United Parcel Service (UPS) and FDX have added a new battleground in their fight for your business. While their sales forces can still be seen in a shipping managers office and on the shipping dock, they both are taking major steps to secure your business much earlier in the supply chain process. Both companies have recently announced partnerships with leading Enterprise Resource Planning (ERP) software suppliers. In September, UPS and Oracle announced an agreement to create an integrated shipping management system that leverages the power of the Internet to provide companies with instant visibility into their order fulfillment processes. The very next day, FDX and SAP joined forces to announce the development of the first-ever suite of completely orchestrated supply-chain solutions.
The joint announcement by UPS and Oracle complements the goals of both companies: to be the e-business leaders in their respective industries. UPS plans to provide a truly integrated ERP and shipping solution. With the integration of UPS Online Tools into the Oracle Application suite, users will be able to offer service options to their customers that formerly required specialized shipment management systems, such as TanDatas Progistics CS or Kewill Systems Aristo and Clippership products. UPS Online Tools will allow customers to calculate shipping costs, select and compare shipping alternatives and track packages from point of entry to delivery. If you are a large UPS user, this is good news. If you use multiple carriers for package delivery and want to offer your customers transportation options other than UPS, you still have to install a shipment management system that can offer the same information for a large number of providers.
The FDX/SAP partnership is of much more strategic importance and the impact goes far beyond the SAP installed base. They have formed a strategic alliance to develop and market a first-ever one-stop portfolio of supply-chain planning, management and execution services. This means it will offer systems and services to manage the flow of products and information across the entire supply chain, regardless of whether FDX services are used or not. For the SAP installed base, FDX is offering supply chain consulting to assist users in building information-based business processes. The company will incorporate SAPs Advanced Planner and Organizer as well as the Business Information Warehouse into its service offering.
FDX will support supply chain execution with its own suite of systems to provide global synchronized distribution of products and orders, as well as supply chain visibility, just-in-time facility management, global order management and international trade logistics.
The impact of these announcements will resonate throughout the supply chain industry during the upcoming year. End-to-end outsourcing of the supply chain has been seen by many as an opportunity, and now FDX and UPS are mainstreaming the concept. Their reputations will enable them to access the executive suite to explain its value proposition and how they can help to reduce total supply chain costs. So dont be surprised when someone from your information technology or planning department comes knocking on your door to talk to you about ERP and the new role the carriers are playing. As we have heard so many times, in todays world of e-commerce, the information surrounding a package has become just as important as the package itself. And the carriers are very interested in playing a part in the integration of your information. Its just their new way of selling their services.