Workflow Driven Management of Logistics Operations in the Cloud

Abstract

From the historical perspective, some keywords can be recognized as milestones of the manufacturing enhancement process. Today, to be in fashion, we must provide smart solutions. We have smart cars, smart grids, smart buildings, and even smart cities. Can we imagine a smart factory? Giving the right answer to this question is only a matter of the definition of the word smart. Nowadays the production of goods is doubtless a challenging activity and needs a steady improvement in the manufacturing environment to compete successfully on the global market. To win on the market, any smart factory cannot be devised as a technology-dependent solution focused on industrial processes (manufacturing) only. The question of how to distribute and finally sell the produced goods is most challenging. It is proposed that the Smart Factory paradigm must, therefore, be addressed to business improvement as well.

Manufacturing plants today are frequently a more or less autonomous part of a global organization – they are like clouds on the corporate sky. Furthermore, all factories are a part of the Global Supply Chain and they are surrounded by markets, vendors, and authorities, which must also be seamlessly involved in the business processes. Thus, starting the discussion on the Smart Factory paradigm, collaboration is the main challenge that must be faced. It requires information sharing as well as well-defined and interacted activities governed by procedures. Both information and behavioral models must be consistent and fulfill business process requirements leading to the optimal solution.

To sum up the foregoing, to succeed and meet the global scope, the first requirement essential to deploy the vision of the Smart Factory is the Internet connectivity as a foundation of collaboration.

Full text

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M. Postół1
Workow Driven Management of Logistics Operations in the
Cloud
1. IntroductIon
From the historical perspective some key words can be recognized as milestones of the manufacturing en-
hancement process. Today, to be in fashion, we must provide smart solutions. We have smart cars, smart grids,
smart buildings, and even smart cities [8]. Can we imagine a smart factory? Giving a right answer to this ques-
tion is only a matter of the denition of the word smart [7]. Nowadays production of goods is doubtless a chal-
lenging activity and needs a steady improvement of the manufacturing environment to compete successfully
on the global market. To win on the market, any smart factory cannot be devised as a technology-dependent
solution focused on industrial processes (manufacturing) only. The question how to distribute and nally sell
the produced goods is most challenging. It is proposed that the Smart Factory paradigm must therefore be ad-
dressed to the business improvement as well.
Manufacturing plants today are frequently a more or less autonomous part of a global organization – they
are like clouds on the corporate sky. Furthermore, all factories are a part of the Global Supply Chain and they
are surrounded by markets, vendors, and authorities, which must also be seamlessly involved in the business
processes. Thus, starting the discussion on Smart Factory paradigm, collaboration is the main challenge that
must be faced. It requires information sharing as well as well-dened and interacted activities governed by
procedures. Both information and behavioral models must be consistent and fulll business process require-
ments leading to the optimal solution.
To sum up the foregoing, to succeed and meet the global scope, the rst requirement essential to deploy
the vision of the Smart Factory is the Internet connectivity as a foundation of collaboration.
2. Smart Factory BaSed on the cloud computIng
Typically parties to collaboration are not sited nearby and, hence, not able to use common ICT infrastruc-
ture. Moreover, it must be assumed that the parties are independent organizations and, therefore, a commonly
used application must be offered as a service to them.
The Cloud Computing (CC) [12] becomes more and more popular today. It is proposed to adapt this con-
cept and, in consequence, meet the requirements related to collaboration of all members responsible for carry-
ing out a business process, and nally realize an idea adhering to the Smart Factory paradigm. CC is dened
as a method to provide requested functionality as a set of services. There are many examples proving that CC
is really useful for reducing costs and increasing robustness [1]. Following the CC idea there is required a
mechanism created on the service concept supporting abstraction and virtualization - two main pillars of the
CC concept. In this concept virtualization is recognized as a possibility of sharing the services by many users
– members of the same business process. The abstraction means the need to avoid unimportant details, which
users must know to interact with the service. The user can just assume that the service is available and efcient
enough.
The rst candidate proposed to be governed by the above-presented Smart Factory rules using the CC is a
process aimed at improving performance of logistics inbound/outbound activities. The main idea for inbound
is to allow all vendors to book deliveries by themselves (like cinema tickets booking) and for outbound to al-
1 Mariusz Postół , Ph.D. Eng. Lodz University of Technology, Poland, Institute of Information Technology, Assistant Professor

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low the factory Export Department to book shipments by themselves. Everyone may see online information
about planned shipments and provide requested information by themselves.
ICT systems are recognized as a typical measure of processing information, i.e. they are consumer and
producer of data. The transportation operation spans in time from ordering the transportation service or goods
up to the point when a track exits the factory premises. It is proposed to employ the workow concept - as a
new ICT system responsibility - with the aim to manage the ow of work among individuals and synchronize
their activities in time. This way an ICT system becomes a contributing member of the business process.
Implementation of the Smart Factory paradigm on the basis of the Cloud Computing concept where the
workows are used to control behavior of the selected business process members is a novel solution and,
therefore, it needs a detailed design in advance of development and deployment of a dedicated ICT system.
The description of this stage of the ITC system lifecycle is far beyond the scope of any paper. But its manage-
ment and main ndings could be reusable and, therefore, below the design approach and critical decisions are
described briey.
3. BuSIneSS proceSSeS and requIrementS
Any business process is a series of logically related activities or tasks performed together to produce a
dened set of results. The Business Process Model and Notation specication [6], [9] is used to model this
process.
In the application supporting management of inbound and outbound operations the vast majority of op-
erations have to be related to a shipment, which is an operation of loading or unloading at a selected shipping
point and carried out during the time dened by an associated Time Slot. The Shipping Point notion is intro-
duced to represent an independent set of resources that are capable of carrying out loading or unloading opera-
tions simultaneously in a warehouse. It exposes to users a collection of available Time Slot items. A Time Slot
is a predened, xed time span associated with the Shipping Point. A Time Slot is a representation of resources
that can be involved in loading or unloading tasks.
For the methodology presented in the previous chapter and focused on the inbound/outbound operations
the following roles, their responsibilities and expected behavior can be distinguished.
Any external user that takes part in handling goods may contribute to the process in any of the following
roles: Vendor, Forwarder, Escort Provider and Guard. All of them are commonly referred to as a Partner.
A Forwarder is an intermediary that acts on behalf of the company, organizing safe, efcient and cost-ef-
fective transportation of goods. A Vendor is a contractor that participates in the inbound. Vendors and Forward-
ers should see online information about planned shipments and provide needed information by themselves to
plan and execute shipments.
An Escort is the role that represents the activity of Escort Provider’s representatives. It is an outside
company responsible for supervising the safe transport of goods. Escort Providers may see online information
about planned shipments and provide security escort information by themselves.
A security Guard is a person responsible for check-in and check-out tasks and participates in both out-
bound and inbound processes. The Guard checks if all conditions are fullled to let the truck enter or exit the
factory premises.
All roles that do not represent eternal users constitute an internal user group.
Each shipment has to be associated with an Owner. The Outbound Owner role may be mapped with the Export
Department or Sale Department, whereas the Inbound Owner role usually represents the Purchase Department.

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A Coordinator is someone whose task is to see that the shipping goes harmoniously, i.e. provided data is
correct and just in time. The Coordinator task starts just after the shipment record creation and nishes when
the truck arrives at the factory gate. Someone from the Transport Department team is usually in the role of
Coordinator.
An Operator handles the loading and unloading phase of the shipment. The Operator consults a Supervisor
in case any problem arises. Usually the Operator role represents someone from the warehouse.
The Supervisor is someone in charge of making decisions and actively involved in overcoming issues
with loading and unloading. The Supervisor can provide supplementary information and make decisions on an
ad hoc basis. Because the Supervisor activity relates to the critical shipment execution phase, very important
limitation for mapping this role is that the person in charge must be available all the time to make decisions as
soon as possible.
When modeling the business processes the following complex activities are distinguished for the selected
case:
- Book-in procedure: creation of the shipment item and selection of the Time Slot.
- Conrmation: collection of the information requested to execute the loading/unloading.
- Check-in: review of the entered data, authentication of the drivers team and truck, and nally authoriza-
tion of the truck entry,
- Execution: loading / unloading
- Check-out: reviewing all data, authentication of the drivers team and truck, authorization of the truck exit,
Functional requirements must be dened on the basis of the presented business processes modeling and,
nally, they must yield denition of functions, which are to be offered to the users (see the section Functionality).
4. FunctIonalIty
Generally speaking, implementation of the methodology proposed in this paper requires functionalities
that may be grouped as follows:
- Graphical User Interface (GUI) – to be used to provide operational communication between users and
the application.
- Messaging systems – to support ofine communication (events reporting) necessary to distribute noti-
cations, warnings, and alerts to the appropriate users.
- Workows simultaneous threads – to implement long-lasting state machines representing the activities.
- Data base management – to persistently archive all entered data and state of the workows.
- Reporting – to calculate selected Key Performance Indexes and graphically illustrate the results.
The Cloud Computing offers application as a service. In this concept only the presentation layer of the
application must be provided using personal distributed resources, i.e. personal computers, mobile devices,
etc. The presentation layer includes GUI and Messaging. Both should use software that has no application-
dedicated functionality.

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To represent the process behavior in time the workows require implementation of a state-full model.
Examples of states are as follows: Created, Conrmed, Awaiting, Late, Waiting, In Progress, Completed, etc.
External or internal events cause a workow state change. For synchronization of the members’ activities the
most important event is if a deadline associated with the current state is missed.
A database management system is responsible for preserving operational and historical data on a perma-
nent basis. The data has a complex structure, where data items are related to each other and must be linked
together internally.
Built-in and ad hoc reports allow for full control of expenditure, meeting deadlines, quality, i.e. an assess-
ment of process ow efciency. Both the built-in reports and Business Intelligence (BI) support the Business
Owner in striving to improve the quality and performance of the business processes.
5. caSe Study
To prove the concept of Smart Factory [5], the Shepherd [3] and Inward Processing Relief (IPR) [4] ap-
plications are selected to be pilot applications of a global solution supporting collaboration of Japan Tobacco
International partners.
Shepherd is an application designed to simplify inbound/outbound management in the factory (see the
section Business Processes and Requirements). IPR is designed to simplify the procedures of managing goods
under IPR (Inward Processing Relief) a method of obtaining relief from customs duties and VAT charges. Both
applications were deployed in the private cloud for the internal users and in public cloud for the corporate
partners.
Shepherd and IPR are the SharePoint™ based applications. They were designed as a customization and
extension of SharePoint 2010 (Microsoft’s widely used collaboration software) instead of developing the ap-
plication from scratch.
The Shepherd project was recognized as bad risk. The innovative nature of the project was recognized as
the main reason. Agile management [2], [11] has been proposed as a methodology that could be helpful and
used to guide software development towards the most valuable outcome possible. After Shepherd, IPR was
the next application deployed in the production environment, but during its development phase agile project
management based on the Scum [10] principles was used successfully.
6. concluSIon
The paper presents a new systematic approach to deploy an ICT system aimed at supporting management
of logistics operations engaging internal and external members of the business process on the tight collabora-
tion basis. Smart Factory exerts inuence outside the conventional factory boundaries, which leads to busi-
ness convergence and, thus, this approach should be mutually benecial as a result of macro optimization and
synergy effect.
It is proposed to design a solution applying the Smart Factory paradigm as a business archetype imple-
mented on the Cloud Computing and workows concepts. Smart Factory leads to loosely coupled multi-
applications systems.
The described use case validated that approach, but the experience gained shows that the development and
deployment work contracted as an innovative project needs additional precautions to mitigate risks and uncertainty.

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Abstract
It is still striving to improve business processes related to management of the logistics operations. The article proposes to support
the management of the inbound and outband transportation activities using a dedicated software application released as a component
of a generic Smart Factory paradigm using the Cloud Computing and workows concepts. The proposed systematic design
methodology is proved by a case study developed and deployed on a contract basis embedding agile management rules to mitigate
risk and uncertainty that are inevitable for this innovative project.
Streszczenie
Obserwuje się ciągłe starania mające na celu poprawę zarządzania procesami biznesowymi związanymi z operacjami logistycznymi.
W artykule zaproponowano, aby działania dotyczące zarządzania transportem dostaw i wysyłek wspierać poprzez zastosowanie
dedykowanych aplikacji softwarowych, jako spójnych komponentów ogólnego paradygmatu Inteligentnej Fabryki bazującej na
koncepcji przetwarzania w chmurze i przepływów pracy. Poprawność proponowanej metodyki systematycznego projektowania
wykazano na przykładzie wdrożenia zrealizowanego na bazie kontraktu, a zawarte w nim reguły obejmowały również zarządzanie
zwinne, aby zminimalizować nieuchronne dla tego innowacyjnego projektu ryzyka i niepewność.
7. reFerenceS
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[4] CAS. IPR Electronic Inward Processing Relief application. http://www.cas.eu/Products/SmartFactory/IPR.aspx,
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[5] CAS. Smart Factory, http://www.cas.eu/Products/SmartFactory.aspx. 2014
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