Southland Distribution and Electronic Shipment Tracking Introduction

Southland Distribution and Electronic Shipment Tracking

Introduction to Supply Chain and Tracking Concerns at Southland Distribution

The cost reductions relative to wireless communication networks and increased efficiency in logistics and tracking within a shipping company are potentially enormous. Not only does tracking shipments make sense from a customer service standpoint, but the company actually saves money when shipments are tracked and sent to the proper destinations. Even within the current logistics system of a company, tracking shipments makes sense in order to solve delivery problems and issues. Many shipping companies use tracking programs and systems to help them stand out above other companies and services in a world where the economic recession has decreased the demand for shipping worldwide.

Southland Distribution is a company that does business through shipment of goods. The services it provides include multi-modal forms of transport as well as time-sensitive delivery of goods. Within a system such as this, it is imperative that a tracking system be implemented that is both flexible enough to handle the unique and different internal demands as well as robust and comprehensive enough to handle the day-to-day and hour to hour complexities of this industry. There are many potential solutions for a company of this size to implement, and a careful consideration of the goals and potential for increased productivity, profits, and customer service is imperative before a company like Southland Distribution can begin to build an effective electronic tracking system.

The sharing of information within a company is a major tool in the fight against inefficiency and waste (Heaver, 2002). Companies that are able to freely move and share information relative to products and movements of these products do much better than companies that do not have such systems implemented. One of the biggest reasons for this lies in the company's ability to create the most efficient, effective service models and shipment services. When services are optimized and costs reduced, not only does the company earn more profit, but they can pass these profits to the customer in the form of reduced rates along with the added benefit of a more intelligent supply chain.

Necessity

Shipping goods from one place to another seems rather mundane and simplistic. But consider shipping a product or package via multiple different modes of transportation, all having multiple stops along the way. Here the logistics problems involved in the packaging, storage, and placement of the shipment on the vehicle itself begin to appear. This is not to mention the logistics nightmare of expected delivery times and the instances where deliveries are made in error or to the wrong locations and recipients. Tracking systems, as a way for a company to share information, make sense in all of these logistics issues. By accurately tracking a product, the company itself can best plan the route, packaging, and packing location that the product will exist within (Heaver, 2002). This seems rather simple, yet it is one of the most basic and most fundamental problems within the shipping world.

Tracking packages through an electronic system also has benefits during times of company crisis or delay. If a company is shipping goods and the goods become delayed, an adequate tracking system can be the first step in successfully re-routing the goods in order to maintain the same delivery date. This goes a long way in keeping customers happy and reducing the ultimate associated costs and frequencies of the shipping mistakes. It is nearly impossible to tell a customer where their goods are at if there is no way to track their movement. With shipment tracking, in an electronic format, real-time estimates can be given and problems can be more successfully dealt with as they appear.

Besides helping a company to reduce shipping errors and increase their capability to handle shipping errors and mistakes, tracking systems can actually help a company grow to incorporate more shipping locations and modes of transportation (Heaver, 2002). Since much of the shipment business deals with logistics, a tracking system can help to reduce the complexity and confusion surrounding a multi-hub, multi-modal shipping system. Companies can increase their efficiency and therefore increase their range, saving costs and giving them the ability to offer more services and options to their customers. This is advantageous because it helps a company separate itself from other companies that are less efficient and logistically effective.

Limitations

There are, however, some significant limitations to most tracking systems within a company. Since Southland Distribution is a multi-modal transportation company, it is vulnerable to logistics issues stemming from the fact that most tracking software and systems only deal with one company, and are usually geared toward single modalities (Karkkainen, Ala-Risku and Framling, 2004). This usually occurs due to the fact that the complexities involved in just one mode of transportation limit the scope and scale of any software and logistics solutions. Just as companies that involve other companies in their supply chain do not often have many smooth transitional commonalities within a software solution; companies that involve multi-modal transportation solutions have an equally hard time integrating one software solution into these multiple modes of transport.

It can be seen that for a company like Southland Distribution, a tracking system for each mode of transport would be beneficial, yet would involve an increased logistics support system and a larger initial investment in the tracking infrastructure. A company such as this may benefit more from a less complex, less efficient, but equally as effective singular tracking system that incorporates all the modes of transport into one central logistics hub (Holmstrom, Kajosaari, Framling, and Langius, 2009). This sort of short-term, multi-hub tracking system would be the best solution for a multi-modal company like Southland Distribution. It would help the company internally while creating the least amount of drag on the transport system itself. It would also create a system of accountability and help provide solutions in the event of lost cargo or improperly shipped goods.

Potential for Better Management

An electronic tracking system implemented within a company like Southland Distribution could help to tighten up management practices and give the company an edge when it comes to implementing new solutions to shipment and tracking in the future. Within the most recent global economic recession, companies have had to survive by doing more with less (Holmstrom, Kajosaari, Framling, and Langius, 2009). By implementing a real-time electronic tracking system, Southland Distribution could help to increase accountability while, at the same time, reducing the actual human requirements placed upon management. This also applies to trying to figure out solutions for shipping errors and dealing with displeased customers. An electronic tracking system would give this company the advantage of knowing more about a particular situation at the moment a problem arises within the supply chain. Instant notification can aid in the solving of a problem while providing management with the most amount of information relative to the error.

Besides helping to create a better, more efficient management environment, electronic shipment tracking can also serve to highlight both the strengths and weaknesses of a company like Southland Distribution. Tracking systems show where maximization is possible, and, over time, helps in eliminating waste and cost overages. By highlighting these specific points within a businesses function, the company can become stronger and more profitable in the medium to long-term (Karkkainen, Ala-Risku and Framling, 2004). There could very well be costs involved initially in implementing some of the fixes that are necessary through the system highlighting weaknesses, but these costs would be minimal relative to the eventual benefits and increased profits. A company like Southland Distribution would do well by allowing an electronic tracking system to highlight its strengths and weaknesses, since these highlights can be quite costly when consultants are hired or by learning through simple trial and error (Holmstrom, Kajosaari, Framling, and Langius, 2009). An effective, efficient electronic tracking system would take the place of trial and error and put the burden of increasing efficiency while reducing costs squarely on the management and people who analyze the shipping and cost patterns themselves.

Much of the technology and strategies implemented within the lean manufacturing world also apply in the movement of goods and services (Ramdas and Spekman, 2000). This is to say that a system that is adaptable, reliable, and easy to overhaul and understand is most beneficial to a company like Southland Distribution. The company would be able to deal with problems on the fly, designating specific resources to solve problems more efficiently with an electronic tracking system. Also, during the course of regular shipping, demand for shipping services will ebb and flow. This means that the human capital and resources that Southland Distribution posses must be able to be shifted to where they are needed most, at any given time.

Having a real-time electronic tracking system would allow the company to see where the demand for resources is within their company at any point in time, allowing for an effective and efficient management and resource allocation response. This is one of the keys to building an effective company while maximizing profits and minimizing costs. Adjusting the workloads and resources available for problem-solving and catering to swings in shipment demands and requirements allows Southland Distribution to do more with less, and fulfill the promises made to the customers with less effort and at a lower cost.

Customer Service Concerns

Customers are always curious about their shipments since their livelihoods often depend on the reliability and accountability found within a shipping company like Southland Distribution. Companies looking to boost their customer satisfaction are always looking for new and cost-effective ways to make customers happy and offer new and unique services at good prices. Southland Distribution could implement a tracking service that helps show customers, in real-time, the location of their shipments and the estimated time of delivery. This would help customers feel as though they could trust Southland Distribution with their business and would help the company garner more support and build a bigger customer base. Many of the largest shipping companies have similar tracking systems, and work hard to incorporate this into the goods and services they offer their customers (Karkkainen, Ala-Risku and Framling, 2004). Companies like DHL and UPS offer customers tracking services based upon the last place the shipment was received. This is great, but it does not provide a snapshot of the current location of the shipment as it is in transit.

Southland Distribution could help set itself above these and other companies by offering real-time tracking of their shipments instead of estimates based upon the last known checkpoint the shipment passed through. Even though, by comparison, Southland Distribution is far smaller than these two companies, it could offer a unique service to help attract customers as well as new business that is more concerned with real-time tracking. This could help the company grow within a niche that serves high-end and sensitive cargo needs.

Associated Costs

Since a company like Southland Distribution covers so many shipping destinations as well as modes of transport, the tracking system implementation stage would likely be the most costly of all the stages required in building such a system. This is due to the simple fact that the sheer number of goods, machinery, and employees that would need to adjust their behavior to incorporate such a system would lead to a major cost obstacle (Ramdas and Spekman, 2000). This stage of implementation would be a closed loop however, and slowly, over time, this loop would be built up from the inside to incorporate the new tracking system. So, over time, the marginal costs of implementing such a system would drop within the company. Southland Distribution stands to gain much from a real-time tracking system, and the benefits far outweigh the costs of implementation.

Besides the up-front costs of implementing a tracking system, there is the maintenance costs associated with it. These costs are relatively small in comparison to those involved in implementation, but none the less should not be overlooked. A company like Southland Distribution could implement and manage an overarching, multi-modal tracking solution relatively easily if it incorporated the proper technology. This technology could include RFID chips, electronic scanners, and computer-based tracking and cost minimization software (Holmstrom, Kajosaari, Framling, and Langius, 2009). There have been many recent technological developments relative to tracking systems and how they follow goods on an item-level, instead of a materials level. Now, each item can be conveniently and cheaply tagged with a chip in order for a tracking system to track it. A system such as this would be rather easy for Southland Distribution to implement, since the shipment of goods does not usually involve many small items, but instead larger, singular items contained within large packages, pallets, and boxes.