Hub to higher performance? - an internet hub for the Vos Logistics supply chain

Sharing information between multiple parties in a multi-modal logistics chain can potentially improve coordination within the chain. However, information sharing also requires the participation and collaboration of multiple parties whose goals are not always aligned with each other. This paper describes experiences from the ongoing implementation of a Logistics Hub system for a transport supply chain directed by Vos Logistics. Interviews with participants in the logistics chain were conducted to analyse the Hub, its implementation process, and its effect on performance of the supply chain. Figure 1: Current financial flows in the chain. 1.3 Research questions and approach While implementation of the Hub was proceeding, Connekt by the beginning of 2002 requested the Erasmus University Rotterdam to conduct a study on the implementation and benefits of the Hub. In this research we focus on three main questions (Table 1). Table 1. Research questions Nr Question Paper section 1 What information, financial and logistics processes take place in the Vos supply chain? 2 2 How will processes change and what performance improvements are expected/realized as a result of the hub? 3 3 What are success factors for implementing a hub for supporting transport chains? 4 Our research approach includes literature study, semi-structured interviews with the supply chain parties involved and Informore, analysis of the hub software design and of actual operational data after the hub goes into operation. The first round consisted of seven semi-structured interviews in five organisations participating in the Hub. A second round of interviews will be conducted as the participants start to use the Hub (anticipated mid 2003). A number of inward adapters, to enable automatic confirmation messages to the Hub, still need to be finalized and discussions on pricing agreements are still ongoing. This paper thus represents an intermediate set of research results. However, the results of the first scan already include several interesting findings and lessons learned. 1.4 Outline of the paper The remaining sections of the paper address the three research questions sequentially. Section 2 describes the current Vos container transport chain and the proposed design of the hub. Section 3 briefly discusses expected performance improvement as a result of a hub. Section 4 highlights some of the implementation issues identified. Section 5 presents conclusions and reflections. 2 THE CURRENT VOS SUPPLY CHAIN 2.1 Current physical flows The logistics chain in this study involves the transport of maritime containers from a hinterland terminal in Veendam (Northern part of the Netherlands) through the port of Rotterdam. We describe in this section the current physical and information flows in some detail and some of the limits of the current situation. In Figure 1 the main arrow represents a simplified image of the physical container flow and financial flows. In reality, many variations of this flow can occur. The container flow directed by Vos between Veendam and Rotterdam involves about 100 full containers daily. At the same time, a similar number of empty containers are moved from Rotterdam to Veendam to replenish the container stock in Veendam. A train shuttle transports full containers between Veendam and Rotterdam on a daily schedule. Currently, Vos batches its daily shipments into one daily trainload. The train shuttle to and from Veendam is managed by the train operator (ACTS) and its load capacity is booked by Vos at an earlier stage. Seaterminal