ONE REASON CARRIERS ARE
reluctant to embrace online transportation services is that they're afraid to share information with potential competitors, an industry consultant says.
Charles Beard, managing director of transportation e-solutions at KPMG, has just completed a report on the transportation industry and e-commerce.
Beard found that while shippers want one-stop shopping for information about their goods' journey through the supply chain, carriers don't necessarily see that as being in their interests.
Many in the logistics industry are striving toward what is called see where an order of sweaters is, whether it's on a truck in India, on a ship in the Atlantic, or on a railcar in Virginia.
Some of the transportation software and e-commerce companies, such as Celarix, say they are close to making that a reality. But a fundamental problem with visibility is that it means each party must send information to a single source, effectively sharing information with potential competitors. This seems to hit carriers, hardest, Beard said.
"You don't see Sprint and AT&T sharing information about how much they charge their customers," Beard said. Carriers don't want to either, he added. But they will probably have to, Beard said as customers increase their demand for what he calls "e-business maturity."
"We probably will start to see information sharing between the carriers. Everyone wants to see through the glass pipe these days," he said.
Unless a company is handling every leg of a cargo's journey, " you're going to have to get into the information-sharing business, and that's not easy," he said.
Generally, the KPMG study found that carriers are at a Stage of e-commerce maturity that Beard described as "transactional," but that shippers and analysts want to see carriers getting "interactive" through the Internet.
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The 'transactional stage means that carriers have advanced from merely posting information on a Web site to allowing customers to book cargo or make other requests.
The interactive stage provide the carriers' customers with a transportation service that is a working part of a dynamic manufacturing and distribution system.
"You're going to see a lot more of companies taking transportation systems and integrating them into the manufacturing schedules to get real-time product," Beard said.
But there is plenty to scare the carrier in the new e-commerce world. Carriers remain leery of online auctions of transportation services. They worry that such auctions would turn carriers' services into a commodity that is sold on price alone.
"Some carriers are beginning to see impact on their business from these things, and they're being rate-shopped," Beard said.
"This is an industry, that's largely built on relationships and performance and now what we're seeing is that certain loads that You would have given to' your carrier of choice, the transport manager is shopping around for a lower rate and going back to the carrier and saying: look how much money I can save." Beard emphasized the main conclusion of his study was that relationships between carriers and customers will remain crucial, and that the Internet would be a useful tool to facilitate that.
Those interested in receiving a free copy of the report can e-mail Ikodama@kpmg.com.
Helen Atkinson can be reached at hatkinson@mail.joc.com
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