Being aware of your partners’ capabilities is the basis to achieve the most of your own ICT systems and accomplish a full integration
Identification of e-logistics applications of partners facilitates integration and coordination, which are key factors in supply chain management.
Any company in the transport and logistics domain can benefit from the implementation of this practice, from manufacturers, good owners and shippers, to transportation companies in all modes, freight forwarders and integrators, terminal operators at rail, sea and inland port and intermodal terminals, since it contributes to improve information flow and processes along supply chain. No matter the size of the enterprise, or its role in the supply chain, this practice is suitable for adoption and brings clear advantages.
Successful supply chain management requires cross-functional and inter-organizational integration, and information systems play a critical role.
During the past decades, globalization, outsourcing and information technology have enabled many organizations to successfully operate solid collaborative supply networks in which each specialized business partner focuses on only a few key strategic activities. This inter-organizational supply network can be acknowledged as a new form of organization. However, interactions among the players are so complicated that it is difficult to understand or foresee how any different supply network structure could impact on the firms performance. Similarly, the coordination conditions, particularly in the information flow context, are quite obscure.
A best practice for supply chain integration comes from the methodology developed within the KOMODA project.
Here, each transport or logistics agent within a supply chain knows in depth his partners’ capabilities from different perspectives, mainly from the information point of view (what data they have and, more important, what data they may provide) and in terms of ICT systems. The following features have in particular to be taken into account:
- Role of the logistics application: strategic, functional or operational. Knowing the functional areas affected by the application will help to analyse the possibilities of integration.
- Tacit areas of activity: particular activities and information provided by the application, e.g. inventory, orders, resources, etc.
- The business entities surveyed: manufacturers, distributors, retailers…. The business entity type may lead to different kinds of information.
- Scope of the application results: all the products, particular families or sectors, functional area within the company…
- Complementary technology/systems required: other applications needed to run the main application, system requirements, etc.
- Available interfaces. The communications channels and protocols are a key factor to success in the ICT systems integration.
- International standards used by the ICT systems. Knowing the compliance to international standards (e.g. EDI compliant) and being aware of the certifications from main ICT systems providers, software and hardware, that the partners have (e.g. ISO 27001, ISO 20000), are a guarantee of success.
Gathering and analysing this information is the basis for developing a robust integration in a long term. Based on the result, it is possible to propose areas of integration between supply chain members and changes in work procedures, with great improvements in the global chain efficiency.
Do you know the capabilities of your partner’s ICT systems? Have you ever experienced the need to know more about them? Have you ever got frustrated due to a lack of information?