Which technological applications are recommended for business to enter Logistics 4.0? (Part 2)

Published by Ngoc Tran on

Besides the Enterprise Resources Planning (ERP) systems and Warehouse Management Systems (WMSs), there are other technological applications recommended for companies to enter Logistics 4.0, which are Transportation Management Systems (TMSs) & Intelligent Transportation Systems (ITSs) and Information Security. So, we are going to discover what these systems are and how they can support our supply chain management, together with a few examples. Let’s get started!

Architecture of integration IT and collaborative Transportation Management (CTM) in a global supply chain (Tyan et al., 2003) is shown in Figure 1 above.

#3: Transportation Management Systems (TMSs) & Intelligent Transportation Systems (ITSs)
These systems facilitate the interaction between an order management system (OMS) and a distribution center (DC)/ warehouse. Advanced TMSs also enable global trade communication and tracking among shippers, carriers, third-party logistics providers and trade partners. The location of transporters can be accurately pinpointed by the use of  GPS technology, while the driver’s behaviour, movements of goods, and shipment consolidation can be monitored with ITSs. There are many characteristics of driver’s behaviour such as fast or slow driving, or breaking the rule, or even being sleepy, or being in good condition for driving or not (Grant et al., 2017). A fully operational ITS supports intelligent truck parking and delivery areas management, plans and coordinates multimodal shipping during various logistics operations. In addition, it can calculate and monitor CO2 emissions, and perform operations priority (e.g. reduce fuel consumption by monitoring vehicle speed, etc.).
Example:
A collaborative Transportation management (CTM) is a business model including the carrier as a strategic partner for information sharing and collaboration in a supply chain, which was applied in transporting notebook manufactured in Taiwan to the US. To implement this strategy, a CTM integrator was developed by the 3PL provider to link with the manufacturer’s ERP system to retrieve shipping information during the shipment tender stage. Documents needed for custom clearance were faster shared with the 3PL provider and thus eliminating customs delay. Data related to the shipment (e.g. pickup confirmation notice, delivery exceptions, etc.) was communicated via the CTM integrator. Some significant improvements were reduction of operating cost, accuracy in staff scheduling and billing, improved delivery reliability and increased revenue. The three major successful factors were IT integration, effective communication and coordination and continuous organizational commitment.

#4: Information Security

The emerging technology adoption and implementation bring several benefits, but also raise a management issue of information security. There have been so many business cases being threatened by hackers, in which they are responsible for their own data but also their customers and partners’ personal information. To solve this, organizations should identify, implement, monitor, and control their security requirements. Encryption, multifactor/ Multimodal authentication and/or authorization* should be applied to control user access, whereas intrusion detection systems (IDSs)** could be installed to detect attacks. Other solutions are training, virtualization***, cloud computing, Internet of Things, and data loss prevention (DLP). More details, please read more about the COBIT 5 framework.

Examples:

  • Insurance industry: This industry has used deep learning to recognize patterns in fraud and thus help companies to find out false claims and determine payouts for legitimate claims.
  • Retailer industry: American convenience store chains aim to build a strong defence across retail stores and corporate offices against sophisticated attacks (e.g. ransomware) while reducing the burden for the small IT team. It decided to implement a wide range of endpoint and data protection functionality from McAfee (e.g. antivirus, endpoint encryption, adaptive threat protection, etc.). For example, the Adaptive Threat Protection introduced machine learning behavioural analysis, dynamic application containment to quarantine unknown files and real-time scanning driven by cloud-based analytics. One of the best results is that the new IT security system provides visibility and replaces six separate vendor’s management consoles.

*Multifactor authentication – the use of two or more types of authentication credentials (e.g. physical card and enter password) in conjunction to achieve a greater level of security.

*Multimodal authentication – the use of multiple authentication credentials of the same type to achieve a greater level of security.

*Authorization – the process of restricting access of authenticated users to specific portions of the system and limiting what actions they are permitted to perform.

***Intrusion detection systems (IDSs) – a monitoring system that detects suspicious activities and generates alerts when they are detected. 

**Virtualization – running multiple systems simultaneously on one physical computer.

So, same questions as last week: “Has your organisation or yourself experienced these technologies? How was the implementation process? What are the lessons learnt?” Please reflect on these questions because it may empower you to generate ideas for bettering your current systems in a more user-friendly way. Also, please share your story in the comment below so we can learn together.

Thank you for reading and share if you find it useful!

Curious about the other technological applications that haven’t yet mentioned? Come back next week so we can discuss with each other!

Recommended reading:

“Sustainable logistics and supply chain management” (Grant et al., 2017)

Logistics 4.0: Digital Transformation of Supply Chain Management (Paksoy et al., 2021)

Tech Trends in practice: The 25 technologies that are driving the 4th industrial revolution (Marr, 2020)

Insights into Organizational Security Readiness: Lessons learned from Cyber-Attack case studies (Quader and Janeja, 2021)

Accounting Information Systems 14th edition (Romney and Steinbart, 2018)

https://www.mcafee.com/enterprise/en-us/assets/case-studies/cs-convenience-store-retailer.pdf

https://www.researchgate.net/profile/Fu-Kwun-Wang/publication/220381707_Applying_Collaborative_Transportation_Management_Models_in_Global_Third-Party_Logistics/links/572ea41608aeb1c73d12989f/Applying-Collaborative-Transportation-Management-Models-in-Global-Third-Party-Logistics.pdf

Series Logistics 4.0


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