BY JAMES A. COOKE, EDITOR AT LARGE
VISIBILITY AND CONTROL
technologyreview
Control towers
made easy
Companies seeking supply chain visibility can
set up a control tower on their own. But
there’s also an alternate route.
WHEN IT COMES TO SETTING UP A CONTROL TOWER
to obtain visibility into the supply chain, companies don’t
have to go it alone. Third-party logistics service providers
(3PLs) offer an alternative to establishing and running
their own systems.
For those unfamiliar with the term, a control tower
is an information technology system that allows
a company to monitor and manage its carriers,
logistics service providers, and suppliers. “Control
towers are a great tool … to ensure raw materials
and end products are moved in a timely fashion
to factories, to distribution centers, and to the
end customer,” says Alejandro Gonzalez Magán,
senior director of customer service at DHL Global
Forwarding, Americas.
Essential to a control tower’s operation is the
implementation of an “information hub” that connects a company to its suppliers and carriers. Although
a shipper can buy software to do the job, it would then
face the task of forging electronic links with all of its supply chain partners and managing the integration between
disparate information systems. Because in many cases, a 3PL
has already established many of those communication links,
the company can simply ride the coattails of its service provider.
“A 3PL will have implemented these technology solutions multiple
times over, so we have the framework of a process in place,” says Dave Belter,
vice president of transportation management at Ryder System Inc. “With the
base process already there, we can [just] make configuration changes for the
customer.”
In addition to providing a technology platform, the 3PL can handle the day-to-
day operation of the tower, freeing the customer to focus on strategic issues. “We
do see that most of the shippers like the idea of retaining control of their strategy
