Each day wholesalers and shops from all over Poland place about 100 orders for delivery of these chocolates. Each day 3,000 cardboard boxes are prepared (i.e. 18,000 thousand individual boxes of chocolates) and they find their way to shops the next day. Is the Customer able to keep control over the continuously modified data about orders and deliveries? Is it possible to streamline the transport of food products?
Yes, even if products are manufactured in several plants and stored in different warehouses, it is possible to outsource logistics without losing control over the relevant data. It is simply necessary to integrate the systems of the manufacturer and the logistics operator.
If the Customer was not willing to cooperate with a logistics operator, the orders sent to him from various shops (for instance, in preparation of Mother's Day), would have to be registered in his own ERP system. The implementation of such a system is not simple but once completed, he would have full control over the flow of information in his business. In order to cut costs and minimize risk, manufacturing companies most frequently choose to outsource logistics. It allows for full utilization of capacities offered by a logistics company and its experience.
Nevertheless, such collaboration raises certain anxieties. Won't it be connected with losing everything that the Customer has been able to develop? Will the logistics operator be able to adjust to the Customer without turning his processes upside down?
PERFECT SYSTEM INTEGRATION I.E. SIMPLICITY...
Integration of IT systems has been successful if:
- data between the systems (ERP of the manufacturer and WMS of the logistics operator) are transferred fast,
- the adopted technical solutions are foolproof,
- transmitted information is of good quality,
- data exchange covers the largest possible number of operations which eliminates manual activities.
The ideal solution from the point of view of the manufacturer of the aforementioned chocolates for Mother's Day is the integration of his system (in this case it was SAP) with the system of the operator (we use the well known Red Prairie system) that would be invisible to his employees. We were able to accomplish this goal in this particular example.
...BACKED BY ADVANCED TECHNOLOGY...
When checking the shipment status, an employee of the Sales Department of the manufacturing company does not need to see that the loading confirmation visible in his computer was registered 15 minutes before in the warehouse of the logistics service provider 300 km away, and that it travelled between the two systems and several servers located in two different countries while being encrypted and decrypted in the meantime.
However, all this had to be taken care of beforehand by IT specialists who ran the integration process and developed 11 different templates of messages transferred between SAP and Red Prairie. They include the following information:
- Basic product details.
- Address details of consignees and consignors.
- Quality control of product batches.
- Advice notes for warehouse deliveries (regular deliveries and returns).
- Confirmation of inbound products.
- Release orders and their updates.
- Release confirmations.
- Orders for value added services (labelling of goods, preparing promotional sets).
- Quality changes.
- Stock updates.
- Current stock reports.
The systems exchange data every 10 minutes. They do it without breaks, 24/7. Transport of food products (and no only) goes like clockwork.
...TO MAKE SURE THAT SHOPS WILL NEVER BE OUT OF CHOCOLATES
All the transactions executed in Red Prairie are immediately communicated to SAP, including information about possible damage of goods, quality changes, accepted returns, etc. This gives the same view of the warehouse stock in both systems. But this could not be enough. Each day, at the same time at night, on the side of the Customer and on the side of Raben, an electronic report of the warehouse stock is generated. After that both files are compared and possible differences that need explaining are sent to e-mail boxes of stock controllers.
This assures the Customer that the 100 boxes of chocolates ordered by the shop for Mother's Day are actually in the warehouse and the order can be executed. And Consumers can be reasonably sure that even at the last moment they'll be able to find their Mom's favourite chocolates in the shop next door.