COLLABORATION

Executive Overview

Collaboration is being discussed in almost every business publication today! Many companies are discussing the topic internally and some have had in-depth discussions amongst their preferred or necessary business partners.  While there are protocols, and transaction sets, the ability to articulate a universal compelling reason that would effectively create the collaborative industrial and commercial culture is severely lacking.  In order for collaboration to succeed, there must be a business culture, universal standards and willingness to make certain information reasonably available to authorized partners. 

 

Collaboration represents one of the foremost opportunities in business today; it can drive down costs, improve operations and performance, culminating in a significant contribution to the profit line.  Of equal importance is that shared information amongst the business partners positions those partners to participate in the new knowledge base created by real-time understanding of shared information.  As an example, it is reasonable to conclude that consignees would have better insight regarding delivery carriers closest to their location, and with shared tracking information and performance monitoring the business partners would be empowered with the ability to make more timely and accurate decisions regarding carrier performance standards and selection.  Without collaboration, this issue may never be solved or solved well after customer service deteriorated and freight costs exceeded the service negotiated.

 

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Without a corporate collaborative culture in the business world, effective and efficient collaboration remains on the horizon.  A successful method of approach to address this problem is to develop a basic definition of collaboration, which is non-threatening, and broad enough to eliminate the potential of limiting the scope of a viable description.  This method of approach significantly increases the chances for realizing the abundant and robust opportunities that are both apparent and developing.

 

Our previous white papers have spoken about some of the reasons why collaboration is so important to the continual growth and development of world wide commerce and industry.  This paper will begin to address:

 

proprietary concerns and corporate security

transportation and distribution management as the vehicle to drive the collaborative effort

collaborative penetration points, that are reasonably harmless, in the supply and demand chains

available collaborative technology and concepts

strange bedfellows make excellent collaborators

 

Collaboration, when successfully achieved can be one of the most influential components significantly contributing to growth, development, performance and profitability of the business enterprise, with the added advantage of developing a new knowledge base.

 

Definition

Collaboration by definition is, “to work together, especially in a joint intellectual effort” ^[1] .  Currently, the commercial and industrial environments have clearly constrained the true collaborative effort, thus the opportunities and advantages that will be forthcoming have been delayed.  This constraint, for the most part, is based upon proprietary concerns, corporate security and the lack of corporate collaborative culture.

 

The supply and demand chains and the master link, transportation and distribution management, stand at the threshold of collaboration and should be the driving force and the basis upon which this new frontier will be crossed and developed.

 

Proprietary Concerns and Corporate Security

With the introduction of computerized business systems and for those of us who can still remember EDP (electronic data processing), astute businesses set out to computerize certain mundane clerical, repetitive tasks.  The process next evolved to the point that interdepartmental tasks were linked, eventually growing to the point of establishing total connectivity within an organization, and then incorporating all of its locations.  This was no easy endeavor and one that was absolutely necessary in our quest for establishing a highly secure, timely and accurate collaboration capability amongst a myriad of business partners with interdisciplinary relationships; best described by considering the entire gamut of the industrial spectrum.   This original model is still in use today.

 

Giving due consideration to proprietary concerns, perhaps one of the best places to begin to understand and appreciate this issue is to look at the original model, linking interdepartmental tasks.  Cleary, the level of concern could be different, but the concepts should remain constant.  As an example, one question that could be raised, “should the transportation system be shared with accounting, finance, purchasing, and the reciprocals thereof.”?   A next logical question could be, “how much of the information could be shared and at what times and under what conditions along with what is the best model for the respective functional distribution of the information.  Answering these questions begins the controls process, the very same process or model that could be employed when considering the sharing of information amongst business partners.  Shared information, as described herein, with an enabler equals collaboration.

 

Another consideration regarding the proprietary and security issues is venue.  That is, what venue best allows for the efficient, effective and timely flow of authorized information to appropriate designees at proper times, without encumbering each partners operations and systems and is secure enough to protect against unauthorized intrusion or use?  The ASP (application service provider), operating on the Internet or societal systems (closed loop) and intranets (specialized buying and selling membership organizations) best addresses the venue issue.

 

Designating authorized users, eligible for certain information, limited to specific periods of time for the respective transactions, coupled with appropriate audit trails, at a minimum, could satisfy security issues.

 

Contractual relationships that would include proprietary, confidential and use terms amongst the authorized trading partners, including all users therein, should reasonably address these concerns.

 

Transportation And Distribution Management As The Vehicle To Drive The Collaborative Effort

The data elements contained in the transportation and distribution management process and functions are prolific and could also be considered interdisciplinary.  Consider the Bill of Lading, the Freight Bill and the Delivery Receipt; on the face of these transportation documents and their electronic equivalents. We have initial data in the Bill of Lading with such data flowing to the successive documents or their electronic equivalents with new data continually appended throughout the process; beginning with pick-pack and continuing with freight staging and concluding through delivery.  Recognizing that the Bill of Lading could be the culmination of events at the shipping location, including the initial sales or purchasing, it is reasonable to conclude that the appending data to these documents or their electronic equivalents also occurs.  Therefore, the referred to data elements are representative of various departments such as; sales, finance, purchasing, manufacturing, operations, human resources, transportation, shipping, distribution and logistics.  We call this the, “transportation link”.

 

It is clear that the business partners are connected via the transportation link, that is, activity/data at the shipping being appended through receiving represents the beginning and ending of the continuous flow of material, in which this corresponding and prolific data is collateral.  For those partners not otherwise physically connected via the transportation link, the available data produced is sufficient to incorporate those partners through other means.  Collecting and appending the data in the transaction stream satisfies the demand for the most current and continuously refreshed data, the absolute basis for successful collaboration.

 

The data, process and functions described above form the basis of collaboration.  Transportation and distribution are both the device and the vehicle that position the data to be converted to collaborative information.

 

Collaborative Penetration Points, That Are Reasonably Harmless, In The Supply And Demand Chains

At the outset, utilizing a well established practice, standard Bill of Lading information would be delivered to available partners through a neutral ASP.  Distribution, in either a push pull or delivered environment for appropriate authorized partners would also be handled through the ASP.  As the freight moves along externally, the data would be continuously appended/refreshed and converted to information.  The information is then made available, via the ASP, to authorized users.  Based upon user security levels, subordinated to the effective agreements and terms of use, the information is properly controlled.

 

Penetration points for data extraction are conceptually described as those points in the process when data is appended and/or refreshed.  As an example, the production of a concluded Bill of Lading, the transmission of a load tender, the creation of an ASN, carrier pickup and tracing and tracking. These are only examples and differences will occur from company to company and will also change as relationships and functions within the process appear. 

 

Defined penetration points for selective data extraction and subsequent information availability coupled with real-time communication within the respective business to business partnership, working together, especially in a joint intellectual effort is the essence of collaboration.

 

Available collaborative technology and concepts

Intranets could be a probable representation of electronic collaboration; in other instances, some companies are suggesting that they offer collaborative services; unfortunately, there is very little if any basis of shared definitions and thus the parties become mired down in scope creep (the evaluation process without a beginning or an end).  Others have a loose arrangement of products, some in transportation, purchasing, finance and operations; if connected, integrated and coupled with effective and efficient communications when combined with security and proprietary programs might be considered collaborative.

 

On the positive side, those companies offering a “simpler is better” method of approach that address incremental transportation management solutions in an ASP environment, are the best candidates for the most comprehensive and meaningful collaborative solution. 

 

Incremental transportation management solutions that include:

 

Routing guides	Tracing and tracking
Bill of Lading generation	Pre-audit
Freight pre-rating	Reporting
Payment	Transportation sourcing
Automated freight bill management	Shipment/logistics information
Transportation collaborative portal	Receiving

 

and incorporate data collection in the transaction stream are best positioned to satisfy the cultural and functional needs for efficient and effective collaboration for worldwide business partners: 

 

Strange Bedfellows Make Excellent Collaborators

There are, at least, two areas of interest within this topic:  those who should collaborate and those that need to collaborate. 

 

Those who should collaborate are best identified as the business partners that have a material involvement and/or interest in the supply and demand chains.   Those who need to collaborate are best identified as the business partners that have a material involvement and/or interest in the transaction. Within both of these descriptions, there are incidental and occasional collaborations that need to be provisioned for. Defining the beginning and the end of the supply and demand chains and the transaction will establish the specific collaborators and assign to each the information that will be available and under what conditions.

 

Consider a simple transaction such as, the buying of a widget.  Even in this simple transaction, participants in the process may not necessarily be those who will collaborate, but at the very least, they will be data contributors or information gatherers.  Therefore, a distinction between participants and collaborators, corresponding to available information must be determined early on in the buy/sell process. 

 

Within this hypothetical transaction, the probable participants (physical or electronic) are:  sales, accounting (credit), inventory control, replenishment, and accounting (accounts receivable), warehousing, traffic, shipping, receiving, purchasing, accounting (accounts payable) and customer service.  There is a high probability that there could be more or less participants. 

 

Depending upon the level of integration within a partner, other departments or business areas that could be involved as participants are:  forecasting and planning, manufacturing, distribution, finance, treasury, collateral material and human resources. 

 

Conclusion

Collaboration is still on the horizon.  Consistent with the current, collateral evolutionary business process model, coupled with the establishment of a worldwide commercial and industrial collaborative culture and reasonably universal business mindset, the real benefits of collaboration are waiting to be harvested.

 

Clearly, the business world is interested and I believe that business professionals recognize the importance of collaboration.  As each business partnership continues to socialize this subject and invest in the process, and because collaboration is viral in nature,  it is highly probable that collaboration will grow rapidly.

 

The most successful collaborators will be those that embrace collaboration early on; they will grow with it efficiently.  Those that are “forced” to collaborate will be relegated to accepting that which others have developed for their own benefit.

 

Continuation

Please consider this white paper as a beginning in this subject area, succeeding white papers will address common issues and address them with common solutions.  We encourage our readers to direct any specific questions or comments to papers@transportgistics.com .

 

Disclaimer

The information presented above represents the opinion of the author and not necessarily the opinion of TransportGistics, Inc. nor is it presented as a legal position.

 

 

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