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LogiCon validation workshop

LogiCon validation-implementation workshop_1nd round

The first round of a project validation works hop was held in March 2014 in Zaragoza, Spain. The objective of the meeting was to explain the approach of LogiCon to target stakeholders and get feedback and validation on the concept.

First of all, the discussion starts with a review of the current status concerning their scope and core business as well as their IT supported operations Then, overall approach of LogiCon, including the technical and non-technical actions of the project was presented. After this, the review on the current support on the exchange of information among other partners and freelance hauliers was made. Later, the discussion was set on the potential benefits of such solutions and the barriers for their adoption.

The stakeholders had a positive reaction, considering of the potential efficiencies and other benefits that could be achieved, especially to solve certain information deficits. In some cases, they had already implemented some partial solutions. For instance, Via Augusta has deployed their fleet management and tracking system to some of their freelance hauliers with a closest relationship (the cost of deployment is charged to freelance hauliers with some financial support – loan - of the sponsoring LSP). In summary, they found this approach as a business opportunity, in order to improve the business cooperation; lowering the risks linked to the management of an owned fleet; QoS factor; as well as the logistic optimization.

Beyond the technical barriers, they considered that cultural barriers, especially for the freelance hauliers could become key obstacle. The role of the public administration was also seen as a potential barrier. To conclude, the initial reaction on the subject was positive; it was assumed a potential business opportunity. There are limited actions undertaken in this direction but an overall effort is necessary to increase critical mass (and so maximizing the impact).


 

LogiCon validation-implementation workshop_2nd round

In order to involve additional companies in the activities of the project, several workshops were organized with SME transport operators cooperating with CARRERAS and CRIADO.
During the meetings with 5 Transport Operators, SMEs, the concept of LogiCon and the objectives of the ES Living Lab were presented. The main objectives included:

  • Get feedback on the general concept of LogiCon (ie, involvement of SME companies in the electronic information exchange with their collaborators),
  • To involve them as users in the Living Lab activities,
  • To establish an communication channel with potential customers of the solution of the ES Living Lab.

Two workshops were organized in the premises of ITA. In addition two visits to companies were organised. The following meetings altogether were held:

- 26 Nov 2014: Tergalindo, Sata Logística, Transporte Lopez Mavilla in addition to Carreras, Jovitrans, Enide and ITA
- 16 Dec 2014: Pedro Mor, Transportes Lomana in addition to Criado, Enide, ITA
- 9 Feb 2015: Tergalindo, Carreras, Enide
- 9 Feb 2015: Transporte Lopez Mavilla, Carreras, Enide

In the workshops, several questions were shared with the groups in order to establish the communication and get feedback on the potential drivers and barriers for the concepts of Logicon. These questions included:

  • Identification and characterization of the companies: size, fleet, etc.,
  • How the size of a transport operator (small, medium, big) is determined?,
  • Level of collaboration with other companies (subcontracting),
  • How is information exchanged with the collaborators?,
  • Information management,
  • Challenges and opportunities of collaboration,
  • Cultural aspects: technological level, smart devices, Apps,
  • Use of third party (contractors) Apps for transport management,
  • Economic Aspects,

In a second part, the App developed for the ES LL was presented

  • Initially, SMEs did not find direct benefits on the sharing of information with other partners and, in general, the adoption of many technological solutions.
  • The general opinion was that there are technological tools for some of the business process but 1) they are not accessible for them; 2) they are already happy with the (limited) tools they already have; 3) it is not clear that the additional cost of investment on new technologies could impact on the selling price.
  • It is important to highlight the differences between last mile and urban distribution and long distance. Specific problems and solutions are necessary.

However,

  • It is clear that most of the communication is based on phone and electronic mail.
  • With the current market conditions, the detailed tracking of the service is fundamental to verify and avoid potential penalties because of delays not caused by the SME (as warehouse not ready for pick up).
  • As the App is presented, they realize the potential benefits from the concept, both for the electronic management of transport service as well as for the information exchange with their main contractor.

Among shortages, obstacles and further requirements towards the solution the stakeholders Expressem the following:

  • Business proposition is unclear. A specific commercial offer should be outlined
  • Value for the SME is fuzzy while benefits for bigger players are understandable and even quantitative. In this scenario, their prescriptor role should be further analysed
  • Simplicity of the tools is appreciated.

In general, the workshops allowed to detect the weak points on the potential commercial offering of the results of the ES LL:

  • It is difficult to attract new users, so the definition of the strategy for approaching the companies is key. The communication aspects and how to present the value proposition to them has to be taken into account.
  • Small companies do not have ICT capabilities and they find it difficult to find electronic exchange of information.
  • The potential of tools as the App for truck drivers is clear, but flexibility, usability and related costs are fundamental topics for discussion.

 

LogiCon validation-implementation workshop_3rd round


Several activities have been carried out to finally asses the results achieved in Spanish LL and plan commercialization. Among them:

  • two open communication sessions with targeted logistics companies
  • several small group communication sessions
  • brokerage contacts with logistics companies in the middle-east
  • results demonstration and communication at a booth.

The objective of these activities was to define the commercial offering, detect strengths and weaknesses and design the commercial approach. The Spanish Living Lab solution was presented as a product for transport operators that enables added value services through the collaboration with SME and freelance truck drivers. The tool prooved its universal and neutral nature, not linked to any specific TMS or ERP system. And does not require any major technological investment to the SME.

The concept is widely understood and acknowledged:

  • the need of exchanging information with SME transport operators and freelance truck drivers is shared with the different stakeholders (large and small transport operators, technological providers, other logistics companies),
  • the use of standards such as GS1 is assumed relevant for the adoption of the concept,
  • the business model based on a pay-per-use approach is welcomed and appreciated.

Other similar tools have been detected. In spite of potential competitors operating in the market, two main findings have been risen:

1) the scope of the tool as well as the universal and neutral approach differentiates the LogiCon result from the others; 2) the market seems prepared for this approach.


Among the shortages and obstacles raised by the stakeholders, two main issues concerned:

  • doubts about the technological approach, especially concerning the access investments for transport operators with existing TMS/ERP,
  • the collaboration model with other technological partners seemed unclear.

Among the participants, there were 15 LSPs, 12 LSCs and 10 Technological Providers. 15 of them were  SMEs.
The results achieved from these activities seemed relevant in order to detect the weak points of the potential commercial offering for the Spanish LL solution. Moreover, the conclusions achieved confirmed that:

  • The market is prepared for the approach. The competition with similar (but limited) tools demonstrates this fact.
  • Although the initial main commercial target are still transport operators, shippers are also understood as valuable key partners. This is especially relevant for transport departments of some shippers. 
  • Initial commercial contacts have been established with several potential customers, and several additional commercial actions are planned to be established in order to capitalize the effort.

 

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