CURTIN UNIVERSITY

GLOBAL DISTRIBUTION AND TRANSPORTATION

TRANSPORT INFORMATION MANAGEMENT SYSTEMS
Prashant Jothi - 16690426 Mihir Kapani 16713077 Zhang Mengxian - 16002827

13

Page 1 of 14

Global Distribution and Transportation Transport information and management systems.

1. Introduction Globalization is a way of doing business today, whether we like or not it forms the most important aspect of modern day business. This could be attributed to the diminishing barriers between continents, countries and cities where more and more population are moving towards urbanization, due to strong economic growth, ease of access to newer marketplace, to production materials, services, food which forms the basic requirement for the humans to survive this modern world. Due to huge inflow of population who are migrating to urban areas it can slow down the progress of people as well as goods. Therefore, the efficiency will depend on how this complex global system of road, rail, air and water links between the populated centres of the cities and megacities. As more and more population are moving beyond suburbs, highways and commuter rail systems provide easy access and connectivity between the cities and their suburbs. In the efforts to make the companys supply chain more efficient, innovative business models are being incorporated appointing a growing number of participants, making the management of these supply chains including the transportation operations which are more complex to manage and adds huge amount of risk (Eisenhardt, 1989). By utilising more complex business models, there arises a need for modified logistic solutions which eventually gives rise to the need for efficient execution. Efficient execution depends on systematic planning which in turn depends on better information and monitoring and controlling of transportation operations. The complex services offered by the Logistic Service Providers (LSPs) and the difficulties arising due to exchange of data make the execution of such value added services much more difficult. Therefore to sort out these difficulties in many of the modern day logistic setups, frameworks for logistic systems using more data and information, also referred to as smart and intelligent, have been developed such as the Smart Freight concept given by Lumpsden & Stefansson (2007) and the Smart Logistics Setup (SLS) proposed by Stefansson & Sternberg (2007).
2

The main purpose of this study is to explore the three major components of smart transportation management which are smart goods, smart vehicles and smart infrastructure. This will further help us in understanding how all these components include some factors
| GROUP ASSIGNMENT

which can have a varied effect on the supply chain performance (Prater, Frazier & Reyes, 2005). 2. Cornerstones of STM Framework In this study we will be exploring the three cornerstones of STP framework namely; Smart Freight, the Smart Vehicle and Smart Infrastructure. We intend to begin our study first with the Smart Freight and the decentralised information setup. Smart Freight The Smart freight system comprises of different components and is dependent on technologies to smoothen its functioning. The goods need to have a Radio Frequency Identification (RFID) tags or parallel technology needs to be equipped, proper data reading system has to be in place which enables us to collect data and submit it to the main system which acts as a backbone and a link to the operators ERP systems, an enabler with implanted logic which is required to read the data (Jones et al, 2005). As ongoing manual information of registration of moving objects and goods and products requires continual data entry which can prove to be quite expensive and can lead to many errors, therefore to reduce the costs and errors, serious efforts need to be put in to avoid any manual registration and use automatic identification systems (McFarlane & Sheffi, 2003).These systems can be commonly found in manufacturing units and units where there are repetitive physical handling of many goods such as post terminals (Kambil &Brooks, 2002).These Auto ID system can also be useful for applications ranging from access and security systems to system that can be used for inventory tracking which will help in managing inventory and simplify the checkout at retail stores using all the different kinds of technologies. With the introduction of new Auto ID which is based on radio frequency identification makes it easier to receive and send data using Radio Frequency Identification tags. This technology enables in speeding up the reading process thereby reducing time and increasing accuracy due to its multi reading capabilities (Karkainnen et al., 2003).The

benefits of using the Radio Frequency Identification system is its compatibility in working along with other technologies which
3

further helps in combining other technologies

depending on the usage area which can help in providing benefits in management of inventory, visibility of asset and interoperability in an end-to-end integrated environment (Vaughan, 2003).
| GROUP ASSIGNMENT

Integration of data within the organisation acts as a requirement for successful use of operations and is essential in order to capitalise on possible service betterment (Bowersox & Daugherty, 1995).Integration of information and synchronizing data is key process in achieving a smooth flow of data and information sharing among the members of the supply chain (Evgeniou, 2002).Today companies participating in the setup of logistics have understood the critical nature of effective information flow (Stefansson, 2006).While

updating of such data in real time will definitely add as an advantage to the party within the logistics setup. However the only noticeable problem in doing so is the storage of such shared data. Now to solve this issue three main solutions are available in the central database and in several other databases with each partner which are incorporated in the freight as well. One of the main characteristics for setting up decentralised system is that freight will carry its own information tags separately and the other parts which belong to the SC will have the access to the required information which can be recovered from these tags. The benefits of having such a system are that it minimises the potential risk of divergence between material and information flow. One of the main benefits in into such a decentralised system is that such vertical transaction relating to central system and moving objects if avoided , will enable in synchronising the material and information flow. However, one of the main issues in setting up such kind of decentralised information system is that, a unit with integrated logic needs to be provided. These are termed as enablers according to (Lumsden & Stefannson, 2007). The main purpose of these enablers technology is to collect data from the Radio Frequency Identification tag and decode it in the correct manner, send and store it to the right database. Such enablers can be situated in places like in trucks, warehouses etc. According to Holmqvist & Stefansson (2006) Smart Goods is categorised by high level of sophistication in identification as compare to traditional way of identifying goods. This means that instead of using past and outdated technologies of barcodes for identifying a particular item, now it is possible to identify individual items or the load unit with the help of using new technology of Radio Frequency Identification (RFI) tag as a carrier for data. In applying such systems in the transport management system it enables users with Radio Frequency Identification tag to capture the data integrated in the tags of the products or load
4

units when they are loaded onto the delivery vehicle or unloaded from the vehicle. Thereby enabling in efficient delivery and pick up processes and quicker turnaround of the vehicle. In addition to that it will also enable faster process of loading and unloading in terminals or
| GROUP ASSIGNMENT

distribution centres which will help in better utilisation of loading docks. This will in turn help in reducing the drivers waiting time on the sites and help in better utilisation of vehicles. Due to this, the capacity of delivering can be increased with existing assets and personnel, or can enable the organisation to handle the same good volume with minimum resources. Smart Vehicle The most important issue of the STM system framework is the Smart Vehicle. The main focus is on the distribution trucks or vehicles which are installed with a vehicle computer system and during the loading or unloading of freight, the identification of the goods is done. Generally the information is stored in the computer system in the vehicle; only in the case of when deviation or pre-notification of arrivals is required the information is communicated to the central computer system. The vehicle system consists of various mechanisms and components. In- truck goods identification. The load units or the items that are installed with RFID tags are used to read the goods identification. In the truck box or trailer, the reading aerials or antennas are set up on the roofs, sides and also on the floor which are all connected to the aboard vehicle computer system. This helps in identifying the goods that has been loaded or unloaded immediately, all the important information of the batch of shipment are stored in the system which purges the need of having an RFID reader at the loading site which eventually reduces the dependence on the on-site shipper data of the shipment. Various other hardwares can also be installed such as Wi-Fi\GPRS units to communicate and exchange information like POA (proof of acceptance), POD (proof of delivery) and the manifests of the goods, to the transport management system and the main system immediately (Ghribi & Logrippo, 2000). A GPS (Global positioning system) can also be installed in the vehicle to keep track of the vehicles whereabouts and help navigate during the shipment and transport operations (Lapide, 2004). Taking into account that the freight information has been confined during the loading of the goods into the vehicle and the manifest of the goods has been installed in the computer system in the vehicle, this helps in minimizing the risk of loading and unloading the wrong goods, efficiently loading sequence for efficient unloading, to identifying the resources that are used in the whole if the transportation system and also to
5

send POA and POD to the main system once the task in finished. This link between the vehicle and the goods is determined which today is not seen in many operational systems.

| GROUP ASSIGNMENT

Vehicle system. The heavier trucks which are above 3.5 metric tons are the ones in which most of the truck manufacturers supply vehicle management system which mainly supports vehicle management, driver management and transport management. The vehicle management component mainly displays and saves the information and data from the tachograph and ECU (engine control unit). Datas like details about the vehicle driver, working hours, fuel consumption, distance covered etc are all stored in the system database and if required, are sent and communicated to the main office system via mobile communication. Besides the vehicle management system, several logistics service providers have their transport management system operation in their office. This helps in the knowing the vehicle location and which is why it is important to allocate tasks to the vehicle and help in the decision making which has its main objectives to increase the efficient utilization of the vehicle, increase the reliability of the delivery and decrease the empty runs. The various possibilities of vehicle and driver management are identification and authority of the driver, driving hours of each individual driver, recommendations of the route, issues relating to training and security and the maintenance of the vehicle. Goods management possibilities include control of the loaded as well as the unloaded goods, place and location of the goods, getting immediate information about the circumstance and condition of the goods, the number of resources used in the in the transportation link and their location and the control on the rerouting of the vehicle based on the traffic conditions. The possibilities of information management are that it uses paperless manifests for the verification and confirmation of the loaded or unloaded goods which also includes paperless PODs and POCs which reduces the paperwork and since the tagging of the trailer and trucks are already done this helps in the automated notifications of the arrivals and departure of the of the trucks and also guides them the pick-up point and drop-out point. Smart Infrastructure Smart infrastructure is the last element of STM. ITS (Intelligent Transport System) is the combination of physical infrastructure with information systems and telecommunication system. In this particular phrase, the term intelligent is avoided because it is misunderstood as self learning system and autonomous which is incorrect. Smart infrastructure includes three
6

parts, physical part, digital part and service part which given to all the various customers and clients such as transport operators, receivers, shippers etc (Arbnor & Bjerke,1997). Physical infrastructure consists of tunnels, roads, ships, harbours etc., in which vehicle travel and move from one place to another using directed information through digital infrastructure. The
| GROUP ASSIGNMENT

digital infrastructure helps retrieve, manipulate, communicate and store data and information from the vehicles through physical infrastructure which uses various kinds of digital technologies. Physical infrastructure. The connecting links are used to in transportation network to move the goods between the hubs which are warehouses, centres, terminals, ports etc. Theses hubs also need to be similarly equipped with reading devices for the incoming or the outgoing docks. The reading devices should also be installed in the warehouses and distribution centres where the goods are stored so that goods identification can be occasionally read if required. All the ports usually have the identification system installed in the incoming and outgoing gates with cameras to character reading for the ordinary containers and the identification of the vehicle, to locate equipments and the management system to position the containers and trailers within the harbour region and even the cranes which are equipped with reading devices which also includes loading and unloading equipments. The links are the roads, ferries and tunnels which are used by the vehicles to travel. These units are also installed and equipped with technologies such as cameras and sensors which are used to gather information using radio messages or signs to inform, warn and notify of the infrastructure state and provisions in case of any congestion, accidents etc., to the vehicle operators. Digital infrastructure. This infrastructure consists of all the technology that is required in STM system to support all the operations and services. Digital infrastructure is divided into three discrete parts: data and information management, data and information exchange and data collection. Data collection. Various resources need to be incorporated to collect data from physical infrastructure and smart vehicles. Road sensors are the first kind of data source which helps in collecting information concerning the speed of the vehicle, vehicles identification number, weather conditions, number of vehicles etc. Road sensors can be communicated both using cables as well as wireless technology based upon the location of the sensor. Vehicle sensor in another kind of sensor that are used. This also includes in-vehicle data collection kit which is used to know the status of the vehicle. This gives detailed information
7

about the condition of the vehicle from defining the speed to the brake system usage and more. The data are generally communicated using wireless technology such as WiFi/GPS. Th added sources are the cameras that are installed in harbours, roads and in tunnels which also helps in collecting information regarding the location, conditions etc. The images are
| GROUP ASSIGNMENT

collected via cables which are extracted using image analysis software which are made to exactly for these kind of purposes. Data and information management. Geographical data and informations like speed on particular roads, directions etc can be stored through GIS (Geographical Information System) like digital maps etc. Digital maps consists generally of the inert situation which does not change frequently and for the data and informations which changes frequently can be stored in road information databass which also includes the the informations that are of the provisional situations in the physical infrastructure such as roads, operation timetables etc (Finkenzeller, 2003). MIS (Management Information System) is the system where the operation is done by each individual participant where the data and information are stored locally in the database and if required, in the main central database. This system consists of various sub-systems which are accountable to the different information system areas within that of the organiazation. Typically this management system is used for customer customers orders, warehouse management, inventory management etc (Croxton et al. 2001). Enabling data interchange. One of the main issues in logistics and supply chain management is the exchange of data issues. Since there are various kinds of departments in logistics, so in some or the other way there is a need of exchange of data and information. There is a need of setting up a virtual road so that the exchange of data and information can be done between the departments. As the transfer of goods is done in physical infrastructure, similarly the virtual road helps in the exchange of data and information. Virtual road provides the communication model in the supply chain management and it is the basis for all the communication in Smart transporation management system (Yin, 1994). This concept uses various technologies which are included in the digital infrastructure linked to different types of datat and information of goods, vehicle etc. The imporatant services that are needed for the existence of STM to operate can be explained by a model. For the understanding of the STM concept, except digital infrastructure and virtual infrastructure there is also a need to acquire the understanding of various services that
8

will allow participants and departments to collaborate and setup logistics management. A service oriented architecture is required for the organization to access the data and information which is stored by other other organizations. The information has to be made available through standardizing the communication interfaces which will help the third party
| GROUP ASSIGNMENT

company to develop their services by providing easy access to the information. The services can be divided into two parts: commercial and public. Commercial services are the ones which are provided by shippers, receivers, transport operators, logistics service providers and specialised informationa service provider organizations and companies. Digital infrastructure provides information to these services to operate. All these services are provided by commercial companies and organizations. Public services are developed and provided by governments and is for the benefit of the society because it does not only provide goods transportation but also personal transportation. 3. Issues relating to performance of Smart Transport Management systems As we study the performance of Smart management systems we may find many issues which can affect its performance in the supply chain systems. As we will evaluate the performance of this systems based on supply chain systems we will look to assess it three broad areas warehouse operation; delivery time; delivery reliability of the reliability process. As these issues form the core of the in logistics and supply chain performance we look to discuss it in great detail.

Warehouse operation
The effects of STM system on warehouse operation can be seen by observing the amount of time spent in identifying goods in the process of loading and unloading as well as within terminal, warehouse and distribution centre operations. There is no denying the fact that considerable amount of time can be saved in the process of order pick and preparation as well as in the process of loading if Radio Frequency Identification is applied effectively allowing multi-reading of products and load units. Such services of missing goods notification can be of great help in identification of goods in the process of loading and unloading.

Delivery time
As delivery time is composed of many time intervals the STM system can help in minimising
9

time in different ways. With the use of real time dynamic planning services with the association of digital maps and geographic location services, can help in making the transportation process much more efficient. By providing precise information on traffic

| GROUP ASSIGNMENT

routes, can enable the truck drivers or dispatching office to take an alternative shorter route to guarantee the shortest delivery time.

Delivery Reliability
For reliability in transferring the goods, there are many processes that need to be safeguarded and operated with greater efficiency. The most crucial factor to consider is to carefully select the route so in case of any given situations where a particular set route is not working, it should be capable enough in rerouting. This requires right to routing software, positioning technology and understanding the potential to communicate the new route to the vehicle in case it is not made available in the vehicle computer system. If it is integrated in the vehicle computer system , a wide range of data needs to be recovered by the vehicle computer system such as type of goods, shipments and conditions of roads etc.The service of missing goods also acts as essential service within the framework of STM to ensure that no goods are left behind and thereby increases the reliability of the delivery.Eventhough the transport notification service is not going to impact the reliability of delivery, it enables the receivers to get notifications on the expected delays which helps them in responding to the events much earlier. The same applies to the arrival notification service which enables the receiver to prepare and plan for the truck arrival in unloading the shipments in given time incase there are many trucks arriving at the same time. 4. Implications and Conclusions With the increase in number of participants in transport systems, has resulted in complex distribution set ups with increase in need for the flow in information, particularly electronic messages between participants in distribution setups. This development calls for new kinds of transportation management systems that can move data and information more effectively between partners, which can help in increasing freight visibility, monitor involved activities in a effective manner, and enhance interaction with infrastructure information to improve dynamic routing and methods to strengthen transportation security. STM framework has been developed taking in to account the requirement of carrying out analysis pertaining to standard participants in todays transportation setups including software
10

providers, truck manufacturers and many more. The STM framework provides practical implications due to its structure and role that can be used in assisting the companies who want to run the advanced transportation management systems. The system also aims at
| GROUP ASSIGNMENT

improving information accessibility and its capability of retrieving such data from the Radio Frequency Identification tagged goods and load units.Inorder to allow such data retrieval the Radio Frequency Identification tags need to carry huge amount of data that can allow the partners to share data which is relevant to each of the partner to make informed decisions at different locations (Twist, 2005). Such model allows in local decision making as a supplement to centralize planning and decision making process. Therefore, the process of decision making will no longer depend on accessibility to central data and information revival as it is in the logistics management setup. In order for the framework to be viable, the implementation of a new infrastructure for data communication is not only not required for the warehouses or terminals but also in the vehicles that transfer the goods as well as in the infrastructure which is used for transportation like roads, tunnels, harbours etc.The Smart Vehicles and the Smart Freight or the load units have to be equipped with communication technologies that can help in pointing out the position and status of the goods and the vehicle. In installing such systems the supply chain operators have good chance of minimising any delays that can arise by deviating from schedules and alter their plans in accordance to the new situations. The Smart Infrastructure is a mixture of all technologies combined together that makes possible for the vehicles to communicate with the infrastructure and retrieve information from the infrastructure. There are two parts to the Smart infrastructure process which are digital and physical. Physical smart infrastructure consists of roads, tunnels, ferries etc where the vehicles move and communicate with double directed information with the help of digital infrastructure. The smart digital infrastructure recovers, controls, and stores and communicates data and information from the physical infrastructure to and from the vehicles that are using physical infrastructure, making use of different digital infrastructures technologies such as sensors, cameras, and databases and positioning technologies. As implementing these technologies do not come for free the cost is saved in the form of more efficient and effective transportation execution and capability to react to avoid delays and help in better utilisation of resources due to more consistent operations as well as many other factors that will help in balancing high cost of implementation.
11

| GROUP ASSIGNMENT

References
Arbnor, I. and Bjerke, B. (1997), Methodology for Creating Business Knowledge, Sage Publications, London. Bowersox, D.J. and Daugherty, P.J. (1995), Logistics paradigms: the impact of information technology, Journal of Business Logistics, Vol. 16 No. 1, pp. 65-80. Croxton, K.L., Garcia-Dastugue, S.J., Lambert, D.M. and Rogers, D.S. (2001), The supply chain management processes, International Journal of Logistics Management, Vol. 12 No. 2, pp. 13-36. Eisenhardt, K.M. (1989), Building theories from case study research, Academy of Management Review, Vol. 14 No. 4, pp. 532-50. Evgeniou, T. (2002), Information integration and information strategies for adaptive enterprises, European Management Journal, Vol. 20 No. 5, pp. 486-94.

Finkenzeller, K. (2003), RFID Handbook: Fundamentals and Applications in Contactless Smart Cards and Identification, 2nd ed., John Wiley & Sons, Chichester. Ghribi, B. and Logrippo, L. (2000), Understanding GPRS: the GSM Packet Radio Service, Computer Networks, Vol. 34, pp. 763-79. Holmqvist, M. and Stefansson, G. (2007), Mobile RFID a case from Volvo on innovation in SCM, Journal of Business Logistics, Vol. 27 No. 2, pp. 251-72. Jones, P., Clarke-Hill, C., Hillier, D. and Comfort, D. (2005), The benefits, challenges and impacts of radio frequency identification technology (RFID) for retailers in the UK,
12

Marketing Intelligence & Planning, Vol. 23 No. 4, pp. 395-402.

| GROUP ASSIGNMENT

Kambil, A. and Brooks, J.D. (2002), Auto-ID across the Value Chain: From Dramatic Potential to Greater Efficiency and Profit, Auto ID-Center, Boston, MA. Karkkainen, M., Fraamling, K. and Ala-Risku, T. (2003), Integrating Material and Information Flows Using a Distributed Peer-to-Peer Information System, Department of Industrial Engineering and Management, Helsinki University of Technology, Helsinki. Lapide, L. (2004), RFID: whats in it for the forecaster?, The Journal of Business Forecasting Methods & Systems, Vol. 23 No. 2, pp. 16-19. Lumsden, K. and Stefansson, G. (2007), Smart freight to enhance control of supply chains, International Journal of Logistics Systems Management, Vol. 3 No. 3, pp. 315-29. McFarlane, D. and Sheffi, Y. (2003), The impact of automatic identification on supply chain operations, The International Journal of Logistics Management, Vol. 14 No. 1, pp. 1-17. Prater, E., Frazier, G.V. and Reyes, P.M. (2005), Future impacts of RFID on e-supply chains in grocery retailing, Supply Chain Management: An International Journal, Vol. 10 No. 2, pp. 134-42. Stefansson, G. (2006), Collaborative logistics management, International Journal of Physical Distribution and Logistics Management, Vol. 36 No. 2, pp. 76-92. Stefansson, G. and Sternberg, H. (2007), Smart logistics systems SLS, paper presented at The 11th WCTR World Conference on Transport Research, UC Berkeley, Berkeley, CA, 24-28 June. Twist, D.C. (2005), The impact of radio frequency identification on supply chain facilities, Journal of Facilities Management, Vol. 3 No. 3, pp. 226-39. Vaughan, J. (2003), DoD, Wal-Mart push RFID, Applications Development Trends
13

Magazine, November 19.

Yin, R.K. (1994), Case Study Research: Design and Methods, Sage Publications, Thousand Oaks,CA.
| GROUP ASSIGNMENT

14

| GROUP ASSIGNMENT