Oracle Transportation Management Cloud in the Global Marketplace

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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

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Agenda

2

KPIT OTM/GTM Cloud Approach

KPIT OTM Cloud Customer Success Story

1

2

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KPIT OTM/GTM Cloud Approach

2/10/2016 © KPIT Technologies Limited 3

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Transportation – Top Objectives and Challenges

2/2/2016 © KPIT Technologies Limited

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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

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Trends in TMS

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0

Cloud lowers the cost of

entry for a TMS making

them available to the mid

market as well as enterprise

level companies.

Cloud/SaaS

their core applications to have

More companies will require

a tablet or phone version for

an increasingly mobile work

force. New OTM mobile apps

are available.

Mobility

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.

Capacity Shortages

Too many companies still

cannot track all of their

shipments and lack visibility

into transportation spend.

Supply Chain

Visibility

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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.

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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

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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

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9

Planners

Customers

Suppliers

KPIT OTM Connector

Konnect (CloudLink)

Email Track

SMS Track

POD

Solution

ERP/Order

Management

Master Data

Carriers EDI Events GPS Provider GPS Events

KPIT Cloud Solution

Back -E nd Pr oce ss es B us ines s Pr oce ss

es • 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, Email adaptors

• Easy to configure adapter endpoints configuration files.

• E-mail Alerts for exception management

• Enhanced error logging system

• Admin console to monitor data interchange and administrative tasks

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Key Offerings Snapshot

Oracle Logistics Applications

Products

• OTM, GTM, WMS, MSCA

Services

• Logistics Management Advisory

• OTM Integration & Development

• OTM Implementation & Support

• OTM Shared / Managed Service

KPIT Transportation Solutions

Application and Database Support Services

Implementations, Configuration & Development, Roll-outs

Design & Product Blue Print

Application Management/ Operations Consolidation

Upgrade and Migration

Consulting and Assessment Services

Se

rvi

ce

O

ff

er

ing

s

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 using Oracle EAM

Certified pre configured solution for

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

OTM

Ready

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KPIT OTM Cloud Implementation Methodology & Approach

Prepare

Start

Configure

Test

Migration

Go-Live

Pre-engage Meeting Super Users Training Kick-off Prepare Environment Configure for Gaps Testing Master Data Upload End User Training by Client Go Live Activities Go Live Support

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

Understand Process Cutover 2/10/2016 11

Show

Confirm

High Level Client Business Solution Accepted

Demonstrate

the Solution

Scoping and

identifying

Gaps

On board Client Run Demo

Deployment Phase

Pre-Project Phase

Identify and document Gaps Provide Checklist to Client Document Gaps UAT

Deployment Schedule (Week)

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15

Integration Development

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OTM Customer Success Story

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Customer Success Story Background

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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

Challenges – Primary Distribution

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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

Challenges – Secondary Distribution

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Customer’s Objective

Project Objective : To implement OTM to Improve Efficiencies and Strengthen Control on

Primary and Secondary Freight Execution

ROI Levers for OTM

Detention

Time Settlement Days Manual freight Errors due to Settlement

• 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

Errors due to Manual Share of business Improve Transit time of shipment 16 Increase Load Efficiency 2/10/2016

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Business Challenges Addressed

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• 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

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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

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High Level Flow for Primary / Secondary Distribution

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Order

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Primary Distribution- Process Flow

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FMCG Transactional Workflow

O TM E R P/ O M S Dispatch Plan 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 Shipment Start Validation Order Constraints Share of business Preferred Carrier (Quality Service) Loaded Vehicle Weight Stock Transfer Created Actual Loading (Stock Transfer is confirmed) Shipment Start Validation Receive GRN Transporter Adds In-transit events Invoice Approval process Accounts Payable Payment Acknowledgem ent Transporter Approves Invoice Tolerance of 0% Start End Tender Process

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Secondary Distribution Process Flow

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E

R

P

O

T

M

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Rate Approval Process

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Level 1 Manager enters

Online approval no and

approves rate

Level 1

Approve Rate

Level 0

Upload Rate

(Rates are not ready to use)

Level2 Manager Approve

Rate

Level 2

Approve Rate

Rates are

active and

ready to use

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Shipment Execution

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Vehicle

Reports At

Gate

Gate In

Loading

Gate Out

Stock

Transfer

Note in ERP

Tare Weight

Sequential Events

Total Weight +5%

Document Ids

Validations

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Warehouse / CFA Receiving Process

2/10/2016 24

Vehicle at

Gate

Vehicle Gate

In

Unloaded

Cargo

Generate

Consignment

Receipt

Vehicle Gate

Out

Vehicle Detention

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Freight Settlement

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Transporter

approves

Invoice in OTM

Finance

Approves

Invoice in OTM

Payment

Initiated

Physical LR and

Invoice sent for

matching

Payable updates

receipt status

on invoice

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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.

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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

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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

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Impact on Key Performance Indicators – Primary Distribution

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KPI Objective Baseline Target

Detention Charges factory & CFA level to enable Track Detention Charges at

actions for reduction 180K GBP/year

120K GBP/year in 2016 (33% reduction in 2016)

Cost/case plan & self- billing will minimize Higher adherence to optimized

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 Truck placement within 24h of _{call-up to the transporter} 70% 90% (from H2 2015 onwards)

Freight covered through OTM Freight movement to be covered _{through OTM} 0% 100% from August 2015 onwards

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Client Contribution to Success

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• 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

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Oracle Transportation Management Cloud in the Global Marketplace

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