Ho Chi Minh city University of Transport

Faculty of Transport Economics

Logistics Science Division
***

Logistics Information System

Compiled by M.Sc Nguyen Huynh Luu Phuong

(Internal Use only)

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* Agenda:
Chapter 1: Logistics Information System Overview

Chapter 2: Techniques and technologies for LIS

Chapter 1: Logistics Information System

Overview
1.1 Some words about Logistics:
❑ What is Logistics?
❑ What does Logistics involve in?

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Chapter 1: Logistics Information System
Overview
1.1 Some words about Logistics:

❑ Logistics management is the process of planning,

implementing, controlling the efficient & effective flow of
goods, services and related information from the point of origin
to the point of consumption for the purpose of conforming to
customer requirements.

1.2 Information System:

1.2.1 Data v.s Information:

Monthly Sales Report

for West Region

Sales Rep: Charles Mann

Emp No. 79154
Item Qty Sold Price
TM Shoes 1200 $100

1.2.1 Data v.s Information:

❑ Data are raw facts representing events occurring in organizations or the physical
environment.
❑ Forms of Data:

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 1.2.1 Data v.s Information:
❑ Types of Data:

Hard???? Soft????

1.2.1 Data v.s Information:

❑ Information is a collection of data organized in such a way that they have
additional value beyond the data themselves.
❑ Process is a set of logically related tasks performed to achieve a defined
outcome.

Monthly Sales Report

1200 100 for West Region
West Charles Mann
Sales Rep: Charles Mann
79154 TM Shoes Emp No. 79154
Item Qty Sold Price
TM Shoes 1200 $100

❑ Information should be viewed as processed data which has been placed in a

context that gives it value for specific end users
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1.2.1 Data v.s Information:

❑ Data structure:

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 1.2.1 Data v.s Information:
❑ Knowledge is an understanding of a set of rules that are followed to convert
data into information and how that information can be made useful to support a
specific task.

Monthly Sales Report

for West Region
Sales Rep: Charles Mann
Emp No. 79154
Item Qty Sold Price
TM Shoes 1200 $100
KG shoes 10000 $250

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1.2.2 Attributes of Information Quality:

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1.2.2 System:

❑ System is a group of
interrelated components
Feedback Feedback
Signals Signals working together
Control Control by Control
Signals Management Signals toward a common goal
by accepting inputs and
producing outputs in an
Input of Manufacturing Output of organized
Raw Materials Process Finished Products
transformation process.

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 1.2.2 System:
❑ Efficiency
Measure of what is produced divided by what is consumed.
❑ Effectiveness
Extent to which system attains its goals.
❑ System performance standard
Specific objective of the system.

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1.2.2 System:

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1.2.3 What is Information System?

❑ An information system is a set of interrelated components that collect (or
retrieve), process, and distribute information to support decision making and
control in an organization.

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 1.2.3 What is Information System?
❑ Components of IS:

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1.3 Logistics Information System:

Logistics Information System

Design and implementation Design, development,

of the efficient flow and
storage of goods...
+ installation, and application
of information system

A new discipline? That

unifies Logistics and
Information System

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Logistics Information System

1.3 Logistics Information System:

Once we’ve already built a LIS, we’ll be able to:
❑ Reduce Order Processing time.

❑ Facilitate receiving and shipping order process.

❑ Make transport more efficient.

❑ Query information immediately.

❑ Track flow of goods.

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1.3 Logistics Information System:

❖ Information technology will affect the growth and development of Logistics.

❖ Computers are used to support Logistics Activities.

❖ Decision support system, artificial intelligence and expert system are being used
to support decision making in logistics.

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1.3 Logistics Information System:

1.3.1 Functions:
❑ Data bases
❑ Planning
❑ Coordination
❑ Communication
❑ Control

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1.3 Logistics Information System:

1.3.2 Customer Order Cycle:

6. Order 5. Order
1. Customer
delivered to shipped to
places order
customer customer

2. Order 4. Order
3. Order
received by picked and
processed
supplier packed

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 1.3.3 How do customer orders enter the firm’s order
processing function?

Traditional Order Placement

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1.3.3 How do customer orders enter the firm’s order

processing function?

Computer network

Modern Order Placement

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1.3.4 Comparison of order processing systems:

Cost to
Level Type of system Speed implement/ Consistency Accuracy
maintenance
1 Manual Slow Low Poor Low
Intermedi-
2 Phone Intermediate Intermediate Good
ate
High
Direct electronic investment
3 Rapid Excellent High
linkage cost, low
operating cost

Characteristics of various order processing systems

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Chapter 2: Techniques & Technologies for LIS
2.1 Electronic Data Interchange (EDI):
2.1.1 EDI Overview:
Electronic Data Interchange is the transfer of business data between computer
applications using a mutually agreed standard to describe the data contained in the
message.

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2.1.1 EDI Overview:

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2.1.1 EDI Overview:

EDI v.s
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 2.1.1 EDI Overview:

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2.1.1 EDI Overview:

❑ Benefits of EDI:
✓ Reduction of data entry errors.
✓ Quick updates of information.
✓ Cost saving & Increased efficiency.
✓ Increased communications between supplier and consumer.
✓ Improvements in business process.
✓ Information in electronic forms is easily shared over the organization.

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2.1.2 EDI Components:

❑ Hardware & Software solution:

IBM EDI Solution

+ ProEDI
PassportXchange
OpenEC Trade Link Software
Covalentworks Cloud EDI Solution
…

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 2.1.2 EDI Components:
❑ Communication: Transportation of the EDI file over a network can be done in
many ways. Any network and any protocol can be used as long as it fits the
needs. Two types of communication are discussed here:
✓ Internet (AS1, AS2, FTP, etc.)
✓ Value-added network (VAN)

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2.1.2 EDI Components:

❑ EDI format: The most commonly used message standard are:
▪ ANSI ASC X12 – US standard.
▪ EDIFACT – recommended by United Nation.
▪ UNTDI – UK retail standard.
▪ more…

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2.1.2 EDI Components:

Envelope schematic
diagram

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 2.1.2 EDI Components:
ISA~00~~00~~12~5557260541~12~5556288340~090408~2206~U~00401~600000198~0~P~:*
GS~PO~15557844480~5557260541~20090408~2206~600000214~X~004010VICS*
ST~850~002140001*
BEG~07~RL~5075676~1~20081009*
REF~DP~036*
CSH~P4*
ITD~05~2~0~~0~~30*
DTM~037~20090413*
DTM~001~20090418*
PO1~~80~EA~5~~UP~999999999999~VA~XXXXXXXXX~CB~9999999~BO~001~IZ~33902*
CTP~RS~RES~22*
PID~F~08~~~TANK WITH LACE:BLK DOTBQT*
PID~F~75~~~BLK DOTBQT*
PID~F~91~~~SMALL*
SAC~N~~VI~TC09~~~~~~~~~KOH3528AT*
SDQ~EA~92~00810~8~00855~32~00860~24~00865~8~00885~8*
CTT~1*
SE~16~002140001*
GE~1~600000214*
IEA~1~600000198*
ANSI ASC X12 format of an EDI document 34

2.1.2 EDI Components:

ISA~00~ ~00~ ~12~5557260541 ~12~5556288340 ~090408~2206~U~00401~600000198~0~P~:*
GS~PO~15557844480~5557260541~20090408~2206~600000214~X~004010VICS*
ST~850~002140001*
SE~16~002140001* 105th character (:)
ST~850~002140002*
SE~34~002140002*
GE~2~600000214*
GS~PC~15557844480~5557260541~20090408~2206~600000215~X~004010VICS*
ST~860~002140003*
SE~29~002140003*
ST~860~002140004*
SE~42~002140004*
GE~2~600000215*
IEA~2~600000198*
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2.1.2 EDI Components:

Common X12 standard EDI documents include:
204 Motor Carrier Load Tender
210 Motor Carrier Freight Details and Invoice
214 Transportation Carrier Shipment Status Message
810 Invoice
820 Payment Remittance Advice
824 Application Advice
830 Planning Schedule/Material Release
832 Price Sales Catalog
846 Inventory Inquiry/Advice
850 Purchase Order
852 Product Sales Activity Data
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855 Purchase Order Acknowledgment

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 2.1.2 EDI Components:
Common X12 standard EDI documents include (cont.):
856 Advance Ship Notice
860 Purchase Order Change
861 Receiving Advice
864 Text Message
865 Purchase Order Change Acknowledgment
869 Order Status Inquiry
870 Order Status
753 Request for Routing Instructions
754 Routing Instructions
990 Load Tender Response
997 Functional Acknowledgment
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2.1.2 EDI Components:

PO1~~80~EA~5~~UP~9999999
99999~VA~XXXXXXXXX~CB~99
99999~BO~001~IZ~33902*
What the hell
is it?

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2.1.2 EDI Components:

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 2.1.2 EDI Components:

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2.1.2 EDI Components:

❑ Message standard: EDI technique can use standardized format such as EDI and
XML.

Did you know?

XML
eXtensible Markup Language
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2.1.2 EDI Components:

A sample of XML & HTML
<note> <html>
<head>
<to>Tove</to>
<title>This is a title</title>
<from>Jani</from> </head>
<body>
<heading>Reminder</heading>
<p>Hello world!</p>
<body>Don't forget me this weekend!</body> </body>
</html>
</note>

What is the difference between

XML and HTML?
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 2.1.3 EDI Implementation:
❑ Cost considerations:
The most important thing to consider is the bottom line - how much your
system will cost to implement and maintain versus how much increase in revenue
you will generate with your system.
If you do a large amount of EDI transactions on a daily basis with many of
your customers, then you will want to invest in a system that has a high level of
automation. Otherwise, you will be able to use an online service.

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2.1.3 EDI Implementation:

❑ Technical considerations:
Consider document flow to choose correct system.

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2.1.3 EDI Implementation:

❑ EDI Provider:

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 2.1.3 EDI Implementation:
❑ Timing consideration:

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2.1.3 EDI Implementation:

❑ EDI expert:
Expert recommends a system that is suitable to your need within your
budgets. Yeah, I can do it.

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2.2 Radio Frequency Identification (RFID):

2.2.1 RFID definition:
Radio frequency identification (RFID) is a generic term that is used to describe a
system that transmits the identity of an object or person wirelessly, using radio
waves.

Why do we use RFID instead of Barcode???

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 2.2.2 Elements of an RFID System:
RFID systems fundamentally consist of two main elements:
• RFID tag (transponder).
• RFID reader/writer.

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2.2.2 Elements of an RFID System:

2.2.2.1 RFID tag (Transponder):
❑ RIFD tag construction formats:

Disk or Coins

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2.2.2 Elements of an RFID System:

2.2.2.1 RFID tag (Transponder):
❑ RIFD tag construction formats:

Glass Transponder
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 2.2.2 Elements of an RFID System:
2.2.2.1 RFID tag (Transponder):
❑ RIFD tag construction formats:

Smart label
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2.2.2 Elements of an RFID System:

2.2.2.1 RFID tag (Transponder):
❑ Frequency, Ranging, Memory capacity:
- RFID systems are operated at widely differing frequencies, ranging from 135kHz
long wave to 5.8GHz in the micro wave range.
- The achievable range of the system varies from a few milimetres to above 15m.
• Close coupling system (up to 1 cm)
• Inductive radio system (up to 1 m)
• Long range system (above 1 m)
- Memory capacity varies from 256 Bytes to 64 KBytes.

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2.2.2 Elements of an RFID System:

2.2.2.1 RFID tag (Transponder):
❑ Active and Passive Transponder:

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 2.2.2 Elements of an RFID System:
2.2.2.2 RFID reader/writer:

RFID reading/writing software (base software) 55

2.2.2 Elements of an RFID System:

❑ EPC RFID Classes:

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2.2.3 Near field communication (NFC):

▪ NFC is a short-range wireless technology that allows
communication between NFC enabled objects over a
distance of less than 20cm.
▪ NFC is based on Radio Frequency Identification (RFID)
standards.
▪ The tags you see or create include contacts, URLs, map locations, text and much
more.
▪ NFC Specifications:
✓ Data transfer rate: 224 kbps
✓ Operating frequency: 13.56 Mhz
✓ Operating time: Less than 0.2 seconds
✓ Operating range: Under 20 cm
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 2.2.3 Near field communication (NFC):
- NFC operates in two mode:
• Active mode
• Passive mode

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2.2.3 Near field communication (NFC):

NFC provides a range of benefits to consumers and businesses, much depends upon
the installation of NFC, but the main benefits are:
▪ Intuitive – NFC interactions require no more than a simple touch
▪ Versatile – NFC is ideally suited to the broadest range of industries,
environments, and uses
▪ Open and standards-based - The underlying layers of NFC technology follow
universally implemented standards
▪ Technology-enabling - NFC facilitates fast and simple setup of wireless
technologies, such as Bluetooth, Wi-Fi, etc.
▪ Inherently secure - NFC transmissions are short range
▪ Interoperable – NFC works with existing contactless card technologies
▪ Security-ready - NFC has built-in capabilities to support secure applications
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2.2.4 Selection criteria for RFID systems:

❑ Operating frequency:
➢ High frequency systems have a significantly higher range than low frequency
systems. Better reading speed rate
➢ Absorbtion rate: Low frequency is better then high frequency.
➢ Electromagnetic interference fields: High requency is better.
❑ Range: The required range of an application is dependent upon several factors:
➢ The positional accuracy of the transponder for security reason (reader and
transponder);
➢ The minimum distance between several transponders in practical operation. The
distance between the transponders must be such that only one transponder is ever
within the interrogation zone of the reader at a time;
➢ The speed of the transponder in the interrogation zone of the reader.
❑ Security requirement: micro processor should be used.
❑ Memory capacity. 60

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2.2.3 RFID applications:
2.2.3.1 Bus cards:

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2.2.3 RFID applications:

2.2.3.2 Contactless payment system:

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2.2.3 RFID applications:

2.2.3.3 NFC applications:

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 2.2.3 RFID applications:
2.2.3.4 Electronic passport:

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2.2.3 RFID applications:

2.2.3.5 Access controlling system:
- Online system.
- Offline system.

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2.2.3 RFID applications:

2.2.3.6 Automobile smart key & Electronic
Immobilization system:

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2.2.3 RFID applications:
2.2.3.7 Animal Identification:

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2.2.3 RFID applications:

2.2.3.8 Container Identification:

Container No: ML0123

Cargo inside: Drug
Total amount: 1000 kg
Penalty: Death

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2.2.3 RFID applications:

2.2.3.9 Waste Disposal:

The more garbage you

throw away, the more
you pay.

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 2.2.3 RFID applications:
2.2.3.10 Sporting events:

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2.2.3 RFID applications:

2.2.3.11 Industrial Production:

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2.2.3 RFID applications:

* Quiz:
What does RFID technology help for container terminal’s activities?

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2.3 Enterprise Resource Planning (ERP):
2.3.1 Problems you may encounter:

What will you do if you are

assigned to make some
purchases?

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2.3 Enterprise Resource Planning (ERP):

2.3.1 ERP Definition:
▪ ERP is a fully integrated business management system covering functional areas
of an enterprise like Production, Finance, Accounting and Human Resource…
▪ It organizes and integrates operation processes and information flow to make
optimum use of resources such as men, material, money and machine.

1 1 1
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2.3.2 ERP Main Components:

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 2.3.3 ERP Characteristics:
▪ Flexibility:

➢ An ERP system should be flexible to respond to the changing needs of an

enterprise (customization)
➢ The client server technology enables ERP to be changed once and all
components will be affected.
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2.3.3 ERP Characteristics:

▪ Modular & Open:

➢ Attachment or detachment module ➢ Accept third party add-ons.

can’t make system shutdown.

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2.3.3 ERP Characteristics:

▪ Comprehensive:

➢ It should be able to support variety of

organizational functions and must be suitable
for a wide range of business organizations.
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 2.3.3 ERP Characteristics:
▪ Beyond the company:

➢ It should not be confined to the organizational

boundaries, rather support the on-line connectivity
to the other business entities of the organization.

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2.3.3 ERP Characteristics:

▪ Best business practices:

➢ It must have a collection of the best

business processes applicable worldwide.

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2.3.4 Why company undertakes ERP:

Integrate customer order information Standardize and speed up

manufacturing process

Integrate financial information

Reduce inventory
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Standardize HR information

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 2.3.5 Benefits of ERP:
❑ Reduction in paper documents.
❑ Improvement in timeliness of information.
❑ Greater accuracy of information.
❑ Improvement in cost control.
❑ Faster response to customers, business operations, market conditions.
❑ Better monitoring and quicker resolution of queries.
❑ Achievement in competitive advantage.
❑ Improvement in supply-demand linkage with remote locations and branches in
different countries.
❑ Unique customer database usable by all applications.

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 2.3.6 ERP Implementation:
These are key decisions that need to be made when considering an enterprise
integration effort.
1. ERP or not?
Factors should be considered:
- Technology
- Process improvements
- Productivity improvements
- Strategic consideration

OR

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 2.3.6 ERP Implementation:
2. Follow software’s processes or Customize?

OR

88

2.3.6 ERP Implementation:

3. In-house or Outsource?

OR

89

2.3.6 ERP Implementation:

4. “Big Bang” or Phased Implementation?

OR

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 2.3.7 ERP Implementation Methodology:
Several steps are involved in the implementation of a typical ERP Package. These
are:
1. Identifying the needs for implementing an ERP Package.
2. Evaluating the “As is” situation of the business.
3. Deciding the “would be” situation for the business.
4. Reengineering the business process to achieve the desired results in the
existing processes.
5. Evaluating the various available ERP packages to assess suitability.
6. Finalizing the most suitable ERP package for implementation.
7. Installing the required hardware and networks for the selected ERP package.
8. Finalizing the implementation consultants who will assist in implementation.
9. Implementing the ERP package.
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2.3.8 Some ERP software solution providers:

92

2.4 Global Positioning System (GPS):

2.4.1 GPS Definition:
▪ The Global Positioning System (GPS) is a utility that provides users with
positioning, navigation, and timing services.

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 2.4.1 GPS Definition:
▪ There are 4 navigation satellite systems (may be available more in the future):

Galileo

GPS

Beidou

Glonass

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2.4.2 GPS Components:

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2.4.3 How it works (GPS):

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 2.4.4 GPS Accuracy:

Sorry, wrong
target.

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2.4.5 GPS Applications:

❑ Agriculture:

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2.4.5 GPS Applications: At the crossroad, make a U-

turn, go straight ahead
❑ Driver GPS Navigation: 100m, turn right and … go
to the hell. Sorry, I make a
mistake.!!!

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 2.4.5 GPS Applications:
❑ Military tracking application:
Fire at Will!!!

100

2.4.5 GPS Applications:

❑ Precise time preference:

101

2.4.5 GPS Applications:

❑ Mobile satellite communication: Black hawk call Eagle, do
you copy? We are under
attack.

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 2.4.5 GPS Applications:
❑ Emergency and Locational Based service:

Where are you, I’m… I’m at work…

darling?

Hurry up! I can’t

wait longer

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2.5 Bar Code:

2.5.1 Barcode overview:
▪ A barcode is an optical machine-readable representation of data relating to the
object to which it is attached.
▪ There are 2 main types of barcode used in many fields nowadays:
✓ 1D barcode.
✓ 2D barcode.

104

2.5.2 1D Barcode:
• 1D Barcode was mentioned in “Goods in transport” subject. This slide is just for
a short review.

Quiz
What is the function
of barcode???

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 2.5.3 2D Barcode:
• 1D Barcode has some disadvantages. To find the solution to this problem, 2D
Barcode was invented.

106

2.5.3 2D Barcode:
• As with 1D codes there are lots of variations of 2D codes including QR Code,
Color Code, EZcode, Aztec code, Bullseye, MaxiCode, 3-DI, Shot Code and
SemaCode…

107

2.5.3 2D Barcode:
• A typical 2D Barcode format:

ASCII code for w: 119 (decimal)

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 2.5.3 2D Barcode:
• Storage capacity: The amount of data that can be stored in the QR Code symbol
depends on the data type, version, and error correction level. The maximum
storage capacities, for instance, occur for 40-L symbols.

Numeric only Max. 7,089 characters (0, 1, 2, 3, 4, 5, 6, 7, 8, 9)

Max. 4,296 characters (0–9, A–Z [upper-case only], space, $, %, *, +, -, .,
Alphanumeric
/, :)
Binary/byte Max. 2,953 characters (8-bit bytes) (23624 bits)
Kanji/Kana Max. 1,817 characters

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2.5.3 2D Barcode:
• Error correction: use the Reed–Solomon error correction algorithm with four
error correction levels. They are:

Level L (Low) 7% of codewords can be restored.

Level M (Medium) 15% of codewords can be restored.
Level Q (Quartile) 25% of codewords can be restored.
Level H (High) 30% of codewords can be restored.

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2.6 Applications:
• Let’s read this comic strip.

One day, A furniture trade show turns up by Mr.NHLP being held at large
convention center. He decides to escape from QL school time and goes to expo. He
bypasses the manual ticketing line easily by his tablet with NFC technology while
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other people are tired of queuing for ticket.

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2.6 Applications:

Entering the room, he doesn’t know which place he should visit first. He goes to
instruction map and takes his tablet near the tag barcode. Instantly, he receives a
e-map on his tablet. He enters the keyword that he’s interested in and it shows him
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the places with red dots he should visit.

2.6 Applications:

He sees some new chairs and he is considering buying it. By scanning hanging tag
barcode, he download e-brochure about that chair immediately onto his tablet.
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2.6 Applications:

After much heart-searching, he decides to choose a luxury chair with unbelievable

price – 40 million VND. He sees a tag barcode below the chair image. That sign tells
“Order now”. By scanning this tag, he is able to quickly place his order with an easy
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way.

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2.6 Applications:

He goes home with a satisfied smile on his face. He is right to escape from school
time, It’s worth doing it. (Don’t tell this story to anyone otherwise he’ll be fired).
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