An Approach In Applying XML To Logistics Communication - CiteSeerX

An Approach In Applying XML To Logistics Communication David A. Koonce and Suporn Chenhansa Industrial and Manufacturing Systems Engineering Ohio University Athens, OH, 45701 ABSTRACT Logistics companies must effectively communicate with changing partners to perform freight transportation and other services. Observations of a logistics company show there is extensive use of manual communication, such as phone, fax, and email, for operational data exchange. Though technology, such as EDI and data warehousing, is available these are usually expensive and/or inflexible. Extensible Markup Language (XML) provides an affordable and flexible solution. This research tests the concept of XML for logistics communication. A methodology for developing XML schema for existing logistics communications is presented. The methodology is employed in a test case and the drawbacks are presented.

Keywords XML, logistics, data communication, freight transport, data exchange.

1. Introduction Current methods for data exchange at the operation level between companies conducting supplier networking (SN) are not effective. While the technology exists for more sophisticated methods, the operations of a typical logistics company involves phone calls, emails, and faxes to and fro m other organizations. These methods of communication are not effective because they are labor-intensive, involve repetitious exchanges, and are prone to human errors such as typographical errors, miscommunication, or lost communication. In addition to the inefficiency, [1] notes that current trends in SN indicate that more effective inter-company data communication will be a requirement for competitive supplier networking as the networks themselves grow, and logistics partners rapidly change. As current supply networks grow increasingly dynamic and extensive, a logistics party is required to use data communication methods which are not only accurate, but flexible. Extensible Markup Language (XML) offers a possible solution to this problem. This paper offers an analysis of using XML for logistics communication.

2. Approach/Methodology The goal of this work is to identify how a logistics company may start utilizing XML in its current data communication. While the most efficient applications of XML may need industry standards, this paper does not aim at recommending a logistics industry standard for a variety of reasons: logistics industry standards are being developed [2]; industry standards should be developed by industry representatives; and, the logistics industry is currently highly fragmented, making it difficult to form an industry-wide base for a successful standard. Processes of two organizations – one a large global logistics company and the other a small freight forwarder – were studied through observations and interviews of the industry employees. Through observation, typical logistic functions were identified and basic data elements were defined. These studies were used to examine the current logistic industry trends and their implications for the use of XML. Specific logistics documents and data definitions were analyzed and adapted to XML. A simplified XML-based communication model was developed to exchange logistics data between two different platforms. The focus of this research is on the method which may be used to develop an XML-based communication system for specific logistic operational functions. This paper offers guidelines on data elements definition, communication requirements identification, and system implementation applicable to logistics receiving functions.

3. Background The term “logistics” defined as all planning and coordination to necessary deliver a product or a service. However, this paper defines logistics more strictly, focusing on the industry segment which supplies transportation and related

services to other businesses and individuals. In addition, this paper focuses on the data communication involved in logistics receiving functions as a representative subset of all the functions directly involved in freight transportation 3.1 Supply Networks In each SN, logistics companies coordinate with other partners through many communication channels. A group of interdependent, autonomous companies together form a network with the common goal of meeting customers’ demands. Recent technology advances have resulted in rapidly changing SNs in which communication partners shift quickly to meet customers’ demands. To be competitive, the SN must be able to work effectively to compete with other networks or with other integrated firms [3]. Each company in this network needs to be able to communicate effectively with its immediate partners to ensure rapid, accurate, and cost-effective product delivery. To stay competitive, businesses find themselves needing to effectively utilize the internet in logistical functions, including running a “virtual factory” [4], adopting “virtual warehous(ing)” practices [5], and forming “virtual organizations” through cooperating with other suppliers in the network to meet common customer demands [1]. All these practices require a great amount of data to be shared between the different enterprises in the “virtual” company, especially if they are in an industry with the traditional, vertically integrated firms. 3.2 Available Technology As companies partner with each other, data needs to be shared. Data integration is a major factor in business efficiency. If the set of data to be shared is small and is needed infrequently, simple communication procedures such as phone calls and emails can be used. However, when the amount of information increases, it is no longer efficient for a worker to verbally exchange information and more automatic data sharing needs to be done. Many of the large companies have invested in enterprise-wide, proprietary systems to integrate data. However, this may be problematic when the company is working with other firms. Two major approaches to sharing information within and among companies are Electronic Data Interchange (EDI) and data warehousing. While EDI allows data sharing between companies in structured formats, data warehousing ensures that all companies are informed by supplying a common data schema accessible to all data partners. The use of EDI or data warehousing require a time and financial investment [6][7], and use structures which may be too rigid to be a practical communication solution to the SN behavior as discussed previously. A company cannot easily adapt EDI standards if it requires information which is not included in those standards. Schema integration and data validation become increasingly problematic when partners are added or removed from the warehouse. In addition, the need to upload data periodically to the data warehouse limits this method to data which is not “live.” XML offers an alternative. The open structure of XML means that changes in partnerships can be handled relatively easily. In addition, XML can be used with other data-sharing methods, such as EDI and databases, to increase the flexibility of these technologies if they are already being used in the company [8][9]. The low investment cost of XML also opens up opportunities for smaller businesses to be an effective part of a SN.

4. Messaging in Logistics receiving functions 4.1 Current messaging in receiving functions The information in this section was gathered through observations at a logistics company for over five months from June - August 2000 and November 2000 - January 2001. Through interactions with the personnel, the steps and the data elements were identified. Follow up conversations revealed that the steps and the data elements used in the receiving process are typical for any logistics company, small or large. As a company receives freight, it works as a part of an SN which may include an airline, a brokerage company, and a trucking company. Table 1 shows, the information needed to process incoming freight; a core set of data which is communicated repeatedly through the SN. Much of the data shared at this level is straightforward, providing the opportunity for software automation. Though this data set involves only 10 elements, this information is needed about each shipment, so processing this amount of data manually can be tedious and time-consuming. The first notification of an incoming shipment is typically received via a “pre-alert” document [10]. This pre-alert can be sent by fax or email and includes all the shipment information listed in table 1. Moreover, the pre-alert often includes other information, such as the description of the cargo, special handling instructions, customer purchase order, and container information. Often, a pre-alert is typed using a text -only option of an email program.

Logistic Tasks Pre-alert for incoming freight

Confirming freight on board Clearing freight through customs Transporting freight

• • • • • • • • • •

Data master airway bill number • consignee & shipper • pieces & weight • pieces and weight per master • delivery address master airway bill number • pieces & weight • comments master airway bill number • house airway bill number •

• house airway bill number • airline & flight number • time ready (ETA + 3 hrs)

house airway bill number airline & flight # estimated time of arrival comments airline & flight # ETA airline, flight#, ETA comments

• pieces & weight • delivery address • comments

Description Given by origin company to notify destination company of incoming freight Confirming with the airline that the designated freight is on its way Notify brokerage of incoming freight for customs clearance Instructs trucker to pickup appropriate freight and deliver to destination

Table 1. Data exchanged in receiving functions After receipt of the pre-alert, a confirmation of freight on board needs to be performed. At both small and large companies, confirmation is usually done by phoning the airline [10]. The master airway bill number (MAWB), flight (FLT) number, ETA, pieces (PCS), and weight (WGT) are all used to confirm freight on board. This information is then used to manually update the database records with a confirmed on board (COB) status and the revised information such as changed ETA, changed flight number (due to delay or cancellation), and corrected piece count. After the information has been entered into the main database with the COB status, the updated information is sent to the brokerage agent. The information that the brokerage agent receives typically echoes the pre-alert but with the updated status and information, including the updated ETA and freight details. The brokerage agent has all the information pertinent to customs clearance. Typically, to meet delivery schedules, freight is cleared as the plane approaches the destination port and it is then ready to be picked up after it has been unloaded off the planes. Once the customs broker has been notified, truck delivery logs are generated and sent to the designated truckers with the appropriate information. The trucker is notified of the shipment and the time which the shipment will be ready to be picked up (unloaded from the airplane, staged for pick-up, cleared customs), usually ETA + 3 hours, unless otherwise notified by the customs clearance agent. After delivery completion, the proof of delivery (POD) information such as recipient’s signature and a timestamp, or reason for failed delivery such as the recipient location being closed, is faxed in. This information is then keyed in when the fax is received. 4.2 Data Elements in XML DTD and Schema A pre-alert document contains information about an incoming freight. The information includes details at the MAWB level regarding origin and destination of the cargo, applicable details of the incoming air freight (other transport methods are not addressed explicitly in this paper) such as ETA and flight number, and the HAWB level details regarding the specific pieces, weight, shipper, and such of each housebill. In developing an XML structure, the issue of elements versus attributes must be addressed. Experienced markup experts offer differing opinions and recommendations for how to decide between the use of elements and attributes with the main differences between the two approaches deal with processing performance and document-size [11]. Recommendations regarding attributes versus elements range from stylistic choices to implementation considerations. Where style considerations are up to the programmer, implementation considerations may change as the XML tools are developed and certain standards are more widely supported. Decisions regarding attributes and elements are primarily made for a consistent internal view of the data, and are therefore subject to the domain experts’ view of the data. The general guidelines which are used by this project draws from a mixture of the different heuristics which are applicable to a system to be used in the logistics industry [12][13][11][14], and from the experiences of other industries with XML [15][16][2]. Figure 1 shows a pre-alert DTD and an XML document.

Figure 1. An example pre-alert DTD and corresponding XML File The pre-alert DTD has a root element, Pre-alertData, which may have one or more MAWB element. There are two other elements in this document: AirFreight and HAWB. The AirFreight element gives information about the flight on which the MAWB is traveling. A MAWB may have one or more HAWBs. The HAWB holds the information regarding the specific shipment and customer information of that cargo. The data is presented in an XML document which would be both human readable and machine processable. In addition to DTDs, XML Schemas can be used to define a document. The additional features of schemas, support data types, make it possible to use schemas to validate documents more strongly. However, the communication system developed in this project treats most of the data elements as text strings. While a schema was developed for this research, it is too large and complex to present in this paper. For all DTDs and Schemas of other documents, see [10].

5. Communication System To test the completeness of the DTDs, a simulated SN was developed and multiple shipments were tracked through the system using XML as the sole method for communication. In this network, the focus company is Company A, a small logistics company. Company A receives pre-alerts from other locations or from external handling agents throughout the day. The size of each pre-alert is usually small, one to two shipments per notification. A small logistics company averages about 10 incoming shipments/day [10]. However, this simulated system used a longer pre-alert, with 10 total shipments. The other data documents followed these shipments through the final delivery function. For this collection of shipments, Company A also had to coordinate with an air carrier, a customs brokerage agent, and a trucking company (all simulated). This system captures the minimum documents which need to be exchanged to effectively coordinate the processing of incoming freight. This paper does not address business documents, such as accounting and sales documents. Most of the communication in similar actual systems is currently conducted through phone calls, emails, and faxes, with a hard copy POD delivered after delivery completion. This communication system is implemented from the perspective of minimal additions to the systems already in place at typical logistic companies. The basic hardware requirements of this system are a computer and a connection to the Internet, both of which are already utilized in the industry. The software requirements are a database program, a SAX parser, a database connectivity tool, and an output program. While large logistic companies often implement proprietary databases, this may not be feasible for smaller companies. Microsoft (MS) Access is a database program which can be used in a smaller company for a significantly lower cost than developing a proprietary system. MS Access can be used for smaller databases and offers basic database functions. Oracle 8 is also used in this system to allow trial exchanges between two different platforms. Medium- and large-sized companies may be more likely to implement a database management system which is similar to Oracle (e.g. SQLServer, Sybase). In this system, organizations other than Company A are simulated using Oracle databases. The XML parser, database connectivity

tool, and the output programs all utilize freeware tools. The Apache Xerces SAX parser is available from the Apache Software Foundation [17] and Java is available from Sun Microsystems [18]. Java is used to run the parser, connect to the database through JDBC, and to generate the output in the appropriate format. The actual transport of the data documents is not addressed in this system. Once the documents are generated, they can be sent via the methods used currently such as email or other messaging methods which are preferred by the communication partners.

6. Findings A goal of this research is to answer four questions about methods of logistics communication and the applicability of XML to those methods. The findings of this research are summarized below. 1. What technology is available to logistics companies at this time? How is technology being utilized now to effectively communicate data? What factors affect the degree to which the industry has embraced certain technologies? Different technologies are available for data communication. EDI requires high investment costs. Data warehousing does not provide views of live data. Logistics companies may consider XML, which can be less costly and more flexible than the previous options. The high cost of implementation and the inflexibility of some options have led these companies to mainly depend on manual methods of data communication. 2. If XML can be used effectively in logistics, what are the requirements of a company to make use of XML? How can XML complement existing technologies already being used? Hardware and software requirements for an XML-based communication system are not costly. A PC with an Internet connection, already common in many companies. Software requirements include a database system, interface tools, and a browser or email program. A company likely has a database system in place to record and track shipments. XML tools are available as freeware and can be adapted to database requirements. However, a company considering development of an XML system also needs XML skills, which may involve a consultant company, hiring XML programmers, or training designated personnel in XML. 3. What are the basic building blocks to an XML-based logistics communication system? As shown in this paper, an XML-based logistics communication system includes a database, an XML parser, and an output program. The development of more powerful and flexible XML tools which operate as part of the database and not as a separate program can simplify the system for the user. 4. What are the implications for the future of data communication in the logistics industry, especially to the participation of the small- and medium-sized companies? The results show that there will be an increasing use of XML in logistics communication to automatically process transport data, as shown by the release of TranXML [2]. In addition, more XML tools need to be developed which can be adapted to different database structures and operate directly as part of the database system. More work needs to be done to develop base schemas, and to show companies how to adapt already developed schemas to their specific needs. In addition to addressing the four questions, the findings of this project also demonstrate the approach of a logistics company to the current developments of XML as a data communication tool. The 8 steps are given below: 1. Decide on the implementation plan of the system. Will it be scalable or will the entire system be implemented at once? Will just one area of the system be modeled and implemented at one time with other parts added in the future? Will this step implement an internal communication system or will it involve an external communication partner? Decisions made here will also assist in deciding the scope of the system. 2. Decide whether to adapt an existing schema or to develop one. It may be more efficient to apply an open standard that has already been developed, such as TranXML, to the system. If the standard does not address the basic data elements of this particular system, then developing a new one may be the better option. In addition, if the project involves other communication partners, form a consensus for the minimal schema set and add this schema set to the standards that already exist. 3. Base elements on “real-life” entities in the system and the relationships between these entities. This step may be purely intuitive for industry experts. However, the identification of the objects in the system may include discussions with the logistic agents who handle this data to gather accurate system perceptions and the IT personnel of the database system, if there is a database system in place. 4. Decide whether elements or attributes will be used for the data elements. A few experiments can be made with trial documents using either elements or attributes to evaluate the preferences for a particular system. Factors to consider are human readability, consistency, and user perceptions. Once the decision is made, all documents should consistently follow this decision.

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Develop a data model either with DTDs or with Schemas based on the data documents identified in step 1. Working with supply network partners or other logistics organizations to develop the data model should provide for more robust models. Develop system software or contact a third-party application service provider. If the company chooses to develop the system, this should include nn XML parser and adapt it to current database system for parsing XML files and a database connectivity tool to current database system for processing data from XML parser and to generate appropriate data and documents to be sent out. Conduct trial runs, either with intra-office communication or with partners involved in the project. Revise and incrementally expand system as outlined in step 1.

7. Conclusion This paper demonstrates a specific process that a logistics company can use to implement an XML-based data communication system at the operational level. The research summarizes the current trends of the logistics industry and identifies how these trends may affect the data flows in the industry. In addition, the project shows how XML can be used as a solution to the problem of data communication between the supply network partners involved in the current logistics industry. The results demonstrate how an XML-based data communication system can provide a logistics company with an extensible, easily adaptable, and flexible system. This process is encapsulated in a set of guidelines which can be used by an organization that is starting an XML implementation internally or within the supply network. In addition to the guidelines, the basic requirements and parts of an XML-based communication system are given. This includes the equipment and personnel investment that a company must consider when implementing XML. A basic communication system, including data documents, models, and processing programs, is presented to demonstrate the viability of the guidelines. This system developed in this project can be used as a starting point for an application of XML in logistic communication.

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