Logistics Operations Management ERP on AWS Cloud

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Introduction to 3PL logistics operations

An ecommerce logistics operation is the backbone of an ecommerce business and it plays a vital role in driving sales and preparing for future growth. The strength of logistics operations impacts the ability to meet customer demand.

Logistics operations is an essential part of the supply chain and refers to the process of moving finished goods, starting from the manufacturer, and moving to the end user. Logistics operations are made up of a series of 4 processes that work together- Suppliers and manufacturers, Distributed fulfillment centers, Warehousing & Shipping

Distributed Fulfilment centres are warehouses that hold inventory close to the end customer, so each order is picked, packed, and shipped as soon as it’s placed to ensure the fastest delivery possible. Many E-commerce companies &  direct-to-consumer (DTC) brands depend on a third-party logistics (3PL) company that performs ecommerce fulfillment services. That way, they don’t have to worry about fulfilling and shipping orders themselves and another key benefit of partnering with a 3PL is the ability to distribute inventory across logistics centers. This reduces shipping costs and speeds up delivery.

3PL logistics operations management applications challenges

E-commerce sector has been an ever-growing sector and due to COVID-19 pandemic we have seen its growth exponentially. E-commerce & DTC has become the backbone for supplying essentials to the more than 1.3 billion people of India.

E-Commerce growth, consumer preferences due to COVID-19 pandemic, government reforms and advancements in digital technologies are expected to lead the transformation of the Indian logistics ecosystem and that’s why most of the 3^rd Party logistics service providers has to remodel its core business processes and expedite the adoption of next-generation technologies and digital-driven solutions to capitalize on this significant market opportunity and fuel its growth plans. 3^rd Party logistics service providers have major changes with their current IT Infrastructure –

• Old legacy enterprise applications for managing the 3PL operations are struggling to keep pace with new business requirements and lacking at technology front.
• Traditional applications are becoming an obstacle for organization growth and not able to provide good customer experience.
• Time to market, Customer experience and real time automation is a big-time showstopper for the 3PL Service Providers.

IBM Solutions on AWS Cloud

By leveraging IBM deep industry expertise and access to technological innovations including cloud & AI, IBM GBS has developed 3rd Party logistics operations management suite of applications, an ERP on AWS Cloud platform which enables 3PL service providers to attain agility in demand management, obtain advanced and flexible dynamic pricing modelling capabilities and provides enhanced visibility and transparency for its customers. It will improve the efficiency and performance of logistics operations.

It is designed specifically with a mobile first policy by which it is available on mobile devices as well as their industry-standard tablets along with Desktop based access, enabling the field staff to work from anywhere and enabling 3PL service providers migrate to a desktop-free environment.

The platform is based on micro services which is a cloud native architectural approach in which a single application is composed of many loosely coupled and independently deployable smaller components, or services. These components can be scaled and updated independently of one another, reducing the waste and cost associated with having to scale entire applications because a single feature might be facing too much load.

Furthermore, by leveraging the container management capabilities of Kubernetes deployed on a AWS cloud, the platform provides high scalability, availability and security with self-healing runtime environment.

Cloud based solutions are now highly mature and can easily provide the backbone to build fully functional logistics operations ERP. AWS highly scalable, virtually unlimited compute, network and storage services, coupled with advanced open-source frameworks can provide Infra & platform for logistics operations management suite of applications.

Many of 3PL service providers moving infrastructure to AWS Public cloud to gain operational efficiency and optimization cost.

It has been a custom development by IBM. End-to-end cloud native microservices based architecture deployed on AWS public cloud by leveraging various AWS Services. It’s a Hybrid cloud solution, ERP Application on AWS platform is integrated with customer’s core mission critical applications on private Data centre, Public SAAS providers, Government Regulatory Servers & External Customer Interfaces. The suite of applications consists of multiple components such as customer contracts, associate contracts, booking, associate management and others.

Solution Architecture

Architecture Overview

1. AWS API gateway, Cognito & ELBs enable 3PL Service Providers to expose secure Open APIs which help them to expand their business with corporate customers by enabling large scale system integrations.

AWS ELBs, CloudFront, Route 53 enable native system integration with handheld devices like Mobile, Laptop, printers, Sticker & barcode scanners. Handheld devise plays major role in logistics operations, Seamless Integrations of such devices with customer build application deployed on AWS provides a great confidence to 3PL Service Providers to adopt public cloud Infra Platform.

Ease to use & deploy AI services like Alexa enabled new way of customer interactions which improves productivity by enabling voice commands on your mobile/wearable. AWS Alexa enable Voice Commands to check Billing done during the day, Number of Eway bill processed during the day, Package delivered during the day etc. It provides rich, personalized voice experiences that redefine the way employees get work done.

2. AWS S3 Document Mgmt Service to store retail & corporate customers contracts & KYC Document, e-way bills & manifests documents required to delivery of 100+ millions packages a year. Customer would be able to reduce paper usage as well by using AWS S3 Digital document Repositories.

3. AWS EKS with Node scaler & HPA enabled to handle high volume transactions like-

• Customer Contracts & KYC Documents CRUD operations. Eway bill CRUD operations
• Rule based dynamic pricing modelling engine to generate invoices based on Customer contracts & e-way bill transactions
• Billing & Payments
• Eway bill tracking
• Master Data Mgmt , Authentication, Authorization

4. Event driven, loosely coupled & highly scalable architecture to establish an robust & fault tolerant integration between AWS cloud services, core mission-critical logistics software on on-premise data centre, Public SAAS providers & External Customer Interfaces and to process millions of packages delivery per day.

5. Private out bound API gateway for secure and unified Integration with Government E-way bill system & Public SMS/Email Service providers.

6. AWS DevSecOps Tool chain provides greater speed and agility for dev & security teams which helps 3PL Service Providers to attain agility in demand management, obtain advanced and flexible dynamic pricing modelling capabilities.

• AWS DevOps pipeline: Automates build release process and provides better collaboration and communication among teams
• AWS ECR: Early identification of vulnerabilities in code
• AWS Synthetic: Automates API Monitoring which helps to proactively identify issues & remediation.
• AWS Device Farm: Automates mobiles apk testing which helps customer to automate proactively testing of new features.
• AWS Cloud watch: Provide high degree of Observability to monitor Infra and applications.

7. AWS provides wide verity of security tools for web request filtering, Layer 3,4 & 7 Security, API auditing, Data Encryption and observability which helps 3PL logistics operation application security.

Conclusion

Online platforms have increased opportunities & competition for 3 PL service providers and hence many E-commerce &  direct-to-consumer (DTC) brands partnering with 3 PL 3 PL service providers to gain operational efficiency and optimize the cost hence It is imperative for logistics service providers to innovate logistics operations applications to manage their growing business, enrich customer experiences as well as boost revenues.

IBM GBS Custom build logistics operations management suite of applications on AWS cloud is a new digital platform to manage 3PL service provider’s growing business, enrich customer experiences as well as boost revenues by acquiring new accounts & by optimizing costs.

Logistics operations management ERP on AWS Cloud would provide following benefits

• 20% reduction in annual Infrastructure cost.
• 20% yearly business growth to handle more customers and order volumes.
• Logistics Operational Efficiency
• Real time automation for dynamic pricing engine
• Future ready digital platform
• Mobility and desktop-free environment
• Reduce Time to market
• Improve Customer experience

Resource:

IBM Travel and Transportation industry