Last week Automotive Logistics hosted its first webinar, an introduction to what will be an ongoing series on important topics for the automotive supply chain and logistics industry. The webinar tackled the issue of optimising yard management and was presented by Steve Jones, founder and managing director of software specialist Vehnet. During it, Jones demonstrated how advanced IT systems can help enhance the design and operations of vehicle storage and distribution yards.
The presentation focused on the increasing complexity of yard management, given the increasing pressures in the industry for lower inventory, faster turns and less damage. Indeed, a live poll taken from the webinar’s nearly 130 participants revealed that 76% said yard management would become even more complex in the next two years.
The objective of Automotive Logistics webinars is to be both informative and participatory. While Jones gave his 30 minutes presentation, those observing submitted questions for discussion. While there was not enough time to respond to all questions during the 45-minute session, here Jones addresses a wide selection of the questions the audience posed.   
The full webinar, along with future Automotive Logistics sessions, will be archived and permanently available online here.
Q. All these years we have been hearing about RFID – can you give us a sense of the technology that is being used at the yards where you have operations, and what you might typically recommend customers?
Steve Jones: Great question! First, the percentage of installations globally is small, however the largest installation of active RFID that we know of is the Broekman operation at Rotterdam. Here, around 42,000 cars are actively tagged and tracked using Wherenet, which provides slot level position for most cars and, in certain areas, a zone location of around 20 cars. Wherenet is tightly integrated with Vehnet Advance Yard. It works very well as a combination and has been in daily use for more than three years. There is a case study about this here.
Obviously, you should only use RFID if it delivers the required return on investment (ROI). The challenge is working out what that should be. As a general rule the four key criteria are volume; process complexity; business risk; and local labour rates. There is a range of RFID options, from simple and inexpensive passive tags up to real-time locating systems. Unfortunately, there are no agreed standards for use globally in the automotive outbound sector. The German automotive association VDA (Verband der Automobileindustrie) has worked on a system for passive tags, however these tags are not practical for giving an up-to-date location because they have to be read within a few metres, and yards can be very large. I am convinced that proper standards would allow for more widespread adoption of tags, built in at the factory at a low cost, that can be read over distances. On the other hand, I’m equally sure that this is not going to happen any time soon. So, in short, my best advice would be for individual yards to investigate whether they can gain benefits from RFID, and then do it on the basis of a local ROI.
Q. When we discuss building up some of these yard planning systems, they include information from an array of other stakeholders – shipping lines, trucking and rail, the OEMs, etc. Is it a challenge to get their buy-in and engagement?
SJ: Absolutely. It is not that the parties are unwilling to engage, but they cannot easily do so in a cost-effective way. The reason, again, is a lack of standards. We have a customer that handles around 15 brands, and each one sends a different message, in different mediums, to request actions – and that is happening throughout the world. There is no electronic, reliable lingua franca. There are Odette or ANSI X12 messages, but they are not in general use; secondly the messages are only structured containers, and different parties use them with different contents. If there were one thing the industry should do together, it should be to work towards creating global message standards, and then enforce them. We are supporting this wherever we can. The AIAG (Automotive Industry Action Group) in North America has recently done some excellent preparation work in developing standard ‘supply chain event’ definitions, but as an industry we need to go further.
Q. Most examples discussed during the presentation have been somewhat European and North American based – how do you see these systems working in emerging markets, such as India or China?
SJ: Physical handling and storage requirements do not always meet the same high standard in Europe and North America, and they vary from excellent to poor in other regions of the world too. From a systems point of view, I would suggest the issue is simply one of cost. From the earliest days of IT, the justification was that ‘computers can do it cheaper, more reliably and faster’. In some regions it could be argued that labour can do the same job cheaper, because IT comes at a price. However, labour is getting more expensive, whilst IT is getting cheaper every year.
Despite the closing of this gap, it is still fair to say that IT for the automotive sector could and should be cheaper. The kind of developments Vehnet has made in the last two years in introducing free and low-cost software, together with our investment in making solutions available in ‘The Cloud’ and in hosted environments offer part of a potential solution for rolling out IT in areas such as India and China.
Q. Does the Vehnet yard management system allow change prioritisation over which load gets into an assembly plant at the gate, based on urgency of the need of content for JIT?  What technology is used for such capability?
SJ: Our system can certainly do this. A data feed from the ASN (Advance Shipping Note) system is required to tell us what parts are in the inbound trailer or container. Then another feed is taken from the production materials system, where the priorities come from. The moment the trailer reaches the gate, the workflow engine kicks in and tells the driver where to position his truck, based on the dock door or parking spot where the parts are needed. Usually production materials will be alerted with an email or a message into their system, or both. It also gives visibility of the trailers in the yard, so that people can search for parts and call the trailers to the dock with a simple click. We call it ‘Warehouse on Wheels’.
Q. How do you handle EDI?
SJ: We are working with organisations such as AIAG, Odette and ECG to improve this situation. How we handle the issue is to provide a very rich toolset for capturing, mapping and processing messages. We can accept simple CSV files, XML, Spreadsheets by email, as well as Edifact and Odette. Same goes for outbound messages.
Q. Is the software multi-language? 
SJ: Yes. All language sets are supported, including double-byte characters such as Japanese and Chinese. Customers have a very clever tool to make their own translations. This is important because we deliver our systems as an exact fit to the needs of our customers – right down to the screens they use. Using this tool, customers can make their own help and user manuals and use them online too.
Q. How is billing for storage handled? 
SJ: There is certainly a baffling range of billing rules and methods out there; however, our tariffs module goes beyond storage. It is able to handle ‘storage by weight range and number of days range by cargo commodity’, for example. Storage is easily triggered. Using workflow and the price algorithms of tariffs gives the correct price. Storage can be started and stopped at any ‘event’, such as ‘arrived or ‘left terminal’. Very complex billing is increasingly demanded by customers, and without an automated process it takes a great deal of administrative labour, with a high chance of error. Sometimes the billing must stop and restart, such as when a car is delayed due to the fault of the yard operator. Billing takes account of free days and each customer contract is respected so that errors are avoided and all opportunities to invoice are captured.
Q. What is the technology that Vehnet uses? 

SJ: We use Microsoft VB.NET tools, with a service orientated architecture based on CSLA. There is true database independence built in to serve any database engine, but in practice all customers currently run on Microsoft SQL Server.