Leading global manufacturer of home appliances
Gaining Complete Control Over the Entire Process
Every year we have to assess our partners through the performance assessment system. The old method took too much time and effort, not to mention the frequent errors. oTMS helped us take that crucial step toward applying a data-driven approach to logistics.
Panasonic is a multinational enterprise based in Japan which owns over 230 companies and employs more than 290,493 employees around the world. In particular, more than 54,000 of Panasonic’s employees are based in China, In 2001, the company recorded annual revenue in excess of US$61 billion, ranking it 26th among the top 500 manufacturing companies worldwide.
Panasonic Corporation unifies its brand around the world under one name — “Panasonic” — and uses “A Better Life. A Better World.” as its brand slogan to realize “the abundance of social life” and the vision of “coexisting with the Earth” and is continuing its devotion to boost the living standards of people around the world.
Similar to many multinational companies in China, Panasonic established over 30 branches and nearly one hundred factories, yet the company does not have a subsidiary that specifically takes charge of logistics services, nor does it have any warehouses or transport vehicles. Therefore, Panasonic outsources its entire logistics operations to third-party logistics providers. The logistics services provided by third party providers must not only support Panasonic’s internal business operation, including procurement of raw materials and delivery of finished products, but also needs to adapt to different kinds of deliveries through different channels. For example: There is a great difference between the delivery of electronic products and home appliances. Likewise, B2B distributors and B2C e-commerce operators possess different delivery features.
To integrate shipping volume resources among different factories and manage third-party logistics providers in different regions, Panasonic was the first company to use a data-driven system to manage its supply chain. The company began applying information management systems like ERP, TMS, and WMS several years ago. However, an information system centered around ERP generally comes from a financial standpoint that emphasizes production processes and internal cost calculation. Thus, such systems have certain limitations when it comes to logistics management, which mainly relies on outsourcing. In addition, the original TMS system could only receive in-transit messages periodically sent by carriers, thereby lacking promptness and traceability. In addition, the inability to upgrade the conventional software hindered the company’s ability to satisfy increasing demands arising from rapid business growth. Therefore, management had no way to determine transport status in real time and could not gauge the quality of on-site implementation from third-party logistics providers.
In contrast to production and warehousing — which only requires managing internal employees — transport, as the only means for delivering products, is the first point of contact for end customers to experience Panasonic’s service and has a direct impact on the customer’s overall impression towards Panasonic. As the increasing prevalence of e-commerce continues to change the shopping habits of Chinese consumers, it is also causing customers to have exceptionally high expectations towards logistics service. “Why can’t we see clear package tracking and location information like on Taobao or JD?” We spent tens of millions of dollars on purchasing the information management system. Can it not even satisfy this need?” Feedback from business departments and customers spurred this company with over a century of history behind it to begin actively exploring alternatives.
Through the oTMS transport management platform, Panasonic realizes real-time data sharing with 16 partnering third-party logistics companies. Compared to the previous method, wherein carriers periodically sent notifications back through integrated systems, oTMS provides a fully traceable and clear real-time tracking and location display with 100% precision. Real-time tracking adds another advantage for Panasonic’s internal personnel. With oTMS’ “Where Is It” app, employees can see the status of goods in transit anytime, anywhere without having to wait for the carrier to communicate with the driver and send notifications back, thereby enabling better control over the timeliness of orders.
In terms of the cost, oTMS provides software as a service (SaaS) which does not require additional hardware or IT personnel. This approach has also cut costs and workloads for connecting with 16 carrier systems. Panasonic has applied the solution from oTMS for less than half a year, so an accurate ROI cannot yet be calculated. Even so, according to statistics from Bestseller, oTMS’ largest customer, after just one year of application, companies can reduce costs associated with tracking personnel and warehouse transfer orders by 80% and 60%, respectively. In addition, the time spent reviewing and confirming shipping invoices can be reduced by as much as 95%, and the tendering process can be sped up by as much as 90%.