March 2001 | Commentary | Supply Chain Technology

Leading Logistics to the Fourth Dimension

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This past year has brought growth, mergers, and a steady move toward collaboration among supply chain suppliers and users. The supply chain community is growing up—and boldly—in a not-so-confident e-commerce world. There is a big difference between B2B supply chain organizations and standard fly-by-the-seat-of-the-pants e-commerce companies. The strong will survive and the poorly thought through will turn in their Palm Pilots.

One of the strong has participated in all the major trends—growth, mergers, collaboration—of the past year. That company is the multi-billion-dollar NOL Group of Singapore. Its supply chain management arm, APL Logistics, has just completed a major merger by acquiring GATX Logistics. The merger immediately established APL Logistics as a player of real rank. But it is strategy, led by Richard Metzler, CEO of APL Logistics, that is moving the company ahead.

Part of Metzler's strategy consists of growing the supply chain side of the business "to rival the revenues of the liner business in the near term." By the books, NOL has been 80 percent liner shipping and 10 percent logistics. Metzler and company want to build another new business—logistics IT—that is 80 percent.

The Fourth Dimension

"I see companies that focus on one small aspect of the supply chain, such as trucking or warehousing, as one-dimensional," Metzler says. "IT linkages can make them three-dimensional.

"I want to take APL Logistics to a fourth dimension by listening to customers, using creative thinking, taking a lateral approach, and creating innovative solutions," he says. "We are looking at plug-and-play systems that are not legacy based or unique to a company; systems that are easy for supply chain partners to use."

Interviews with APL Logistics customers reveal that they want logistics providers to proactively manage exceptions, to do things differently, and to interface on an end-to-end basis—from sourcing and product development to finished goods. Customers also are looking for providers that offer not just information, but time-definite services and predictability, Metzler notes.

Two parts of Metzler's business strategy are tools for customers:

  • Basic visibility— Visibility of a global nature, involving multi carriers in an open architecture.
  • Monitoring— The ability to deal with historical trends, and being able to plan through a predictive modeling engine.

Two other strategies that customers outsource to APL Logistics:

  • Event management using customer business rules and economic objectives.
  • Collaboration— hundreds of factories and retailers work together in a time-definite way for maximum efficiency.

To address visibility and monitoring, APL Logistics offers NetTrac technology. NetTrac lets customers track merchandise by shipment or purchase order as it moves through the supply chain. The information can relate to a shipment's movement at any time, and anywhere, and can be independent of whether APL Logistics physically handles it or not.

NetTrac is an inventory tool that resides on the customer's desktop. It allows for real-time access of shipment information through the web. In addition, NetTrac offers SKU product visibility, management by exception, tracking of milestones the customer wants to monitor, an archival data history going back two years, and unlimited access for the customer.

As an inventory tool, NetTrac gives users access to customized fields that include a customer PO number, carrier bill of lading and container number, and a unique product code. Customers can review shipments, logistics or merchandising reports, or export information to applications such as Excel or Dbase4.

NetTrac's exception management capability makes it possible for users to respond to these situations early.

There is high security for the database because it is built within the company's own firewall. Users also must register and receive their own ID numbers.

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