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Closing the Loop: Providing Web Service Solutions Enabling E-Logistics Integration

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In the context of today's business world, collaboration is becoming increasingly important to companies in their attempt to achieve competitive advantage, not least in becoming flexible to meet the constantly changing demands placed on organisations to excel in their sector and achieve growth in the most cost effective manner. The implementation of distributed computing technology is thus an essential element of business strategy. Web services enable the development of remote, distributed enterprise applications. Lower costs of integration may also allow businesses to create new business value by improving data exchange in corporations, with business partners and even competitors. This research focuses on investigating Web services as an integration technology in the context of service logistics and in particular on-line service logistics software delivery through an Application Service Provider (ASP) model. The research serves to outline some of the key considerations necessary for Web services technology to be utilised in the development of robust, useful and cost effective solutions for service organisations. The research considers the case of a service logistics software development organisation that has implemented Web service-based e-integration projects for customers. Key employees in customer organisations provide input to the research findings. A primary objective is to develop insights into the areas where Web service technology can be applied to improve the software solutions provided to these customers.
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1
18
th
Bled eConference
eIntegration in Action
Bled, Slovenia, June 6 - 8, 2005
Closing the Loop: Providing Web Service Solutions
Enabling E-Logistics Integration
Martin Fenton
Chip eServices, Ireland
mfenton@chipeservices.com
Ciara Heavin
University College Cork, Ireland
c.heavin@ucc.ie
Abstract
In the context of today’s business world, collaboration is becoming increasingly
important to companies in their attempt to achieve competitive advantage, not least in
becoming flexible to meet the constantly changing demands placed on organisations to
excel in their sector and achieve growth in the most cost effective manner. The
implementation of distributed computing technology is thus an essential element of
business strategy. Web services enable the development of remote, distributed enterprise
applications. Lower costs of integration may also allow businesses to create new business
value by improving data exchange in corporations, with business partners and even
competitors. This research focuses on investigating Web services as an integration
technology in the context of service logistics and in particular on-line service logistics
software delivery through an Application Service Provider (ASP) model. The research
serves to outline some of the key considerations necessary for Web services technology to
be utilised in the development of robust, useful and cost effective solutions for service
organisations. The research considers the case of a service logistics software
development organisation that has implemented Web service-based e-integration projects
for customers. Key employees in customer organisations provide input to the research
findings. A primary objective is to develop insights into the areas where Web service
technology can be applied to improve the software solutions provided to these customers.
Martin Fenton, Ciara Heavin
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1. Introduction
Web services have emerged as the potential integration technology of the future.
Multinational organisations such as Microsoft and Sun have undergone considerable
changes in order to deliver on the promise of Web services. Proprietary technologies such
as Electronic Data Interchange (EDI) and Common Object Request Broker Architecture
(CORBA) have failed to impact sufficiently in the service logistics sector. Repair
organisations utilise spreadsheets as a tool for tracking key information from the point of
sale to the end-user and subsequent repair. However, this tool is ineffective in integrating
the systems of multiple organisations involved in the reverse supply chain. Effective
integration of systems across diverse locations and multiple organisations is essential to
manage the return of consumer products. Web services are essentially “enterprise
applications that exchange data, share tasks, and automate processes over the Internet
(Shirky, 2002). This technology, which takes advantage of the ubiquitous nature of the
Internet, is non-proprietary, relatively easy to implement and has the backing of major
players such as Sun, Microsoft and IBM. The possible “improvements in application
integration, coordination and data interchange” (Shirky, 2002) between multiple parties
involved in service logistics processes is discussed as part of this research. The research
aims to identify the benefits that may be derived in service logistics organisations through
the use of Web services technology. This will provide insights into the advantages
associated with incorporating Web services into the business strategy of a service
logistics software solution provider in order to provide useful and worthwhile solutions to
customers.
2. Theoretical Foundation
Web service architecture allows applications to be designed using modular business
functions that can communicate and interact with each other. These “coarse-grained
business functions” (Chung et al., 2003, p. 35) can be dynamically accessed across
multiple organisations and from diverse platforms (Hagel, 2002). Alameh (2003, p.23)
characterises Web services as “self-contained, self-describing, modular applications that
clients can publish, locate, and dynamically invoke across the Web”. Each Web service
can be invoked or called independently of other Web services or applications. Web
service architecture extends across a number of stack layers that interact to allow the
creation and consumption of Web services (Table 1). A Web Service Description
Language (WSDL) document describes the interface to a particular Web service. A
business or user may develop a Web service to perform a function and publish it on the
Internet using a standard known as Universal Description, Discovery, and Integration
(UDDI). Other standards include Simple Object Access Protocol (SOAP) for XML
messaging and Hypertext Transfer Protocol (HTTP).
Closing the Loop: Providing Web Service Solutions Enabling E-Logistics Integration
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Table 1: Web Service Standards (Hündling and Weske, 2003)
Stack Layer Web Service Standard
Service Repository
Universal Description, Discovery, and Integration (UDDI)
Service Description Web Service Description Language (WSDL)
XML Messaging
Simple Object Access Protocol (SOAP)
Transport
HyperText Transfer Protocol (HTTP), Transmission Control Protocol
(TCP), or Simple Message Transfer Protocol (SMTP)
2.1 Service Logistics
Service logistics is an industry characterised by the multiple parties involved in business
processes. Ludwig and Klüber (2003) explain that technical and business potential of
Web services is such that benefit can be derived from the technology in the
implementation of new business functions (Table 2). Projects can be completed with
minimised costs “by way of optimising development spend through application re-use”
(King, 2003, p. 1) and therefore minimising Total Cost of Ownership (TCO) of new
systems. Manufacturers can focus resources on delivering new and improved products
with market value to the end-users, safe in the knowledge that they can collaborate
efficiently and effectively with the service organisations to ensure that the value
proposition for their products extends throughout the lifecycle of the products.
Table 2: Potential of Web Services (Ludwig and Klüber, 2003)
Web services technical potential
Utilisation of existing development staff skills
Minimising Total Cost of Ownership (TCO) and development costs
Reduction of complexity of integration projects
Web services business potential
Reduced time-to-market by using and enhancing existing services
Increased flexibility
Reap new opportunities through increased functionality and lower costs
Logistics is an element of the supply chain process that involves the transfer of goods or
services from the point of manufacture to the point of consumption in order to meet the
market demand (Tibben-Lembke and Rogers, 2002). Reverse logistics can be defined as
the reverse of this. Reverse logistics has in the past been overlooked in the broader
context of Supply Chain Management (SCM). Sweeney (2003) explains that there are two
strategic reasons why companies focus on reverse logistics. Firstly, cost reduction can be
achieved by reduced return rates, increasing asset recovery, reduced inventory and
reduced compliance costs. Secondly, the goal of achieving customer service is enhanced
through decreasing average Turn Around Time (TAT), increasing follow on sales and
increasing customer retention by ensuring that all complaints are dealt with effectively.
Martin Fenton, Ciara Heavin
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Service logistics is a component of logistics that can be defined as “all logistical issues
around the implementation of closed loop reverse logistics in the electrical and electronic
goods sector” (Sweeney, 2003, p. 5). Sweeney (2003) further explains that service
logistics describe reverse logistics for all products that carry a unique serial number
identifier. It may be described as closed loop as the customer returns a product for repair,
exchange or credit. It also encompasses the supply of spare parts to the point of repair.
Ludwig and Klüber (2003) state that Web services technology could be effectively
applied to the implementation of integration solutions for the global logistics industry.
Robust Web services offer an ideal way to connect the different organisations involved in
the supply chain with low integration costs.
2.2 Strategic, Organisational, and Managerial Benefits
of Web Service Technology
Manes (2003) explains that the most significant motivation behind Web service
technology is application integration, as organisations invariably have multiple
application systems possibly in diverse locations. The motivation manifests itself in two
ways; firstly, tactically businesses require improved application integration in order to
enhance operational efficiency and reduce costs and secondly, from strategic perspective
organisations require better access to information to enable more accurate decision
making. Organisations must evaluate the business strategy in order to become more agile
and respond rapidly to changing market conditions (Srinivasan and Jayaraman, 1999).
Web services may be used in service logistics to “significantly change the cost structure
associated with maintaining software systems” (Stencil Group, 2003, p. 8). By adopting
Web services technology, manufacturing organisations can look to other areas of business
process improvement in order to achieve increased productivity. By leveraging a suite of
Web services, real-time repair data can be provided which allows managers to assess the
quality of product manufactured and thus support improved strategic decision-making.
Web services components reside in Web-based servers where they can be invoked by any
Web-enabled application from any machine such as a PC or handheld device (Vaughan-
Nichols, 2002). Applications no longer need to sit on a user desktop PC and all devices
can be integrated into a “virtual computing fabric” (Vaughan-Nichols, 2002, p. 18). Web
services promise to decrease unit cost and increase return on information systems
investment by sharing functionality across boundaries (Langdon, 2003). Web services
components may be used in two ways; firstly, for integration or e-business automation in
enterprises and secondly, for client application design. The latter involves the possibility
of Web services enabling the design of applications that do not reside on client machines
but, rather, are accessed as required through the composition of Web services. Web
services provide an appropriate means for designing effective middleware that hides the
diversity and complexity of underlying processes. The technology is lightweight avoiding
intrusive object models and single programming language requirements and is
interoperable (Vinsoki, 2003). Langdon (2003) claims that enterprise systems such as
Enterprise Resource Planning (ERP), Customer Relationship Management (CRM) and
Supply Chain Management (SCM) systems can be more tightly integrated though the use
of Web services technology while remaining adaptable to changing business requirements
such as new products or business partners.
2.3 Challenges Facing Web Services Technology
Despite the documented benefits of Web services technology there are still a number of
issues remaining. Hagel (2002) suggests that there are two principal technical challenges
that need to be addressed in the development of XML-based Web services. Firstly, the
Closing the Loop: Providing Web Service Solutions Enabling E-Logistics Integration
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growing integration costs should be considered, as multiple custom connections may be
required for data sharing amongst several organisations or even locations. Secondly,
continual redefinition of connections poses a significant problem causing significant
burden on resources, as businesses attempted to ensure connectivity between Web sites
and Internet applications. Staab et al. (2003) outline the following five issues that Web
services need to address:
1. Efficiency. The execution of Web services must be efficient to ensure
scalability to enterprise application integration.
2. Expressiveness. The complex enterprise business processes required for
integration purposes require expressive concept modelling.
3. Security. Data transfer across and between enterprises must be secured to
prevent attack and loss of data integrity.
4. Reliability. Communication using Web services must be reliable so that
messages are sent once to ensure dependable interactions
between the involved parties.
5. Manageability. The Web service process for e-business automation must be
manageable so that organisations can monitor usage and delivery
and also enable easy update to Web services interfaces due to
frequent enhancements.
Another unresolved issue with regard to Web services technology is that providers of a
service will “clearly want to earn revenue based on service consumption” (Lim and
Wen, 2003, p. 55). Contracts and billing standards must therefore be addressed to provide
the basis for negotiation between the consumer and the provider. Support for measuring
compliance with service-level agreements and for providing payment mechanisms must
be included in Web service standards (Langdon, 2003). Heflin and Huhns (2003) outline
several limitations of Web services technology for transforming the Web into semantic,
machine-interpretable format. Firstly, a Web service knows only itself and not its users,
clients or customer. Secondly, Web services are not designed to reconcile formats among
themselves and clients, also they are passive and cannot provide alerts or updates as new
information becomes available. Autonomous semantic Web services provide the means
for automating usage of data across the Internet that would “support capability-based
discovery and integration at runtime” (Paolucci and Sycara, 2003, p. 35).
3. Research Objective and Approach
The objective of this study is to investigate Web services as a technology to facilitate the
development and deployment of service logistics software solutions. This research serves
to evaluate why and how web services technology may be suitable for the delivery of e-
logistics integration solutions. A two-phased study was conducted, with the initial data
collection and analysis focused on document analysis which was used to inform the
interview guide. Given the qualitative, exploratory nature of this research, a case study
was employed as the most fitting research approach. Interviews were conducted with
employees of a small service logistics software development organisation and employees
of customer organisations who are actively involved in overseeing the implementation of
these solutions. The interviewees were chosen through the use of positional methods
(Knoke, 1994). They were selected based on their positions, offering rich insights into the
area with their knowledge of the service logistics industry, their experience with the case
organisation, and their knowledge of issues that must be considered for the
implementation of service logistics solutions and the implications associated with moving
Martin Fenton, Ciara Heavin
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to a new technology for this purpose. Each interview was taped and lasted approximately
45 minutes in duration. A number of the interviewees have been represented in this study
with the use of aliases to protect their privacy and opinions. The findings were interpreted
in the context of the integration of the multiple organisations that interact in service
logistics processes. Finally, the research identifies some of the key benefits and
implications of the use of web services technology in the delivery of integration solutions
for the management of service logistics processes.
4. Background to the Study
Since 2002, Chip eServices have provided highly scalable Web-based solutions suitable
for large enterprises to manage post-sale activities. The solutions provide manufacturers
and appointed repair organisations with the ability to collaborate efficiently and
effectively with data shared across the parties. The solutions also provide manufacturers
with the ability to develop high-quality on-line post-sale service relationship management
directly with customers. Solutions are delivered using the Application Service Provider
(ASP) model. The solutions that Chip eServices provides are targeted directly at the niche
market of service logistics sector in the manufacturing industry. The sector is
characterised by the repair of all electronic and electrical goods ranging from consumer
electronics such as Discmans, Stereos, DVD Players and Televisions to high-tech storage
devices used in data centres worldwide and the standard desktop PC or laptop. OEM
organisations in the sector are large multinationals such as Sony, Philips, Teac, Dell and
Apple. These are worldwide organisations that require integration across diverse systems,
platforms and locations. To maximise profits these organisations must provide quality
service to the end-users of the products. These organisations give standard warranty
periods with the products within which they are obliged to repair the products for free.
Also, they may sell extended warranty periods to end-users. Service obligations are
fulfilled through payment to Authorised Service Providers or Service Centres for the
repair services.
The primary application developed by Chip eServices, myRMA.net, focuses on managing
Return Material Authorisation (RMA). RMA is the term used to describe the generation
of a return authorisation following the establishment of a fault in an electronic product.
The Client returns the product to an Authorised Service Provider that processes the faulty
product by repair or disposal, and then returns the repaired product, an exchange product,
or credit to the Client (Table 3). The Authorised Service Provider operates on behalf of
the OEM manufacturer of the product.
Table 3: RMA Process
RMA Participant RMA Function
Warrantor The manufacturer of the product and sells the product to the Client.
Client
After purchasing the product the Client requires service. A business
Client would use myRMA.net to manage returns to its key supply base.
Service Centre
A department of the Warrantor or an independent operator. The Service
Centre processes RMAs by completing the loop by credit exchange or
repair.
Closing the Loop: Providing Web Service Solutions Enabling E-Logistics Integration
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There is a third party relationship involved in the RMA process. myRMA.net assumes
responsibility for the management of the entire process and because the application is
offered on an Application Service Provider (ASP) model, all of the data is stored centrally
by Chip eServices, and can be updated on a real-time basis by any one of the parties,
allowing the other RMA participants immediate access to status information. The RMA
participant organisations require integration capabilities in order to ensure that the RMA
process data stored by Chip eServices is accessible within the organisation to legacy
systems for internal functions such as reporting and auditing.
Chip eServices has adopted Web services as the key mechanism for e-integration between
the myRMA.net product suite and customer systems. The organisation has developed
Web service-based synchronisation technology that allows customers to retain an up-to-
date local copy of their service logistics data. One customer uses this data to post data to
their internal ERP system for integration purposes. The synchronisation mechanism was
further refined to allow a repair organisation to upload data from their internally
developed Service Management System (SMS) to myRMA.net. Real-time data is then
available to the Warrantor organisation and can be used to analyse world-wide service
logistics issues. Recently, a new project involving integration with a global logistics
operator has become tactically and strategically important to a customer organisation.
This research serves to identify further areas of application of Web services in order to
optimise the global and cross-boundary applicability of Chip eServices service logistics
software solutions.
4.1 Customer Organisations
These service organisations have implemented or are in the process of implementing
service logistics solutions using the suite of applications developed by Chip eServices
(Table 4). The management of the information flows in “boundary spanning”
relationships between multiple organisations is one of the key goals of the software
development at Chip eServices. These processes extend the relationship between the
manufacturing organisations and the repair organisations, retailers, and end-users. The
interviewees have a great deal of knowledge of the service logistics industry and this is a
prime reason for their selection as part of the interview process. In order to effectively
develop solutions for these organisations Chip eServices need to understand the
difficulties that they encounter in the management of their service logistics processes.
Employees of these customer organisations also offer insights into the implications of
moving to new technologies, such as Web services, based on practical experience. Chip
eServices can then improve their understanding of the applicability of Web services
technology in the development of these solutions. The organisation must strive to
continually enhance and improve the quality of the solutions and furthermore must
remain competitive in the after-sales software market by utilising state-of-the-art
information technologies. Web service technology has been adopted by the organisation
for this purpose.
Martin Fenton, Ciara Heavin
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Table 4: Customers Organisations
Organisation Business Relationship to Chip eServices
Vendlink
Communications
Mobile phone
top-up
machines
Vendlink are currently using myWARRANTY.net to store
warranty registration information. They intend to integrate
this solution with myRMA.net to manage the call centre and
repair process for the machines.
Teac
Recording and
reproduction
equipment.
Teac implemented an RMA Wizard solution using
ServiceCentreSync that allowed their TPM’s to upload RMA
information directly to myRMA.net. The application used
Web services to accomplish this task.
Tyco/Sensormatic
In-store
security
products for
loss
prevention
Sensormatic implemented myRMA.net to manage their
European Service Centre in Cork, Ireland.
Philips
Electronics
Consumer
Electronics
Philips intends to implement myRMA.net to manage the
return of consumer electronics to Service Centres around
Ireland. The organisation may also implement a warranty
registration solution using myWARRANTY.net
Storage Devices
Inc.
Storage
devices
Storage Devices Inc. is in the process of implementing a
warranty solution using myWARRANTY.net and will
ultimately integrate this solution with myRMA.net.
5. Analysis and Discussion of Evidence
By definition, the service logistics industry is boundary spanning in nature with multiple
organisations involved in the repair process (Figure 1). These organisations include the
manufacturers of electronic and electrical goods, the “repairers” (Philip, Service &
Environmental Manager, Philips), the retailers and the end-users. Web services
technology can be used to “solve a great deal of communications, service and support
issues” (Jo, Service Manager, Teac) associated with the information flow between these
“integration points” (Jerry, Managing Director, Chip eServices). Web services
implementations also offer the advantage of “code reusability” (Dwayne, Software
Architect, Chip eServices). Distributed computing across multiple service organisations
can harness the modular nature of Web services to provide cheaper, robust, reusable
components that can be incorporated into client applications at any node in the service
logistics chain.
Closing the Loop: Providing Web Service Solutions Enabling E-Logistics Integration
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Service Logistics Information and Material Flows
Warrantor
(Manufacturer)
Retailer
Service Centre
Logistics
Operator
End-User
Physical Flow
Physical Flow
Physical Flow
Spare Parts
Distributor/
Supplier
Physical Flow
Product
Information
End-User
Information
Product Information
Fault, Extended
Warranty Information
Purchase Information
Product Information
Repair Information
Product, Warranty
Information
Spare Part
Orders
Spare Parts
Information
Figure 1: Service Logistics Supply Chain
The complexity of the information flows between each node in the chain illustrates the
need for systems to effectively manage the constituent processes and interactions. One
key issue is the automation of information flows between each of the parties involved in
the service logistics supply chain (Table 5). IT systems designed using Web services
technology can diminish the inherent complexities. Dwayne (Software Architect)
explains that the “interoperability of Web services” heralds significant advances toward
full automation of information flows in the service logistics sector. Each organisation
involved in the reverse supply chain is dependent on the availability of information from
another. As pointed out by the Service & Environmental Manager at Philips, the
manufacturers “originate a lot of the information” but most of the information resides
with other people. Providing a mechanism to retrieve this information is a strategic
necessity for service organisations.
Martin Fenton, Ciara Heavin
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Table 5: Examples of Web Service Implementations
Information Flow Web Service Implementation
Transfer of Service Centres
repair data to Warrantor
Service Centres input repair data using a Web services
interface. Warrantor has real-time access to the repair data.
Transfer of warranty information
to Service Centres
Repair organisations have real-time access to a serial number
database with warranty information using a Web services
interface.
Transfer of spare part order
information from Service Centres
to supplier
Service Centres access a Web service method to place orders
with the supplier. The order information is immediately
available to the supplier.
End-user registration for warranty
entitlements or purchase
extended warranty
End-users access the manufacturers Web site and input
warranty registration information to oblige Warrantor to repair
the unit in the event of a fault
Operational efficiency across service organisations and manufacturers can be improved as
warranty obligation information for the repair of products can be made available through
Web service implementations to the Third Party Maintainers (TPMs) or Authorised
Service Providers. The repair organisations can then determine whether to charge their
customer for repair of a product. According to the Service & Environmental Manager
(Philips), this is an area where Web services technology may be most suitable in the
service logistics industry; “in or around the claims process – that always causes the most
difficulty”. The repair data is also of critical importance to the manufacturer in order to
deal effectively with repeat complaints, and improved access to information “can be used
to improve the quality of new product development” (Jo, Service Manager, Teac). Web
service implementation can provide a means to deliver complex repair data from client
applications in the repair organisations to manufacturers. Composition of Web services
can be used to improve application integration by sharing data across boundaries. This is
illustrated in the case of spare part ordering where real-time data can be accessed by
suppliers to ensure prompt supply of spare parts to the point of repair. Strategically, this
may also improve customer service levels, which can help to increase the consumer
confidence. Jerry (Managing Director, Chip eServices) explains that “warranty
registration or returns tracking functionality” is the type of process that can be
implemented using a Web service portal “opened to customers” (Jo, Service Manager,
Teac). The improved “data visibility” (Paul, Senior Service Engineer, Storage Devices
Inc.) across the entire service logistics chain can lead to improved organisational tactical
and strategic decision-making.
5.1 Inadequacy of Traditional Systems – Web Service Benefits
The limitations of “platform dependent, traditional, proprietary systems” can be
overcome through implementation of Web service solutions (Table 6). Web services
technology takes advantage of standardised technologies such as Extensible Markup
Language, Simple Object Access Protocol (SOAP) and Web Services Description
Language (WSDL). The technology is non-proprietary so solutions implemented using
the technologies are relatively inexpensive. Also, the solutions are flexible due to the
platform-independence of the technology, and the ubiquity of the Internet.
Closing the Loop: Providing Web Service Solutions Enabling E-Logistics Integration
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Table 6: Issues with Proprietary Systems (Service & Environmental Manager, Philips)
Issue Problem explained Importance of solution
Incompatibility
Traditional proprietary
systems tend not to be
compatible with the
systems of other
organisations.
Service logistics is boundary spanning with
multiple organisations and information flows
involved. These systems need to be compatible
for each party involved in the reverse chain.
Inflexibility
The proprietary systems
cannot handle service
requirements such as
serial numbers.
Repairs must be tracked on a serial number basis
due to warranty registration – to ensure that
warranty obligations are met and customers do
not abuse the system.
Information
Management
Operational management
is difficult using Excel.
Management information
cannot be extracted easily.
Operations include the day-to-day activities
around providing the required quality of customer
service whilst on a strategic level data must be
accessible for management reporting and
decision-making.
Knowledge
There may be knowledge
gaps for the development
of methods to manage the
information using Access
for example.
Knowledge in service organisations is primarily to
do with the day-to-day repair of customers’
products. The organisations should focus on
these key strengths rather than attempt makeshift
solutions that may not be robust and easy to use.
Bi-location
Proprietary systems are
not Web-based and cannot
be accessed from multiple
locations. Protection of
integrity of the data cannot
be guaranteed.
The information must be accessible to each party
involved in the reverse chain and it must be
accurate to ensure that the service organisation
can manage the processes effectively.
The first issue explained by Philip’s Service & Environmental Manager is that of
incompatibility between the systems of business partners. Due to the inherent
characteristics of Web services the technology offers advantages over traditional service
logistics systems. The technology addresses integration difficulties across disparate and
diverse systems due to the interoperability of the technology. The ubiquity of Web
services overcomes past bi-location barriers that limited automation of information flow
between service organisations. Inflexibility in traditional proprietary systems is also
overcome through the development of Web service implementations. Service logistics
information systems must be flexible in recording information relating to warranty
registration and repair data and this information must be readily available to relevant
parties involved in the reverse supply chain. For example, a serial number database
tracking warranty can be made available through a Web service interface to repair
organisations. The improved application integration by sharing functionality across
boundaries can help to improve operational efficiency. Traditional technologies fail to
offer the level of operational and strategic management that is required in service
organisations. Brian (Production Manager) cites the availability of better information to
Vendlink’s service engineers to help them in diagnosing and fixing any problems with the
mobile top-up machines as a key advantage of Web services. Field technicians update
information such as repairs, requests for spare parts, spare parts used, and issuing of
replacement units on a real-time basis using portable devices. Ultimately, management
accounting information improves resulting in a more “accurate reflection of stock in the
field” (Brian, Production Manager).
Martin Fenton, Ciara Heavin
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Table 7: Technologies used for Integration
Technology Utilisation Advantages Disadvantages
Electronic Data Interchange (EDI)
Not used in service logistics.
Used extensively for ERP
integration in and between
large organisations e.g. in
sales department or in
automobile industry.
Effective data transfer
Widely adopted/accepted
standard
Effective error tracking tools
Standards defined
worldwide
Expensive to implement Requires
expensive networking
infrastructure, Proprietary
technology
Platform dependent
Not interoperable
Restrictive standard
Fax/Email and Spreadsheet
Used extensively for
information flows between
service organisations. E.g.
repair data, warranty
processing, and spare parts
order. Usage declining.
Includes human element
Widely used
Slow
Inaccurate
No real-time information
Cumbersome
Not on-line or shareable
Flat file transfer
Cited by one interviewee for
transfer of data for integration
Crude
Needs manual reprocessing
Web Site Integration
Cited by one organisation for
spare parts integration
Links TPM to spare parts
ordering system
Manual ordering through logging
into Website
No integration with SMS
Others
CSV Cited by one interviewee for transfer of data for integration
Access
Cited by one interviewee as an alternative to Excel. However,
knowledge gap for internal development of a solution.
CORBA/COM Interviewees unaware of the technologies.
Web Services
Has not been used in service
logistics but will be used
extensively in the future
Low cost alternative to EDI
Provides flexible solutions
Reusable modular
applications
Web-based
Interoperable
New technology
“Untried/untested”
Version control
Security
Messages are “beefed up” by
SOAP
Current technologies have been relatively unsuccessful in adequately addressing the main
integration issues involved in the service logistics industry. The principal failings of
technologies such as spreadsheets, email, flat file transfer technology, website integration
and EDI were identified during the interview process (Table 7) The majority of
interviewees concurred that while EDI is a widely used technology in the area of ERP
integration, the technology has never been used “within the service part of the business”
(Service & Environmental Manager, Philips). Jerry (Managing Director, Chip eServices)
explains that while EDI is “the de facto standard … for boundary spanning businesses”,
service organisations are small and “it is more likely that Web services will be successful
because it’s a lower cost solution for more flexible relationships with smaller suppliers”.
Additionally, Web service technology offers the distinct web orientated advantage of
interoperability. The most predominant technology cited is spreadsheets, which are
Closing the Loop: Providing Web Service Solutions Enabling E-Logistics Integration
13
transferred using the media of email and fax to other organisations in the reverse chain.
The spreadsheet is “by far the most common way of swapping information across
boundaries between companies” (Philip, Service & Environmental Manager). The usage
of the inaccurate and tedious medium of the spreadsheet could be replaced by a robust
and cheap solution based on Web services technology that would allow “real-time
update” (Paul, Senior Service Engineer) of information resulting in improved reporting
functions within the organisations.
Table 8: Strategic suitability of Web services technology in service organisations
Characteristics Examples Strategic Benefit of Web Service Solution
Service Logistics Information Flows
Suite of Web services provides a simple implementation
of service logistics processes for each of the information
flows
Repair data
Statistical analysis of the repair data improves product
development allowing organisation to gain competitive
advantage
Warranty
information
For Service Centre dealing with warranty claims
becomes easier through accessing warranty registration
database using Web service
Warrantor knows only legitimate claims are processed
Boundary spanning
involving multiple
organisations
Physical flows of
goods
Complex
information flows
Spare parts
order
Service Centres place order using Web service
Spare parts are received promptly
Customer service levels improved
Integration Issues
Suite of Web services allow can be accessed from any
number of integration points in the reverse supply chain
for a manufacturer
myRMA.net with
Baan/SAP
Integration with
Web-based
applications
Integration with
ERP – internal
systems
Integration across
boundaries of
organisations
involved in service
logistics
E-business
capability into a
Website
Platform independent nature of the technology means
that any system can be integrated
Web services available across Internet regardless of
location
Code reusability – there may be only one implementation
of the Web services that can be invoked from any
application anywhere
Allows “portals” for e-business to be opened in Websites
Issues with Proprietary Systems
Suite of Web services overcome issues with proprietary
systems through the implementation of client applications
that invoke the service methods
Incompatibility
Inflexibility
Information
Management
Knowledge
Bi-location
Excel / Access
Web services are interoperable
Offer flexible solution – data can be accessed by any
department
Information is available for decision-making
WS can be developed by external companies allowing
service organisation to focus on core strengths
Web services are Web-based so bi-location issue
addressed
Bhaswar (Business Analyst) cites simple flat file transfer technology as an integration
technology. However, he identifies a number of limitations associated with the
Martin Fenton, Ciara Heavin
14
technology, commenting that it “is pretty crude” and requires “plenty of monitoring and
error logging”. In the event of too many errors the files “may then have to be manually
reprocessed”. Alternatively, Web services technology may be used to simplify the data
transfer process. “XML dataset[s] of information” (Dwayne, Software Architect) could
be returned from a relational database, wrapped in a SOAP message and passed reliably
over the Internet. Philip (Service & Environmental Manager) cites “Website integration”
as the mechanism through which Philips’ Authorised Service Providers (ASPs) can link
to a European spare part ordering system. Jerry (Managing Director) explains that
Website integration is the “current state of the art” for integration in service logistics.
Philips system allows the ASP’s to order spare parts from anywhere in Europe but they
have to log in and enter the spare parts manually. The complexity of the channels and
inherent “business logic can be encapsulated in the Web services” (Dwayne, Software
Architect) provide a flexible solution where all parties in the reverse supply chain for a
particular manufacturer have access to the same system through a suite of Web services.
Table 8 summarises the strategic suitability of Web services technology in service
organisations as discussed by those interviewed.
6. Conclusion
This research focuses on the suitability of Web services technology for the development
and deployment of service logistics solutions. The research was carried out using a case
study supported by elite respondents from customer organisations. Key employees at
these organisations were interviewed to provide a rich discussion of the research topic.
Evidence from this study indicates that Web services technology is suitable for the
service logistics industry and should be actively adopted by service organisations either
through developing a relationship with external software organisations such as Chip
eServices or by promoting the technology within their own organisations so that IT
managers are aware of the benefits associated with this type of architecture. Chip
eServices has already successfully adopted Web services technology but recognise the
need to improve its Web service strategy through creating an awareness of the technology
throughout the service logistics industry, by marketing comprehensive, robust solutions
that are developed using a suite of Web services.
The nature of the service logistics industry involving complex information flows between
multiple organisations is a prime reason for the adoption of Web services technology in
the development of solutions to implement automated information processing between
organisations. A service organisation can integrate with external partners across the
reverse supply chain so that the data visibility is apparent throughout and benefits all
parties involved through added value that increases consumer confidence in a brand or
product. The data that is dispersed throughout the reverse supply chain can be leveraged
to assist in the realisation of these strategic goals. The long term strategic benefits to the
organisation are tangible i.e. time and money savings, as the efficient and effective
transfer of data between organisations is optimised as a result of implementing Web
services. In this way, each node in the supply chain adds value and quality to the products
across the value chain resulting in increased consumer confidence and increased
profitability for all parties involved. Effective integration of systems across diverse
locations and multiple organisations is essential to manage the return of consumer
products. Additionally, organisations can utilise the technology internally to improve
reporting functions. Strategically this enables the production of quality management
reports that aid the decision-making process in service organisations. Traditional
proprietary systems used in service organisations can be replaced by a series of client
applications that invoke methods from a suite of Web services that implement the primary
service logistics processes. Reporting and client applications can be provided to
Closing the Loop: Providing Web Service Solutions Enabling E-Logistics Integration
15
organisational management that utilise the same Web services (and data), allowing
strategic decision-making to be carried out using real-time data. These ‘Smart Clients’
utilise Web service technology to integrate with central enterprise systems across the
Internet providing access to real-time data for more accurate strategic decision-making
throughout the organisation. Web services are key to providing extensive functionality as
services are offered that increase the integration between the parties involved enhancing
collaboration and cross-boundary virtual enterprise management.
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