Oracle Transportation Management Cloud in the Global Marketplace
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1 Oracle Transportation Management Cloud in the Global Marketplace Presented on February 4, 2016 OTM SIG, Malmo, Sweden Sushant Sawant Global Practice Leader Supply Chain and Logistics Isha Kashiva OTM Solution Architect
2 Agenda 1 2 KPIT OTM/GTM Cloud Approach KPIT OTM Cloud Customer Success Story 2 1/18/16
3 KPIT OTM/GTM Cloud Approach 3
4 Transportation Top Objectives and Challenges Freight planning Freight Cost Optimization: Complex Contract structure with Penalty High Detention Carrier performance KPIs Supply chain visibility and tracking: No visibility of shipping execution Freight audit and settlement: Long payment cycle Control over ad-hoc cost Inefficiencies in extracting reports 4 2/2/2016
5 Trends in TMS Cloud/SaaS Cloud lowers the cost of entry for a TMS making them available to the mid market as well as enterprise level companies. Mobility More companies will require their core applications to have a tablet or phone version for an increasingly mobile work force. New OTM mobile apps are available. Capacity Shortages With an aging driver pool companies will need to plan sooner and more often to get their most optimal transportation plans. Drones & autonomous trucks will not help in the near future. 0 Supply Chain Visibility Too many companies still cannot track all of their shipments and lack visibility into transportation spend. 5
6 Why Consider Oracle Transportation Management Need to lower transportation spend. Using manual processes to support business. Currently lack of visibility to process and goods in transit. Have always been forced to choose between a 3PL or a TMS. Need to increase Event Management visibility Outsource their freight payment to a 3 rd party. Do not want to lend staff to IT projects for half a year or more. Manage by Exception Business process standardization. Globally enabled and Scalable solution. 6
7 Oracle Transportation Management Key Features Transportation Procurement Contract and rate management Transportation Order Management Fleet and Driver Management Order and Shipment Planning Shipment Booking and Tendering Visibility and Event Management Freight audit and payment Reporting, documentation, and business intelligence 7
8 Changing Implementation Paradigm Need for OTM/GTM Cloud Accelerating Business Innovation Align Value Strategic Drivers / Rate of Industry Change / Ability to Change Leaner Implementations Pre-Built Templates / Accelerators Manage Risks Patching / Automation Cloud Changes Everything Why Visible Costs / Underlying Costs / Managing Risks What Environment / Support / Portal How Readiness / Execution / Deployment 8
9 Back-End Processes Business Processes KPIT Cloud Solution Planners Customers Suppliers ERP/Order Management Low Operating Cost Multiple Data conversion formats such as EDI to XML, XML to EDI, XLS to XML, XML to XML Technology agnostic integration capabilities In-built FTP, HTTP, DB, adaptors Easy to configure adapter endpoints configuration files. Alerts for exception management Enhanced error logging system Admin console to monitor data interchange and administrative tasks GPS Events GPS Provider Master Data KPIT OTM Connector Konnect (CloudLink) POD Solution SMS Track Track EDI Events Carriers 9
10 Service Offerings Key Offerings Snapshot Oracle Logistics Applications Products OTM, GTM, WMS, MSCA KPIT Transportation Solutions On-Track OTM Integrated VTS application Container Track Pre-configured solution for Container Management in the supply chain Fleet Track Pre configured solution for integrated fleet management and asset management Services Logistics Management Advisory OTM Integration & Development OTM Implementation & Support OTM Shared / Managed Service using Oracle EAM Certified pre configured solution for OTMReady Pre configured solution for Auto Logistics LSP s Auto Ready, Shipper s Shipper Ready, Freight Forwarding Forwarder Ready Logistics Management Platform - Integrated solution comprising of OTM, WMS and VTS Bolt On Solutions Design & Product Blue Print Implementations, Configuration & Development, Roll-outs Application Management/ Operations Consolidation Application and Database Support Services Upgrade and Migration Consulting and Assessment Services 10
11 KPIT OTM Cloud Implementation Methodology & Approach Deployment Schedule (Week) Pre-Project Phase Deployment Phase Show Confirm Prepare Start Configure Test Migration Go-Live High Level Client Business Solution Accepted Pre-engage Meeting Kick-off Configure for Gaps Testing End User Training by Client Go Live Run Demo Identify and document Gaps On board Client Prepare Environment Provide Checklist to Client Understand Process Document Gaps Master Data Upload Integration Development Super Users Training UAT Go Live Activities Cutover Support Demonstrate the Solution Scoping and identifying Gaps Get ready for the project Understand Process and Train Key Users Fine Tune System and Validate Testing with Client Data User Acceptance and Cutover Environment is live and supported 11
12 OTM Customer Success Story 12
13 Customer Success Story Background 13
14 Challenges Primary Distribution COST MANAGEMENT Minimize freight spend using logistics best practices Carrier Performance analysis to ensure low cost / kg /km at optimal service levels SERVICE LEVEL MANAGEMENT Ensure in time and full deliveries to customers Ensure zero in-transit losses due to damages Visibility of deliveries to customers to plan for receipts viz. workforce planning SUPPLY CHAIN SECURITY Control over logistics process to ensure secure supply chains Item Traceability till point of consumption SUSTAINABLE LOGISTICS Lower carbon emissions by ensuring vehicles adhere to emission norms Minimize driven miles and maximize truck loading to enable lower per kg /per km carbon emissions 14
15 Challenges Secondary Distribution Transportation Planning Correct Transport Mode, Correct Vehicle, Correct Transporter, SKU Compatibility, Truck Capacity Calculate Dispatch Time, Plan Multi-stop shipments Transportation Execution Vehicle Booking Process Document Control for Shipment/Dispatch Addition of events by transporters and various parties Claim Settlement Shortages and Damages Debit Notes Other Charges / Penalties / Freight Accrual Calculate Detention Days / Incentive Days Penalties related to Truck Non Compliance, Non Performance, Delivery Delays Freight Accrual and Variance calculations 15
16 Customer s Objective Project Objective : To implement OTM to Improve Efficiencies and Strengthen Control on Primary and Secondary Freight Execution Framework for OTM configuration, Order Management, Tendering, Integration Set-up, Reports development, troubleshooting etc. Optimization engine to optimize shipments based on cost and service level Share of Business among service provider according to contract and removing manual error using preferred carrier per lane per vehicle type Automates the processes of internal and external freight payment ROI Levers for OTM Improve Transit time of shipment Errors due to Manual Share of business Detention Time Settlement Days Increase Load Efficiency Errors due to Manual freight Settlement 16
17 Business Challenges Addressed Freight planning Freight cost optimization: Complex Contract structure with Penalty and Incentives was difficult to manage High Detention value Transporter performance measurement Supply chain visibility and tracking: No visibility of shipment execution Freight audit and settlement: Long payment cycle Control over ad-hoc cost Huge time investment in extracting MIS report 17
18 Solution Deployed Robust Pre-configured On Cloud OTM solution for Primary and Secondary Distribution Rate Utility upload tool to manage: Rate Structure Complexity Frequent Rate Changes Rate Approval Process Easy Order Upload through Konnect (CloudLink) Orders (~ 200 OR with around 800 OR lines) are punched in an excel file The file is uploaded using Konnect Order Releases are created in OTM Analytical Reports 18
19 High Level Flow for Primary / Secondary Distribution Order Management Transport Planning Shipment Management Shipment Execution Freight Settlement 19
20 OTM ERP/ OMS Primary Distribution- Process Flow FMCG Transactional Workflow Start Dispatch Plan Stock Transfer Created Actual Loading (Stock Transfer is confirmed) Receive GRN Accounts Payable Tender Process Transport Order (Order Release) Shipment Creation Loading Confirmation (Add Reporting and Gate In Event) Update Shipment Details Vehicle Departs (Add Gate Out Event) Shipment Received at Warehouse/ CFA (Add Gate Events) Automatic Invoice creation Invoice Approval process Payment Acknowledgem ent Order Constraints Share of business Preferred Carrier (Quality Service) Shipment Start Validation Loaded Vehicle Weight Shipment Start Validation End Transporter Adds In-transit events Transporter Approves Invoice Tolerance of 0% 20
21 Secondary Distribution Process Flow E R P O T M 21
22 Rate Approval Process Level 1 Manager enters Online approval no and approves rate Level2 Manager Approve Rate Rates are active and ready to use Level 0 Upload Rate (Rates are not ready to use) Level 1 Approve Rate Level 2 Approve Rate 22
23 Shipment Execution Validations Sequential Events Vehicle Reports At Gate Tare Weight Gate In Stock Transfer Note in ERP Loading Total Weight +5% Gate Out Document Ids 23
24 Warehouse / CFA Receiving Process Vehicle at Gate Vehicle Gate In Cargo Unloaded Generate Consignment Receipt Vehicle Gate Out Vehicle Detention 24
25 Freight Settlement Transporter approves Invoice in OTM Payable updates receipt status on invoice Finance Approves Invoice in OTM Physical LR and Invoice sent for matching Payment Initiated 25
26 Execution Challenges Addressed Real time event capture was crucial Event time is captured by the people at Gate Security Guards used Tablets for ease of Mobility Most of the security guards have never used any computer Simplified screens to add events and eliminate data entry errors Gate Keepers are now using tablets to log gate events for 200+ shipments on a daily basis. 26
27 Achievements Primary Distribution Pilot site went live in 14 weeks and 2 weeks of infant support Primary Distribution - 20 Dispatch locations and 35 Receiving locations rolled out in additional 6 weeks Secondary Distribution - 6 stocking locations to 52 + distributors in 12 countries in middle east Primary Distribution Achieved ROI in first 16 weeks of execution without Planning module. ROI continues to be tracked on : Detention Transit time Freight approval process Automatic and seamless payment interface Reduction in Payment cycle OTM helped client in rate comparison analysis and transporter scorecard which further helped in Rate Negotiations Achieved 85% utilization (since vol utilization is difficult to achieve) without any manual intervention. Further benefits: Cost saving from automating the Control tower from Day1 27
28 Benefits Realized Actual Truck Placement vs. Contracted Truck Placement - Analytics Monitor Detention times & Improve Analytics Better Financial Compliance to Contracts Control Reduced Invoice Settlement Days - Control Future Extension to Global sites Scale 28
29 Impact on Key Performance Indicators Primary Distribution KPI Objective Baseline Target Detention Charges Track Detention Charges at factory & CFA level to enable actions for reduction 180K GBP/year 120K GBP/year in 2016 (33% reduction in 2016) Cost/case Higher adherence to optimized plan & self- billing will minimize cost of inefficiencies Plan 2016 (no baseline) Plan 2016 (63.14 GB pennies/case) Invoice settlement days Drive cash discounts and better service levels through faster invoice processing 30 days for the transporter to collect the delivery documents + 63 Days payment terms 63 days payment terms from transporter self-billing in OTM Penalties and lead time monitoring Enforce penalties to transporters in the contract based on service level and tracking of actual vs. agreed lead times Not possible to track Have zero penalties to transporters with increased truck availability linked to below KPI. >90% lead time compliance Truck Placement efficiency Freight covered through OTM Truck placement within 24h of call-up to the transporter Freight movement to be covered through OTM 70% 90% (from H onwards) 0% 100% from August 2015 onwards OTM availability Downtime excluding planned maintenance NA - less than 3.5hrs in a month 29
30 Client Contribution to Success Trust and positive approach of the client was one of the key point in the successful implementation within the stipulated timeline Client s acceptance to improve their business process and aligning the users accordingly is appreciable. Project Manager understanding of the business process and the management of getting infrastructure ready from VM Server to micro level management eg. arranging tablets during EUT of gate keepers Dedicated Change Management resource: The Change management was very effectively planned All pain areas from almost all the physical locations were gathered and aligned On-time Data readiness Deploying resource to complete essential requirement coming during UAT to help implementation partner 30
31 Thank You Contact Sushant Sawant
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