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| | Logistics business transformation outsourcing Consider the logistics outsourcing provider business model for greater scope and deeper integration |
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Service detail The logistics outsourcing provider business model is evolving to offer greater scope and deeper integration. Currently, logistics outsourcing models include: transport, warehousing, customs brokering; third party logistics providers (3PL's) and freight forwarders; lead logistics providers; and supply chain integrators. Each type of model has different attributes with regards to client relationships and pricing arrangements. IBM's approach to logistics outsourcing is to deliver improved business results through continuous strategic change and the transformation/operation of a client's business measured against C-level executive business outcomes. Highlights |  | | IBM goes beyond just addressing a client's pain points in the short term and demonstrates sustained value and innovation over the strategic horizon. IBM's Logistics Business Transformation Outsourcing solutions address the challenges experienced by clients in the logistics space: |
Financial Pressures - Erosion of margins
- Logistics costs rising as a % of revenue
- Shareholders demanding faster ROI
- Shift to a more variable cost structure
- Need to focus on core business & shed assets
- Cohesive logistics strategy across enterprise
Multiple Logistics Providers in a Global Network - No single optimal logistics provider
- Need for global consolidation / aggregate spend
- Commoditization
- Downward rate pressure
- Need more control, cost efficiencies, governance model with providers
Flexibility, Reliability, & Responsiveness - Customers are expecting higher visibility & reliability
- eCommerce with immediate order / shipment tracking
- Dynamic routing
- Inventory optimization for cost reduction and just in time delivery
- RFID mandate
Global Expansion - Sourcing / Manufacturing in China & Eastern Europe
- Global competition increasing
- Growth through acquisitions generates inefficiencies
- Increasing government regulations for earlier data, accuracy and security
Our Logistics Business Transformation offering is built on the success and innovation of IBM's own Global Logistics operations. IBM's Global Logistics Network is secure, robust, scalable and reliable. It has delivered a proven track record of on time performance and availability. Because IBM's logistics infrastructure is scalable and has "plug & play" supplier capability, we can easily and quickly extend our solution for clients. There are the four service areas in the IBM Logistics Business Transformation Outsourcing offering framework: (1) Logistics Strategy, Network Design and Development - Translate business needs and priorities into logistics requirements
- Logistics network modeling and business case development
- Logistics operations design: organization, process, IT, measurements
- Best/proven practice guidance
(2) Logistics Services Procurement - Sourcing strategy development & Industry Knowledge
- Supplier evaluation, selection, and contract management
- Supplier cost and service management
- Supplier relationship and performance management
(3) Logistics Operations Management - Day to day logistics network management
- Integrated in-transit visibility, event management, order status, operations metrics
- Supply chain total cost & network optimization
- Claims processing
- Logistics supplier payment and audit
- IT integration and management
- Logistics operational guidance
(4) Logistics Global Trade Management - Global trade (import / export compliance) process management
- Government and Customs relationship management
- Duty & tax accuracy and payment minimization
- Supply chain security management
- Global and country specific shipping procedure management
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