DVZ special supplement TMS, September 15, 2020
Of course, it is anything but usual to hold an event without participants on site. On the other hand, there is hardly a more suitable topic for this internal premiere than transport management systems and how they will have a lasting impact on the forwarding industry of tomorrow.
Over two days, Sebastian Reimann, Editor-in-Chief of DVZ, and Rainer Hoppe, Managing Partner of Apari Consulting, hosted the publisher’s first fully digital conference.
This gave viewers insights into increasing digital networking and the added value that can be achieved from it. Data is the keyword. However, it quickly became clear that data alone is of no use. It depends on the evaluation and on the employees, who need to be involved in this process and trained accordingly.
In the end, everyone involved agreed that this exchange of experiences was extremely enriching and that purely digital events can also work.
DHL Freight’s mammoth project
The afternoon of the first day of the conference was dedicated to TMS roll-outs in an international environment. Using DHL Freight as a concrete example, Torsten Vogt, Vice President Digital Transformation, Dr. Stefano Arganese, CDO and Uwe Hess, CIO, all from DHL Freight GmbH, explained what is particularly important here.
A mammoth project for DHL Freight, which has to involve 13,000 employees in more than 30 countries in this process. It was made clear how important it is to simplify all internal processes first. Specifically, the standardization of the control logic and the harmonization of processes and business rules were addressed. A gap analysis must then be carried out to identify any problems or gaps. Finally, the development of the program could begin.
Another important aspect is what is known as “leading change management”. This refers to the empowerment of local managers. They need to learn how a TMS works and how it can be further developed so that the core competence is available at all locations.
DHL has already completed two successful pilot projects in France and Turkey. The roll-out on the German market is planned for 2022. The company wants to be well prepared for this step. The project should be completed in three to four years. However, the principle of “safety before speed” applies.
How to save 34 percent costs per teu
Friedrich Schierenberg, Managing Director of CargoSoft, and Frank Rottmann-Simon, Managing Director of Rieck Sea Air Cargo International, explained what is important for roll-outs in the international air and sea freight environment. The entire process has changed fundamentally over the past 20 years, explained Rottmann-Simon. At that time, order processing was still carried out via 16 different programs and at two different locations.
Today, there is only one system for sales, operational processing, customer billing and partner connection. In addition, end-to-end processes have been automated, such as a door-to-door tracking system. And all of this runs via a globally standardized IT infrastructure with central application expertise.
Rottmann-Simon and Rieck’s experience shows that investments in modern technology and documented processes are worthwhile. In addition, despite all the digitalization, people should not be forgotten. The employees trained on the TMS must subsequently be equipped with sufficient skills and opportunities to exert influence. Nevertheless, we must continue to provide constant support with on-site expertise. Last but not least, the necessary sensitivity is crucial. The Rieck Managing Director emphasizes that, while trying to enforce specifications uniformly, local conditions must always be taken into account.
If these points are taken into account, considerable benefits can be derived from the TMS. Rieck compared the administrative costs per teu from 2009 (with the old system) and 2019 (with the new TMS) and found that the costs per teu have fallen by 34 percent. This contrasts with only a marginal increase in IT costs and implementation costs of around EUR 3,000 per TMS user. In general, the costs for such a TMS range between EUR 1,500 and EUR 7,000, says Friedrich Schierenberg from Cargosoft. Rieck is therefore in the lower third of the average implementation costs. This is due to the negotiating skills of Rieck’s Managing Director as well as the size of the company, says Schierenberg, explaining the principle: “The larger the company, the lower the implementation costs per TMS user.”
In addition to this quantitative advantage, Rottmann-Simon also mentions a qualitative added value: all employees work on an operational system and therefore on a uniform database. This helps to minimize errors and simplifies internal processes. In summary, Rieck’s CEO rates the roll-out of Cargosoft’s transport management system as positive and is planning further investments: “We want to continue investing in digitalization and continue to grow as a result.”
Pricing with a BI system
The second day of the event delved a little deeper into the subject matter. Dietmar Haveloh, Key Account Manager, and Felix Samu, BI Expert from Anaxco, spoke about business intelligence systems and how they can be used to move from controlling to process consulting. The time when productive systems were slowed down because evaluations were always period-related, delayed, laborious and not digital is therefore over.
A modern business intelligence system is not just a simple dashboard or a one-off project. All important, valid data is automatically identified, aggregated and evaluated. The system then provides decision support based on this data. The system can be used company-wide and is highly customizable. In addition, these evaluations are often carried out by two to three employees, particularly in medium-sized companies. This means that this area is very dependent on the personnel responsible. The BI system makes a company largely independent of this.
As an application example, it was shown how the system can support pricing. The system first asks itself whether freight space costs the same every day of the week and which factors play a role in this. In addition to supply and demand, various parameters are included in the assessment. The BI system can save considerable costs with the help of data analysis by finding the most favorable price for the most suitable time. Ultimately, of course, it is important that the data-based decision support provided by the BI system is translated into action. “It is important that this process is lived in the company and that evaluations are not simply filed away,” advises BI expert Felix Samu for the time after the system has been introduced.
Digital helper in the driver’s cab
At the end of the TMS conference, Timo Ketterer, Product and System Manager at Continental Aftermarket & Services, gave an insight into how the digital tachograph can help to digitize documentation and thus create added value.
The original purpose of the digital tachograph, namely to monitor the driver’s driving and rest times and speed, is now long outdated. Instead, we are now talking about an “intelligent tachograph”, which is seen as part of a digital ecosystem for freight forwarding 4.0 and should provide real added value for the company. This means that BAG checks, for example of cabotage violations, are now possible via brief communication with the tachograph. The data protection measures have been standardized and the truck’s position data is valid and easy to retrieve or transmit. This means that various data can be extracted for telematics service providers to use for fleet management, for example. So far, however, this is only an intermediate step: “The intelligent tachograph offers far more possibilities and data to further increase the benefits for freight forwarding 4.0,” says Ketterer. (tb)