When it comes to Logistics Service Providers (LSPs), it is clear that FedEx and UPS have technology-driven value propositions. There is no other way that they could economically and efficiently pick up and deliver large volumes of packages each day without the aid of technology.

But technology innovation is not just limited to very large LSPs. Some "boutique" service providers, like D.W. Morgan, have also built their company, in large part, based on their technological capabilities.

D.W. Morgan provides transportation solutions using their own people, trucks, warehouses, TMS, and visibility solutions. One niche for them is last mile, just-in-time deliveries of raw materials to inbound VMI hubs that supply the contract manufacturing facilities of their high tech clients. Morgan calls this service "supply on demand." In this area, the company has developed a proprietary "last mile" real time visibility solution that includes status updates, GPS with geo-fencing, and signature capture.

For GPS, the company uses SkyBitz, which leverages satellites for both pinpointing an asset's location and for communicating that information back to headquarters. Many other GPS providers switch to cellular networks for communication because it is less expensive, but Morgan prefers the higher-cost SkyBitz due to its higher reliability.

Last mile visibility is not particularly difficult to achieve in the U.S., but if you are providing this service around the world--particularly in low cost manufacturing nations in Asia and Eastern Europe-stitching satellite and cell phone coverage together to track distinct supply chain transactions becomes more difficult. Consequently, in the past, Morgan provided customers with near real time data from these countries, but it was a very labor-intensive process.

Last year, when Apple released a software development kit for the iPhone, Morgan decided to build an iPhone tracking application for their drivers to use. This application allows for a signature to be captured and sent back to the U.S. headquarters where it is then automatically uploaded to the Internet for their customer. The signature is validated with a GPS stamp that shows where the signature was captured, and users can even use a Google map to zoom in and see where the transaction occurred. The application also allows drivers to upload pictures of damaged shipments to the Internet. Finally, Morgan has built human resource functionality into the application. For example, drivers sign in and out of work and breaks using the iPhone. Currently, the iPhone does not support bar code scanning, but Apple will release a new version of their platform in June, which will have the ability to support peripheral devices via Bluetooth.

What are the advantages of the iPhone for Morgan? Apple has assembled a global network of mobile carriers to support the iPhone, so there is better global coverage; the software development platform allows Morgan to be masters of their own destiny and to quickly build flexible solutions for customers; the platform also serves as a communication and HR system for their mobile workforce; and, finally, Morgan has branded itself as an IT innovator and this "cool" solution helps to validate that branding.

D.W. Morgan is not a low-priced commodity player. Their focus is on critical transportation moves. They are willing to use somewhat more expensive technologies if those technologies provide greater reliability and flexibility. Morgan's use of the iPhone development platform also validates what we wrote about in "An App Store for Logistics"-i.e., how companies need to "think different" when it comes to how you develop, sell, purchase, and deploy logistics software.
ARC Advisory Group