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Global Manufacturer CNH Builds Successful Transportation Management System with Oracle
CNH, a global leader in agricultural and construction equipment, historically spent hundreds of millions of dollars each year on outsourced transportation operations to accommodate its global logistics needs. But by managing logistics in house, the company estimated it could increase its visibility into the operations and in turn save millions of dollars.
So it decided to streamline and more closely manage its transportation operations using a comprehensive transportation management solution (TMS). But finding the right TMS program was no easy task, in part because of CNH's expansive operations. Each year, the company ships over 300,000 pieces of outbound whole goods globally and completes one million inbound shipments to support its 38 manufacturing plants. In addition, the (USD) $13-billion company serves more than 11,000 dealers in 160 countries
Critical requirements
When CNH began evaluating possible TMS providers, it first defined a list of critical requirements that vendors would need to meet. Candidates had to offer a single,
integrated TMS platform with proven success in global projects. In addition, the vendors had to show innovation leadership that could drive continued TMS transformation, as well as success at hosting TMS applications and integrating them within SAP environments.
These requirements quickly pared the list of 42 possible TMS vendors down to only a handful of companies that might meet these needs. In the end, CNH chose Oracle because of its transportation expertise and that of the then newly acquired g-log technology.
CNH's focus since picking Oracle a year ago has been on European and North American logistics operations. Oracle Transportation Management provides a hub around which CNH is integrating inbound and outbound activities, such as scheduling pickups and shipments from CNH plants, coordinating deliveries with carriers, and managing freight payments.
Learning to succeed
Throughout this process, CNH has learned a number of lessons about how to assure the success of large-scale TMS projects. First, a world-wide deployment on the scale of what CNH is accomplishing requires from the first day a global team comprised of company and vendor representatives to oversee the project. Important issues they need to address: orchestrate naming conventions and provide global issue resolution.
CNH also learned that contract negotiation is time consuming, a reality that should be accounted for in schedules if questions haven't been fully addressed before project kick off. Similarly, CNH says it spent a significant amount of time defining load-building requirements, another area that schedulers need to allow sufficient time to complete.
Finally, TMS project planners should also be wary of legacy outbound data, which can cause problems due to incomplete weight, dimension, and volume information. CNH also discovered a number of inaccurate addresses and duplicate records.
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