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Utilizing eCRM, Supply Chain, Novell eDirectory™, and Security Solutions in the Transportation Sector Lawrence Rosenshein Senior Digital Business Strategist Strategic Services Group Novell, Inc. Lawrence.Rosenshein@novell.com Charles Radi Strategic Services Group Novell, Inc. Charles.Radi@novell.com
“If you don’t know where you’re going you might end up somewhere else.” Yogi Berra
Objectives • one Net Overview • Forces Driving the Transportation Industry • Current developments in Transportation • Ocean Shipping Industry as metaphor • A Multi-Modal Transportation Provider • A Novell Case Study
Agenda one Net Overview
Vision…one Net A world where networks of all types—corporate and public, intranets, extranets, and the Internet—work together as one Net and securely connect employees, customers, suppliers, and partners across organizational boundaries Mission To solve complex business and technical challenges with Net business solutions that enable people, processes, and systems to work together and our customers to profit from the opportunities of a networked world
The Network Becomes the Business The extraction of business value from the new realities of scale, speed, technology, customer power, and other fundamentals of the business context today; the strategic challenge. The development of new tools, including supply chain and knowledge management, to transform digital information into actionable knowledge The interconnection of digital elements (the communications revolution), using technologies such as wireless. Soon we will have a billion personal computers, three billion mobile phones connected to the Internet, and sixteen billion embedded processors connected to the Internet The fundamental shift from analog to digital (the computing revolution).
Automated, networked business models Network-based applications E-markets Enterprise portals Web front-ends to client-server apps Inter-enterprise integration Client-server Enterprise integration ERP Application integration The Vision: Content and Context Becomes Embedded in the Network Physical to Logical • Automate and integrate new collaborative business models • Reuse of data across various application 1990 2001 2010 Source: Bowstreet and Cambridge Technology Partners
Low Loosely coupled SOAP,UDDI, WSDL Web Services Architecture cXML, RosettaNet XML Based B2B Interaction Tightly Coupled, monolithic J2EE-EJB, COM+ Degree of system Coupling Static Web based Applications Some Dynamic BindingTechnology Dependantwith interoperable elements Client Server Applications Corba, COM/DCOM Tightly Coupled Technology Dependant IDL driven Mainframe Based Applications High Low Flexibility of Solution High
The Internet Is Infrastructure • The Internet is infrastructure, like roads or lighthouses, which benefits everyone but no one company in particular • Standards are extending now from the physical and technical to the logical and business layers • We’re building the logical infrastructure on top of the physical infrastructure
Transportation Is in the Forefront • The next wave is machines talking to machines • Networked business models will become reality • Best of breed outsourcing and coupling • Business processes will be re-built • Bottom-up approach • Loosely coupled (and de-coupled) web services • Dynamically done based on real-time needs • Cost structures can be greatly reduced
Agenda Forces Driving the Transportation Sector
Forces Driving the New EconomyNearly Every Industry Is Affected • Globalization of markets • Deregulation and privatization of markets • Disinflationary economies, coupled with capital abundance • Consumer power • Disintermediation of non-value added channels • Products become content-rich vs. engineering rich • Consumers break traditional brick and mortar rules • Communications ubiquity • Heightened emphasis on innovation
New Economy Businesses Are Driven by Six Characteristics • Scale—coalition of independent entities • Speed—velocity is changing market behavior • Technology—rapid assimilation of new capabilities • Customer-Centricity—they measure your loyalty • Intellectual Capital—putting a price on brains • Trust—yours to lose The best of today’s players in the new economy excel at all six. *see Cambridge’s New Economy Primer, Redefining Customer Acquisition, Business Models for the New Economy, and Creating Value Through Innovation for more information on Cambridge thought leadership
These Characteristics Have Organizational Implications • Smart scaling requires an open organization and a relentless quest for competencies and partnerships • Velocity of markets requires focus and flexibility • Technology innovation requires an adaptive culture and cooperation between the business and ‘IT’ • Customer centric reverse markets require highly informed, motivated, and empowered employees • Intellectual capital requires fostering innovation • Trust must be embedded in the organization These features must be built into New Economy Business models
Digital Economy Competitive Arena Organization Context for Analysis • The Internet affects all aspects of a business • The internal operations of a company, focussing on reducing costs, and managing existing operations more effectively • The industry in which the company operates; competitors attempting to gain market share through new ways of doing business. • The contextual environment affects all industries—new competitors can come from anywhere
…to an “Integrated Value Chain” of Customers, Partners and Suppliers... eMarket eVolution a “Virtual Value Chain” of Networked Business Models connected by B2B Electronic Markets. From an “Inside the 4 Walls” focus on efficiency…. Fundamental Shifts are Occurring across the Value Chain in all Industries!
Ariba CommerceOne GM Chevron Broadvision Vignette Cisco Dell Buy Side eCommerce Sell Side eCommerce S B S S SCM CRM B S B S B B Bringing Internet efficiencies to Enterprise applications • Extensions of an established model • Value is based on productivity improvement • No disruption in the power hierarchy • Savings are used to reinforce existing businesses • Continuation of the client/server revolution eVolution of B2B eCommerce Source: The Chasm Group
Procurement Portals Distribution Portals Buy Side eCommerce Sell Side eCommerce s b B s b s b PP B s b s b B S S S s b s b DP s b • Moderately new model • Transaction fees are shared • Domain expertise is key for sell side • Unified infrastructure is key for buy side • Value is based on market efficiency • Some disruption in the power hierarchy • Non-value-adding brokers most at risk Using the Internet to Aggregate eVolution of B2B eCommerce Portals Automotive Aerospace Petrochemical PC Industry Buy.com Metalsite Grainger.com Source: The Chasm Group
Procurement Portals Distribution Portals Buy Side eCommerce Sell Side eCommerce eMarkets B S • Imposing a wholly new model • Professional services firms and Applications and infrastructure are an enabler • Market-maker transaction services rule • Value is based on displacing incumbents • Total disruption in the power hierarchy • Savings are used to attack existing businesses S B s b X b s b s Making a market for a product or service B S s b S B eVolution of B2B eMarkets Ariba (Tradex) CommerceOne (MarketSite) Altra Energy Chemdex SciQuest Source: The Chasm Group
Move towards Collaborative Commerce: Shared, essential business processes which facilitate commerce Demand and Supply Chain Collaborations Industry Collaboration “Hub” Parts Data Management Design Collaboration Direct eProcurement B2B eMarkets Indirect eProcurement eMarkets OverviewEvolution of Services • Synchronize operations within a company’s demand and supply chain • Synchronize operations across entire industry value chains Source: MSDW 2000
Strategy Today • Strategy in today’s business environment is complex and subject to rapid change • How can businesses create (and attempt to sustain) competitive advantage to become successful, high performance organizations exploiting distinctive competencies?
Strategy Is All About Activity Choice • Shall we perform activities similar to those of our rivals? • The same as competitors • Better than competitors • In different ways than competitors • Shall we perform different activities from rivals? Your biggest competition will not come from someone doing things better than you, but from someone doing things different than you. --Michael Bloomberg, CEO Bloomberg
Transform businesses Extend core business Horizon 3 Support core business Horizon 2 Horizon 1 Reduce transaction costs and increase efficiencies Existing products to existing customers New customers New products and services New delivery approaches New geographies Enterprise level models New business models Support, Extend, or Transform? The difference between supporting a core business and a business transformation is the difference between a technology point solution and a developed technology strategy
Agenda Current Developments in the Ocean Shipping Industry
Shipping Logistics SCM The TransitionCustomer Expectations • Performing a business function (shipping) • to providing services (logistics management) • to a complete end-to-end customer solution (integrated supply chain management-SCM-leveraging appropriate technologies over the internet)
Shipping Logistics SCM The TransitionWhy It’s Happening • The New Economy values intellectual capital over material capital - the Internet enables the transition • The Internet is ubiquitous…it evens the playing field • The Internet shifts power in the industry from those that best manage hard assets, to those that best manage the information associated with hard assets • Information allows better management decisions, both internally (business operations) and externally (business model analysis); information that enables better management decisions commands a premium in the market and, in turn, commoditizes hard assets • Doing things right does not matter if you’re not doing the right things
Shipping Logistics SCM The Transition Shipping—The Material Assets • Shipping allows companies to move product from one point to another • Flexibility in scheduling, quality of service, and the general level of perceived value are all components of how customers evaluate their shipping partners • Shipping is a business function, associated with logistics management, as part of the customers’ management of their supply chains
The Transition Logistics—Managing the Assets’ Information • Logistics is a process which interfaces and interacts with the entire company and with external companies, vendors, customers, carriers and more • Logistics is responsible for the movement of products from your vendors right through to the delivery at your customer's door, including moves through manufacturing facilities, warehouses, third-parties, such as repackagers or distributors • It is not shipping and receiving, nor is it traffic or warehousing...it is much more Shipping Logistics SCM
Movement of product—Shipping Company core business The new battleground The Transition Logistics—The Five Components • Movement of information—Information-timely and accurate—is vital for sound decision-making • Time/service—The ability to respond to the dynamics of the global marketplace • Cost—often the key metric by which logistics effectiveness is measured. • Integration—within your company, between you and your customers, between you and your vendors, across your supply chain, across the industry’s value chain Shipping Logistics SCM
The Transition: Customer Solutions—End-to-End Supply Chain Management • Customer solutions offer competitive advantage • The industry is shifting to a focus on complete customer solutions • Few companies will be able to provide world-class end-to-end supply chain solutions • A complete solution will be made up of a tightly integrated group of partnerships and alliances • A companies’ value will be measured by how well they perform their particular activities but also, how well they coordinate with their partners in providing the customer with a complete supply chain solution Shipping Logistics SCM
The Transition Supply Chain Management Trends • Companies are demanding supply chain transparency • Especially in the retail industries, fulfillment of orders, both customer facing and sourcing needs can be a competitive advantage • SC transparency allows for more accurate planning and forecasting • Collaborative Planning, Forecasting and Replenishment (CPFR) capability for companies relies on information in the supply chain; the better the information, the better the management tool • “You can funnel virtually your entire supply chain through the Internet, and everybody ends up winning”—Ernie Heether, SVP Merchandise Operations, K-Mart Corporation Shipping Logistics SCM
eBusiness • Managing Multiple Processes Across Multiple Enterprises • Channel Disruption and Dis-Intermediation Occurring • Speed, Knowledge, Information and Agility • Planning Across Entire Supply Chain Community • Simultaneous Planning and Execution • Process Knowledge and Information • Days and Weeks • Is the low-cost medium • Customer The Transition eBusiness Changing SCM Area Industrial Age • Managing Multiple Processes Within The Enterprise Scope of Supply Chain Mgmt • Predictable and Consistent Supply Chain Process Behavior Competitive Advantage • Physical Assets and Cost • Enterprise-Centric, Clear Lines Of Delineation And Execution Planning Assets • Physical Cycles of Change • Months and Years Internet Utilization • Channel Supply Chain Focus • Costs and Asset Utilization Source: Achieving Supply Chain Excellence Through Technology AMR Research 1999 Shipping Logistics SCM
Channel RetailersDistributors Wholesalers Customers The TransitionValue Chain Opportunities Suppliers E-Customer Strategic - Tier 1 Synchronized Production Scheduling e-Relationships/e-Orders Supplier A Supplier B Manufacturer Non-strategic - Tier 2 Supplier X Collaborative Product Design& Development Collaborative Demand Planning Supplier Y Collaborative Logistics Planning e-Fulfillment Transportation Services Distribution Center Services E-Procurement and Strategic Sourcing Shipping Logistics SCM
Competitive Environment • Three types of Ocean Carrier Competitors • Existing competitors that attempt to use the internet to perform traditional functions better than competitors (support existing businesses) • Existing competitors that leverage the internet to offer additional services across the spectrum of the supply chain (extend existing businesses) • New entrants and existing competitors leveraging the internet to change traditional business models and develop new ones (transform existing businesses)
Fed Ex LogisticsVision • “FedEx Logistics will be acknowledged world leader in global integrated logistics management, supply chain solutions and time delivery. Our motivated associates will forge mutually profitable partnerships with our customers using world class technology and business practices.”
Agenda • A Multi-Modal Transportation Provider • A Novell Case Study of Client X
One of the Largest Latin American Transportation Providers • Founded in mid-’50s • Integral part of NAFTA success • Now a Novell Client
Strategic Vision Statement “Integrated door-to-door-all-in logistics multimodal transportation services providing one-stop-shop master-contractor convenience to its clients.”
Project Overview—PDW/PEW • Objective • Define the digital product that will support the requirements given by the first set of customers in terms of functionality, technical architecture and look and feel (User Experience). As part of the project the multidisplinary team will also evaluate the technical tools, packages and plataforms that will support X’s Logistics Group • To achieve the objective the following tasks were performed: • Definition of the high level business processes • Definition of the functional requirements and prioritization of them • Definition of the future state architecture • Definition of the User Experience or Visual Architecture • Technology evaluation to select the players for the final platform
Project Overview • Deliverables • High Level business processes • Functional Requirements (through the functionality matrix) • Future State eBusiness Architecture • Visual Architecture (including storyboard) • Packages’ evaluation and possible scenarios • High level gap analysis • Final Presentation
Client X Customers Novell High Level ProcessProduct Definition Workshop (PDW) Focus groups needs understanding Through interviews with external and internal users Functionality Definition and Priorization Based on the focus groups and prioritizing for short term business benefits Needs and Requeriments Technical Architecture Definition Logical and Physical for the whole platform and points of integration Client X and Functional understanding Newco High-Level Processes Definition To interact with the customers and with Client X Including an electronic storyboard to show de look and feel Visual Architecture Definition Methodology and industry expertice
High Level ProcessPackage Evaluation Workshop (PEW) Short vendors list creation Based on the previous research performed and the technical, functional and visual requirements Previous research on technologies RFI Creation for technology evaluation To be distributed among the vendors in the short list Functionality Definition Qualification criteria definition To determine the weights for each item and the mechanics of the evaluation Vendors corporate presentations Technical Architecture Definition Where the vendors will present their corporations and try to show the technologies capabilities Technology implementators research To assure the feasibility of the final implementation Visual Architecture Definition Where we’ll reach consensus among X’s representatives as of what is(are) the best technology(ies) Final Evaluation Process
The Results—High Level Processes Processes Defined Transportation Multimodal Multisegment Multicarrier (TMMM) Total Transportation Management (TTM) Dedicated Contract Carriage (DCC) Warehouse Management (WMS) Yard Management (YMS) Specialized Maritime (Car Carriers) Functions covered Customer Setup Order Entry Order management Execution Track & Trace Billing Customer Service
Technical Architecture TrackProcess and Activities • Facilitated sessions, between Client X Logistics And Novell, led to: • Definition of the logical technical architecture • Definition of the physical technical architecture • Inventory of system interfaces • Definition of design, development, test and production environment infrastructure requirements • Definition of the technology package requirements of the systems involved(specifically EAI Tools) • Technology package recommendations (short list of up to three (3) packages) • Short list of ISP and managed hosting services vendors (up to three (3))
High Level Architecture ViewWhat Is an eBusiness Enterprise Architecture? • The “Blueprint” for building value-added business applications that enable the delivery of eBusiness services to customers, partners, suppliers, and employees • Provides the foundation of Core Services and processes to extend the enterprise as determined by true business value • These processes are both inter-company and intra-company, and can leverage the information collected from any application or system • The goal of an eBusiness Enterprise Architecture is to create the optimal environment for the support of a company’s competitive advantage