International Conference on Industrial Engineering and Operations Management Kuala Lumpur, Malaysia
January 22 – 24, 2011 Real-time Tracking and Tracing System: Potentials for the Logistics Network AHM Shamsuzzoha and Petri T Helo Department of Production University of Vaasa, Vaasa, FI-65101
, FINLAND Abstract The importance of tracking and tracing of shipments is considered quite high for manufacturing firms in terms of customer service and essential for managing logistics networks efficiently. Global industries are facing problems both from tracking and tracing in their logistics networks that creates huge coordination problems in the overall product development sites. This paper presents a sophisticated overview on technology-based methodology or approach for solving the complex tracking and tracing system in the logistics and supply chain network. The main objective of this research is to the management of logistics network through analyzing the new technological opportunities on real-time shipment tracking in dispersed manufacturing environment. It is hoped that these technologies would be able to offer solutions for tracking and tracing distribution chains through future information technologies such as available real time tracking technologies. Keywords Logistics tracking, IT-based solution, Distribution network, Real-time information flow, Business competition. 1. Introduction The importance of tracking and tracing of shipments is considered quite high for manufacturing firms in terms of customer service and essential for managing logistics networks efficiently. Global industries are facing problems both from tracking and tracing in their logistics supply networks, that creates huge coordination problems in the overall product development sites. This problem looses the track among production, delivery and distribution in the complete logistics chain from source to destination, which is responsible for opportunity cost through customers’ dissatisfaction. Tracking system helps to identify the position of the shipment and informed the customer in well advance. Without tracking system it is almost impossible to find out delivered items and often considered as lost or stolen item that causes business loss. This system might fulfill the needs of project manager to map the production process from transportation to material management [1, 2]. In practice, there are several tracking systems available through
GPS, GTIN , RFID , Barcode etc; however, all these systems are not fully compatible for industry. Most of the available tracking and tracing systems utilize proprietary tracking numbers defined by the individual companies operating systems and are based on information architecture, where the tracking information is centralized to the provider of the tracking service. Existing tracking systems can not able to identify the contents within a box for example, whether the box is open or the contents are lost or stolen etc. In order to tackle such misalignments in the logistics channel a state-of-the art technologies or tools are needed to be developed for sustainable production process. These tools are needed to be cost effective and at the same time possibility for reuse or recycling for any circumstances. Before proceed towards the real-time tracking technology, it is crucial to analyze its possible cause and effects. Optimal performance measures for the technologies could ensure projects success for any industries.
Tracking technologies in logistics networks are implemented fairly little in the global technology industry. Mostly high volume of global industries are implemented this technology with limited capabilities. The basic methods for all these tracking systems are usually confined for the customer to access the tracking information are within the area of tracing the shipments through manual queries such as using a www-site or telephone call, e-mailing, fax or to engage in developing systems interfaces or integrating with the tracking system. There is even no available tracking system between invoice and transportation. Customers got their ordered goods through calling or e-mailing the 242
Shamsuzzoha and Helo supply networks.
This research study ensures an interactive forum for companies’ supply-demand network to learn and share the concepts and benefits concerning logistics network tracking technologies. This projected work is also developed with a view to study, what kind of practices industries do in terms of logistics tracking and what kind of practices or technologies would fit in particular business scenarios. The specific target of this research is therefore can be summarized as follows. Description of information flows within the logistics chains
Definition of the specifications for the tracking system
Description of the tracking technologies
Analysis of tracking logistics in supplier networks
Analysis of the potential partners in delivering the IT-solution.
3.2 Research Targets and Research Questions The purpose of this research project is to create knowledge concerning learning in networks, and help companies to develop tracking system within logistics supplier networks.
Our goal is to create a framework, models, methods and tools to facilitate the state-of-the-art tracking and tracing technology in supply chain logistics networks. These targets require finding answers to the following three research questions:
1.How do customer companies define logistics networks and what kinds of needs are there for tracking the logistics network development?
2.How do companies track and trace their logistics networks in an international context? 3.What kind of concepts, methods and tools do support in collaborative logistics networks in different industrial environments? 4. Definition and Specification of Logistics Tracking and Tracing Networks The real-time track and trace system is essential to manage the integrated logistics networks and to enhance customer services. In literature various authors defined real-time tracking and tracing in different ways. According to APICS Dictionary  traceability has two fold; (1) the attribute that allows the ongoing location of a shipment to be determined and (2) the registering and tracking of parts, processes and materials used in production, by lot or serial number. Traceability is defined by the ISO  as the ability to track the origin of materials and parts, the product processing history and the distribution and location of the product after delivery.
There exists distinction between product tracking and product tracing. Product tracking Product tracking initiates from the concept of product value or associated risk, whereby individual wishes to locate the products. On the other hand, product tracing initiates from exception handling, whereby individual wishes to establish the source of (bad) quality . Tracking and tracing can be subdivided into forward and backward part respectively, where tracking part consists of determining the location of the items during their way through the logistics chain and the tracing part consists of determining the source of the problem of a defective item in the logistics network . Weigand  is defined tracking and tracing a modern tool that offers insight into the origin of products which is used to optimize and to enhance the total supply chain network. The tracking and tracing system is not merely restricted to the manufacturers’ level only but also to the entire supply chain networks, which are separated by market forces. In respect to tracking and tracing system, supply chain networks can be considered as the integrative approach for dealing with planning and control of materials from suppliers to end-users . Proper tracking and tracing is therefore required all necessary information of the supply networks in order to be managed efficiently and effectively. Various parties within supply chain logistics network need to work together in order to determining the requirements for tracking and tracing. With respect to tracking and tracing system, Jansen  divides the supply chain logistics parties into two groups: suppliers and industrial customers and end-customers. In terms of tracking and tracing, suppliers and industrial customers impose requirements on the supply chain as ‘business-to-business’ requirements whereas; end-customers impose requirements on the supply chain as ‘business-to-consumer’ requirements.
5. Description of the Tracking and Tracing Technologies
The tracking system is usually considered as the link between the information systems and the physical reality (the material flow) in the logistics network . This system is seen as a key service component for the transportation industry to fulfill the needs of manufacturing companies. In logistics chain, the delivery notification at real-time is very important and the immediate status of delays or other delivery problems are required to notify as soon as
Shamsuzzoha and Helo vendors and there do not existing real-time tracking and tracing technologies. This lacking affect to network and relationship structures between manufacturers and potential customers. Thus industries need a concept, methods, tools and competencies to systematically develop their real-time tracking technologies for logistics network.
Without proper and suitable tracking and tracing system, efficient co-ordination of logistic flow would be difficult to acquire . Through the implementation of this system, it is possible to detect and reacting any uneven situations in the logistics chain and where needed significant problems can be resolved or at least the damage can be minimized [6, 7]. This system is also considered as a key service requirement for the global transportation industries especially, when they are integrated with the manufacturing companies adopting just-in-time operational strategy . In case of tracking and tracing technology several issues are considered to be applicable in an inter-organizational communication such as operational scope, goods identification technology, coding of the tracked items, information architecture, accessing the tracking information etc [9, 10]. 2. Literature Review The tracking and tracing of logistics networks is recently considering a very important issue in the global supply chain management (SCM). It is identified as the search for competitive advantage, where manufacturing firms have recognized the potential importance of their logistics networks. There is no universally accepted definition of tracking and tracing in the logistics literature. In most occasion tracking is usually been attached with tracing commonly termed as ‘tracking and tracing’ [9, 11]. The term tracking can be identified as the collecting and managing the information of the present location of a product(s) or delivery item(s)
On the other hand, tracing system signifies to storing and retaining the life cycle history of the manufacturing and distribution of product(s) and its components [9, 12, 13, 14, 15]. This tracking and tracing system is considered as industrial norms to provide customer services which consequently trigger competitive advantage for the logistics service providers (LSPs) too. The demand for logistics network tracking and tracing of items has been long since recognized by the individual industries. The academic communities along with standardization organizations are also actively looking forward in efforts to develop global identification methods for items or products . The standard procedures developed so far are mainly concern with identification of items and as such, do not directly define any connection to product tracking systems. The complexity of the logistics chains in global industry has meant an increasing interest in improving their manageability . Due to the diversity of product variants together with the necessity to improve on product traceability, a lot of information about the items is needed [13, 17]. This tracking tracing system is considered an extremely useful service in the industrial logistics management and for satisfying higher customers’ demands [18, 19, 20]. Organizational managers noticed this tracking system as a means of strengthening their market position through improved customers’ satisfaction and implementation of information technology (IT) . This system covers globally both physical and information logistics networks more transparency with effectively and efficiently in today’s changing market environments. However, most of the existing tracking of shipments is designed for the purpose of a single organization and therefore there is lacking of tracking and tracing for multi-organization environments . Most of the single logistics company focus on the reduced span of tracking and tracing, which offers easier accessibility of information and maintain the proprietary tracking codes and information architectures. Independent providers of tracking service such as Savi
Technologies and EURO-LOG offer the development underline the importance of customers being able to locate shipments in-transit through planning
and monitoring their operations [21, 23, 24]. The existing tracking systems are suitable for use when goods are handled by one company and are not suitable for multi-company networks [13, 15]. These company specific tracking services utilize service provider- specific coding for consignments, which resulted increase the complexity of retrieving tracking information for the potential customers. 3. Research Scope and Content 3.1
esearch Objectives and Methodology Ever increasing t
rends on product customization and reduced delivery time forces companies of looking for state-of- the-art technologies or methodologies to develop optimal tracking systems with real-time information processing. This optimal tracking system should satisfy both the manufacturers and their suppliers within the projected logistics