Services Information

8/2/2019 Services Information

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SERVICES-INFORMATION

UNIT 5

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Information Functionality

• Logistics can be referred to as an enterprise planningnetwork used for the purpose of information, materialmanagement, capital flows.

• In the words of a layman, it can be described as

delivering at the right time, for the right price and in theright condition.

• In the modern day competitive business scenario, itincludes complex information which is important to the

control and communication systems of the organization.• No matter the size and the area of operations of an

organization, logistics information plays an important rolein the achievement of the goals of the organization.

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• Timely and accurate flow of information iscritical for an organization for mainly 3reasons:

• 1. A customer expects to be providedinformation on order status, availability ofproduct, delivery schedule, invoices.

• This he perceives as total customerservice

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• 2. Accurate and timely information greatlyreduces inventory by minimizing demanduncertainty.

• 3. Resources can be utilized to maximumadvantage when information is readilyavailable.

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• Information integrates logistics activitieson 4 levels of functionality:

• 1. Transaction

• 2. Management control

• 3. Decision analysis

• 4. Strategic planning systems

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• Transaction includes:

• Order entry

• Inventory assignment• Order selection

• Shipping

• Pricing and invoicing• Customer response service

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• In the transaction system emphasis in oninformation efficiency.

• Processes, are therefore well defined.

• A well structured flow of informationenables order status information to beavailable to customers whenever they sodesire.

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• Management Control:

• It is an evaluative, tactical, intermediatefocus that evaluates past performance andidentifies alternatives in the areas of:

• Customer service measurement

• Productivity management• Quality measurement

• Exception reporting

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• Some management control measures canbe well defined but some measures suchas customer service is less specific.

• LIS (Logistics Information System) mustbe proactive and capable of predicting thefuture.

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• Decision Analysis: The focus here is ondecisions regarding:

• Vehicle routing and scheduling

• Inventory levels and management

• Network facility/Location planning

• Most LIS application packages have anumber of analytical tools to help in theanalysis.

• The analysis is tactical and evaluative.

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• Since the emphasis is on effectivenessrather than on efficiency the LIS needs tobe relatively unstructured and flexible with

a wide range of options.

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• Strategic Planning: Development ofCapabilities

• Scanning for opportunities

• Customer service analysis

• The above become points to considerwhen planning a strategy, which is a long

term focus.

• The LIS must reflect on data collectionthat can be converted into a wide range of

business planning and decision making 12




• Information flow was used to improvetransaction efficiency.

• In today’s business environment

competition is aggressive.

• Hence, LIS applications must focus onproviding major savings in all aspects ofmanagement control, decision analysisand strategic planning components.

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Principles Of Logistical Information

• Logistics is the field of study to focus onthe design, control and implementation ofthe efficient flow and storage of goods and

services and other related informationfrom the point of origin to the point ofconsumption with an aim to satisfy the

requirements of its existing and potentialcustomers.

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• The management of logistics involves theintegration of information, transportation,inventory, warehousing, material handling,

packaging and very often security.

• Information Systems is an applieddiscipline that studies the processes of the

creation and operation and consequencesof systems that manipulate information.

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• Information Systems gathers, categorizes,stores and spreads information that isneeded for the organization to both grow

and prosper.

• LIS (Logistics Information Systems) is anew discipline that unifies logistics and

information systems.

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• A few principles to be followed whiledesigning or evaluating LIS applicationsare:

• 1. Availability• 2. Accuracy

• 3. Timeliness

• 4. Exception based LIS• 5. Flexibility

• 6. Appropriate Format

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• Availability: Logistics information (orderand inventory status for example) must beavailable at all times.

• Customers can be responded to readily ifinformation is made available, accessibleto all staff regularly and consistentlyacross the organization and must beregularly updated.

• This also helps in making and improvingmanagement decisions.

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• Accuracy: LIS reports must matchactual physical counts or status.

• Information should be accurately

reflect current status and periodicactivity for critical measures.

• Accuracy must be 99% or more.

• Accurate information reducesuncertainty and costs.

• This in turn leads to better inventorycontrol.

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• Timeliness: Besides receiving accurateinformation it is critical to receive it ontime.

• Timely information helps in taking quickand appropriate action by management toresolve issues.

• Timely information will help rectify errors,minimize loss, enhances customer servicecapability.

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• Exception based LIS: Information musthighlight “exceptions” i.e. highlight problemsand opportunities.

• This assists management to focus efforts onsituations that require attention.

• Service improves and costs reduced.

• Exception based reports are greatmanagement tools since a large number ofcustomers, products, vendors and servicecompanies are being handled.

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• Flexibility: A LIS must have the flexibility tomeet the needs of both system users andcustomers.

• Customization would be greatly beneficialto specific customers.

• A customized report helps customeranalyze and make necessary changes andkeep track of costs and efficiency.

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• Appropriate format: The format of the LISreport should be in a format that is easilyunderstood by users/customers.

• Contain the right information.

• It could be a single screen or multiplescreens.

• Graphic representation makes it easier tounderstand.

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Information Architecture

• Class assignment

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The Role Of Information Technology

In Logistics

• Strong IT capabilities are an essential buildingblock for any effective freight and logisticscompany.

• Logistics companies want unified, seamless global

operations—able to move anything anywhere andflexible enough to support customers whodifferentiate their product offerings via specialized“I need it tomorrow” service.

• They need intelligent systems smart enough to

know where every box is and to select the mostefficient next step in the supply chain.

• Robust information technology is at the center ofall operations.

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• The field of logistics had to introduceinnovative concepts, including modernenabling technologies, in order to cope

with today's business environment Just-in-Time (JIT), Quick-Response(QR), EfficientCustomer Response (ECR) and enabling

technologies such as Electronic DataInterchange (EDI), Global PositioningSystem (GPS) or Electronic Fund Transfer

(EFT). 26


In Logistics



• The Just-in-time (JIT) concept focuses onthe elimination of waste throughout thelogistic and manufacturing system.

• This is done by delivering materials andcomponents to the next stage ofmanufacturing just before they are to be

processed and only in the quantity that willbe used.

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In Logistics



• The ECR concept, the main purpose relieson the increasing of efficiency andeffectiveness of the entire chain by

integrating marketing and logisticsdecisions and on the optimization of theco-ordination of the different links

throughout the chain.• The ultimate goal is, in fact, the

maximization of customer satisfaction.

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In Logistics



• The Quick-response system stresses onthe need for coordination.

• Therefore sharing information to createtransparency is encouraged.

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In Logistics



• In logistics planning, the place ofInformation technology is become central.

• Planning and scheduling activities are

enhanced and enlarged by the settlementof an appropriate IT structure.

• Capacity to communicate has been also

drastically extended by the integration ofIT systems in managing information flow,in terms of speed, quantity and reliability.

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In Logistics



• Today's new technologies enables realtime transfer of information, data file,programs, or other digital documents so

that communication between distantplaces can be realized in real time.

• The highway achieves better performance

than traditional informative methods.

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In Logistics



• Information technology plays also a criticalrole.

• It permits origin, location and flow ofproducts to be easily traced and/ortracked, so that consumer possessescomplete and accurate product

information.

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In Logistics



• It is of crucial importance that organizationskeep working on developing more reliableproducts.

• Also, regular verifications of the installations,control and frequent renewal of the elementswill contribute to prevent eventual failure.

• Moreover, emphasizing secondary systems(back-up systems) may also be a solution tominimize risk of logistics failure.

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In Logistics



• Finally, as IT associates people, createslinks, and modifies drastically the way ofdoing business and particularly the way of

doing logistics,

• IT installation should be thought afreshstrategically, taking into account the

context of application (use, function,frequency, implementation…)

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In Logistics



• IT applications can be classified from thepoint of view of functionality:

• 1.Data capture, display and organization:Record inventory, production, resourceavailability using automated techniques.

• Data may be displayed in graphic form or

in a format that is easily understood by theemployees.

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In Logistics





• 3. Processing: IT applications help inprocessing data required for makingstrategic decisions.

• Data can be analyzed for different productrequirements, quantity, networkdestinations.

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In Logistics



• An LIS contains five modules order entry,order processing, transportation andshipping, distribution operations and

inventory management.

• IT helps design and implement data andsolutions required for an efficient logistics

operations.

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In Logistics



• IT in logistics :

• Enables the move from centralized todecentralized management without loss of

data.

• Improves speedy and timely delivery,reliability, saves cost and ensures secure

transfer.• Connectivity, information sharing and

integration within an organization andamongst customers.

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In Logistics



• Some specific technologies that havebeen used in logistics are:

• 1. EDI or Electronic Data Interchange

• 2. Bar coding and scanning

• 3. RFID or Radio Frequency Identification

• 4. Satellite communications• 5. Expert systems

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In Logistics



Electronic Data Interchange

(EDI)

• Electronic Data Interchange (EDI) is thestructured transmission of data betweenorganizations by electronic means.

• It is used to transfer electronic documentsor business data from one computersystem to another computer system, i.e.

from one trading partner to another tradingpartner without human intervention.

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• EDI can be formally defined as the transferof structured data, by agreed messagestandards, from one computer system to

another without human intervention.

• It is more than mere e-mail; for instance,organizations might replace bills of

lading and even cheques with appropriateEDI messages.

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(EDI)



• EDI documents generally contain the sameinformation that would normally be found in apaper document used for the same

organizational function.• For example an EDI 940 ship-from-

warehouse order is used by a manufacturer

to tell a warehouse to ship product to aretailer.

• It typically has a ship to address, bill toaddress, a list of product numbers and

quantities. 43


(EDI)

l i h



• Another example is the set of messagesbetween sellers and buyers, such asrequest for quotation (RFQ), bid in

response to RFQ, purchase order,purchase order acknowledgment, shippingnotice, receiving advice, invoice, and

payment advice.

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(EDI)

l i h



• Some major sets of EDI standards:

• The UN-recommended UN/EDIFACT is the onlyinternational standard and is predominant outsideof North America.

• The US standard ANSI ASC X12(X12) ispredominant in North America.

• The TRADACOMS standard developed by theANA (Article Numbering Association now knownas GS1) is predominant in the UK retail industry.

• The ODETTE standard used within the Europeanautomotive industry.

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(EDI)

El i D I h



• EDI formats usually contain the name of thefirms and all relevant data in a structuredformat.

• EDI is fast, error-free, reliable.

• Documents such as purchase orders,dispatch advices can be sent through EDI.

• Accuracy improves.

• Cheaper.(no paper/reduced labor cost andtelecommunication costs)• Improves customer responses.

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(EDI)

R di F Id ifi i



Radio Frequency Identification

(RFID)

• Radio frequency identification (RFID) is ageneric term that is used to describe asystem that transmits the identity (in the formof a unique serial number) of an object orperson wirelessly, using radio waves.

• Unlike ubiquitous UPC bar-code technology,RFID technology does not require contact or

line of sight for communication. RFID datacan be read through the human body,clothing and non-metallic materials.

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R di F Id ifi i



• A basic RFID system consists of threecomponents:

• An antenna or coil

• A transceiver (with decoder)

• A transponder (RF tag) electronicallyprogrammed with unique information

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(RFID)

R di F Id ifi i



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(RFID)

R di F Id tifi ti



• The antenna emits radio signals to activatethe tag and to read and write data to it.

• The reader emits radio waves in ranges ofanywhere from one inch to 100 feet or more,

depending upon its power output and the radiofrequency used.

• When an RFID tag passes through theelectromagnetic zone, it detects the reader's

activation signal.• The reader decodes the data encoded in the tag's

integrated circuit (silicon chip) and the data ispassed to the host computer for processing.

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(RFID)

R di F Id tifi ti



• The purpose of an RFID system is toenable data to be transmitted by aportable device, called a tag, which is read

by an RFID reader and processedaccording to the needs of a particularapplication.

• The data transmitted by the tag may

provide identification or locationinformation, or specifics about the producttagged, such as price, color, date of

purchase, etc.51


(RFID)

R di F Id tifi ti



• There are two kinds of tags:

• Passive tags have fine electrical currentinduced in the antenna by the incoming

radio frequency signal which providesenough power for the tag to power up

• Active tags have their own internal powersource that generates the outgoing signaland are typically more reliable thanpassive tags.

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(RFID)

R di F Id tifi ti



• RFID tags are replacing bar code tags.

• RFID allows accurate knowledge ofinventory by eliminating discrepancy

between inventory record and physicalinventory.

• It can also reduce errors.

• There is also a reduction in labor cost.

• Simplifies business processes.

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(RFID)

R di F Id tifi ti



• Manufacturing RFID has been used in manufacturing plants formore than a decade. It's used to track parts andwork in process and to reduce defects, increaseout put and manage the production of differentversions of the same product.

Supply Chain Management RFID technology has been used in closed loop

supply chains or to automate parts of the supplychain within a company's control for years.Companies are increasingly turning to RFID totrack shipments among supply chain partners.

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(RFID)

R di F Id tifi ti



• Retailing :Retailers such as Best Buy, Metro, Target, Tesco and Wal-Mart are in the forefront of RFID adoption. These retailers arecurrently focused on improving supply chain efficiency and

making sure product is on the shelf when customers want tobuy it.

Payment Systems :RFID is all the rage in the supply chain world, but the

technology is also catching on as a convenient paymentmechanism. One of the most popular uses of RFID today is topay for road tolls without stopping. These active systems havecaught on in many countries, and quick service restaurantsare experimenting with using the same active RFID tags to

pay for meals at drive-through windows. 55


(RFID)

R di F Id tifi ti



• Security and Access Control :RFID has long been used as an electronickey to control who has access to officebuildings or areas within office buildings. The

advantage of RFID is it is convenient (anemployee can hold up a badge to unlock adoor, rather than looking for a key or swipinga magnetic stripe card) and because there is

no contact between the card and reader,there is less wear and tear, and therefore lessmaintenance.

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(RFID)



Satellite Communication

• Satellite communication greatly enhanceslogistics performance through real timecommunication.

• Improves services with fewer resources.

• It is a two way communication systembetween company headquarters and

vehicles and stores.

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• The Global Positioning System (GPS) isa space-based satellite navigation systemthat provides location and time information

in all weather, anywhere on or near theEarth, where there is an unobstructed lineof sight to four or more GPS satellites. It is

maintained by the United Statesgovernment and is freely accessible byanyone with a GPS receiver.

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• State of the art technology is important, but wecannot lose sight of the most important person inthe wheel, the driver hauling the load.

• The most effective way to bring the driver into the

loop is investing in mobile satellite communication.• With this new technology drivers are able tomanage their time more effectively by not havingto call in every hour while waiting for a load.

• Also, drivers can accurately view the details of theorder.

• These factors lead to a higher level of service.

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Feature Benefit Business Value

Operations Management

Efficient Loading and Dispatch Increase Fleet Utilization Increased Fleet Capacity

Two-way Satellite Communication Quick Response and Direction Client Satisfaction, More Contracts

Logistics Annotations Greater Load Status Knowledge Quicker Asset Turnaround

Driver Management

Detect Unauthorized Use Improved Driver Behavior Reduced Risk and Fuel Savings

Theft Deterrent and Detection More Vehicle Recoveries Lower Fleet Costs

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Expert Systems

• Expert Systems are artificial intelligencesystems which can provide expert informationto decision-makers when a human expert isnot available. Basically, an expert system

works in a way to replace a human.• An expert system is a computer program that

contains stored knowledge and solvesproblems in a specific field.

• For example, A farmer could use an expertsystem to find out what sort of soil is best forhis farm.

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• There are expert systems that can diagnosehuman illnesses, make financial forecasts,and schedule routes for delivery vehicles.

• Some expert systems are designed to take

the place of human experts, while others aredesigned to aid them.

• To design an expert system, one needsa knowledge engineer, an individual who

studies how human experts make decisionsand translates the rules into terms thata computer can understand.

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Expert Systems



• An expert system captures and stores logisticsknowledge.

• This can be modified, updated.• Expert systems consist of 3

components…..knowledge base, inference engineand user interface.• Knowledge base contains information, inference

engines searches the knowledge base to identifyrules that are relevant to a particular decision and

the user interface facilitates the interactionbetween decision maker and the expert system(interprets the responses).

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Expert Systems



• Expert systems improve logisticsproductivity and quality.

• In today’s business environment it

provides a competitive edge to theorganization.

Expert Systems