Evaluation of a transport and logistics IT tool
– A case study of ABB
Introduction
The ABB Group is one of the leading companies in the power and automation technologies industry. ABB has a decentralized structure with diverse
diverse supply chains logistics
transport and logistics processes within the company. through bundling of purchasing vol
processes and achieve transparency
standardization of strategic and operational transport and logistics by an IT tool in a global, diverse and
Method
For the majority of this research a qualitative approach has been applied since the data collected aims to describe business requirements and quality of an IT tool
statistical conclusions. The data used in thesis report was collected mainly through interviews and questionnaires.
Results and Conclusion
Choosing an IT tool to support transport and logistics processes is a challenging task. thesis report presents a framework to be used fo
and logistics processes. The framework proposes the process to be split into three steps shown in the figure below. The framework has been applied on ABB to provide a decision basis and rationale to invest in a lo
• The pre-study aims to reac business processes, to ide
performance of processes. The pre
should be evaluated and cost driver of the investment as well as benefit drivers to be used in the cost-benefit calculation
• The screening and evaluation process
and show their strengths and weaknesses based on the evaluation criteria categories identified in the pre-study.(figure below)
Evaluation of a transport and logistics IT tool
A case study of ABB
The ABB Group is one of the leading companies in the power and automation technologies . ABB has a decentralized structure with diverse businesses which naturally results in supply chains logistics processes. Currently there is a low level of harmonization of transport and logistics processes within the company. To gain economies of scale benefits through bundling of purchasing volume, it is desired to standardize transport and logistics processes and achieve transparency on material flow and spend. H
strategic and operational transport and logistics process erse and decentralized company like ABB?
For the majority of this research a qualitative approach has been applied since the data business requirements and quality of an IT tool
The data used in thesis report was collected mainly through interviews and questionnaires.
Choosing an IT tool to support transport and logistics processes is a challenging task. thesis report presents a framework to be used for evaluating IT tools to support transport and logistics processes. The framework proposes the process to be split into three steps shown in the figure below. The framework has been applied on ABB to provide a decision basis and rationale to invest in a logistics IT tool.
to reach good understanding on how the organization is set up, to identify weaknesses and how an IT tool can support an
cesses. The pre-study also identifies the criteria on which the IT tools and cost driver of the investment as well as benefit drivers to be used in benefit calculation.
The screening and evaluation process should give a fair assessment of the different solutions ow their strengths and weaknesses based on the evaluation criteria categories
study.(figure below)
Evaluation of a transport and logistics IT tool
Author: David Sanne
The ABB Group is one of the leading companies in the power and automation technologies businesses which naturally results in Currently there is a low level of harmonization of To gain economies of scale benefits ume, it is desired to standardize transport and logistics on material flow and spend. How can this processes be supported
For the majority of this research a qualitative approach has been applied since the data business requirements and quality of an IT tool rather than The data used in thesis report was collected mainly through
Choosing an IT tool to support transport and logistics processes is a challenging task. This r evaluating IT tools to support transport and logistics processes. The framework proposes the process to be split into three steps shown in the figure below. The framework has been applied on ABB to provide a decision
organization is set up, map how an IT tool can support and improve the riteria on which the IT tools and cost driver of the investment as well as benefit drivers to be used in
should give a fair assessment of the different solutions ow their strengths and weaknesses based on the evaluation criteria categories
• The cost-benefit calculation estimates
deliver. The identified cost and benefit drivers are presented
benefit driver an estimation rationale needs to be defined. This rationale will be specific for the solution selected in the evaluation process and the current set up of the organization.
Potential benefits will present themselves where the current logistics processes are weak. The drivers that present the largest benefit potential are also areas that should be prioritize in the implementation phase.
When applying the process for ABB purposes a number of external as well as two already internally established systems where evaluated. One of the internal systems was chosen as the preferred solution to be piloted on a large
The presented framework will also work as a guideline for assessi then just transport and logistics specific ones
and benefit drivers and their rationale,
IT tool aims to support. It is important to note that when using a framework, like the one presented and discussed in this thesis, a pragmatic approach should be applied. It is important to be flexible and adapt the pro
IT tool is of course not enough to ensure that the potential benefits are obtained. Just as important as finding the best suited IT tool, the implementation process is absolute key to achieve the potential benefits that the
benefit calculation estimates what impact the selected solution can expect to deliver. The identified cost and benefit drivers are presented below
benefit driver an estimation rationale needs to be defined. This rationale will be specific for the evaluation process and the current set up of the organization.
Potential benefits will present themselves where the current logistics processes are weak. The drivers that present the largest benefit potential are also areas that should be prioritize
When applying the process for ABB purposes a number of external as well as two already internally established systems where evaluated. One of the internal systems was chosen as the preferred solution to be piloted on a larger scale.
framework will also work as a guideline for assessing other types of IT tools then just transport and logistics specific ones. In this case, new functional requirements and benefit drivers and their rationale, have to be identified for the business processes the
It is important to note that when using a framework, like the one presented and discussed in this thesis, a pragmatic approach should be applied. It is important to be flexible and adapt the process to the specific project. Finding the best suited not enough to ensure that the potential benefits are obtained. Just as important as finding the best suited IT tool, the implementation process is absolute key to
ial benefits that the IT tool can deliver.
what impact the selected solution can expect to below. For each cost and benefit driver an estimation rationale needs to be defined. This rationale will be specific for
the evaluation process and the current set up of the organization.
Potential benefits will present themselves where the current logistics processes are weak. The drivers that present the largest benefit potential are also areas that should be prioritized
When applying the process for ABB purposes a number of external as well as two already internally established systems where evaluated. One of the internal systems was chosen as
ng other types of IT tools functional requirements, cost ified for the business processes the It is important to note that when using a framework, like the one presented and discussed in this thesis, a pragmatic approach should be applied. It is Finding the best suited not enough to ensure that the potential benefits are obtained. Just as important as finding the best suited IT tool, the implementation process is absolute key to
Further studies
To complement the results of this study it would be interesting to conduct further studies on the importance of the different key ABB logistics stakeholders, in order to gain further knowledge how a pilot should be chosen and how to structure the roll-out process. This knowledge would help to maximize probabilities for successful implementation.
Acknowledgements
Many thanks to my two mentors Carl-Johan Asplund at LTH and Daniel Helmig at ABB. I am also very grateful for Alexander Strehls guidance and support throughout the project.
Sources:
Ballou, R. (1992). Business Logistics Management. London: Prentice-Hall International.
Blecker, T., Kersten, W., & Herstatt, C. (2007). Key Factors for Successful Logistics. Berlin: Erich Schmidt Verlag GmbH & Co.
Schönsleben, P. (2007). Integral Logistics Management. Boca Raton: Taylor & Francis Group
Harrison, A., & van Hoek, R. (2002). Logistics Management and Strategy. London: Pearson Education Limited.
