In Shipping, Real-time Means Real Savings
February 26, 2003
Shipping company Emery Forwarding deployed a WLAN to help it with the tracking of packages and found that real-time data can lead to a significant return on investment.
In the shipping industry, real-time access to data means real gains in profitability. Emery Forwarding learned that lesson first-hand after it installed wireless local area networks (WLANs) in its 100 North American service centers as part of an overhaul of its communications capabilities.
"Previously, we had a very manual batch bar-code scanning environment" said Ron Berger, Emery's managing director for technology. "We didn't have a real-time view into where shipments were. In our business, it's much better to see data as it occurs, not at the end of the day."
The batch-oriented system caused unnecessary expenses and was not customer-friendly, Berger said. He described how the old system worked: "Previously, during a pickup, the driver would scan the barcode on the shipping document," he said. "When the package got to the service center, the driver put the handheld into the cradle and that's when the information was downloaded to the mainframe."
Now, when a driver picks up a shipment, he or she scans the information with a handheld device that has both wireless and barcode scanning capabilities. The device automatically transmits that information to Emery's mainframe via a wireless wide area network (WAN) provided by Motient.
When the driver returns to the service center, milestones in the shipping process are automatically added in real-time via the 802.11b network to each package's tracking record. Milestones include unloading the shipment and assigning it to a specific plane or truck, Berger said.
That process occurs in reverse when the package arrives at its destination service center. Milestones such as putting it on a delivery vehicle are added to the package's record, again automatically and in real time, via the WLAN.
Emery's new system has created an unusually strong return-on-investment, Berger said. For instance, one important area in which the company saw decreased costs and increased productivity was in handling customer inquiries about the status of shipments.
"Before, a phone inquiry from a customer would have resulted in a call from the call center to the shipping service center. From there, there'd often be a radio call to the driver. If you added it up, it could cost 30 minutes of labor just to get the answer for one customer."
Now, customers can get the real-time status of their shipment via the Internet, Berger said. If they prefer to dial the call center, the new system enables personnel there to provide answers more quickly than before.
Another significant benefit has been the company's ability to dispatch trucks and deploy planes more efficiently.
"We used to have a very manual dispatch system," Berger said. Now, for both pickup and delivery, the company's dispatch software automatically assigns many packages to a specific vehicle. If the driver is at the service center, the software transmits that information via the WLAN. If the driver is on the road, the information is sent via the wireless WAN.
"Also, if we see a large shipment coming in and we have an overloaded plane, we now have more time for contingency planning to protect the shipment that our customers expected."
A formal study commissioned by the company confirmed the strong ROI."We calculated a fifteen minute productivity gain per day for every driver and for dock personnel," Berger said. Also, many expenses, such as those for call centers, have been reduced.
The study found an ROI of 151% and an eight-month payback on Emery's investment.
Berger said that there were surprisingly few problems deploying WLANs in the company's 100 North American service centers.
"We did a facility planning overview for each service center, looking at the size and configuration of the facility in terms of coverage," he said. "For some of the larger facilities, we did a RF (radio frequency) audit for the placement of the access points."
While the audits examined a variety of issues, most notably potential interference, they found relatively few problems.
"We had a couple of instances where there was an office in the middle of the facility with a lot of metal ductwork -- that sort of thing," Berger said. In those few cases, access points were positioned in such a way to minimize interference, he said. The ease of the WLAN deployment also was the result of the nature of the service center buildings.
"Most of the service centers have tall ceilings and the access points are ceiling mounted." Because of that, there were few structural interference problems and most service centers required only two access points for complete coverage.
However, even when WLAN or wide area wireless coverage is lost, Berger said Emery's system handles the problem adroitly. The handheld applications automatically go into "journaling mode" in which they continue to collect and store data. When coverage resumes, the devices automatically transmit all the stored data.
As often is the case with 802.11 networks, security was a key concern for Emery. "We started out with WEP (Wired Equivalent Privacy)," Berger said of the encryption protocol built into 802.11b equipment. "But then we went much further."
In addition to encryption, Berger said the network must recognize the device itself before access can be gained. Also, there is application-level security that must be adhered to before data is transferred to the mainframe. He refused to discuss the details of the application-level security.
Because of those measures, Berger said he was confident that Emery's data is secure.
"Maybe somebody could see that there's an access point," Berger said. "But they'll have a heck of a hard time getting any further."
Given the relative ease of the deployment and the strong ROI, Berger said the company is extremely satisfied with its new technology, particularly since it helps provide better service for its customers.
"If you're delivering a load of transmissions to an automaker and they need to know where the shipment is at so they can plan their own process, providing that information in real time is a huge value," he said.