Transcript OTM webcast - Transportation Challenges 2008

Agenda
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Today’s Challenges
Best In Class Performance
Achieve Best-In-Class Capability with OTM
Questions
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Supply Chain Disruptions
• Global outsourcing, less predictable lead times, and vulnerability to
supply chain shocks are the top challenges to manufacturers RSAG Research
• Other possible supply chain disruptions
– Security threats to airports, ports and critical supply chain nodes
– Natural Disasters
– Port Disruptions
– Aging and congested transportation infrastructure
• Accenture study found 73% of companies have experienced a
disruption in the last 6 years
How Do You Respond?
• Increase agility needed for flexible execution
• Utilize intelligent alerts that provide notification to adverse events
• Perform what if analysis to evaluate alternate shipment methods, routes
and develop contingency plans for supply chain disruptions
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Limited Visibility &
Manual Processes
Carriers
Shippers
Planning
Warehouses / 3PLs
Customers /
Suppliers
Execution
Fragmented Communication and Visibility
Multiple,
Non-Integrated
Systems
Manual
Processes
Fragmented Visibility to Shipments and Manual Labor Intensive Processes
Results in reactive issue resolution that increases the need for expedited shipments
How Do You Respond?
• Automate manual tasks and proactively monitor shipments and manage by exception
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Increasing Customer
Expectations
“Effective transportation management involves overcoming a
host of real challenges and ever increasing customer
expectations for smaller and more frequent delivery times.”
Aberdeen
Customers want increased global order promise accuracy
How Do You Respond?
• Utilize a Transportation Management System to manage
more frequent deliveries with consolidated shipments
• Increase visibility to shipments in order to improve lead
time reliability and reduce inventory levels
• Allocate freight costs to orders to gain visibility to customer
profitability
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Volatile Fuel Costs
Primary component of
freight cost has more
than quadrupled in the
last 6 years and nearly
doubled in the last year
How Do You
Respond?
•Consolidate and
optimize freight
•Mode shift and consider
alternative routings
•Re-evaluate your supply
chain network
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Green Initiatives Impact
Key Drivers of Green Initiatives (2008 eyefortransport Green Transportation Report)
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Desire to Improve Customer and Public Relations
Want to Decrease Fuel Costs
Part of their Corporate Responsibility Agenda
Financial Return on Investment (ROI)
“Both competitive pressure and marketplace perceptions will drive every
major company to factor sustainability into their supply chain equations”
How Do You Respond?
Inbound Logistics
Institute sustainable transport policies
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Measure and Reduce your Emissions
Use more environmentally friendly logistics providers
Optimize your routing and consolidate freight to reduce miles driven
Automate tasks and communications to reduce paper consumption
Enact energy conservation strategies (Reduce, Re-use and Recycle)
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Impact of Challenges
Suppliers
• Supply chain disruptions
• Limited visibility and
Margin Pressure
manual processes
• Increasing customer
expectations
• Volatile fuel costs
• Green initiatives
Your
Company
Customers
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• Where can I
reduce costs?
• How do I
differentiate my
logistics offerings?
Best in Class Performance
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What Are Industry Leaders Doing?
• Focus on maximizing profitability rather than just
minimizing costs
• Make transportation decisions with overall supply
chain performance in mind
• Access to timely and accurate data concerning
their performance
• Utilize a Transportation Management System such
as Oracle Transportation Management (OTM)
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Industry Leaders Performance
Definition of Best in Class Aberdeen Group - Integrated Transportation Mgmt.
• Top 20% of companies
• Reduce freight spend relative to revenues yearover-year
• Greater than 97% on-time delivery performance
• Achieve higher earnings (EBIT) averaging 14%
versus 6% for industry laggards
• Possess a holistic view of their end-to-end
processes
• Achieve better performance at lower costs
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Achieve Best-In-Class Shipment
Lifecycle Capability with OTM
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Streamline Processes
Achieve Best-In-Class Shipment Lifecycle Capability with OTM
Freight Payment,
Billing & Claims
Procurement
Collaboration
& Optimization
Order-Shipment Lifecycle
Reporting &
Document
Generation
Performance &
Financial Analysis
Supply Chain
Event Mgmt
Global In-Transit
Inventory
Visibility
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Logistics
Order
Management
Shipment
Planning &
Optimization
Shipment
Execution
Streamline Processes
Achieve Best-In-Class Shipment Lifecycle Capability with OTM
Freight Payment,
Billing & Claims
Procurement
Collaboration
& Optimization
Order-Shipment Lifecycle
Reporting &
Document
Generation
Performance &
Financial Analysis
Supply Chain
Event Mgmt
Global In-Transit
Inventory
Visibility
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Logistics
Order
Management
Shipment
Planning &
Optimization
Shipment
Execution
Procurement Collaboration
and Optimization
Solicit carrier bids, Optimize awards, Issue contracts
Your Company
Carriers
Oracle Global Logistics
• Orders
Receive • Lane Forecasts
Demand
Bid
Initiation
• Assess the financial
impact of proposed rate
changes before rates
are awarded
Bid Packet
Optimized Award
Recommendation
Accept
Quote
Analysis
• Evaluate multiple award
scenarios based on
cost, service and
performance
Quotes
Contract
Load Execution
Environment
Award
Notice
Selected
Carrier
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• Electronically send
out bid packages using
real history, forecasts
and actual orders
• Automate transportation
rate uploads into OTM
Procurement Collaboration
Bidding Results
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Streamline Processes
Achieve Best-In-Class Shipment Lifecycle Capability with OTM
Freight Payment,
Billing & Claims
Procurement
Collaboration
& Optimization
Order-Shipment Lifecycle
Reporting &
Document
Generation
Performance &
Financial Analysis
Supply Chain
Event Mgmt
Global In-Transit
Inventory
Visibility
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Logistics
Order
Management
Shipment
Planning &
Optimization
Shipment
Execution
Logistics Order Management
Order Entry
• Freight Choices
• Transit Time
• Routing Guides
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Plan both Purchase Orders for pick up & Sales Orders for delivery
Quote freight options during order capture process
Accurately promise deliveries based on inventory & transit times
Allow routing guides to select carrier based on rules
Allocate costs of complex routings to order lines & determine customer
freight charges based on the allocations
• React quickly to changes in order sizes, cancellations, or delivery dates
with rapid, continuous re-planning capabilities
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Streamline Processes
Achieve Best-In-Class Shipment Lifecycle Capability with OTM
Freight Payment,
Billing & Claims
Procurement
Collaboration
& Optimization
Order-Shipment Lifecycle
Reporting &
Document
Generation
Performance &
Financial Analysis
Supply Chain
Event Mgmt
Global In-Transit
Inventory
Visibility
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Logistics
Order
Management
Shipment
Planning &
Optimization
Shipment
Execution
Shipment Planning & Optimization
Inputs optimized for lowest delivered cost while
accommodating business rules and constraints
• Consolidate loads by leveraging pooling, cross-docking, or multi-stop routes
• Streamline carrier selection & route optimization from item availability to final delivery
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Shipment Planning Results
• Planning
results capture
statistics such
as total cost,
weight, volume
and distance
• Graphical view
of results
broken down
by carrier and
mode.
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Streamline Processes
Achieve Best-In-Class Shipment Lifecycle Capability with OTM
Freight Payment,
Billing & Claims
Procurement
Collaboration
& Optimization
Order-Shipment Lifecycle
Reporting &
Document
Generation
Performance &
Financial Analysis
Supply Chain
Event Mgmt
Global In-Transit
Inventory
Visibility
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Logistics
Order
Management
Shipment
Planning &
Optimization
Shipment
Execution
Shipment Execution
Your
Company
Review &
Approve
Shipment
Tender
Service
Provider
Accept
Tender
Pick-up
Transport
Deliver
Message: Picked-up
Message: En route
Message: Delivered
• Automatically tender shipments eliminating delays from manual processes
• Receive shipment status and delivery confirmation
• Communicate with carriers through the internet, wireless device or electronically
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Streamline Processes
Achieve Best-In-Class Shipment Lifecycle Capability with OTM
Freight Payment,
Billing & Claims
Procurement
Collaboration
& Optimization
Order-Shipment Lifecycle
Reporting &
Document
Generation
Performance &
Financial Analysis
Supply Chain
Event Mgmt
Global In-Transit
Inventory
Visibility
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Logistics
Order
Management
Shipment
Planning &
Optimization
Shipment
Execution
Global In-Transit Inventory
• On hand as well as in-transit inventory visibility
and management down to the SKU level
• Facilitates Vendor Managed Inventory (VMI)
• Inventory data by supplier, owner, warehouse,
quantity on hand, aging and description
• Employee, supplier and customer notifications for
changes in quantity on-hand or re-order points
• Increases inventory reliability and reduces the
days of inventory on hand
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Streamline Processes
Achieve Best-In-Class Shipment Lifecycle Capability with OTM
Freight Payment,
Billing & Claims
Procurement
Collaboration
& Optimization
Order-Shipment Lifecycle
Reporting &
Document
Generation
Performance &
Financial Analysis
Supply Chain
Event Mgmt
Global In-Transit
Inventory
Visibility
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Logistics
Order
Management
Shipment
Planning &
Optimization
Shipment
Execution
Supply Chain Event Management
• Agents automate business processes and notify
involved parties to events
• Reduce non-value-added manual activities
• React to potential issues - before they occur
• Automate decisions where appropriate
• Send proactive notifications
• Monitor escalated issues
• Utilize role based alerting so the right people are
notified of exceptions
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Streamline Processes
Achieve Best-In-Class Shipment Lifecycle Capability with OTM
Freight Payment,
Billing & Claims
Procurement
Collaboration
& Optimization
Order-Shipment Lifecycle
Reporting &
Document
Generation
Performance &
Financial Analysis
Supply Chain
Event Mgmt
Global In-Transit
Inventory
Visibility
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Logistics
Order
Management
Shipment
Planning &
Optimization
Shipment
Execution
OTM Reports and Documents
Reports
• Activity
• Carrier Delivery
• Carrier Capacity
• Carrier Commitment
• Cost Savings
• Event Reason
• Freight Payment
• In Transit Inventory
• Inventory Visibility
• LTL Trailer Building
• Order Financial
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Planned versus Actual
Projected Late Orders
Purchase Order
Shipments by Carrier
Tenders Declined by Lane
Documents
• Bill of Lading
• Commercial Invoice
• Packing List
• Transmittal Letter
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Streamline Processes
Achieve Best-In-Class Shipment Lifecycle Capability with OTM
Freight Payment,
Billing & Claims
Procurement
Collaboration
& Optimization
Order-Shipment Lifecycle
Reporting &
Document
Generation
Performance &
Financial Analysis
Supply Chain
Event Mgmt
Global In-Transit
Inventory
Visibility
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Logistics
Order
Management
Shipment
Planning &
Optimization
Shipment
Execution
Freight Payment & Billing
Automate Freight Settlement
Shippers /
Customers
Invoices
only for
additional
charges
Auto-Pay
Carriers
Pay based on
actual shipment
activity and
contract rates
• Intra-company cost
transparency
Payments
• Allocate costs
to orders & order
lines for billing
• Calculate profit
margin for each
shipment
• AR & AP Vouchers
• Allocated costs
Financial System
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Bills
via web
or
integration
Payments
Streamline Processes
Achieve Best-In-Class Shipment Lifecycle Capability with OTM
Freight Payment,
Billing & Claims
Procurement
Collaboration
& Optimization
Logistics
Order
Management
Order-Shipment Lifecycle
Reporting &
Document
Generation
Performance &
Financial Analysis
Supply Chain
Event Mgmt
Global In-Transit
Inventory
Visibility
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Shipment
Planning &
Optimization
Shipment
Execution
Performance & Financial Analysis
• Key Performance Indicators based reporting
• Quick visual status of performance such as:
freight cost per mode, cost per mile, trailer
utilization and on-time arrival rates
• Drill-down into graphs for trend and variability
• Monitor carrier performance and EPA SmartWay
progress
• Analyze lanes that have high costs and target them
for improvement
• Drives Continuous Improvement
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Monitor Goals &
Improve Performance
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Drill Into Details to Identify
Trends and Variability
Multiple dashboards
Weight shipped by
mode of transport
Drill to transaction
shipment details
TMS Value Proposition
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Transportation Cost Savings
Forrester Research reports TMS savings of 8%
year over year from the following benefits:
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OTM Sole Leader
• “Oracle scored
the highest
relative to its
competitors
across ground
transportation
planning, freight
payment,
multimodal
transportation,
product strategy
and vision."
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OTM Leader in Gartner Report
• “OTM balances deep
functionality with ease of
use, which appeals to a
broad array of
customers.”
• “OTM provides credible
and powerful capabilities
across the TMS
functional spectrum,
with notable depth of
functionality in
international logistics for
which global visibility is
important.”
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Case New Holland
CUSTOMER PERSPECTIVE
“CNH embraced an aggressive plan to
insource its N. American logistics operation
and gain control of its global inbound
transportation within a year. With the
partnership of Oracle and the
implementation of Oracle Transportation
Mgmt, this plan was successfully executed.”
-- Kathy Acker, IT Director
COMPANY OVERVIEW
• World leader in the agricultural and
construction equipment
businesses
• $13B in revenues with 30
manufacturing sites and over 25k
employees
• Products sold in 160 countries
through more than 11k dealers
and distributors
• Brought transportation operations
in-house to reduce costs and
increase visibility
RESULTS
• Lowered transaction, headcount, and
carrier selection costs
• Improved visibility to suppliers, shipment
data, freight rates & payments, damage
claims, and dealer destination charges
• Retired legacy system in Europe
• Live in United States and Europe less
than 6 months after selection
SOLUTION
• Live on Oracle Transportation
Management, future integration to SAP
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In Summary: Transforming
Transportation In Your Organization
 Optimize and automate transportation processes
utilizing OTM
 Collaborate with carriers, suppliers and customers to
create more economical processes
 Benchmark metrics, establish objectives for success
and monitor with OTM’s Transportation Intelligence
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Complimentary Assessment
 Contact Emerging Solutions for a
complimentary Transportation
Value Assessment
 Utilizes proven analytical tools and
our extensive industry expertise to
identify quantifiable improvements
in your transportation operations
and to your bottom line.
www.emergenow.com/transportation-assessment
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Questions and
Answers
Additional
Questions?
Contact
Brian Hamrock
[email protected]
www.emergenow.com
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