“Efficient Logistics Operations” is a combination of ‘on time delivery, with agreed quality specifications and within budgeted costs’. Logistics cost, which we shall here consider as a mix of warehouse handling costs and transportation costs, is an important component in managing the Cost of Goods Sold. At times, these costs run as high as 30%. For example: Cement. Managing cost metrics in the ecosystem of suppliers, transporters and customers and within the changing dynamics of multiple inter-related parameters of real world is complex. However, thanks to comprehensive, robust and scalable Oracle Cloud Product Stack, it at least helps alleviate, if not eliminate the associated pains.
The strong interconnected ecosystem of Oracle Cloud Products encompassing SaaS based Oracle Cloud ERP, Oracle Cloud Logistics (OTM + GTM + WMS), Oracle IoT Fleet Monitoring Cloud and the Oracle PaaS platform help achieve an end-to-end, break-free internal warehouse operations and external transport operations within the cost line. The key success-determining factor is not only the robust and globally scalable product features of Cloud Applications, but also its seamless integration, which facilitates real time monitoring, management and inducement of corrective actions along the supply chain. The high complexity of this supply chain in real life can only be simplified and depicted in a severely scaled down model as below.
The whole execution process, covered in 5 steps below, revolves around optimizing costs at each step in the long supply chain. The culmination of a series of tiny benefits converges to translate the benefits into a gargantuan size.
Step 1: The initiating point to the cost benefits chain is the Sales Order Line in the Oracle Cloud Order Management module (in Cloud ERP application), which triggers the shipment schedule with ‘planned ship date’. While one set of data flows to Inventory Unit and Shop Floor for production activities, a maze of interfaces in parallel update the Logistics unit using Oracle Transportation Management and Oracle Logfire. The Oracle Cloud Order Management module contributes its share of benefits to optimize the Warehouse Logistics and Shipping Costs with a combination of rules engine that run across picking and packing rules, and shipping schedules.
Step 2: Oracle Logfire with its robust multichannel functionalities, enables complete warehouse and logistics fulfillment from any browser-based device. It provides inbound and outbound fulfillment execution, cross dock and ‘to-store’ management, value-added services, as well as reverse logistics, which collectively deliver total management of inventory from manufacturer to the distribution center to the store and ultimately to the consumer.
Step 3: Oracle Transportation Management (OTM) uses state-of-the-art optimization techniques to determine the best way to fulfill the organization’s transportation needs. OTM creates Optimal transportation plans by simultaneously optimizing multiple parameters like Mode Selection, Carrier, Vehicles, Service Time, etc.; all while adhering to the business constraints such as pickup / delivery times, location specific calendars, compatibilities and more.
Step 4: While each of the listed Oracle Cloud Products are within organizational control and help to manage costs and schedules within designed measurements, the true icing on the cake comes from the integration of Oracle IoT Fleet Monitoring Cloud Services in the solution.
Digital Fleet Management picks up data from two sources.
The data from OBD II port is routed through IoT Fleet Monitoring SaaS cloud. The container ambience is captured through Autonomous IoT PaaS cloud. This area can be completely custom built as per user needs. The solution users can gain visibility to the vehicle, its mechanical fitness, location, etc. on a real time basis.
Container Ambience Control: In addition to timeliness and cost of delivery, ensuring right quality of goods reaching customer site is equally important. This holds special relevance to shipment of temperature and humidity sensitive items. For example: Food and Pharmaceutical products. Oracle Autonomous IoT PaaS Platform and its technology components help monitor and manage the ambient parameters of the vehicle’s container carrying such items. Sensors can be installed at various spots on the container body holding the goods to measure temperature, pressure, humidity or any other parameter of relevance and importance. The data can be transmitted thru Restful API/ Webservice integration and populated on a custom built dashboard built using Oracle Visual Builder Cloud Service (VBCS). Since there is a continuous monitoring of the measured values of required parameters, any deviation beyond prescribed tolerance levels can immediately raise an alert. The vehicle driver can be notified in real time on his hand held mobile device to take the required corrective actions, thereby avoiding any Qualitative damage to the shipped goods.
Step 5: Once the goods in bulk quantities have reached the customer shores, it will need further distribution to smaller warehouses and stores at short / long distances in an optimal manner. Oracle Cloud Transportation Manager again comes to help to optimize basis best mode of transport, goods carrying capacity of transport vehicles, routes, ship schedules and more.
Integrated Applications Architecture: The threads of complete end-to-end transactional processes cutting across a series of applications are stitched using Oracle Integration Cloud Services.
Monitoring and managing of such large volume high density transaction flows generates a new challenge in itself. The positive though is that each application in itself hold the capability of rendering dashboards and reports to the user depending on the role they play. They are both maneuverable and customizable. Oracle Business Intelligence Cloud Services is an additional tool available to seek benefits of flexibility and scale.
Single OEM: One of the many advantages of this explained mechanism delivering a competitive business advantage is that all required application components are provided by the single OEM; viz. Oracle Corporation. In addition, they work in equal compatibility with non-Oracle application products as well. These are 100% cloud enabled, making involved costs manageable within the operational cost framework of the organization. The return on investments may vary for different companies, but the payback time is akin to being immediate as the subscription costs to the Cloud components off-set the loss on account of operational inefficiencies, lost and damaged goods, delayed schedules, vehicle maintenance etc. On a cost benefit analysis, it is surely a proposition worth evaluation for logistics and transport intensive businesses.
Disclaimer: The views presented herewith by the author are of his own and hold no bearing on any one including his employer, Oracle Corporation or any other entity. It is advised to Readers to make their own independent evaluation in the decision making process.