The consumer societies of today have become used to the ability of technology to help them find, review, price and buy all manner of products and services. They are able to do this from anywhere there is a reasonable Internet connection, order from vendors located almost anywhere and express ship to almost any point on the globe.
This has resulted in the transformation of the logistics industry and benefited those organisations with global reach and scope, who can utilise their asset intensive and wholly owned integrated networks. The other winners have been those companies that have enabled this explosion in online commerce, organisations such as Amazon.
The speed at which they have been able to build a logistics capability capable of competing with the very large global integrators has been largely due to their use of advanced technology. Since the company is itself a child of the Internet (Amazon would not have been able to exist prior to the WorldWideWeb), there is an inherent understanding of technology. While many of the large logistics operators have also developed impressive technology platforms, their mindsets have traditionally been the utilisation and control of physical assets. Amazon is, in its very DNA, a technology business that views, operates and directs its worldview through and by technology.
As the world continues to adopt technology devices in order to participate in modern society, this is very likely to entrench their dominance. This is a challenge to manufacturers who may find they have limited choices in accessing some markets, as well as logistics service providers that struggle to support the expected service levels of their customers if they focus on price rather than capability. Both of these categories include companies with a range of information systems supporting their operations.
These systems will include old, inflexible, but very reliable, ERP systems, through to loosely connected functional applications, with fragile and unreliable EDI mechanisms for client and partner data exchanges. e.g. Inventory Management, Order Management, Transportation Management, Supply Chain Planning, etc.
They are increasingly unsuited for the operational requirements shippers and their logistics service providers will need to compete with Amazon and their competitors going forward. It should also be understood that Amazon’s Chinese competitors are at least as advanced in terms of technology supported operations and customer engagement. Their physical logistics operations are in some cases, even more capable than those of Amazon.
This is why a new approach is necessary for companies seeking to compete in such a market. At the moment the online giants have a small fraction of the retail market in developed countries. But because retail is so fragmented, the success of the online players stands out. This means that there are opportunities for those companies prepared to embrace innovative technology platforms and reshape their entire fulfilment operations around them. This will not be a trivial task as it requires a shift in mindset and culture, characteristics that are perhaps the hardest to transform.
SAN FRANCISCO and LONDON, Feb. 4, 2020, PRNewswire
Logistics and Supply Chain industry veterans, Peter Nicholls, Ken Lyon, and Linda Elliott Zider, announce the launch of Tucson Technology, a management solution for shippers, 3PLs and carriers worldwide.
Established in the UK with operations in Hyderabad India, San Francisco California and Singapore, the team has developed the first cloud-native global carrier management platform: T2 Cloud.
T2 Cloud is an enterprise-class platform supporting worldwide operations designed to ship from everywhere to anywhere. The T2 platform supports the most demanding and complex business logistics needs. “The elaborate choreography necessary to manage the variety of physical logistics services, related information flows and unexpected external factors such as weather and other unforeseen issues, is both complex and obscure. The team at T2 has decades of building solutions that do this,” according to Ken Lyon, Board Chairman.
Tucson Technology’s T2 Cloud “uses the latest technologies to ensure continuity and keep pace with the inevitable transformation of the digital supply chain,” stated Peter Nicholls, Chief Architect. Peter was formerly President of Tangata (now ConnectShip, a UPS subsidiary) and was one of the creators of the first patented client-server shipping system.
CEO Linda Elliott Zider has brought together a world-class team with a track record of delivering solutions in Asia, Europe, and North America. Tucson Technology has received initial funding from investors in Europe and America.
About Tucson Technology: Tucson has decades of experience in enterprise shipping combined with deep knowledge of the technologies required to deliver and deploy the world’s first 21st century shipping solution.
It used to be known as ‘The Martini Principle’ – “Anytime, Anyplace, Anywhere”. An advertising slogan for the popular drink that successfully promoted it as a lifestyle choice for international travellers. It’s now been co-opted by logistics professionals as a phrase to describe both the customer demand for product availability and omnichannel fulfilment strategies.
This presents an opportunity for enterprises who can establish operating models aligned with this requirement but is a huge challenge for established enterprises with rigid fulfilment and transportation processes. In both of these instances, the underlying technology platforms will determine their success – or failure.
Consumers in the developed world have been empowered by both the ubiquity of the smartphone and access to the Internet. In the developing world, smartphones are almost as prevalent, even though high speed Internet access is still a work in progress for many areas. But most of them have now become familiar with the ability to order products online and expect rapid delivery anywhere. When this is coupled with social media platforms that can act as powerful broadcast channels, any failure to meet expectations can swiftly turn into reputational wrecking balls that destroy trust, driving customers into the arms of competitors. The pressure for companies to perform is now colossal, irrespective of if they are manufacturers, retailers or logistics service providers.
The systems necessary to address these operational challenges, must be agile, adaptable and scalable.
Established enterprises are usually operating with a technology infrastructure that was designed, implemented and operated over many years, primarily with the goal of meeting internal operational metrics. This infrastructure has probably been updated and augmented in line with business demands. However augmenting an internal ERP platform with some additional applications that streamline access to data and certain processes, then exposing them through an attractive interface supporting client interaction, is probably not agile, or adaptable and is certainly not scalable.
For most organisations, this represents a significant challenge and for some, it is an existential threat.
New entrants competing with established organisations have the luxury of building an operating platform designed specifically for their required operations. The difference between now and when the established businesses designed their technology strategy, is that the costs are much lower and the technical tools, infrastructure and resources are freely available.
Consider this, just over a decade ago, any company seeking to implement some kind of enterprise-class information system needed to acquire and commission the following:
Hardware – servers, data storage, communication routers and possibly internal cabling.
Software – Licences for any operational applications, application tools for any internal development staff, user licences for any applications running on desktop PC’s
People – IT staff to manage operations, training and support, possibly development and data communications
This is not an exhaustive list, but every one of these had to be part of the ongoing budget cycle each year, either as part of capital or operational expense.
In contrast, thanks to the availability of Cloud services, it is possible to replace almost all of these items (including personnel), with monthly subscription fees at a small fraction of the total cost.
New entrants to the market can exploit this trend and compete with the established players at a much lower cost. Of greater significance is the fact that if the new entrant is successful and their business expands rapidly, their technology platforms can expand almost instantly to meet increased demand. This is due to the ‘elastic’ capabilities of the Cloud platforms that have virtually infinite capacity available on demand. The users of these platforms just pay through an increased subscription for the additional capacity they require, while and where they require it. If their requirements change, for example after a peak holiday season, they can reduce their requirement with a commensurate reduction in their monthly fees. This is similar to the way utility services are billed.
This is almost impossible to mimic with the internal IT environments of established companies, who need to procure and commission additional hardware and software in the face of increased demand, but can only do so with enough lead time. If subsequently the demand falls off, they are stuck with the cost base of the additional resources.
This shift in the way technology services are delivered is fundamentally altering the manner in which the world operates. Any organisations that cannot adapt to these new operating models will be unable to survive.
As companies adapt to the demands of omnichannel fulfilment, how they manage the transport and delivery of high volumes of smaller shipments will be critical. Due to the aforementioned Martini principle, shippers will need to quickly determine how they can deliver items, reliably, accurately and swiftly. Both parties in the transaction, the buyer and the shipper, will need to have applications that can provide accurate information as to the choices made and the progress of the order through to final delivery.
This has to happen irrespective of the delivery being across the city or across the globe.
The elaborate choreography necessary to manage the variety of physical logistics services, related information flows and unexpected external factors such as weather etc., is both complex and obscure. Experience in managing these elements is essential when developing the information systems platforms supporting these new commercial models. The specialists at T2 have decades of doing just this, while at the same time learning lessons from every technology evolution they’ve been through. This is why the T2 carrier management platform is so unique.
It is the first global shipping system that is entirely Cloud native, as the development team has taken a clean sheet approach to the design and construction of the platform, its core functions and user apps, using only Cloud technologies and tools.
Obviously, any carrier management solution, has to integrate with the multitude of additional systems existing in the global transportation environment. These are the systems used by the carriers themselves, the major functional applications used by the shippers and logistics service providers, key transit port community systems and government agencies. The T2 development team have been building connections to these systems for many years and this experience has been embedded in the solution design of the T2 platform.
As the explosion in e-commerce reshapes the commercial landscape in many economies, new solutions will be needed to support this transition. Tucson Technology has developed the T2 solutions in response to this evolution and will continue to evolve these capabilities