedicated/available memory.  These errors could be caused by an inappropriate setup in EBS or even by manual errors as simple as creating an internal requisition with inappropriate source. These transactional errors takes a lot of process maturity and user knowledge\training to control but still very difficult to avoid. What this means is that in case the application sizing wasn't done scientifically or in the case of above errors, the planning engine run impacts the performance of all the applications that reside on that server.

Most of the businesses going with centralized architecture face challenges during the month end\period closure activities where the finance processes (which process a huge volume of data) overlap with the planning processes

Also the amount of memory consumed depends on multiple factors such as volume of finished goods, depth of BOM, volume of transactional data , type of plans being run, amount of constraints and the list continues. In our experience we have seen businesses where the plans have a peak application memory consumption of over 64 GB. What this means is that an unscientific application sizing would not just impact planning but the activities in transactional modules in a centralized environment.

For businesses which have operations spread geographically across globe and have multiple plans catering to different geographies, it is imperative that they run those plans at different times in a day meaning the server resources need to be made available at all points in time such that the plans complete smoothly.

Having said that below are the pros and cons of the available architectures:

Centralized

Decentralized

Pros:

·     Lesser investment in infrastructure and its maintenance.

·     Simple architecture.

Pros:

 

·     Issues related to planning engine will have least impact on the transactional systems.

·    Supports different versions of EBS and VCP. EBS can be at the same or lower version than VCP.

·     VCP can be easily upgraded without any changes to EBS. VCP can be patched with a minimal impact on the EBS.

·     Ideal for implementation of multiple VCP modules.

·     Ideal for businesses with multiple plans running at different times.

·     Scaling up solution (such as adding new organizations, businesses) to the existing VCP instance is easy.

·     Ideal for businesses with multiple EBS instances which can be connected to a single VCP instance.

·     Can maintain multiple but not so powerful servers.

 

Cons:

 

·    Risk of facing issues related to memory.

·    Does not support different versions for planning and EBS.

·    Difficult to patch and upgrade. Upgrading VCP would be possible only when the entire instance is upgraded.

·     Limitation in terms of scalability of the solution.

·     Not ideal when multiple VCP modules have to be implemented.

·     Need to maintain huge and powerful servers.

 

Cons:

 

·     Higher investment in infrastructure and maintenance.

 

 

To conclude, a decentralized architecture is the most preferred and recommended architecture. Small organizations which could not afford multiple servers and the businesses with very limited and minimal planning requirements can choose OR start with a centralized implementation and move over to de-centralized architecture slowly.

 

For any inputs, clarifications and feedback, please feel free to write to me at mohan.chimakurthy@infosys.com. Our specialist team of VCP consultants will assist you in taking the right decisions at the right time.

December 17, 2016

Contract manufacturing and subcontracting practices: A propellant for tomorrow's world-class organizations

The dynamics in retail and consumer packed goods (CPG) industries has touched many aspects of the supply chain, and contract manufacturing is no exception to the rule. Industry players world over have leveraged this arena to its full potential, as each player focuses on its core competencies. 
Contract manufacturing can be defined as 'outsourcing of a requirement to manufacture a particular product or component to a third party.' It enables organizations to reduce the investments in their own manufacturing capabilities, helps them focus on their core competencies while retaining a high-quality product with a reasonable price, and delivered on a flexible schedule.

Continue reading " Contract manufacturing and subcontracting practices: A propellant for tomorrow's world-class organizations " »

December 1, 2016

Are you availing the benefits of international trade agreements?

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

Intrinsic trade compliance issues with SMEs

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.

Challenges

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

Mitigation

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

EU's proposal to modernize its dual-use regulation and its impact on various industries

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.

  1.         Computer and network surveillance related products
  2.         Spyware manufacturing products
  3.         Information extraction software

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

November 29, 2016

Minimizing multi-tier transportation costs with smart network routing

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:

  •        The order which is being transported from a source to a destination, may require multiple shipments through intermediate locations
  •         Different choices for intermediate locations are available between a source and destination
  •         Decisions related to routing are taken at the time of planning
  •         Order volumes can impact the routing choice

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,

Source region

Xdock

Destination region

Gujarat

Nagpur

Hyderabad

Karnataka

Rajasthan

Indore

 

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.

Region ID

Location ID

Roles

Gujarat

Anand

Ship from / ship to

Surat

Ship from / ship to

Ahmedabad

Ship from / ship to, x dock

Rajasthan

Udaipur

Ship from / ship to

Bikaner

Ship from / ship to

Jaipur

Ship from / ship to, x dock

 

Nagpur

X dock

 

Indore

X dock

 

Hyderabad

X dock

Karnataka

Mysore

Ship from / ship to

Hubli

Ship from / ship to

Bengaluru

Ship from / ship to, x dock

 

The orders and their transportation legs would be similar to the below:

Order 1

From manufacturer in Anand to consumer in Mysore

Order 2

From factory in Surat to showroom in Hubli

Order 3

From warehouse in Ahmedabad to retailer in Bengaluru

Order 4

From manufacturer in Udaipur to consumer in Bengaluru

Order 5

From factory in Bikaner to showroom in Mysore

Order 6

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:

  •      There are three orders--one is from Anand to Mysore, another from Surat to Hubli, and a third one from Ahmedabad to Bengaluru. These orders can be transported in the same route through cross- dock and the locations can be added to a single region as an efficient way of transportation planning
  •      Thus, Anand, Surat, and Ahmedabad will be configured as locations under the region of Gujarat with Ahmedabad as the cross-dock for the source location (Gujarat). And Mysore, Hubli, and Bengaluru will be under the region of Karnataka with Bengaluru as the cross-dock location for the destination (Karnataka). Similarly, for the order which should be transported from Udaipur, Bikaner and Jaipur will be the locations configured under Rajasthan region
  •       Now, for the order to flow from Gujarat to Karnataka and from Rajasthan to Karnataka; Nagpur, Indore, and Hyderabad will be taken as the three cross-dock locations
  •     So, if the itinerary leg links to a network, then OTM will use the network which has been configured for bulk planning, provided the appropriate planning parameter has also been configured

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

November 10, 2016

Supply chain visibility

OTM
Oracle Transportation Management (OTM) has provided companies the flexibility to manage all transportation related activities across supply chains on one platform. Apart from minimizing costs, optimizing service levels and providing flexible models of business process automation within their logistics networks, OTM also helps organizations in mapping their highly complex business requirements from logistics domain.

What is supply chain visibility (SCV) and what role does it play in OTM?
Supply chain visibility (SCV) is the ability of parts, components, or products in transit to be tracked from the manufacturer to their final destination. SCV's major focus is to improve and strengthen the supply chain by making data readily available to all investors - including the customer - and enabling transparency and a greater understanding of product movement and overall performance. SCV monitors and controls logistics processes more effectively by reducing inventory levels with real-time monitoring of inventory and management capabilities.

Key elements of SCV
Production
Supply
Inventory
Transportation

Production: Strategic decisions regarding production focus on customer preferences as well as demand in the market. They also analyze the type and quantity of products to be manufactured and the parts or components that should be produced, and whether they should be produced at a particular plant or outsourced to a capable supplier. They must also keep in mind production quality and the capacity of the goods to be produced that will ultimately have to meet the expectations of the customer and the market. 

Supply: An organization must select a supplier that provides the best raw materials at the best possible price. Organizations should also determine what goods their facility / facilities are able to produce both economically and efficiently so that they can maintain the availability of stocks whenever required in order to support the smooth functioning of the supply chain.
Inventory: Strategic decisions in this area always focus on inventory, particularly stock-in-hand. In SCV, this aspect is a very critical issue and determining the optimal level of stock at each location is vital in ensuring customer satisfaction as demand fluctuates.

Transportation: OTM is the world's leading transport management tool providing planning and execution solution for shippers and third-party logistics providers. A single application integrates and channelizes shipment planning, execution, freight settlement, and business process automation. OTM can be implemented for varied modes of transport, ranging from full truckloads to complex multi-leg combinations of air, rail and sea shipments. As a consequence, this tool substantially brings down transportation costs, leads to an improvement in customer service and asset utilization, and helps in delivering the benefits of a flexible solution.

Objective of SCV 
Maintaining the reliability of the supply chain is critical in ensuring that a high demand for goods percolates through at all times, as in today's competitive world, meeting deadlines and achieving customer satisfaction is of utmost importance.

Business challenges of SCV
The execution phase poses formidable challenges in terms of the entire plan. Key challenges such as order modification, shipment damage, unfavorable weather, production backlog, and similar unexpected events culminates into 'delayed shipments' and leads to serious 'supply chain issues' regardless of how robust the initial plan was. Thus, organizations constantly strive to achieve real-time tracking of their goods within the supply chain. Real-time monitoring of Goods-in-transit provides companies opportunities of identifying pertinent problems and arrive at mitigation plans for reducing their impact.
Event management through visibility: Service-level agreements (SLAs) are specified for each lane which varies from one another. These SLAs need to be monitored so that, if and when any SLA is not met, a notification is sent to the Service Provider. In order to meet this requirement, a milestone monitor is setup and configured.
The entire lifecycle of orders and shipments is managed proactively by SCV through automated milestone monitoring. When pickup confirmations have not been received within a specified tolerance interval, SCV automatically accelerates shipments and status updates are received from transportation service providers using multiple communication formats such as web, XML, or mobile telephony.

OTM and its contribution to SCV
OTM in its recent versions have helped a great deal in improving the logistics business and streamlining order fulfillment and procurement to bring down production costs and lead times. In the coming years, OTM is poised to play a significant role in determining future of logistics enterprises. Improving visibility all throughout the supply chain and removing wastages/bottlenecks shall be the key tenets of implementing OTM solution. These functionalities shall undoubtedly lead to higher levels of efficiency and effectiveness across supply chains, thus meeting the ever increasing expectations of tech savvy customers who want their orders delivered in the fastest manner possible at an optimized cost.
In a nutshell, OTM and its upgraded version have largely emphasized on:
Increasing  supply chain visibility with carrier and trading partner communications
Improving operations and network performance with embedded analytics
Reducing freight costs and increasing profit margins
Increasing customer service and supply chain reliability
Reducing supply chain and compliance risk worldwide
Outsourcing transportation, production, and warehousing that has increased unexpectedly, meeting all the challenges of SCV
To know more, please meet us at the Infosys Booth during the OTM SIG APAC 2016 Conference (Singapore) and we will be delighted to showcase our solutions.
Written by: Rachana Singh

Optimization overdrive

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.

Retailer's perspective

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:

  1.        The fresh food products need to be delivered from the vendors to the supermarkets as quickly and as efficiently as possible. Any delays from the day the food was made available by the vendor to the day it arrives in the supermarket can have significant repercussions
  2.       For the retailers, buying 3PL's transportation services should be beneficial in the long run over using their own fleet

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:

  1.         The distance between pickup locations
  2.       The requested delivery date of individual orders
  3.       The truck capacity in the available lanes

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:

  1.         The original load plan / shipment received from the upstream system considers a capacity limit of, say 4000 cubic meters, in a certain lane and the volume utilization achieved was around 82 percent. The downstream TMS can achieve a better volume utilization by upgrading a smaller truck to a larger truck and consolidating several other orders / shipments, effectively achieving a volume utilization of 98 percent. Of course, this is subject to slight changes to the original plan received from the supermarket
  2.      3PLs make the delivery to the doorstep, however, the supermarket only negotiates for the delivery to be made to their DCs. After the picking and packing is done, the supermarket has to buy the 3PL services a second time for the second leg of the movement. Instead of two shipments for the same order, a 3PL can make one delivery for a single price, thereby reducing the cost

3PL's perspective

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:

  1.       Buy the whole truckload (TL) space if it is between major cities like Sydney and Melbourne, Perth and Brisbane, etc. This is because volumes are high and relatively stable, albeit subject to seasonality issues from time to time. Additional expenses such as fuel surcharge and accessorial costs are levied on the whole truck. Individual cartons, pallets, and consignments that make up the truck do not influence the cost of a TL. The 3PL has to make sure they maintain healthy volume utilizations on these trucks. The profit and margin that the 3PL makes on each carton / pallet / consignment is directly proportional to the truck's volume / weight utilizations. So, hiring a full truckload is only practiced on lanes where the 3PL has huge volumes
  2.      Buy less than truckload (LTL): This contract is based on the consignment's volume, weight, or other dimensions. The carrier would levy an additional fuel surcharge on each consignment. The total truck's utilization does not influence the profit and margin the 3PL makes on each carton / pallet / consignment. This is adopted for home deliveries where the customer is more than happy to upgrade to an 'expedited' service or an 'air overnight' service in place of a 'general' service. It is also useful in return deliveries where products purchased earlier are being returned to the manufacturer such as when a mobile phone that is ordered online arrives home with a manufacturing defect. If it is left to the 3PL, they would choose to negotiate only LTL rates for these and many other scenarios within the city limits. But some carriers that operate in remote locations demand fresh contracts that are neither TL nor LTL
  3.      Hourly hire: Here, carrier charges are truck-agnostic, so to speak. The 3PL will be charged only after the consignment is delivered to the recipient. It is at this point that the number of hours spent in delivering the consignment are recorded and relayed back to the 3PL. Most of this is automated; for instance, the driver of the truck opens up an app to get the recipient's signature. This app records the milestone achieved (proof of delivery) and electronically submits it to the 3PL. Since all the milestones are tracked, the 3PL's TMS can ascertain the number of hours spent on the job

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:

  1.        The 3PL's TMS creates three shipments to be delivered today, tomorrow, and the day after tomorrow respectively. These shipments have the earliest start time of yesterday, today, and tomorrow respectively.  When the carrier receives these shipments, and their TMS looks up available trucks to optimize, it is limited due to the time window sanctions imposed by the 3PL's TMS system
  2.      The carriers can benefit by maximizing their volume utilization. Ideally, a carrier should be allowed to switch between small and large trucks based on the delivery time windows of the original orders. But the original orders and the original time windows are not visible to the carrier. The carrier's TMS is fed processed data from the 3PL's system

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:

  1. A single-leg voyage all the way from the port of loading to the port of discharge
  2. Multi-leg voyage with the first cross-docking at Singapore and onwards

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:

  1.         Male garments with a delivery time window of four months
  2.       Female and kids garments with a delivery time window of three months
  3.       All footwear with a delivery time window of three months
  4.       Promotional products with a delivery time window of one month (so that the products can be displayed months before release)

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:

  1.        The residual cargo carrier has enough shipments with him to load the next vessel before the original cargo carrier can place his outsource orders. Now, the original carrier has to wait for the next vessel, and if it proves to be too late, he may have to consider an aerial route
  2.       The residual cargo carrier commits to a vessel schedule but does not have enough shipments to load on board

Conclusion

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

September 8, 2016

Internet of Things (IoT) in field service management (FSM)

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 IoT explained

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.

Integrating IoT with FSM software applications

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

A 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 features:

    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

Here 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



Wind turbines: A case in point of how IoT integrates with FS systems

Failures in wind turbines interrupt power generation leading to lower productivity and higher system downtime, which result in varying energy production and higher operating costs. To maintain profit margins, higher efficiency and uptime are required.

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 **


Continue reading " Internet of Things (IoT) in field service management (FSM) " »

August 26, 2016

Optimizing Supply Chain Inventory Using Oracle Inventory Optimization

 

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.


August 17, 2016

Data transfers to / from Oracle Transportation Management

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.

int1.PNG

Exchange information from ERP systems to OTM

int2.PNG

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:

  • ·         HttpPost

o   WMServlet: Default servlet to post transmission to OTM

    http://hostname/GC3/glog.integration.servlet.WMServlet

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

     http://hostname/GC3/glog.integration.servlet.TransformerServlet

o   DirLoadServlet: Bypasses application server to upload data into OTM. This will be used when data is loaded into OTM and processed later

http://hostname/GC3/glog.integration.servlet.DirLoadServlet

  • ·       Web service: OTM supports Simple Object Access Protocol (SOAP) Web Services (IntXmlService) for inbound transmissions. The web service is deployed in the application server
  • ·         Oracle Advanced Queue (OAQ): OTM supports Oracle Advanced Queue (OAQ) for sending and receiving XML transmission to/from OTM. The advantage of using OAQ is that it guarantees message delivery.
  • ·         Manual upload: Upload the XML file from OTM's front end. This is predominantly used for testing

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:

  •            Automatically as part of workflow notifications
  •            Manual Scheduling outbound transmissions

At the same time, an external system can be configured to post data from OTM to:

  •          FTP server
  •          HTTP/HTTPS
  •          Queue
  •          Web service

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

Improve bottom-line with enhanced fleet management features

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

  •  Automatic trip assignment: Fleet drivers can play a crucial part in the overall improvement of fleet metrics. If the drivers are utilized properly, it has an overall impact on fleet operations. Oracle Fleet Management optimizes automatic trip assignment using resources available at a given time and location
  •  Comprehensive tracking of driver's performance: It is always difficult for the fleet manager to keep track of driver breaks, which could impact the time to deliver shipments. Oracle Fleet Management evaluates a driver's hours of service and calculates the breaks required for the given duration of the trip
  • Consolidation of fleet data: In an enterprise, there are multiple information systems which need to function harmoniously and efficiently. Oracle Fleet Management and Oracle Transportation Management brings all stakeholders on a single platform for better communication and visibility
  • Real-time visibility into resources and traffic: As fleet operations are geographically widespread, fleet managers find it difficult to establish communication with their drivers or locate them. Oracle Fleet Management provides real-time visibility of fleet resources via an on-board device (TOMTOM, Teletrac Navman, etc.). Through an enhanced user interface (UI), it also enables fleet managers to view the last location of the driver and current traffic conditions on a map to plan out activities in a better way
  • Compliance with rules and regulations: Rules and regulations are set by authorities to ensure driver safety primarily. According to the Federal Motor Carrier Safety Administration (FMCSA) fact file, in 2014, nearly 3,978 trucks and buses were involved in fatal crashes. The second most common cause for crashes were fatigue, illness, etc. By setting an hours of service rule and managing availability as per events for each driver, Oracle Fleet Management contributes to optimal planning, driver safety, and avoids breaches of the rules and regulations set by the country's authority
  • Reduction in manual financial settlements: The transportation of goods always involves a lot of paperwork, and maintaining finances manually is a tedious task, not to mention time consuming. Oracle Fleet Management aids in the reduction of paperwork and automatically segregates payables to drivers and external carriers, making the process transparent and reliable

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

August 13, 2016

Oracle Transportation Mobile app: A review

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.PNG

Screenshots from the OTM Mobile App

OTM Mobile app Features

Rating ( 5/ 5)

Ease of Use

5

Review Tender / Accept Tender

5

Ability to add events

5

Add Signature

5

Add Photo

5

View Contact Details

5

Ability to work offline

2

Review Invoices

0

Ability to add multiple events

0

The app gets an overall rating of 3.5/5

Written by: Vipin Kumar Madan

Designing Next Generation Supply Chain and Logistics

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.

a.png

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.

b.png
Gartner Hype Cycle 2015

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

 


August 12, 2016

The Global Impact of TPP and Oracle GTM's Adaptability

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:

          -          Comprehensive market access
    -          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.

gtm3.png

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.

gtm4.PNG

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

Infosys Edge: Plug-Tune-Play Oracle GTM Solution

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

Country-specific requirements

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.

 

GTM_pic1 (1).jpg
Written by: Ravikiran Narayan Khobragade and Mohammad Haider Talat