Logistics Enterprise Resource Planning in the cloud

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2 Logistics Enterprise Resource Planning in the cloud An opportunity for opening up new markets in a globalized world Jan Andreas Daske, Gunter Teichmann SALT Solutions GmbH

3 Agenda SALT Solutions a brief introduction What exactly is "cloud computing"? Some different approaches and our conclusion What does it mean in context of logistics? Virtualization of real world services Transformation of classical IT systems Enterprise Resource Planning in the cloud Chances and Challenges State of technology and science What s the right roadmap? 3

4 SALT Solutions GmbH Profile Founding 06/2002 Locations Employees (effective ) Equity Equity ratio Dresden, Düsseldorf, Oberpfaffenhofen, Würzburg 270 (full time) 4,8 Mio Euro 50 percent General Managers Dr. Bernhard Blüthner and Associates Business Areas Dieter Heyde Markus Honold Production Logistics Retail 4

5 Our concept Production Logistics Retail Process design and IT-solutions along the value chain Experienced operating department and IT consulting services Proven international project expertise Life-time Application Management and Support Certifications: ISO 9001, SAP AMS 5

6 Who we are: Jan Daske Head of Business Development Gunter Teichmann Head of Research & Development 6

7 Cloud computing What exactly is it? Four deployment models Three service models? Five essential characteristics 7

8 Software Software Software Software Software Software Software Software Software Three service models Middleware / OS SaaS Server & storage platform Server & storage platform Infrastructure (datacenter) Server & storage platform PaaS IaaS 8 8

9 Four deployment models source: Wikipedia,

10 Conclusion source: Wikipedia,

11 Software Software Software Software Software Software Software Software Software Our Conclusion: Four service models Content, collaboration, communication, finance, Middleware / OS SaaS XaaS Server & storage platform Server & storage platform Infrastructure (datacenter) Server & storage platform PaaS IaaS 11 11

12 What does it mean in context of logistics? Logistics industry has been an early adopter of internet technology (telematics solutions, fleet management systems, track&trace systems, ) The internet becomes an internet of things and services. That is nothing else than logistics. Logistics is particularly strong driven by globalization related changes: think global, act local

13 The challenge in logistics Producers, retailer and consumers move further apart and around the world. Logistics is therefore one of the world's most globalized business in general. Result: The fragmentation of processes increases dramatically by divided process responsibility. The global risk management strategies of the leading producers and the movement of strategic resources results in more and higher demands on logistics flexibility. Value chains moves with high speed to new providers, plants, suppliers and resources. Service Cluster with clear focuses becomes more and more importance

14 Five characteristics of digital value networks The customers are not viewed as passive recipients of services, but to actively shape their/s product or solution, which are tailored for them as individual service packages. Customer orientation After the customer's order, the relevant procurement, manufacturing and distribution activities are automatically triggered in the digital value network. 14

15 Five characteristics of digital value networks The respective digital value creation network consists of a unique network of suppliers, customers, competitors, complementary and intermediary, which form a special value creation network. Each partner contributes its specific core competence. Cooperation and holism Customer orientation Coordination is done through a system-wide communication and information management. 15

16 Five characteristics of digital value networks Due to the flexibility of the production, distribution and information flows to ensure that the digital value network can respond quickly to changes in demand, new product introductions, changes in partner constellations and growth within the digital value creation network. Agility and Scalability Cooperation and holism Customer orientation This decreases the capital commitment and the duration of the process and steps can be reduced. All processes, whether material or information must be scalable. 16

17 Five characteristics of digital value networks Agility and Scalability Cooperation and holism Velocity Customer orientation The order processing cycle is fast and compressed. Ordered by the customer, the problem solution is delivered within the shortest possible time to any location. 17

18 Five characteristics of digital value networks Rule based, event driven systems on web technology automate most operational decisions of the manufacturing process. The activities of the participating companies, customers and suppliers are connected through digital information channels. Agility and Scalability Cooperation and holism digital Velocity Customer orientation A digital value network is characterized by the intelligent use and digital design of information and production processes. 18

19 Optimization of value creation in changing times Complexity Number of stakeholder Clockspeed

20 Value creation in networks 2nd Order Supplyer 1st Order Supplier 1st Order Customer 2nd Order Customer Company A Company B Company C Supply Side Demand Side Internal Supply Network Specific Supply Network Entire Supply Network 20 20

21 Value creation in networks 2nd Order Supplyer 1st Order Supplier 1st Order Customer 2nd Order Customer Company A Company B Company C Supply Side Demand Side Internal Supply Network Specific Supply Network Entire Supply Network 21

22 Cloud computing history source: Forrester Research Inc. 22

23 InterLogGrid - Cloud Services for intramodale Logistics Showcase: Inbound air cargo from warehouse to the customer 23

24 The airport in the logistics chain Airport processes Upstream processes Downstram processes 24 24

25 Provision of the services within the supply chain The individual process steps in the supply chain are provided by separate companies

26 The airport as the center of a powerful network of partners The airport is therefore the focus of a potential partner network. Each partner has its own specific skills and services. 26

27 The airport as the center of a powerful network of partners 27

28 The airport as the center of a powerful network of partners 28

29 The airport as the center of a powerful network of partners 29

30 The airport as the center of a powerful network of partners 30

31 The airport as the center of a powerful network of partners 31

32 The business activities of the partners in the network is a potential value 32

33 IT-Services increase the efficiency of the network and its partners Service Service Service Service Service Service Service Service Service Service Service Service Service Service Service Service Service Service Service Service Service Service Service Service Service Service Service Service Service Service Service Service Service Service Service Service 33

34 IT services support all phases of the logistics process Tendering Optimization Implementation Check Planing Control Operation Billing Service level analysis Shipment consolidation Customer billing Simulation of Logistics chains Costing each subprocess Determination of resource requirements Customer analyses Tour planning Determination lowest-cost service Service Service Service Service Service Service Balance tours with traffic conditions Service Service Service Service Service Service Service Balance Service tours with Service Service Service Service timetable Customs clearance Service Service Service Service Service Service Service credit Performance analysis Service Service Service Service Service Service Service Service Service Service Service Service 34

35 Cloud architecture Company A Company B Company C Local Data PC Client Mobile Client(s) Local Data PC Client Mobile Client(s) Local Data PC Client Mobile Client(s) Cloud Interface Cloud Interface Cloud Interface Company data Company software Company data Company software Company data Company software Service Service Service Service Service Service Service Service Service Service Service Service Service Public Service Service Shared Service Shared Service Service data data software Service Service Service Service Service Service Service Service Service Service Service Service Service Service Service Service Service Service 35

36 From traditional phase model to a model driven permanent cycle Concept Plan Implementation Test Introduction Usage Shutdown Modeling Simulation Production 36

37 Logistics ERP Cloud Architecture Company 1 Company 2 Company n Local Systems Business Modeler End User Client(s) Local Systems Business Modeler End User Client(s) Locale Systems Business Modeler End User Client(s) Business Model Controller Task Controller Business Model Controller Task Controller Business Model Controller Task Controller Business Data Model Process- Model Organisation Model Business Data Model Process- Model Organisation Model Business Data Model Process- Model Organisation Model Customer Company Business Repository Customer Company Business Repository Customer Company Business Repository Shared Business Repository Shared Business Data Model Shared Process Model Shared Organisation Model Cloud Computing Platform 37

38 Collaboration in the Cloud Company 1 Company 2 Local Systems Business Modeler End User Client(s) Virtual Company Local systems Business Modeler End User Client(s) Task Controller Virtual Business Controller Task Controller Business Model Controller Business Model Controller Business Data Model Process- Model Organisation Model Customer Company Business Repository Business Data Model Process- Model Organisation Model Virtual Company Business Repository Business Data Model Process- Model Organisation Model Customer Company Business Repository Shared Business Repository Shared Business Data Model Shared Process Model Shared Organisation Model Cloud Computing Platform 38

39 Agenda SALT Solutions a brief introduction What exactly is "cloud computing"? Some different approaches and our conclusion What does it mean in context of logistics? Virtualization of real world services Transformation of classical IT systems Enterprise Resource Planning in the cloud Chances and Challenges State of technology and science The right roadmap 39 39

40 The right road to the cloud 40 40

41 should be light weighted 41

42 Facing the challenge in logistics - More Service - Great Clustering - Combined Business Service Models - More awareness with individual services to global producers - service oriented interaction between global customers and logistic networks and his business members - Using Cloud Computing as basic resource to improve business - Act as one service provider

43 Summary Cloud computing thought to end means Everything as a Service. That means virtualization of real world logistics services and virtual organization (virtual companies). Classical applications have to be transformed into a service oriented architecture. This is not just a technical affair, but rather requires a organizational and entrepreneurial rethinking in order to succeed. Companies wishing to benefit from it must open up their walled gardens. This contains great opportunities but also risks. Think big, start smart : The way into the cloud can be light weighted

44 For additional information Jan Daske Head of Business Development Tel.: / Gunter Teichmann Head of Research & Development Tel.: /