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Assessment of Supply Chain Performance Improvements through
Technology Implementation
I-NUF METRANS
Mario Monsreal, Ph.D.
Juan Carlos Villa
Texas A&M Transportation Institute October 19th, 2017
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Agenda
2
• Overview
• Approach
• Literature Review
• KPIs and ICT selection and matching
• Case studies
• Conclusions
• Next steps
Overview
3
Objective
• To assesses how technology implementation can improve supply chain performance at the regional level.
Scope
• Regional level
• Public sector perspective
• Focus on information and communication technology (ICT), and
• Ground transportation
Approach
4
Three Tasks:
Task 1. Conduct a literature review on SCM Perspectives, KPIs and ICTs that are used in supply chain performance measurement
Task 2. Select, develop and match most adequate KPIs and ICTs for regional supply chain performance measurement.
Task 3. Conduct two case studies to evaluate the selected KPIs and ICT
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Task 1. Literature review on SC Management, KPIs and ICTs
Task 1. Literature review
6
Feature Private-sector SCM Public-sector SCM
Goal Profit making from customer Quality service delivery to
citizens
View of SCM Procurement is viewed as an
element of SCM
SCM is viewed as a
procurement tool
Sources of
Revenue
Sales of goods and services Taxes and fees
Governance Guided by board of directors and
business plans
Legislative bodies, laws and
regulations
Skills Have highly skilled actors Have less skilled actors
Receptiveness Emphasis on innovation and
entrepreneurship
Emphasis on accountability
and transparency
Private Vs. Public Supply Chain Management Perspectives
Task 1. Literature review
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Feature Private-sector SCM Public-sector SCM
Organizational structures Firms of many sizes with
room for new entrants
Highly complex system of
organization
Competencies Very high Low
Confidentiality Very high Low
Degree of collaborations Very high Low
Degree of integration Very high Low
Strategic partnership High level Low
Degree of implementation High Low
Technological application High application Low application
Private Vs. Public Supply Chain Management Perspectives
Task 1. Literature review
8
Outcomes:
KPIs
Supply Chain Operations Reference Model (SCOR) and Logistics Performance Index (LPI) as a framework.
Criteria:
• Descriptive Value
• Technical Appropriateness
• Data Availability and Cost
Task 1. Literature review
9
Outcomes:
ICTs
ICTs were classified under three categories based on the technology function :
1. Data collection
2. Data transmission
3. Data processing
ICTs were selected based on the IoT concept
10
Task 2. Select, develop and match most adequate KPIs and ICTs
Task 2. KPIs and ICTs selection and matching
11
Selected KPIs and their relation to public sector
KPI Relation to public-sector decision points
Time Measures
Lead Time
Depends on order processing time and product transportation
time, which in turn depend on communication and
transportation infrastructure.
Idle Time
Depends on the general conditions of infrastructure some freight
inspection processes and regulations on the use of infrastructure.
Transit Time
Depends on the general conditions of infrastructure and
regulations on the use of such infrastructure.
Clearance Time Depends on the general conditions of infrastructure, regulations,
and inspection processes.
Task 2. KPIs and ICTs selection and matching
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Selected KPIs and their relation to public sector
KPI Relation to public-sector decision points
Cost Measures
Inbound Costs Depend on tariffs, regulations, and on lead, idle, transit, and
clearance times.
Outbound Costs Depend on tariffs, regulations, and on lead, idle, transit, and
clearance times.
Transportation
Costs
Depend on regulations and on idle, transit, and clearance times.
Reliability Measures
On-Time Final
Performance
Depends on suppliers’ lead-time, and on idle, transit, and
clearance times, which in turn are influenced by infrastructure
conditions.
Transit or Travel
Time Reliability
Depends on the general conditions of infrastructure and
regulations on the use of such infrastructure.
Task 2. KPIs and ICTs selection and matching
13
Selected KPIs and their relation to public sector
KPI Relation to public-sector decision points
Effectiveness Measures
Load Factor Function of infrastructure conditions and assets, regulations.
Throughput Depends on infrastructure capacity and facilities use regulations.
Service Measures
Order Fill Rate Depends on infrastructure and facilities use regulations.
Perfect Order
Metric
Formed by time, reliability, and fill rate components; it depends on
infrastructure, facilities use, and regulations.
Trip Measures
Market Distance Depends on trade routes, international transportation
agreements, and domestic market development.
Supply Base
Distance
Function of trade routes, international trade agreements and
development of domestic suppliers.
Task 2. KPIs and ICTs selection and matching
14
Selected Information and Communication Technologies
Task 2. KPIs and ICTs selection and matching
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KPI Data Collection Data Transmission Data Processing
Time Measure
Lead Time (Days)
RFID, Optical Codes, Inductive Technologies,
WSN
Bluetooth, RTLS, WSN, GPRS, GSM, M2M
CTM, TMS
Idle Time Video Vehicle Detection,
WSN GPS, RTLS, GPRS, GSM CTM, TMS
Transit or Travel Time
RFID, Optical Codes, Video Vehicle Detection,
WSN
Bluetooth, RTLS, GPS, GPRS, GSM, WSN
TMS, CTM, APS
Clearance Time
RFID, Codes, Video Vehicle Detection,
Inductive Technologies, Weigh-in-Motion, WSN
Bluetooth, RTLS, WSN, GPRS, GSM
TMS, CTM
KPIs-ICTs matching
Task 2. KPIs and ICTs selection and matching
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KPI Data Collection Data Transmission Data Processing
Cost Measures
Inbound Cost
NA M2M CTM, APS, TMS, ERP,
WMS
Outbound Cost Transportation
Cost Reliability Measures
On-Time Final Performance
RFID, Optical Codes, Video Vehicle
Detection, WSN, Inductive Technologies
M2M, GPS, RTLS, GPRS ERP, APS, CTM, TMS
Transit or Travel Time Reliability
RFID, Optical Codes, Video Vehicle
Detection, WSN
Bluetooth, RTLS, GPS, GPRS, GSM, WSN
TMS, CTM, APS
KPIs-ICTs matching
17
KPI Data Collection Data Transmission Data Processing
Effectiveness Measures
Load Factor
RFID, Optical Codes, Video Vehicle
Detection, WSN, WIM, Inductive
Technologies
Bluetooth, RFID, WSN, RTLS, M2M
TMS, WMS, APS
Throughput
RFID, Optical Codes, Video Vehicle
Detection, Weigh-in-Motion, WSN
Bluetooth, GSM, GPS, WSN, RTLS, M2M, GPRS
CTM, APS, TMS, ERP
Task 2. KPIs and ICTs selection and matching KPIs-ICTs matching
18
KPI Data Collection Data Transmission Data Processing
Service Measures
Order Fill Rate
RFID, Optical Codes, Weigh-in-Motion
Bluetooth, RFID, WSN, RTLS, M2M
WMS, ERP, APS
Perfect Order
RFID, Codes, Video Vehicle Detection, WSN
GSM, Bluetooth, RFID, GPS, WSN, RTLS, M2M,
GPRS
CTM, APS, WMS, TMS, ERP
Distance Measures
Market Distance
RFID, Codes, Video Vehicle Detection
GPS, RTLS, M2M, GPRS, GSM
TMS, CTM
Supply and Base Distance
RFID, Codes, Video Vehicle Detection, WSN
GPS, RTLS, M2M, GPRS, GSM
TMS, CTM
Task 2. KPIs and ICTs selection and matching KPIs-ICTs matching
19
Task 3. Case studies
Purpose:
To evaluate the use of KPIs and ICTs and their integration in real-world scenarios.
Specific Cases:
1. Land Border Port of Entry (Laredo, TX)
2. Maritime Port of Entry (Port of Houston, TX)
Approach:
Look at the gap between current KPIs and ICTs and “desired/needed” for SC performance measurement.
General Outcomes:
• Current KPIs and ICTs—already implemented and measured.
• Proposed KPIs—not yet being measured, but that the port has the required technology in place to calculate them.
• Recommended KPIs— with regional supply chain scope that the port could provide information to measure.
20
Task 3. Case studies
21
Mexico U.S.
1 MexicanYard:
Shipment is picked up by trucker and
heads to Mexican Customs
Inspection
Mexican Customs
Inspection:
US Federal Compound
CBP Primary Inspection:DOT-FMCSAUSDA, other
federal agencies
2 3State Safety
Facility: Border Safety
Inspection Facility
4 5U.S. Yard:
The shipment is dropped off at the U.S. yard once crossing
the proper inspections
Transit or Transit Time / Transit or Transit Time Reliability
Clearance Time
Idle Time
Laredo POE with Current and Proposed KPIs
Task 3. Case studies
22
Laredo implemented technologies
Task 3. Case studies
Technology at the
Land POE
Type of
Technology Application at the Port Benefits of Applied Technology
RFID Data
Collection
1. ID for trucks that pay
annual fees
2. ID for shipments in the
FAST program
3. Measure transit time and
wait time
RFID technology has helped expedite
the border crossing process by sharing
data electronically and identifying trucks
that are enrolled in FAST program. It
also measures travel time systematically.
23
Port of Houston with Current and Proposed KPIs
Task 3. Case studies
24
Port of Houston implemented technologies
Task 3. Case studies
Technology
at the Port
Type of
Technology Application at the Port Benefits of Applied Technology
OCR Tags (2D
Optical Tags)
Data
Collection
OCR 2D optical tags placed on
the back of trucks coming
through the Port. Cameras read
the registration information
during the first process of entry
into the Port.
Trucks no longer have to wait and
fill out registration information at
the gate. This technology has
reduced idle time (at the gate) by
48%.
WIM Scales Data
Collection
Trucks are weighed to make
sure they are within the legal
weight limit when entering and
leaving the Port.
Truck weights can be measured
accurately and quickly. Weight
data is collected and stored
automatically.
25
Task 3. Case studies
Technology at
the Port
Type of
Technology Application at the Port
Benefits of Applied
Technology
Lynx
Application
Data
Processing
Provides real-time
information on pick-up and
drop-off processes (dock
availability and scheduling).
Container availability,
equipment history, or vessel
schedule is available through
the website and the mobile
app.
Improved coordination and
idle time by increasing
communication, decreasing
wait time for pickup or
delivery, decreased
congestion, easier access to
accurate information, and a
reduction of cell phone
usage at the terminals.
Port of Houston implemented technologies
26
Task 3. Case studies
Technology at
the Port
Type of
Technology Application at the Port
Benefits of Applied
Technology
JD’s ERP
System
Data
Processing
JD Edward’s EnterpriseOne
9.2 ERP system has an
internal website used
across the organization,
from HR, Procurement,
scheduling, etc.
Improvements through
streamlining various
business processes and
enhanced overall system
security.
Terminal
Operating
System (TOS)
Data
Processing
The Navis 4 is the TOS
currently used by the Port.
This system manages gates,
vessels, ship yards, and
billing.
Minimize truck turn-
around time and increase
vessel productivity.
Port of Houston implemented technologies
27
Estimated Benefits of implemented technologies at the Port
Task 3. Case studies
Technology Supply Chain Impact Percentage of Impact
Terminal Operating
System (TOS)
Terminal Productivity Improves up to 20%
Transit or Travel Time Improves up to 35%
Optical Character
Recognition (OCR)
Idle Time Reduced in Houston by
48%
Inventory Distribution Cost Reduces by up to 30%
Transit or Travel Times Reduces by up to 40%
28
KPI Relation to POE Specific
Variables
Data Collection Systems
Data Transmission
Data Processing
Recommended KPIs for the Laredo POE
Throughput Number of trucks processed at the POE
Truck Volume (empty, loaded, FAST)
Inductive Loop Detectors, Laser vehicle detection devices
WSN, M2M CTM
Recommended KPIs for the Port of Houston
On-Time Final Performance
Punctuality of the container final deliverable time to truckers. Important KPI to improve port efficiency and reliability.
Target Time, Time of Arrival
RFID, Optical Codes, Video Vehicle Detection, WSN, Inductive Technologies
M2M, GPS, RTLS, GPRS
ERP, APS, CTM, TMS
Recommended KPIS for Regional SCP Measurement
Task 3. Case studies
29
KPI Relation to POE Specific
Variables
Data Collection Systems
Data Transmission
Data Processing
Recommended KPIs for the Port of Houston
Load Factor
Determine vacant space in containers and provide that information to shippers supply managers.
Volume, Capacity
RFID, Optical Codes, Video Vehicle Detection, WSN, WIM, Inductive Technologies
Bluetooth, RFID, WSN, RTLS, M2M
TMS, WMS, APS
Perfect Order
Information on travel times and on-time final performance KPIs. Identify where/when/how containers are being delivered at destination.
Time, Distance, Cost, Volume
RFID, Optical Codes, Video Vehicle Detection, WSN
GSM, Bluetooth, RFID, GPS, WSN, RTLS, M2M, GPRS
CTM, APS, WMS, TMS, ERP
Recommended KPIS for Regional SCP Measurement
Task 3. Case studies
30
Conclusions and Next Steps
Conclusions • Public sector agencies and private sector industries have different
goals and metrics. However, they could benefit from sharing information to improve overall supply chain performance and regional competitiveness.
• IoT could prove to be a valuable asset in regional supply chain management, as a seamless ICT integrating platform throughout different levels of a regional supply chain and between different supply chains.
• KPI-ICT pairing is the technical core of supply chain performance measurement. It links the needed information for decision making with available and suitable tools to provide required information.
31
Conclusions • Underutilized implemented technologies for supply chain
performance measurement. Mainly due to:
• Technology implementation is often performed for reasons other than supply chain performance assessment. Ample room for improvement.
• Lack of understanding by public-sector decision makers of the importance of supply chain performance, measurement methods and available tools.
32
Next Steps
• Develop a general system to measure regional supply chain performance that could then be applied to different geographic regions.
• Overcome the lack of understanding of the IoT concept through…
• …Specific demonstration of the IoT concept and its impacts on supply chain performance via simulation.
33