fax:++43-2254-780-3888. E-mail address: alexander. kaufmann@arcs. ac. at (A. Kaufmann. 0166-4972/02/$-see front matter 2002 Elsevier Science Ltd.
Data from a research project SME Policy and the Regional Dimension of Innovation (SMEPOL, see acknowledgements) enable us to assess better
Upper Austria has an industrial core region formed by the three cities of Linz (the capital of the province), Wels, and Steyr.
Outside this core area there are peripheral areas in the north and south of Upper Austria but also several smaller industrial centres.
) Before we present the results of the data analysis, however, it is necessary to describe some technical details of the survey:
The data presented in Table 2 correspond to the results of other studies (e g.,, Fritsch and Lukas
A statistical analysis of data from a survey on innovation systems in several European regions (Kaufmann and To dtling, 2000b) leads to the conclusion that it is particularly the interaction with science that stimulates more advanced innovation, i e.,
A too dominant focus on the region limits the scope of available technical information technologies, and accessible markets.
two are research-oriented Software Park Hagenberg (SWP) and Research and Training Centre for Labour and Technology Steyr (FAZAT).
The technology centre which is most explicitly R&doriented is the Software Park Hagenberg (SWP), located close to the capital of Linz.
and research centre for software development, industrial mathematics, and related services, exclusively focusing on this technology field.
The SWP was founded in 1987, initiated by a department of the University of Linz (Research Institute for Symbolic Computation.
teaching by the technical college (offering the courses Media Engineering and Media Design and Software engineering),
and belong predominantly to software, data processing, and consulting services. There are hardly any manufacturing companies and only a few high-tech firms.
This leads to a situation where certain technological fields are pre-2 All data regarding innovation support are based on the annual reports of the FFF (Forschungsfo rderungsfonds fu r die gewerbliche
These fields are microelectronics and information technologies (21%of total funds and 16%of supported projects), pharmaceutical technologies (9%of funds and 2%of projects),
The Austrian industries most frequently benefiting from FFF support are machinery, information and communication technologies, data processing, medical, measurement and optical technologies, and chemicals.
According to the survey data the spillover effects to SMES in the region are negligible. In comparison, relations to the centres are more frequent in the category of large firms.
and services (frequently software) while only 19 belong to the metal-and-steel industry, metal products, plastic products,
information and communication technologies, chemicals, data processing, and electrical equipment. Of course, there is no simple correspondence between industry and technological level (especially in the service sector),
The network paradigm new departures in corporate and regional Development environment & Planning D: Society and Space 11,543 564.
0271) 740-2844 Fax:(0271) 740-2279 Internet: www. prokmu. de PRO KMU Alle Rechte vorbehalten.
ISSN: 1863-6632 III Table of contents 1. Introduction...1 2. Conceptual Framework for Identifying Good Practices on RTD and Regional Development...
Internet links for further information on‘good practice'regions...77 List of Figures Figure 1:
Some key data on Bremen concerning innovation...43 Table 3: Some key data on Tuttlingen concerning innovation...
59 Table 4: Stylized Matrix of Good Practice Elements in Surveyed Regions...62 1 1. Introduction1 This report is part of the work undertaken to realise Work Package 2 within the CRIPREDE project.
which is reflected in statistical data showing a lower number of patents or lower expenses for R&d personnel,
Based on US data, Acs and Audretsch (1990) provided further empirical support for the disproportionate contribution of SMES to innovation.
what constitutes innovation as well as different databases to examine it, the point to stress is that both large and small firms play important roles in innovation and R&d.
Specialised suppliers such as engineering or software industry frequently carry out product innovations, often together with customers.
in the‘New Economy'innovations would contain the introduction of new software products and services or the development of new customer segments.
Several studies illustrate processes of regional clustering, analysing in some detail how initial conditions within a region are triggered reinforced,
thus introducing an interaction-based clustering process (Wolter 2004) 9. Initially, high-tech industries and clusters need triggers to set them off onto technology specific trajectories.
In contrast to the development of territories such as the Silicon valley, Route 128 or the Research Triangle Park in North Caro-9 Wolter (2004) distinguishes two dominant explanations for clustering tendencies,
Examples are the Finnish telecommunication concern Nokia or the German automobile company VW in Wolfsburg.
Thus, weak ties‘represent local bridges to disparate segments of the social network that are unconnected otherwise'(Elfring and Hulsink 2003: 411.
demonstrating the extent to which this results in cumulative processes in core regions at the expense of peripheries.
Data from this study clearly shows that the pattern of patenting is concentrated much more than the distribution of the industry in general.
the creation of specific forms of knowledge and the pressures and incentives to upgrade firm capabilities often becomes vital to its continued success. Advantages that are developed through the interaction of individuals, firms,
which are heavily dependent on scientific knowledge such as biotechnology, information technology and others. Here, research activities are compared more important to development.
The authors use the software agglomeration in Dublin and the IT-sector in Tampere as examples to demonstrate how the agglomeration process is contingent on local resources and processes.
which could originate out of territorial catalysts fostering a local innovation system such as technological parks.
and spatial clustering allows firms to realise and draw on knowledge spillovers. With this classification we aim at capturing the regional RTD context.
The embeddedness of firms in local information systems is important to remain innovative, ‘since they encourage continuing learning processes of the resident companies in an evolutionary, self-sustaining way, combining knowledge external as well as internal to the region.'(
or the‘Bangalore University'with 250,000 students as well as a number of public research institutes covering various areas such as IT, artificial intelligence, production technologies, aircraft-/aerospace (Fromhold-Eisebith and Eisebith 1999).
Manufacturing industries (it is home to the headquarters of state owned heavy industries such as Hindustan Aeronautics, National Aerospace Laboratories, Bharat Electronics, Indian Telephone Industry, Hindustan Machine tools),
space technology (Indian Space Research Organisation) and IT (esp. international computer hardware and software enterprises that have operations in Bangalore).
Texas instruments, Infosys Technologies Ltd..In total, Bangalore is the most important centre of civil and military aircraft and aerospace industry and IT in India.
The Indians are seen as ambitious and capable people who are international mobile with high qualifications.
In a historical context, the US major enterprise Texas instruments that‘discovered'Bangalore as a location is of great importance.
Bangalore's software cluster owes‘its origins and growth to increased cross-border flows of labour,
and Silicon valley one that could play an important role in upgrading the Indian software industry in the future.'
, data networks) that supported the settlement of foreign enterprises. In Bangalore subsidies were given on an enterprise level (e g.,
, free trade area and establishment of the‘Software Technology Park')so that the support reached the beneficiaries directly (Balasubramanyam and Balasubramanyam 2003.
This so called‘Massachusetts Miracle'(Rosegrant and Lampe 1992: 2) ended in the late 1980s when a severe crisis begun because of the decline of the minicomputer industry and a reduction in military budgets, both on
‘By 2000, Boston was a center for information technology, financial services, and biotechnology, and ranked as the eighth richest metropolitan area in the US'(Porter et al. 2005: 287).
but also in supra-regional or even worldwide social networks) that‘offer particular()advantages for firms engaged in innovation and knowledge creation.'
The technological development worldwide (increasing importance of sectors like biotechnology, internet services etc.;dislocation of emphasis from hardware to services) was a benefit for Boston that‘was poised ideally to take advantage of the rise in returns to skill that so marked the last quarter of the twentieth century.'(
'Glaeser 2005: 151. Contrary to regions such as North Jutland or Bremen, policy and governance is of no greater importance for regional development.
These market or structural changes can be seen as main external triggers for change and the search for and the acceptation of new market opportunities and the change of technological focus (lately, emergence of biotechnology and internet services.
Talking of key data, on the one hand the inhabitants'income situation in Bremen is relatively good, for instance.
and the existence of innovation abilities (see also Table 2 for more data referring to Bremen's success
Some key data on Bremen concerning innovation First, there are the general conditions and resources to look at.
With this framework Bremen is putting a main emphasis on developing new innovation fields like T. I. M. E. telecommunications, information technology, multimedia and entertainment), health care services and environmental economics etc.
The settlement of an IBM plant in 1965 can be seen as a major initial impetus for a new phase of economic development as part of a‘third industrial revolution'(Kolmer 1997: 127.
‘Euromédicine'for medicine, pharmacy and biotechnology,‘Agropolis'for tropical and Mediterranean agronomy,‘Antenna'to support the development of telecommunications and audiovisual techniques and‘Informatique'for microelectronics, data processing, etc.
In addition, the massive expansion of the city evoked heavy traffic, a lot of construction sites, high prices for real estate and high cost of living in general.
A Digital and Wireless Periphery North Jutland is a county on the Jutland peninsula in Northern Denmark, the largest county in Denmark.
Radiocommunications technology is the common knowledge base for the cluster. It can be traced back to 1947
modem and fax equipment for wire and wireless systems as well as various equipments for maritime communications and navigation (Dalum et al. 1999;
and basic research is seen as a core asset of the region (Stoerring and Dalum 2006).
that the region build on its core assets, namely ICT (Norcom) and the emerging life sciences at university for Biomedico.
and maintaining social networks have a long tradition in the region (Stoerring and Christensen 2004). Moreover, a widespread awareness of the importance of further developing the technological system can be found (Dalum et al. 1999;
Furthermore, Oxfordshire has the largest concentration of printing and publishing companies in the UK outside London (Oxfordshire County Council 2005.
But for‘the greater ease of retrieving data,) (we will make the Prato industrial district‘ideally'correspond to the province of the same name,
information technology (Lazzeretti and Storai 2001. As in every industrial district, the enterprise structure in Prato is characterised by an extensive division of labour.
Some key data on Tuttlingen concerning innovation What is responsible for this success? Firstly, there are some general conditions resp. resources that contribute to it.
or the settlement of major multinational enterprises such as IBM in Montpellier,'Big pharma'in North Jutland and Texas instruments in Bangalore.
This in turn influences the possibility of a cluster to 26 Entropy is a concept from natural science.
'The author indicates that there is also evidence showing that embedded relationships may be a relic of the past instead of being a result of clustering tendencies. 5. 3. Unsolved Questions in Regional RTD All this poses additional challenges to be taken into account by policy-makers.
The software cluster in Bangalore. In: J. H. Dunning (ed.:Regions, globalization, and the knowledge-based economy.
Innovation in Small Scottish Software Firms. In: Entrepreneurship & Regional Development 12 (3), 217 244.
Download 15 june 2006. Hospers, G.-J. 2004: Place Marketing in Europe: The Branding of the Oresund Region.
Social networks, Resources and Entrepreneurship. Entrepreneurship and Innovation, 103-109. Johannisson, B.,M. Ramirez-Pasillas and G. Karlsson (2002:
Download 6 june 2006. Keeble, D c. Lawson, H. Lawton Smith, B. Moore, F. Wilkinson (1998: Collective learning processes and inter-firm networking in innovative high-technology regions.
Territorial Clustering and High-technology Innovation: From Industrial Districts to Innovative Milieux. ESRC Centre for Business Research working paper 54, University of Cambridge.
towards a knowledgebased theory of spatial clustering. Environment and Planning A 34,429-449. Malmberg, A.,Ö. Sölvell and I. Zander (1996:
Spatial Clustering, Local Accumulation of Knowledge and Firm Competitiveness. Geografiska Annaler, 78 B (2), 85-97.
Bridging the digital divide. New delhi, Thousand Oaks: Sage Publications, pp. 169-181. Schamp, E w. and V. Lo (2003:
Download 6 june 2006. Stam, E. and E. Wever (1999: Propinquity Without Community Spatial Transfer of Knowledge in The netherlands:
the SPRU Innovations Database revisited. Research Policy 2, 19-32. Toedtling, F.;Trippl, M. and J. v. Gabain (2006:
Knowledge-based industrial clustering: International comparisons. In: J. de la Mothe and G. Paquet (eds.:
High-tech industry clustering rationales: the case of German biotechnology. In P. Cooke and A. Piccaluga (eds.:
Internet links for further information on‘good practice'regions (selection) Bangalore-India: www. onlinebangalore. com www. bangaloreit. in Boston-USA:
Digital economy and Society Index1 20152 Country Profile Hungary Hungary has an overall score3 of 0. 41
and Use of the Internet (Hungarians are keen to engage in many internet activities and outperform the EU average on use of the Internet-80%use social networks, the highest in the EU). At the same time,
Hungary scores below the average in Digital Public services (just 31%of internet users actively use egovernment,
while 8. 9%use social media, among the lowest in the EU). Hungary falls into the cluster of low-performance4 countries, where it performs above average.
0. 33 0. 45 1 The Digital economy and Society Index (DESI) is a composite index developed by the European commission (DG CNECT) to assess the development of EU countries towards a digital economy and society.
It aggregates a set of relevant indicators structured around 5 dimensions: Connectivity, Human Capital, Use of Internet, Integration of Digital Technology and Digital Public services.
For more information about the DESI please refer to http://ec. europa. eu/digital-agenda/en/digital-agenda-scoreboard 2 The DESI 2015 is constructed from indicators referring mostly to the calendar year 2014 (except
when data is not available for that calendar year, in which case the latest prior data was used).
3 DESI scores range from 0 to 1, the higher the score the better the country performance. 4 In the DESI 2015, the low-performance cluster of countries comprises Bulgaria, Cyprus
which is caused mainly by the progress in radio spectrum allocations. Hungary EU DESI 2015 DESI 2014 DESI 2015 value rank value Rank value 1a1 Fixed BB Coverage%households 94%(2014) 23 94
%(2013) 22 97%(2014) 1a2 Fixed BB Take-up%households 68%(2014) 13 66%(2013) 13 70%(2014) 1b1 Mobile BB
Take-up Subscribers per 100 people 34 (2014) 28 27 (2013) 28 72 (2014) 1b2 Spectrum%of the target for spectrum to be harmonised at EU level 71
%(2014) 16 48%(2013) 22 70%(2014) 1c1 NGA Coverage%households, out of all households 80%(2014) 14 76%(2013) 12 68
but VDSL coverage is also increasing. Hungary is catching up regarding the take-up of fixed broadband access:
%At the same time, Hungary has the lowest score in mobile broadband take-up. The recent spectrum allocations may trigger a growth in mobile broadband in the coming years.
DESI 2015 Country Profile Hungary Page 3 of 6 2 Human Capital 2 Human Capital Hungary Cluster score EU score rank score
Hungary EU DESI 2015 DESI 2014 DESI 2015 value rank value rank value 2a1 Internet users%individuals (aged 16-74) 75%(2014) 15
Graduates in STEM per 1000 individuals (aged 20 to 29) 9. 5 (2012) 26 9. 5 (2012) 26 17 (2012) 75%of Hungarians use the internet,
Increasing the level of digital skills should be a priority to further improve the performance of the digital economy.
DESI 2015 Country Profile Hungary Page 4 of 6 3 Use of Internet 3 Use of Internet Hungary Cluster score EU score rank score
Hungarian Internet users engage in a broad range of internet activities and outperform the EU average on the Use of the Internet.
Hungary EU DESI 2015 DESI 2014 DESI 2015 value rank value Rank value 3a1 News%individuals who used Internet in the last 3 months (aged 16-74
) 85%(2014) 6 83%(2013) 8 67%(2014) 3a2 Music, Videos and Games%individuals who used Internet in the last 3 months (aged 16-74) 47%(2014) 18 51%(2012) 13 49%(2014) 3a3 Video on Demand
%households that have a TV 23%(2014) 16 23%(2013) 15 41%(2014) 3b1 Video Calls%individuals who used Internet in the last 3 months (aged 16-74
) 52%(2014) 7 37%(2013) 14 37%(2014) 3b2 Social networks%individuals who used Internet in the last 3 months (aged 16-74) 80%(2014) 1
78%(2013) 1 58%(2014) 3c1 Banking%%individuals who used Internet in the last 3 months (aged 16-74) 40%(2014) 22 36%(2013) 23 57%(2014) 3c2 Shopping%individuals who used Internet
in the last year (aged 16-74) 42%(2014) 20 38%(2013) 21 63%(2014) As for the most popular activities on-line,
85%of Hungarian internet users read news, and 80%use social networks. The use of social networks is the highest in the EU. 47%of the internet users listen to music,
watch films or play games online, and 52%make video calls. Despite the progress last year, Hungary still falls well below the average on internet banking and online shopping.
On ecommerce, this is also linked to the supply side, as the percentage of SMES selling online is also below the average.
DESI 2015 Country Profile Hungary Page 5 of 6 4 Integration of Digital Technology 4 Integration of Digital Technology Hungary Cluster score EU
score rank score DESI 2015 25 0 21 0. 27 0. 33 DESI 2014 26 0. 18 0. 24 0. 3
Hungary's businesses need to better exploit the possibilities offered by on-line commerce, social media and cloud-based applications.
) 16%(2014) 26 13%(2013) 26 31%(2014) 4a2 RFID%enterprises (no financial sector, 10+employees) 3. 9%(2014) 16 1
. 1%(2011) 22 3. 8%(2014) 4a3 Social media%enterprises (no financial sector 10+employees) 8. 9%(2014) 21 9. 4%(2013) 22 14%(2014) 4a4 einvoices%enterprises (no financial sector, 10+employees) n
) 4b2 ecommerce Turnover%turnover of SMES (no financial sector, 10-249 employees) 6. 9%(2014) 18 5. 1%(2013) 22 8. 8
. 5%(2013) A true digital economy is one where businesses take full advantage of the possibilities
%Cloud services (5%)or social media (8. 9%)in Hungary is among the lowest in the EU. Without digitisation
Hungarian businesses will struggle to make it in the global digital economy. Hungarian businesses need also to take advantage of the possibilities offered by on-line commerce.
out of Internet users in the last year (aged 16-74) 31%(2014) 16 23%(2013) 17 33%(2014) 5a2 Pre-filled Forms Score (0 to 100
(2014) 5a4 Open Data Score (0 to 700) 300 (2014) 19 n. a.-378 (2014) 5b1 Medical Data Exchange%General practitioners 12
and degree of service offered by health systems can be improved greatly through digitisation. Only 12%of Hungarian general practitioners exchange medical data electronically,
versus 36%in the EU. The same applies to eprescription, as only 2. 2%of general practitioners transfer prescriptions to pharmacists electronically,
which data that is already known to the public administration is filled pre in the forms that are presented to the user),
. 6 Economic analysis and indicators European commission B-1049 Brussels E mail: RTD-PUBLICATIONS@ec. europa. eu Europe Direct is a service to help you find answers to your questions about the European union.
More information on the European union is available on the Internet (http://europa. eu). Cataloguing data can be found at the end of this publication.
They show thematic strengths in key technologies and also the high tech and medium tech contribution to the trade balance.
DG Research and Innovation Economic Analysis Unit Data: DG Research and Innovation, Eurostat, Member State Notes:(
which data are available). Hungary has had a participant success rate of 20.4%in FP7 close to the EU average of 21.5,
DG Research and Innovation Economic Analysis Unit Data: DG Research and Innovation, Eurostat, OECD, Science Metrix/Scopus (Elsevier), Innovation Union Scoreboard Notes:(
and the latest available year for which comparable data are available over the period 2000-2011.3) Fractional counting method.
DG Research and Innovation Economic Analysis Unit Data: Science Metrix using Scopus (Elsevier), 2010; European Patent Offi ce, patent applications, 2001 2010 Hungary's scientifi c and technological strengths The maps below illustrate six key science
Compiled by Science-Metrix using data from Scopus (Elsevier) Number of publications by NUTS2 regions of ERA countries Health, 2000-2011 Publications (Fractional Counting) 9. 7-4537.4
Compiled by Science-Metrix using data from Scopus (Elsevier) Number of publications by NUTS2 regions of ERA countries Information and Communication Technologies, 2000-2011 Publications (Fractional Counting) 0
Compiled by Science-Metrix using data from Scopus (Elsevier) Number of publications by NUTS2 regions of ERA countries Environment (including Climate Change & Earth sciences), 2000-2011 Publications (Fractional Counting
Compiled by Science-Metrix using data from Scopus (Elsevier) Number of publications by NUTS2 regions of ERA countries Biotechnology, 2000-2011 Publications (Fractional Counting) 0. 0-98.6
Compiled by Science-Metrix using data from Scopus (Elsevier) Number of publications by NUTS2 regions of ERA countries Automobiles, 2000-2011 Publications (Fractional Counting) 0. 0-13.9
Compiled by Science-Metrix using data from Scopus (Elsevier) Number of publications by NUTS2 regions of ERA countries Security, 2000-2011 Publications (Fractional Counting) 0. 0-26.3
DG Research and Innovation Economic Analysis Unit (2013) Data: Innovation Union Scoreboard 2013, Eurostat Note:(
1) Based on underlying data for 2009,2010 and 2011. The graph above shows that, in Hungary,
DG Research and Innovation Economic Analysis Unit Data: OECD Notes:(1) High-tech and medium-high-tech sectors are shown in red.'
From 1995, it can be noticed that almost all medium high tech and high tech sectors, especially motor vehicles, electrical machinery and apparatus,
. 5 1. 0 1. 5 2. 0 Professional, scientific & controlling instruments & apparatus Electrical machinery, apparatus & appliances Telecommunication,
DG Research and Innovation Economic Analysis Unit Data: COMTRADE Notes:‘‘Textile fibres & their wastes'refers only to the following 3-digit subdivisions:
Evolution of the contribution of high-tech and medium-tech products to the trade balance for Hungary between 2000 and 2011 Change in the contribution to trade balance (in%points) The graph above shows that several high tech
and medium tech industries signifi cantly improved their contributions to the Hungarian trade balance over the period 2000 2011, in particular telecommunications, scientifi c and controlling instruments, general industrial machinery and specialised
DG Research and Innovation Economic Analysis Unit Data: Eurostat, DG JRC ISPRA, DG ECFIN, OECD, Science Metrix/Scopus (Elsevier), Innovation Union Scoreboard Notes:(
which compatible data are available over the period 2000-2012.2) EU average for the latest available year.
DG Research and Innovation-Economic Analysis Unit Data: DG Research and Innovation, Eurostat, Member State Notes:(
A Tudomány-Innováció Program 2015-re köztes célként 1, 5%-os K+F-intenzitást tuzött ki (az átfogóbb, 2011-es Új
0, 69%-os szintre emelkedett. Magyarországon 2003 és 2007 között a vállalati szektor teljes K+F-ráfordítását (BERD) tekintve csökkent a külföldrol befelé irányuló üzleti kutatás-fejlesztési
Magyarországnak a hetedik keretprogram keretében a 21,5%-os uniós átlaghoz közeli, 20,4%-os sikerhányada volt a pályázók száma alapján, és 2011 közepéig 681
DG Research and Innovation-Economic Analysis Unit Data: DG Research and Innovation, Eurostat, OECD, Science Metrix/Scopus (Elsevier), Innovation Union Scoreboard Notes:(
and the latest available year for which comparable data are available over the period 2000-2011.3) Fractional counting method.
A tudományos publikációk legtöbbet hivatkozott 10%-ába a magyar tudományos publikációknak mindössze 5%-a tartozik bele, szemben a 11,6%-os uniós átlaggal.
DG Research and Innovation-Economic Analysis Unit (2013) Data: Innovation Union Scoreboard 2013, Eurostat Note:(
1) Based on underlying data for 2009,2010 and 2011.0.527 0. 612 0. 543 0. 000 0. 100 0. 200 0. 300 0. 400
DG Research and Innovation-Economic Analysis unit Data: OECD Notes:(1) High-tech and Medium-High-tech sectors are shown in red.'
DG Research and Innovation-Economic Analysis unit Data: COMTRADE Notes:""Textile fibres & their wastes"refers only to the following 3-digits subdivisions:
DG Research and Innovation-Economic Analysis Unit Data: Eurostat, DG JRC-ISPRA, DG ECFIN, OECD, Science Metrix/Scopus (Elsevier), Innovation Union Scoreboard Notes:(
which compatible data are available over the period 2000-2012.2) EU average for the latest available year.
You can obtain their contact details on the internet (http://ec. europa. eu) or by sending a fax to+352 2929 42758.
Priced publications: via eu bookshop (http://bookshop. europa. eu). Priced subscriptions (e g. annual series of the Official Journal of the European union and reports of cases before the Court of Justice of the European union:
All results are available on the internet and can be accessed or ordered via the Europa server
or directly at the Sebw website (www. europa. eu. int/comm/enterprise/ict/policy/watch/index. htm, www. ebusiness-watch. org).
This report presents the results of a sector impact study, focusing on electronic business in the transport and logistics services industry.
50 3. 3. 3 Use of Open source Software...53 3. 3. 4 Deployment and implications of RFID technology...
58 3. 4 Internal Process Integration...60 3. 4. 1 Use of software systems for internal process integration...
60 3. 4. 2 Use of ICT for cooperative and collaborative business processes...64 3. 4. 3 Deployment of e-invoicing...
82 3. 8 Cluster analysis: Employees with internet access at their workplace...86 3. 9 Summary and conclusions of ICT and e-business deployment...
outlook and policy implications...185 6. 1 Key findings...185 6. 2 Possible further developments of e-business...
see Section 1. 3 and Annex I for more information about data sources. For data analysis, descriptive and analytical statistical methods were used,
including advanced statistical methods such as growth accounting. The sector at stake The transport and logistics industry,
particularly those linked to the internet and e-business (see Chapter 3). Basic ICT infrastructure Nearly all companies which use computers in the TLS sector said in 2007 that they were con E-business in the transport & logistics industry 6 nected to the internet (97%).
%There is a clear trend towards broadband connections: except for micro-firms, more than 40%of all companies are connected by broadband,
The digitisation of business processes The continuous improvement of the basic ICT infrastructure in the TLS sector has allowed companies to embrace opportunities to substitute paper-based
thus optimising the flow of information and documents in and between companies, taking advantages of the increased diffusion of advanced e-business software systems.
data related to orders (received or placed) is exchanged typically in a paper-less way between the ERP systems of the two companies trading with each other.
(EU-7) weighted by employment Use of specific software systems for transport & logistics management Specific software solutions for the TLS sector, such as Cargo Handling Technology,
and ITMS (see Section 3. 4).%of companies*using specific transport & logistics software systems 16 3 12 20 31 29 8 22 35 43 12
the survey found that about a third of the medium-sized and more than 40%of the large firms in the sector use Electronic Data Interchange (EDI.
In freight transport and logistics, ecommerce includes initiating, tracking, and acknowledging shipments online. The special role of this subsector in this context is that its business is exactly to provide these services to other industries.
In all cases, ecommerce is in this sector closely linked with the objective to optimise business processes:
CRM (customer relationship management) systems, a comprehensive software to capture, storage and analysis customer data in an integrated way, is used not yet widely in the TLS sector (see Section 3. 6. 3).%Companies*accepting
For example, the diffusion of Intermodal Transportation Management Systems (ITMS) or RFID technology is used more widely in the US.
On the other hand, in some other areas, European companies appear to be more active using specific software systems like Warehouse Management Maintenance Management Systems (MMS.
The self-assessment of firms to what extent their data exchanges with business partners are conducted electronically, however, suggests that enterprises in Europe
US firms (in%,by their share of firms)- 2007 ICT adoption indicator USA EU-7*Internet access 100 97 Wireless LAN 43 22 Intranet 29
24 ITMS (Intermodal Transportation Management System) 8 4 RFID (Radio frequency identification Device) 7 2 Data Exchange mostly electronically 13 13 WMS (Warehouse Management
The analysis used data from the EU KLEMS Productivity and Growth Accounts2 (macro-data) as well as from the E-business Survey 2007 (micro-data.
Regressions based on the micro-data from the E-business Survey 2007 aimed to explore links between ICT usage,
Policy implications The empirical study findings (micro-data and case study analysis, macroeconomic analysis) lead to the conclusion that the following issues are particularly relevant for policy considerations (see Section 6. 3:
The analysis is based on literature, interviews with industry representatives and experts, company case studies and a telephone survey among decision-makers in European enterprises from the TLS industries.
This chapter is mainly based on survey data from the Sectoral E-business Watch. Chapter 4 assesses the impact of the developments described in Chapter 3 on work processes and employment, innovation and productivity,
A qualitative case study approach (Chapter 5) is combined with a descriptive presentation of quantitative survey data (Chapter 3)
All publications can be downloaded from the programme's website at www. ebusiness-watch. org. In 2007/08, the focus is on the following sectors and specific topics:
7 RFID adoption and implications (several sectors)--8 Intellectual property rights for ICT-producing SMES 30.01+02,32. 1-3, 33.2+3;
notably by enabling electronic data exchanges between a company and its customers, suppliers, service providers and business partners.
devices and services used for data processing (the information side of ICT) as well as telecommunications equipment and services for data transmission and communication (the communication side).
The European Information technology Observatory (2007) structures the ICT market into four segments with an estimated total market value of about € 670 billion in 2007 (Exhibit 1. 2-1
communications equipment (such as mobile phones), office equipment (such as copiers) and data communications and network equipment (such as switching and routing equipment, cellular mobile infrastructure) €159 billion Software products
System and application software €76 billion IT services Consulting, implementation and operations management €140 billion Carrier services Fixed voice telephone and data services, mobile telephone
the former internet hype was replaced suddenly by a widespread disappointment with e-business strategies. Companies adopted a more reserved and sceptical attitude towards investing in ICT.
The maturity of ICT-based data exchanges between businesses and their suppliers and customers, fostered by progress in the definition
In parallel, recent trends such as"Web 2. 0"and social networking are discussed widely in terms of their business E-business in the transport
'they constitute ecommerce. Transactions can be broken down into different phases and related business processes, each
either be pursued electronically (online) or nonelectronically (offline), and all combinations of electronic and non-electronic implementation are possible.
While the narrow definition focuses on'internet transactions'alone, the broad definition defines e-commerce as"the sale or purchase of goods or services,
and other public or private organisations, conducted over computer-mediated networks. The goods and services are ordered over those networks,
but the payment and the ultimate delivery of the goods or service may be conducted on-or offline"(OECD, 2001).
The addendum regarding payment and delivery illustrates the difficulty mentioned above to specify which of the processes along the transaction phases constitute ecommerce (see Exhibit 1. 2-2). The OECD definition excludes the pre-sale/pre-purchase 10 In 1999,
11 while fully recognising the importance of the internet during the pre-purchase phase for the initiation of business.
and other public or private organisations, conducted over computer-mediated networks. OECD) E-business: automated business processes (both intra-and inter-firm) over computer mediated networks.
OECD) e-Interactions: covers the full range of e-transactions as well as collaborative business processes. such as collaborative online design processes which are not directly transaction focused.
This vision of e-commerce also covers the digitisation of internal business processes (the internal processing of documents related to transactions) as well as cooperative
The OECD WPIIS12 proposes a definition of e-business as"automated business processes (both intra-and inter-firm) over computer mediated networks"(OECD, 2004, p. 6). In addition,
This can be achieved by replacing the paper-based processing of documents by electronic exchanges (machine to machine-machine)
but it requires the agreement between the participants on electronic standards and processes for data exchange.
Data and information sources The study is based on a mix of data sources and methodologies, including primary data collection, desk research and case studies. More specifically,
information was collected from the following sources: Sectoral E-business Watch Survey (2007: The TLS sector was one of five sectors covered by the Sebw Survey of 2007.
data for 1970-2005 are available for the former EU-15 EU MS and for the US,
while data from 1995-2005 are available for 10 new MS that joined the EU in 2004.
The data sources that have been used to create the EU-KLEMS data series are large based on series from the national statistical institutes (e g. investment series),
but also from a variety of national sources, in cases where no international database or statistics from the NSIS were available (e g. for hours worked by labour type).
Due to the broad range of sources used and data limitations in these sources, the level of detail in the EU-KLEMS database varies across countries, industries and variables. 16 Case studies:
12 case studies on e-business adoption in companies from the sector covered are conducted specifically for this study.
For more information about the database, see: EU-KLEMS Growth and Productivity Accounts, Version 1. 0, Part I Methodology.
/E-business in the transport & logistics industry 21 Data analysis For data analysis, descriptive and analytical statistical methods were used:
This constitutes the first and most basic step in data presentation. The requirement for this step is that micro-data have been aggregated
and that weighting has been applied. Weighting is an important issue for data presentation, as unfortunately it is understood not well by many users of data.
However, weighting is necessary, as due to stratified sampling the sample size in each size-band is not proportional to the population numbers.
If proportional allocation had been used, the sample sizes in the 250+size-band would have been extremely small,
It combines micro-data analysis (using data from the E-business Survey 2007) and macrodata analysis (using the EU-KLEMS Growth and Productivity Accounts).
Using some advance algorithms on the multivariate analysis results, we try to assess the patterns existing among the variables,
We combine this technique with the clustering analysis. Cluster analysis: is advanced an data analysis technique useful to group cases based on their internal similarities.
With this technique one can build groups of cases (companies) with a similar profile based on some relevant indicators
of having comparable e-business data and results for the land transport and logistics sectors, due to their huge importance in the European competitiveness and future economic challenges of the region.
technological development has to be at the core. In other words, the utilisation of the most up-to-date technologies, including ERTMS,
Vehicle dimensions and loading standards Green transport corridors for freight Urban freight transport logistics E-Freight and ITS Internet for cargo Standard for information flow Standard
data set to describe freight e-maritime Sustainable quality & efficiency Continuous bottleneck exercise Freight transport logistics personnel and training Improving performance Benchmarking intermodal terminals Promotion
and best practices Statistical data Simplification of transport chains Simplification of administrative compliance Single transport document Liability Security FREIGHT TRANSPORT LOGISTICS ACTION PLAN Framework for the ITS Regulatory Framework for the standardisation
and will have a total budget of EUR 400 million. 42 Revitalising the railways Transport is a key driver for the EU-25 outlook in terms of both energy and emissions.
traveller information systems, ticketing systems, etc). The case study on real-time passenger information system at Trafikanten, Norway confirms this asseveration (see Section 5. 11.
Trafikanten implemented an innovative information system providing travellers with reliable information on real-time departure times of public transport vehicles.
The system is a combination of location positioning systems, distance measures devices, travel planning information and other ICT-related technologies.
Performing information and communication systems To obtain the quality solutions needed in the organisation and operation of the European transport system,
The proper functioning of the logistics chain requires well performing information and communication systems. Thus, means of transport synchronize their activities
One such technology is radio frequency identification (RFID) which is a growing market but requires further research
and work on radio spectrum management, interoperability and standardisation. In transport and logistics RFID is expected to contribute to improved efficiency and security,
and provide new quality services for mobility of people and goods. For instance, the railroads, have fortified RFID with even more advanced technologies,
including GPS, real-time engine-health monitoring and wireless data. RFID-enabled supply chains are beneficial in the following ways:
reduce inventory levels due to increased confidence in on-hand, in-transit, and manufactured inventory levels minimize stock-outs and inventory shortages decrease operating costs due to obsolescence, expiration,
and spoilage reduce labour costs through automatic identification and physical inventory counts streamline recall processes due to ability to identify possible impacts to damaged product improve security,
Much of today's applications of information technologies and intelligent transport systems are modal. Intermodal or cross-modal applications are only slowly developing
Complexity-ITS applications use a variety of technologies with different terminology, different protocols & data formats proprietary data processing.
and monitoring of freight haulage for terminals as well as for all other service providers of intermodal transport chains is one of the most challenging application domains for computer and business sciences in the transportation sector.
This would require standardisation efforts towards a single platform for applications, data and interconnectivity. In the one hand, the EU is investing considerable public funds in these systems
the transport industry not only has a big impact on air quality and greenhouse gas emissions, but high oil prices also have a significant influence on the transport sector and the economy as a whole.
clean and energy efficient mobility of people and goods. 53 There are many practical examples that would help the Working group to collect data as is the case of the FRIDA solution developed
and (iii) data acquisition technologies. 55in what concerns the identification technologies, firms may appeal to bar-coding or to RFID.
The bar-coding and RFID are identification technologies that facilitate logistics information collection and exchange.
As regards data communications technologies, firms may appeal to the electronic data interchange (EDI), the Internet, the Value Added Network amongst others.
Nowadays, as regards the data acquisition technologies, the firms usually deal with a large amount of goods
and data which means that data collection and exchange are critical for logistics information management and control.
Good quality in data acquisition can help firms deliver customers'goods more accurately and efficiently.
Firms need to be able to manage information effectively and to integrate several logistics activities by including inbound and outbound transportation, distribution, warehousing,
The impact of information technology on logistics, International Journal of Physical Distribution & Logistics Management, 21 (5), 32-7. Impact E-business in the transport & logistics industry 38 value
for customers, the information and communication systems convert data into information, in order to facilitate managerial decision making. The author argues that information is a resource to be used for decision and
as ICT and e-business are relevant for nearly all core business areas of the TLS industry.
The accessibility and the numerous opportunities to creatively use the Internet has brought many implications to the organisations core business processes to generate enormous benefits in terms of performance as well as provide greater value-added products and services.
Percentages of enterprises adopting several technologies (2005) EU25 57 Reis F. The internet and other computer networks and their use by European enterprises to do ebusiness, Statistics in focus, Industry
particularly those linked to the Internet and e-business. ICT and e-business activities deployment has thus become increasingly important for the industry.
Low-cost access to the Web and the dissemination of e-business technologies provide firms with a tool to satisfy customer demand by using traditional services in conjunction with growing information-based services.
and cooperation between knowledge teams (including virtual teams) using intranet technologies as well as between the organisation
This has changed with the introduction of warehouse management system software. Warehouse management systems (WMS) assist managers in tracking products throughout the entire storage and distribution process.
These systems span from simple computer automation systems to high-end feature-rich management programs that improve order picking,
and monitor inventory management. Case studies about Geodis (Belgium) and AIT (France)( Chapter 5) represent the range of actual possibilities available to logistics companies large
The main issues or trends in warehousing include radio frequency identification (RFID), transportation management systems, pick-to-light technology,
Enterprises use of ICT (2005)( as a percentage of the total number of enterprises with 10 or more persons employed) Internal Computer network Intranet Online purchases business model Online sales business model External
*External integration of business processes refer to the automatic linking between a computer system for managing orders and a supplier's or customer's business system.
as data is not available..Source: Eurostat, Community survey on ICT usage and e-commerce in enterprises.
E-business in the transport & logistics industry 40 Today, the main transport and logistics service firms are in a position to provide a variety of information via the Internet and to secure transactions online with customers.
Modern information systems and technology offer opportunities for fast and safe sharing. Key findings regarding use of and access to ICT in the TLS are summarised below.
The prominence of the internet among all computer networks is evident because of its size in terms of the number of persons and enterprises it connects and its worldwide scope.
For most EU Member States internet adoption is approaching saturation point. Overall, for the EU, by 2005,91%of enterprises with 10 or more persons employed had internet access. 58 In line with this tendency, in the present study, nearly all companies (97)
%which use computers in the TLS sector said that they are connected to Internet. Exhibit 3. 1-4 Internet access and bandwidth (2007) Of those:
Sectoral e-Businesswatch (Survey 2007) Only among passenger transport firms, a minority of 5%responded that they have no Internet connection.
By share of employment, firms representing 99%of the sector workforce are connected to Internet. A relevant indicator is the existence of broadband connection.
and also a precondition for all potential benefits of the use of computer networks. Exhibit 3. 1-4 shows also a tendency of the firms to have a higher broadband connection.
Only 17%of the sector companies (representing 8%of the sector workforce) still use an Internet access up to 144 kbit/s, 58 Reis F. The internet and other computer networks and their use by European ibid.
The quality of the Internet connection is paramount to the development of e-business. This connection enables an exchange of more information per unit of time
Use of internal computer networks The use of computer networks internally in the enterprise is believed to yield potential gains in efficiency and productivity.
The adoption of internal computer networks is a first step towards the computer integration of business processes.
A computer network is composed of multiple connected computers that communicate over a wired or wireless (Local area networks LAN,
and Wireless LAN) medium to share data and other resources. In the TLS industry, as shown in Exhibit 3. 1-6,
the deployment of the Wireless LAN technology only reach 22%of the sector companies, although it is used already by about a half of the large-sized firms,
the use of ICT to connect computers internally to a company network increases with company size.
%E-business in the transport & logistics industry 42 Exhibit 3. 1-6 Networks and protocols used Transport & Companies having Logistics Sector LAN WLAN Intranet Extranet
Sectoral e-Businesswatch (Survey 2007) The size and scalability of any computer network are determined both by the physical medium of communication
and by the software controlling the communication (i e.,, the protocols. An Intranet is a specific application of the internal computer network
which serves as a communication tool within the enterprise, and an Extranet can be viewed as part of a company's Intranet that is extended to users outside the company.
As such, both can be regarded as a next step in the use of the internal computer network as ebusiness.
Around one quarter of the TLS sector firms use an Intranet and, again, it depends on the company size, ranging from a relative small 23%for micro-sized firms to a high 77%for large firms.
Only a few firms in the industry use an Extranet (6%%most been used by large-sized firms (42%.
%Remote access means that employees can access data from the company's computer system remotely, e g. when working from home or travelling.
E-business in the transport & logistics industry 43 Voice-over-IP Voice over internet Protocol, also called Voip, IP Telephony, Internet telephony, Broadband telephony, Broadband Phone and Voice
over Broadband is the routing of voice conversations over the Internet or through any other IP-based network.
Some Voip services offer features and services that are not available with a traditional phone,
Some cost savings are due to utilising a single network to carry voice and data especially where users have existing underutilised network capacity that can carry Voip at no additional cost.
while Voip to public switched telephone networks (PSTN), 59 may have a cost that's borne by the Voip user.
or purchase other applications that will come from software developers. Exhibit 3. 1-7 Percentage of firms who uses Voice-over-IP in the TLS sector 13 11 20 26 21 0 10 20 30 40 50
a common scenario predicts that all fixed network voice telephony might be converted to internet protocol. 59 The public switched telephone network (PSTN) is the network of the world's public circuitswitched telephone networks,
in much the same way that the Internet is the network of the world's public IP-based packet-switched networks.
The econometric analysis presented in this report using the EU KLEMS database shows that in the transport and logistics industries,
User skills cover the utilisation of common generic software tools and the use of specialised tools supporting business functions within industries other than the ICT industry. 63 There are companies-usually medium and large-sized firms-that can afford employing ICT practitioners,
Sectoral e-Businesswatch (Survey 2007) Based on the data from the TLS Sebw Survey 2007, where companies were asked
and continuously upgrade e-skills stems from technological change an increasingly from Internet-enabled global sourcing.
As Internet commerce grows in popularity and importance, companies are finding that designing, developing, and maintaining cutting edge Web-sites
Focussing on core competencies by outsourcing noncritical activities to specialised providers is a general trend in the TLS industry,
or web hosting) than to employ their own ICT practitioners. The case study AIT (France) confirms this observation (Section 5. 2). The choice of a small company as a solution provider allows the AIT to achieve great benefits.
which made investments in ICT hardware or networks during the past 12 months Weighting:%%of empl.%
Sectoral e-Businesswatch (Survey 2007) 3. 3 Standards and interoperability 3. 3. 1 Types of e-standards used Electronic Data Interchange (EDI
the Internet and the World wide web, EDI is still the data format used by the vast majority of electronic commerce transactions in the world.
-9) Small (10-49) Medium (50-249) Large (250) Data for TLS total weighted by employment (read:"
"firms representing x%of employment"),data for size-bands in%of enterprises. Source: Sectoral e-Businesswatch (Survey 2007) Figures related to the TLS sector shows (Exhibit 3-3-1) that about a third of mediumsized companies and more than 40%of large firms
The widespread adoption of XML as a common data language is giving B2b integration the critical mass it needs for rapid growth.
electronic business using extensible Markup language. 72 See www. ebxml. org. 73 For detailed information about the background
Interoperability refers to the"ability of two or more systems to exchange data and to mutually use the information that has been exchanged."
since it is often necessary to exchange information between heterogeneous information systems. 76 Standards such as ebxml can help by simplifying this process.
and Cellular networks (GNSS/CN)"."The standard will provide the main technical requirement for the achievement of interoperability.
A Cross Sector Perspective and Outlook. 76 In the context of information systems, heterogeneity means that the systems are somehow different from each other.
Two heterogeneous systems are difficult to integrate and hence, they are said to have low interoperability. 77 According to the European Interoperability Framework for pan-European egovernment services,
A Cross-Sector Perspective and Outlook, e-Businessw@tch Special report 2005). 78 Technical Committee 278 (2007) Road Transport and Traffic Telematics, Open Call for Project Team Experts:
related to mobile personal assistance for travel information, published by ICT Results79 (see business example). Business example:
Mobile personal assistant for travel information (Im@gine-IT) A mobile, personal access device providing location-based transport information, mapping
and other related services anywhere in Europe has been tested successfully pilot at five European sites. Existing travel and transport information services often lack data outside a limited range of general facts.
In addition they tend to employ a variety of user interfaces and service delivery platforms. This limited content and lack of standardisation have been major limiting factors in their attraction to users,
having built defined system architecture, a data management module and a localisation algorithm, as well as having developed information services for multimodal forms of transport.
The IM@GINE-IT personal assistant is a small additional piece of software that will run on any mobile device
be it a mobile phone, mobile PC, PDA or in-car system. By communicating with Web-based services hosting the relevant information,
the IM@GINE IT device offers an integrated routeguidance system which combines in-vehicle, pedestrian, public transport and public building route guidance modules.
The system has been tested by around 100 users at five European sites in Finland, Germany, Italy, Greece and Hungary.
IM@GINE IT website: www. imagineit-eu. com) Although this business example shows a well managed
and interoperability by and for SMES. 3. 3. 3 Use of Open source Software The open source model Open source software (OSS) is computer software
which source code is available under a license (or arrangement such as the public domain). This permits users to use, change,
and improve the software, and to redistribute it in modified or unmodified form. Open source is cited frequently as one of the most important movements in modern software creation.
Related projects are supported by the European Commission82 and almost every further and higher education institution makes use of open source software.
The promise of open source is better quality, higher reliability, more flexibility, lower cost, and an end to predatory vendor lock in.
Open source licenses define the privileges and restrictions a licensor must follow in order to use, modify or redistribute the open-source software.
OSS includes software with source code in the public domain and software distributed under an open-source license.
It is developed often in a public, collaborative manner and is the most prominent example of open source development
and often compared to user generated content. The cost of immediate acquisition to the end-user is usually minimal;
this is because the right to freely redistribute the software makes selling licences for copies of open source software an unlikely business proposition.
The following research example shows the possibility of OSS in the logistics field: the Open source Warehouse Management System, developed at Fraunhofer-Institut für Materialfluss und Logistik in Dortmund, Germany:
Mywms-The Open source Warehouse Management System Modern Warehouse Management Systems (WMS) have to operate quite a number of different interfaces,
consider restricted storage strategies, minimize transport routes and times, support different kinds of stocktaking and many other things.
Despite of existing standards, e g. VDI or FEM which cover partial fields, there are no generally accepted standards for WMS.
for the prohibition to store goods together or for the optimal Networked Enterprise Applications and Software, FP6 508011),
Networked businesses and government set out in the IST 2003-2004work programme of FP6. 82 The European commission has taken several strides towards encouraging the development of open source software.
In October 2006, it granted €3m towards a project, called SQO-OSS, to test the quality of open source software.
And just days before, the Commission extended its open source web portal, the Open source Observatory, (http://ec. europa. eu/idabc/en/chapter/452) to develop interoperability between applications.
Open source development Another approach which has already been implemented successfully in many projects is based on openness
The keyword is Open source: disclosure of all documents and the source codes of a software project as well as a permanent communication between all participants.
This makes the interface specifications, the system architecture and the data models available to everyone.
The WMS can also benefit from such a development style. Such project is presently being developed at the Fraunhofer-Institut für Materialfluss und Logistik in Dortmund:
mywms, the Open source Warehouse Management System. This system is designed with modern software technologies and tools with the aim to create a widely accepted WMS with well-defined interfaces
and data models. mywms will be coded object oriented and in the programming language JAVA. Free software products will be used for the development and operation.
LINUX, for example, will be preferred the operating system and Postgresql the preferred database. The complete user interface is based browser,
i e. it uses the common web browsers. This allows for the use of existing network structures and inexpensive personal computers with almost any operating system as workplace computer.
The first level includes a core system with the inventory management the master data management and the possibility to enter
and process storage and retrieval orders. For practical use mywms has to support concrete interfaces to ERP-systems and the conveyors.
For this purpose, corresponding programme modules will be developed and saved in a driver library. The further development of mywms includes a coupling to ERPSYSTEMS, an extension of the supported conveyor elements, the integration of simple storage strategies and the optimisation of and coupling to an e-shop.
The interface to SAP-systems will be certified for mywms. 83 Deployment of Open source Software Deployment of open source software should follow the same pattern of evaluation of needs
testing, and acquisition from a supplier and so on as would be used with proprietary software. The cost of deploying and supporting software,
whether open source or closed source, is very often much higher than the simple cost of licence acquisition,
and will often be the principal component of the total cost of ownership. 84 There are clearly a number of Open source products that can offer a fast return on investment,
because they are genuinely excellent software products and the support is acceptable. In comparison with proprietary software OSS is more inexpensive in acquisition and use (total costs of ownership
also because the direct and indirect maintenance costs are significantly lower. By integrating open standards in designs and other 83 Available at:
www. mywms. org/export/sites/default/introduction/downloadgallery/mywms beschreibung en. pdf. 84 Joint Information systems Committee (JISC),(2006) Open source Software briefing paper
, http://www. jisc. ac. uk/publications/publications/pub ossbp. aspx. E-business in the transport & logistics industry 55 applications and platforms OSS heightens the efficiency
of which ICT-applications are developed. The availability of the source code supports a high innovation grade, next to more efficient maintenance of the software which will result in a more effective effort by ICT experts.
The cost is very low, but it has to take into account the learning curve and the cost of deployment and also the potential impact on the rest of the software that they are expected to integrate with.
OSS doesn't exclude the use of proprietary"closed source"software. The owner of a closed system can let his programme cooperate with opensource software;
after all he has access to the complete source. The opposite-closed source code, not able to cooperate with other programs-is more common than an exception in the world of modern IT.
Frequent implementation of OSS within companies improves interoperability of computer systems and with that the strategic strength.
A recent research has found that almost 40%of European companies already use some type of open source software,
and a further 8%reported plans to pilot it during 2006. Web server and server operating systems are the top two areas,
with two-thirds of firms using alternatives like Apache, Tomcat, or Linux. 85 The E-business Watch 2007 sectoral study confirmed that operating systems (including Linux) based on OSS are used widely by large companies (nearly 50%).86 Exhibit 3. 3-3
shows that for the TLS industry the use of OSS clearly increases by firm size:
more large companies use OSS than small companies. In particular, internet browsers (including Mozilla and Firefox) based on OSS appear to be used widely by companies from the TLS industry (21%).
%Among the large sized firms, about 47%say that they use OSS browsers. Special emphasis should be put on the deployment of OS Software in micro and small enterprises
which constitute the vast majority of TLS companies. Exhibit 3. 3-3: Companies using Open source Software 8 9 21 28 10 13 32 41 21 24 30 47 05 10 15 20 25
30 35 40 45 50 TL (EU-7) 10-49 50-249 250+Open source operating system Open source databases Open source browsers Base (100%:
%Companies using computers. N (for sector, EU-7)= 997. Weighting: Totals (for the sector and for all 7 sectors) are weighted by firms.
Figures for size-bands are in%of enterprises from the size-band. Questionnaire reference: A13a, A13b and A13c 85 Forrester research, Inc. 2005.
Is Open source Gaining Adoption In Europe? http://www. forrester. com/Research/Document/Excerpt/0, 7211,38061, 00. html. 86 See e-Businesswatch (Survey 2007.
E-business in the transport & logistics industry 56 Source: Sectoral e-Businesswatch (Survey 2007) In addition to the possible cost savings of using OSS that can be essential for SMES,
OSS provides a number of attributes that favour SMES. One of them is the ability to adapt software for local needs.
Proprietary software companies are concentrated usually global in a few parts of the world. This is the nature of the software market,
which, thanks to network effects and proprietary standards tends towards natural monopolies. 87 Also, as is the case in the TLS sector,
many large corporations are now deploying Open source products at the heart of their IT, but doing so in a considered and responsible way. 88 Digital signature In cryptography,
a digital signature or digital signature scheme is a type of asymmetric cryptography used to simulate the security properties of a signature in digital, rather than written, form. 89 Digital signatures use
what is known as"public key cryptography"(PKI), which employs an algorithm using two different but mathematically related"keys":
"one for creating a digital signature or transforming data into a seemingly unintelligible form, which involves the user's secret or private key,
and another key for verifying a digital signature or returning the message to its original form
which involves the user's public key. The output of the signature process is called the"digital signature.
A digital signature can be used with any kind of message, whether it is encrypted or not, simply so that the receiver can be sure of the sender's identity
and that the message arrived intact. The prospect of fully implementing digital signatures in general commerce presents both benefits and costs.
A digital signer will require software, and will probably have to pay a certification authority some price to issue a certificate.
Hardware to secure the subscriber's private key may also be advisable. Persons relying on digital signatures will incur expenses for verification software and perhaps for access to certificates and certificate revocation lists in a repository.
On the plus side, the principal advantage to be gained is more reliable authentication of messages.
Economic impact of open source software on innovation and the competitiveness of the Information and Communication Technologies (ICT) sector in the EU. Final Report. http://ec. europa. eu/enterprise/ict
Open source: Revenge of the Nerds, IT DIRECTOR. 89 Wikipedia, http://en. wikipedia. org/wiki/Digital signature. 90 American Bar Association Section of Science and Technology Information security Committee E-business
in the transport & logistics industry 57 Formal legal requirements, by strengthening the view that legal requirements of form, such as writing, signature,
E-business in the transport & logistics industry 58 3. 3. 4 Deployment and implications of RFID technology Factors determining the use of RFID in the TLS industry The current business environment
One such measure is the use of RFID. In transport and logistics, RFID is expected to contribute to improved efficiency and security,
and provide new quality services for mobility of people and goods. Using RFID, companies can track
and monitor goods without scanning them using bar code scanners. Thus, RFID Technology and Systems RFID can be viewed as a competitor to the barcode,
or a more advanced technology than the barcode. This technology streamlines warehouse management systems, encouraging its adoption and that of other SCM solutions.
As the use of RFID touches a wide range of policy issues including spectrum policy, privacy, food and drug safety, identity cards, biometric passports, e-payments,
and possible concerns raised by the deployment of RFID technology and its applications. 91 In practice,
It is an enormous step to move from the present market to one where RFID is ubiquitous,
but there are clear signs that the market is moving. 92 A more widespread RFID deployment could strengthen the role of ICT in driving innovation
In the transport industry, RFID systems have the inherent capacity to assist in vehicle identification,
RFID systems are playing a role in increasing load factors and hence reducing empty running.
In logistics applications, RFID enables service providers and forwarders to better track and trace consignments on the different legs of transport processes.
By tagging not only packages and consignments but also transport units and vehicles with RFID technology, the asset management of these transport operators can be improved.
Using RFID technologies for ticketing in public transport will not only lower transaction handling costs and reduce fare dodging,
2004) RFID Logistics Case studies-Thirty detailed RFID logistics case studies. E-business in the transport & logistics industry 59 opportunities for public transport companies and strengthen their competitiveness in the transport market. 93
Current trends and forecasts indicate that the RFID market will grow fast in the next 10 years.
Although RFID technology was tested proven and in the past 3 years under a huge variety of operational conditions,
environments and applications, enterprises that commit to the RFID journey are and will still be facing some challenges that need to be overcome as to lower implementation risks
Results from the present Sebw survey show a very limited use of RFID technologies yet.
By sub-sector, about 6%of the logistics firms, 1%of passenger transport firms and 1%of the freight transport companies said they used RFID.
The highest percent of those firms (77%)said that they use RFID technologies to manage goods, products and services inhouse.
Only large firms show the higher adoption of RFID technologies (24%.%Exhibit 3. 3-5:%
%of companies using RFID by sub-sector 12 1214 13 0 10 20 30 40 50 T&l-total (EU-7) Passenger trans.
Freight transport Logistics Data are weighted by employment (read:""firms representing x%of employment"in the sector.
RFID application areas(%of RFID users applying it for a given purpose) 82 36 29 77 0 20 40 60 80 10 0 to support the order of goods
to manage products inhouse to support customer service to manage the value chain In%of firms (out of those using RFID.
companies using RFID. Source: Sectoral e-Businesswatch (Survey 2007) Nevertheless, if the typical innovation life-cycle applies to RFID technology,
a possible scenario for the TLS industry is that the technology will be adopted by medium-sized and smaller companies once it has proven successful in larger firms,
and become more affordable to SMES. 93 Towards an RFIC Policy for Europe (2007), RFID in Transport and Logistics, RFID Consultation Web site:
http://www. rfidconsultation. eu/workshops/18/124. html. E-business in the transport & logistics industry 60 3. 4 Internal Process Integration More and more the Internet is becoming
The new capabilities to use the Internet to supply large amounts of relevant information from multiple internal and external sources give the possibility to move from isolated information systems toward an integrated environment in every business organisation.
Current opinion holds that Internet-based supply chain integration with upstream suppliers and downstream customers-"e-integration"-is superior to traditional ways of doing business.
which implies the integration of business applications and data with the Internet and with the systems of the company's trading partners.
Improved efficiency in these core business processes leads to faster cycle times, reduced overhead, more competitive offerings,
or between a manufacturer and its distribution channels, the financial return dwarfs the gains realised by setting up a disjoint web front-end.
scalable and reliable solution suitable for running a company's most critical core business processes. 3. 4. 1 Use of software systems for internal process integration Specific software applications
A document management system (DMS) is a computer system (or set of computer programs) used to track
and store electronic documents and/or images of paper documents. A DMS system allows an enterprise
DMS may be needed in enterprises that capture and store a large number of documents such as invoices, sales orders, photographs, phone interviews,
(or attempt to integrate) all data and processes of an organisation into a unified system.
A typical ERP system will use multiple components of computer software and hardware to achieve the integration.
A key ingredient of most ERP systems is the use of a unified database to store data for the various system modules.
Although the term ERP originated in the manufacturing environment today's use of the term ERP systems has much broader scope.
and information technology, this would include accounting, human resources, marketing, and strategic management. In the TLS sector the use of ERP systems is notably low (6),
because if a business partner does not have an ERP system, the exchange of data in standardised,
Exhibit 3. 4-1 Use of e-business software systems Companies having Transport & logistics sector (TLS) an ERP system an SCM system a CRM system a software application to manage the placing
or receipt of orders a warehouse or depot management system Weighting%of empl.%%of firms%of empl.%
Sectoral e-Businesswatch (Survey 2007) E-business in the transport & logistics industry 62 In 2007, about a fifth of firms (representing about 44%of sector employment) in the TLS industry reported the use of software solutions
or internet-based services for eprocurement (see Exhibit 3. 4-1). This shows that there is a gap between the percentage of companies placing at least some orders online (41%)and those that use special software for this (20%).
%It can be assumed that companies without such software place orders mainly through websites or extranets of suppliers,
It is interesting to observe that the percentage of firms with special ICT systems for e-procurement is more than three times (20%)than those firms with an ERP system (6%).SCM software can help companies from the TLS industry to match supply
some conclusions can be drawn from the presented data: one tenth of the TLS sector firms use a fleet control system,
while in some other areas, US companies appear to be more active using specific software systems, like cargo handling technology and intermodal transportation management systems.
From the early successes of internal application integration and the business drivers of the Internet economy to companies to more tightly integrate their processes,
E-business in the transport & logistics industry 65 has legal implications to both transacting parties. e-invoicing is mediated a computer transaction between a seller/invoicer (invoicing entity) and a buyer/payer (receiving entity),
and the integrity of contents must be safeguarded by means of either an advanced electronic signature as defined in the e Signature Directive (1999/93/EC) 98
of the European parliament and of the Council of 13 december 1999 on a Community framework for electronic signatures.
data related to orders (received or placed) is exchanged typically in a paper-less way between the ERP systems of the two companies trading which each other.
This enables the automated processing of data during all transaction phases (request for quotations/proposals,
Data exchange between ERP systems represents the most sophisticated form of ebusiness. However, due to the low rate of adoption of ERP systems in the TLS sector (see Section 3. 4. 1),
Exhibit 3. 4-4 Data exchange with business partners Companies characterising their typical data processing and exchange with business partners as Transport & Logistics Sector"mostly verbally""mostly in paper based format
Sectoral e-Businesswatch (Survey 2007) As expected, most of the companies where data with business partners is processed
and exchange data with business partners mostly electronically (Exhibit 3. 4-4). An example of a transport document management system E-business in the transport
The solution is based on a software solution that allows automating the exchange of documents between customers
and delivering them through different formats like e-mail, fax, SMS, XML, etc. This software is linked to the internal information system of CEMAT, an Italian company specialised in combined transport of containers,
trailers, swap bodies and vehicles on land and sea. The case also highlights the difficulties faced in the adoption of the solution by the end users. 3. 5 e-Procurement
Procurement is a support activity for the purchase of inputs (raw materials, office and production supplies and information systems) for all parts of the value chain.
Internet technology provides ways of drastically reducing different categories of transaction and communication costs. In that respect, the potential merit of various electronic procurement forms,
such as electronic catalogue systems, electronic auctions, intelligent agent applications, electronic market places seems largely undisputed. However, in these supplier-buyer relations a holdup problem arises
if a company depends on a third party to provide the data, it is very important to get a clear E-business in the transport
and customer-relationship management analysis to improve core business processes. For these type of reasons, e-procurement has been seen to have the potential to play a pivotal role in a firm's endeavours to create a competitive cost advantage that lasts for many years 99,
Freight transport Logistics Micro (1-9) Small (10-49) Medium (50-249) Large (250+)Data for TLS total weighted by employment (read:"
"firms representing x%of employment"),data for size-bands in%of enterprises. Base: all companies.
which is conducted on the Internet, and is expected to account for the vast majority of it within a few years.
and aims to provide customer services over the Internet for a simpler, faster and more reliable exchange of information with the customer.
providing four major e-services to customers allowing them to directly order transport services on the Internet (Commande@RESAFRET),
The Clic Services Fret SNCF portal was developed using PHP and Dot net languages. Security is guaranteed via SSL encryption of information and via a dedicated login and password for each user.
In an external integration perspective IOIS100 constituting automated information systems shared by two or more companies, can be used to support information-sharing with customers and suppliers.
The IOIS concept can be considered an overall term for a group of technologies that support information sharing across organisational boundaries as email, EDI,
extensible mark up language (XML), electronic data access (EDA) and the Internet. To meet customer demand for seamless, comprehensive and reliable information on which to base business decisions today,
companies must integrate data from the many sources involved in a customer's supply chain.
For those companies, a possible explanation is that many companies have software for managing their inventory and supplies internally,
without really integrating suppliers directly through the system. 100 ICT used to exchange information in the supply chain is named often interorganisational ICT or interorganisational information systems (IOIS).
%firms using SCM software/sharing information on inventory levels with suppliers (2007) 4 8 22 38 8 16 36 6 0 10 20
Customer service management Procurement Product development and commercialisation Manufacturing flow management/support Physical distribution Outsourcing/partnerships Performance measurement SCM software is intended
of which have their own specific software. Some vendors have assembled these different chunks of software together under a single solution,
but the development of a complete package that is right for every company is a big challenge.
Data on SCM usage in the TLS sector in Europe are analysed in Section 3. 5. 1 of this Report.
Warehouse management systems utilize Auto ID Data Capture technology such as barcode scanners, mobile computers, wireless LANS and potentially RFID to efficiently monitor the flow of products.
Once data has been collected, there is either batch synchronisation with, or a real-time wireless transmission to a central database.
The database can then provide useful reports about the status of goods in the warehouse.
The detailed setup and processing within a WMS can vary significantly from one software vendor to another;
however the basic logic will use a combination of item, location, quantity unit of measure, and order information to determine where to stock, where to pick,
and in what sequence to perform these operations. E-business in the transport & logistics industry 74 In the TLS sector about 15%of companies use a WMS.
Logistics Micro (1-9) Small (10-49) Medium (50-249) Large (250+)TL (USA) Data for sector totals
data for size-bands in%of firms. Source: Sectoral e-Businesswatch (Survey 2007) Case studies about WMS in France Geodis Group The case study about Geodis Group (see Section 5. 7) shows a typical example for automated
The solution also provided the company with detailed data analysis on the whole company activity and the optimisation of different processes like customer billing, purchasing and business operations.
and in particular the internet, can be used in various ways to support marketing activities, including the communication with customers, offering products for sale,
and their automation, reducing the need for repeated data entry and reduces errors and delays.
The goal of the solution was to provide the status of the transport over a Web interface to customers.
Free Essays, Cliff Notes and Term Paper Database. Available at: http://www. essays. cc/free essays/b2/utv192. shtml.
improving customer services Hupac The case study about Hupac, Switzerland (see Section 5. 8) deals with the integration of a software management (GOAL) system with GPS train control (e-train.
Hupac has implemented an innovative information technology solution that manages transport information in real time and coordinates all phases of intermodal traffic from departure to arrival.
regardless of transport mode or company, providing travellers with real time accurate information about vehicle arrival and departure time via Internet, mobile channels and through signs available at the stops.
The solution has been implemented in over 245 railway stations where each selling point is equipped with a PC
and a printer linked to the different systems. 90 million tickets have been sold through the system
website of Trans Link Systems http://www. translink. nl/;/ERTICO ITS Europe e-Newsletter: N 19/07, 5 october 2007.
E-business in the transport & logistics industry 80 3. 6. 3 e-Integration of marketing processes Customer relationship management (CRM) CRM is a broad term that covers concepts used by companies
Operational CRM provides support to"front office"business processes, including sales, marketing and service. Collaborative-direct communication with customers that does not include a company's sales or service representative (self service.
Interaction can be through a variety of channels, such as web pages, email, automated phone (Automated Voice Response AVR) or SMS. Analytical-analysis of customer data for a broad range of purposes (for example,
in order to segment customers or to design and execution of targeted marketing campaigns to optimise marketing effectiveness.
%In some service sectors, in particular, CRM is a key application for many of the larger companies, for example in telecommunication services (48%)and in the tourism industry (23%.
Logistics Micro (1-9) Small (10-49) Medium (50-249) Large (250+)TL (USA) Data for sector totals
data for size-bands in%of firms. Source: Sectoral e-Businesswatch (Survey 2007) The relatively low diffusion of CRM technology within micro and small firms should not come as a surprise:
CRM software suites are quite expensive and require intensive organisational preparation to be introduced effectively in a company.
%Companies using computers and which have the respective business function asked. N (for sector, EU-7)= 970 Weighting:
%Companies using computers and saying that only some or none of their processes are conducted as e-business.
Sectoral e-Businesswatch (Survey 2007) E-business in the transport & logistics industry 86 3. 8 Cluster analysis:
Employees with internet access at their workplace In this section we perform an advanced cluster analysis on the survey results using the percentage of employees that have internet access at their workplace as the main clustering analysis. With this type of analysis we use the clustering data analysis technique
In the following table we have the clustering algorithm results for the variable Percentage of employees that have internet access at their workplace.
We also include the means for each cluster for the variables of percentage of firms having a LAN, A w-LAN and their on website.
Percentage of firms having their own website Weighting:%%of firms%of firms%of firms%of firms%of firms 1. Low 374 9 52 19 22 2. Medium 257 44 48 29 20 3
and the means of variables like percentage of firms having a LAN, A w-LAN and their on website.
(and the implied computer usage) is related to the LAN, WLAN and own company website adoption.
LAN and W-LAN and company website usage variables (means of percentages of firms) 9 44 98 52 48 54 71 59 19 29
with internet access at their workplace%of firms with a LAN%of firms with A w-LAN%of firms with their own website Exhibit 3. 8-3:
the Logistics services sector has a relatively bigger percentage of firms in the high internet usage by employees cluster.
So with this cluster analysis we detect some adoption and usage differences based mainly to the profiles of activity and positions in the different transport and logistics sectors.
being the medium internet usage cluster the cluster of companies with more probability of increasing their market share
The Chi-square algorithm is a statistical technique that tests the relationship between analysed variables.
& logistics industry 90 3. 9 Summary and conclusions of ICT and e-business deployment Concerning the rate of Internet adoption, the TLS sector infrastructure,
For this reason, it will be practically unnecessary the inclusion of questions related to Internet or connectivity in future surveys.
Thus, the existing ICT infrastructure and e-business software systems analysed in the preceding sections led the TLS sector to a situation in
According to the survey data, large TLS enterprises are currently increasing focus on ICT issues, as they have started introducing more advanced ICT solutions such as eprocurement systems, WMS, SMS, CRM systems and so on.
Open source Software. The use of OSS seems to be correlated positively to the size of the company in employees.
In particular Internet browsers (including Mozilla and Firefox) based on OSS appear to be used widely by companies from the sector.
RFID. There's a very limited use of RFID technologies yet. Only 2%of firms (23 from a total of 1097 surveyed firms) have declared that they do use this technology
mainly large-sized firms. E-business in the transport & logistics industry 93 4 Drivers and impacts of ICT adoption Chapter 3 assessed the current state-of-play in e-business in the TLS industry.
It focused on trends in ICT usage, the diffusion of ICT-based applications and how they are used by companies, both for internal processes and for exchanges with other organisations or consumers.
For the analysis of the impact on productivity and links with the skills base, EU-KLEMS data have been used. 109 The analysis of links between ICT adoption
and value chain characteristics is based on micro-data from the E-business Survey 2007. The"structure-conduct-performance"paradigm Economic literature suggests that the ongoing diffusion of ICT
the 109 EU-KLEMS is a database on measures of economic growth, productivity, employment creation, capital formation and technological change at the industry level for all European union member states from 1970
The compilation of this database was funded a project by the European commission, Research Directorate General, as part of the 6th Framework Programme, Priority 8,"Policy Support and Anticipating Scientific and Technological Needs".
and considering the data that are available for a given sector in EU-KLEMS and from the Sectoral E-business Watch surveys.
"it will be assessed how the adoption of ICT hardware and software correlates with innovation activity of firms("conduct),
"and whether there are any significant links between innovation activity("conduct")and turnover growth("performance")."The Chapter is structured in three sections, each
and telecommunication (Jorgenson, Ho, Samuels, Stiroh, 2007, Jorgenson, Ho, Stiroh, 2007, Inklaar, Timmer, van Ark, 2007).
thus, the application of ICT may increase the demand and wages for skilled labour and decrease the same for unskilled labour(‘digital divide').
or not (Section 4. 1. 4). The empirical analyses in sections 4. 1. 2 till 4. 1. 4 will be based on data from the EU KLEMS project.
the EU KLEMS database published by the Groningen Growth and Development Centre (GGDC) in March 2007 does not allow the retrieval of the data for land transport activities
and related logistics services sector alone. 112 Hence our empirical analysis must focus on the more broadly defined sector transport
The fact that the internet and globalisation have led to many closely-knitted interlinkages between land,
and related services can be employed as an argument in favour of looking at the data at a somewhat higher aggregation level than the one envisaged for the qualitative research reported elsewhere in this text. 112 NACE 1. 1 defines the transport and logistics services sector
EUKLEMS database, GGDC; own calculations Growth accounting of gross value added Growth accounting of gross value added components is used a commonly approach that enables the study of the relative contribution of different factor inputs to overall
which the necessary data was available over the period from 1995-2004. It can be seen that the contributions of the different components vary greatly among the member countries studied.
EUKLEMS database, GGDC; own calculations 4. 1. 3 ICT impact on labour productivity growth Labour productivity growth in the transport and logistics sector The EU KLEMS data contains consistent
annual data for a subset of the EU-27 (typically the EU-15 or less.
Data on labour input are available in terms of labour productivity, employment, average hours worked per employee and total working hours.
The latter is broken further down in different skill categories (low, medium and high. Exhibit 4. 1-3 shows that pattern of labour productivity growth varies a lot across the EU member countries.
EUKLEMS database, GGDC; own calculations Expectedly and in line with other research (e g. van Ark et al. 2003), we cannot detect an acceleration in labour productivity growth similar to that reported for the U s. Gordon, 2004;
EUKLEMS database, GGDC; own calculations Exhibit 4. 1-5: Average working hours per employee in transport intermediation services, EU-15 member countries, 1980-2004 (annual average growth rates, various sub-periods)- 0
EUKLEMS database, GGDC; own calculations E-business in the transport & logistics industry 102 The impact of ICT on labour productivity growth Based on the secondary intermediate inputs and the two primary input factors
we have estimated a stochastic production possibility frontier (SPF) model by using a panel data set for 14 EU member states for
which all necessary data was defined available as EU-14). 114 Specifically, we have used the error component model suggested by Battese and Coelli (1992),
1995 2004 (Gross production value per total working hours based on EU-141 Multi-Country-Panel) Explanatory variables Coefficient Standard error t
EUKLEMS database of GGDC, own calculations. DIW Berlin 2008 The parameter estimates obtained are measures for the respective output elasticity of the input factor concerned.
Data requirements include gross production value, total intermediate inputs, total working hours, ICT-capital stock, non-ICT capital stock and total working hours,
115 For the econometric estimation, the software package Frontiers 4. 1 was used (Coelli, 1996. E-business in the transport & logistics industry 103 With respect to the significance of the estimated parameter values we observe that except of the ICT capital stock and medium-skilled labour intensity,
"which cannot be measured by means of the data on ICT-investment available in the database. 116 t-values above 2 assure by a rule of thumb this 5%-signficance threshold of the test. 117 For medium-skilled labour the estimated
80%of them related to ICT technologies. 119 This was confirmed, for example, for the telecommunication industry by an analysis on the Jcurve of innovation (Erber 2005,
or university degree the use of e-collaboration tools (such as SCM or other applications to share information about inventory levels with business partners) to share data with business partners The analysis is conducted at the micro-level,
using data from the E-business Watch Survey 2007. Internal capacity Knowledge stock and skills found a firm's absorptive capacity to adopt new technologies (Cohen and Levinthal
The most obvious example of investments in complementary assets include investments in software, training and organisational transformations that accompany ICT investments.
The hypothesis is tested on the basis of data from the E-business Survey 2007. In order to focus the analysis only on ICT-enabled innovations,
or teams managing the same tasks (Mcafee, 2006). Rather than e-commerce, it is the use of electronic networks that leads to a higher probability of firms collaborating in innovative activities
E-business in the transport & logistics industry 109 The hypothesis is tested on the basis of data from the E-business Survey 2007.
and the use of electronic data and information exchange between business partners, a probit regression was run.
The hypothesis is tested on the basis of data from the E-business Survey 2007. The analysis focuses only on
and analysis of data, assuming that one variable is dependent upon another single independent variable (simple regression) or several independent variables (multiple regression).
and follows all steps of the new process in a way specified in the software design. The copy-exactly strategy is particularly beneficial
On the other hand, tools, such as email, knowledge management systems, wikis or instant messaging, considerably improve the process of innovation in knowledgeintensive and service-oriented sectors with informal, unstructured and spontaneous type of work, such as
banking (Mcafee, 2006. ICT facilitates firms'innovativeness by propagating innovations that are structured less than business processes.
The hypothesis is tested on the basis of data from the E-business Survey 2007. The dependent variable controlling for organisational changes is based on companies'answers to the questions of
Infrastructure endowment index that comprises of hardware components used by a firm and includes the share of employees with an internet access at their workplace, internet connection capacity and the use of LAN, Intranet and Extranet.
Software endowment index that comprises of software applications used by a firm. The index includes the following applications:
a software application to manage the placing or receipt of orders, ERM, SCM, CRM and the use of the internet to buy
and sell goods. ICT human capital variable that controls for the presence of ICT practitioners.
In addition, the regression includes dummy variables controlling for the percentage of employees with a higher university degree, firm size, age and country of origin.
and the use of electronic data and information exchange between business partners, an ordered logit regression was run. 123 Exhibit 4. 2-5 reports the results of the regression.
ICT use and organisational change Independent variable a Coefficient Standard Error Infrastructure index (A2, A3, A4) 0. 000 0. 002 Software index (A6, A7, B1,
ICT hardware of little importance for organisational changes: Hardware endowment, measured in terms of network infrastructure usage and internet access, does not increase the likelihood of introducing organisational changes.
Software use and IT practitioners drive organisational changes: The intensity of ICT applications and in particular IT-skilled employees are the major drivers of organisational changes.
This together with the previous result indicates that ICT skills, soft-and hardware have different implications for companies'conduct and performance.
Whereas hardware is a necessary condition for an efficient ICT use, it is not a sufficient condition for business transformation.
These are rather human 123 Similar to probit/logit regressions, ordered logit model is used when the dependent variable is ordinal.
E-business in the transport & logistics industry 113 skills combined with innovative software that enable firms to rearrange their operations
Hardware infrastructure, in contrast, is already a commodity that does not offer companies any potential to create a competitive advantage. 4. 3 ICT,
E-business in the transport & logistics industry 114 The hypothesis is tested on the basis of data from the E-business Survey 2007.
The dependent variable accounting for the intensity of the ICT usage is a sum of answers to the questions regarding the internet connection type (score between 1 and 4), the use of LAN, WLAN, WWW, Intranet, Extranet, ERM, SCM, CRM,
the use of the internet to sell and buy goods and employing IT practitioners (one score for each positive answer).
At the beginning of the internet era, a common believe was that ICT and e-commerce were to eliminate the limitations of location
are entries of internet start-ups. Amazon or ebay are already icons of e-commerce that changed the landscape of the retailing industry.
Though of a smaller magnitude, these effects hold for traditional shops as well. ICT offers existing firms possibilities to expand their market reach,
The hypothesis is tested on the basis of data from the E-business Survey 2007. The dependent variable accounting for the change of a firm's market share can take one out of three values:
The explanatory variable controlling for a firm's ICT endowment level is composed an index of answers to the questions regarding the internet connection type (score between 1 and 4), the use of LAN, WLAN, WWW, Intranet, Extranet, ERM, SCM, CRM,
the use of the internet to sell and buy goods and employing IT practitioners (one score for each positive answer).
The hypothesis is tested on the basis of data from the E-business Survey 2007. The dependent variable can take a value 1 if a company outsourced any of its business activities in the last 12 months,
The explanatory variable controlling for a company's ICT endowment level is composed an index of answers to the questions regarding the internet connection type (score between 1 and 4), the use of LAN, WLAN, WWW, Intranet, Extranet, ERM, SCM, CRM,
the use of the internet to sell and buy goods and employing IT practitioners (one score for each positive answer).
as well as the outsourcing of non-core activities may actually play a more important role. Finally, there seems to be some (preliminary) evidence regarding the time structure of TFP growth accelerations.
2006, p. 4). Such time lags might explain the mixed results from evaluating the EU KLEMS database
Innovation, market structure, value chain The analysis based on the E-business Survey 2007 data allows identifying the driving forces of ICT and its impact on selected business dimensions.
Hardware infrastructure, in contrast, offer companies less potential to create a competitive advantage compared to software applications and skilled employees.
This case study summarises how the implementation of a centralised information system can help a passenger transport company like AISA to reduce its planning
and on the other hand to provide the company with detailed data analysis on the whole company activity. 3. 4 Internal process integration 3. 4. 2 e-Integrated supply chains:
and improve the transport document management for CEMAT and its customers. 3. 4 Internal Process Integration 3. 4. 1 Use of software systems for internal process integration E-business in the transport & logistics
Integrated software management with GPS train control at Hupac, Switzerland. Discussion of challenges and success of the application of an innovative IT solution that manages transport information in real time
and monitor stock levels, keep pace with demand and check the order shipment status. 3. 5. 2 e-Integrated supply chains:
SCM, WMS and ICT links with suppliers 3. 4. 1 Use of software systems for internal process integration Case study 11:
Real-time passenger information system at Trafikanten, Norway. Trafikanten is the joint information provider for the two public transport authorities (PTA) in the Oslo region of Norway.
Trafikanten deployed an innovative real-time passenger information system providing travellers with reliable information on real-time departure times of public transport vehicles.
a commitment towards innovative retailing and ticket solutions 3. 4. 1 Use of software systems for internal process integration Case study 12:
This case study summarises how the implementation of a centralised information system can help a passenger transport company like AISA to reduce its planning
Centralised information system, RFID 5. 1. 1 Background and objectives The goal of this case study is to demonstrate an example of the adoption and usage of ebusiness systems in AISA,
However future concessions are probably going to take into account also new ICT implementation aspects, like internet sales, web page, centralised information systems, etc.
and data on passengers, sales figures, etc. for consolidation, settlement and result evaluation of services and operations.
Without an automated and computerised information system it would be impossible to generate this type of operation data to satisfy these client demands.
AISA innovates to be prepared for these processes with suitable e-business solutions like the new centralised information system.
and statistics on the operations, using the information downloaded from the machines and consolidated in the computers of the company,
with a centralised analysis of the relevant information. 5. 1. 2 E-business activities The new centralised information system implemented by AISA enables the company to integrate
and optimise the processes minimising operation times and improving reaction times to the market changes or probable future scenarios in the market. he first steps prior the implementation of the centralised information system of AISA started with the introduction
of computers in the year 2000. In this year the company had four computers operating. The computerisation of the main business processes of the company started in the year 2000 and now,
in 2008 the company has more than 50 computers. The big change in the computer adoption in the last has eight years has been the computerisation of all the processes.
This long and complex process has replaced previous manual processes with automated processes using computer systems and applications.
The computerisation of processes has represented a major operational change for the company. This centralised information system started as an e-business system project in the third quarter of 2007.
The main objective was to integrate information flows of the different company facilities, including the offices, buses, lines and garages.
This should enable the company to speed up information processing, planning, reporting and daily operation control tasks.
The technical backbone of this centralised information system are two high E-business in the transport & logistics industry 124 capacity computer servers (from Hewlett packard) in the central company office.
They are connected with all computers in centres with offices and ticketing offices. This way, AISA collects
and aggregates data from its various facilities, for example bus information form the ticket machines, ticket systems onboard the busses and ticket offices,
and analyse the data in real-time to support the management of its daily operations. The system has different application modules for different operations and type of centres.
Data flows are integrated with the accounting, analysis, planning and control systems of the company. The accounting information from the different company centres are integrated in the central servers.
The company has designed this proprietary system in conjunction with its ICT provider and a specialised consulting company.
AISA uses a service provided by its telecommunications provider (Telefonica) to run a company network (standard VPN Virtual Private Network.
Data are transmitted via regular broadband network connections (ADSL) with a download speed of 8mbit/s in the central offices and 3mbit/s in the rest of the centres.
The main applications of the centralised information system are interconnected. Some examples of important applications integrated in the system are:
accounting and payroll software; panning; garage software for management. A practical example of applications enabled by the company-wide integration of data flows is a new timetable
which manages the timetables of all individual workers and automatically links these data to the payroll application.
The system combines some features typical form systems like ERM and ERP. It enables AISA to improve the planning and control of:
Operations Human resources Vehicles Services Cash management Accounting systems Reporting systems Ticketing systems (sales) The system has been customised to the company needs for reporting, accounting, controlling sales, information analysis
This system consists of the implementation of RFID chips in the fuel tank area of the buses that to control the fuel consumption of the bus and opt to a professional fuel subsidy from the Spanish Government.
The company has future project for the implementation of GPS systems and Wifi implementation onboard the buses for data transfers in the garages.
The centralised information system has had a positive impact on the company and its business. In particular reporting, planning and controlling processes have been improved significantly.
These processes can be accomplished much faster and based on much more accurate data, which facilitates decision making in operational management.
when it will be integrated fully (with the new software version operating). The centralised information system has also a positive impact on data security.
It is now possible to make backup copies of all the relevant data from the central servers,
avoiding duplicating task and minimising the risk of losing important data. The system allows eliminating existing duplicated processes
and reducing errors in the information process, reducing the costs of information processing for the company.
files have to be saved on the server and not in the local hard drive. Employees have been trained to use the new system properly.
The Telemat system of RFID chip for fuel subsidy has very positive impacts in the cost reduction thanks to the fuel subsidy save.
Once the information system was accepted internally and users were accustomed to work with it, the positive effects became visible almost immediately.
The information system led to reduced human errors in information processing, as former manual processes could be automated.
Interview (s) with AISA Quality Manager and responsible of the centralised information project (Madrid, 2008) Websites:
and on the other hand to provide the company with detailed data analysis on the whole company activity. This case study case demonstrates the benefits of such a solution and analyses the success factors of this e-business project.
Case contact*Information systems Françoise Arnaud, Director of Information technology AIT 5. 2. 1 Background and objectives AIT is a supplier of complete logistics services for all kind of goods with its headquarters
Continuously training of its staff to keep abreast of new information technologies and logistics management. Offering innovative solutions based on know-how, pro-activity and dynamism.
Information technology is key to support AIT in this market positioning. According to Françoise Arnaud, Information technology Director at AIT, the main role of Information technology for the company is to automate business and data transmission processes,
to eliminate errors, to save time and to allow AIT having visibility on the whole activity through the availability of complete data.
Current ICT solutions implemented are a company web site a Sage software solution for the accounting,
as well as a global transport management solution. AIT implemented a first transport and warehouse management solution in 2000.
The solution developed by an external provider was composed of a core programme with specific developments to match AITS specific needs.
in order to get detailed data on their traffic and activity from the current system in 2003,
business operations and to provide detailed data analysis on the whole activity. 5. 2. 2 E-business activities Beginning of 2004 the Information technology Director and the General manager of AIT,
E-business in the transport & logistics industry 129 The solution that has been developed is composed modular software of the core Solulog solution
The programme has been developed with VBA code on Access and uses a SQL database. The Solulog solution is hosted internally at AIT.
Data entry of a transport file: At the beginning of the transport process a specific transport file is created directly in the system including all information related to the transport order.
Depending on the data that is entered at the beginning, transport purchase orders are created automatically. This is possible through the interconnection of the system with the global e commerce shipping platform INTTRA,
allowing companies to automate the shipping instructions. Edit the transport documents: According to the type of transportation, AIT does not create the same transport documents.
printed and sent by fax to the involved partners (customer, transport company, AIT internal). If the merchandise is stored in the warehouse of AIT,
This module also allows preparing all the elements of a future transport file (data directly usable
The interconnection with the global e commerce shipping platform (INTTRA) has enabled AIT to automate the shipping instructions.
The most important benefit is achieved probably through the availability of detailed data of the activity allowing AIT today to have clear visibility on profitability of the different transports.
and no data is available for the period before the solution implementation. There is no doubt that the solution allows AIT today to save time,
The maintenance of database is also an important point to consider when implementing such a solution.
The former transport management solution used by AIT was based on a unique database which with the time grew
The new solution is composed of three databases. There is one operating database, where the data for one year is stored to optimise the respond times of the system.
Another database contains all data elder than one year and a third database contains all information for the infocentre,
allowing providing the Business figures and analysis. It is very important to consider the correct maintenance of the databases including cleaning the data,
extracting the data from the operating database to keep the response time of the system optimised.
The outsourcing of the solution to a data-centre may represent a major advantage for SMES since the solution is managed by specialists in a controlled technical environment Another point that AIT would like to improve in the future is the creation of Business processes together with the deployment of IT solutions.
AIT did not create any processes when implementing the system. A first step towards process creation was engaged in 2003 with an audit performed on the company.
The results were impressive but AIT did not engage any concrete actions to improve the situation.
E-business in the transport & logistics industry 132 Interview (s) with Françoise Arnaud, Director of Information technology AIT, 05/02/08, Genas, France Websites:
Since the 1980s, with the introduction of the first computers in the ticket sales area, ALSA has been developing its current modern e-business and ICT systems.
with complete Java internal support and external web interfacing for the e-ticket sales via Internet and mobile phone.
and positive impacts, including the opening of new sales channels (mobile and internet sales) which increase the customer satisfaction,
The company introduced the first computers in the sales area in the 1980s. These computers were dedicated mainly to the ticket selling systems, the first E-business in the transport & logistics industry 135 implementation of ICT technology in the company in this department.
Since the year 2000 ALSA started the ticket sales system via internet (based on a B2c platform.
The current Integrated Sales system of ALSA is designed now and implemented in Java programming language, including an integrated operations platform that manages the base and intermediate layers of the system in order to control each of the different sales channels.
This enables ALSA to change only the final interface layer of the system to the different sales channels
when they add a new channel to sell the tickets (internet, mobile phone, travel agency, ticket offices, etc.).
The integration of the systems enables the centralisation and optimisation of all the data and operations of the sales area.
The Integrated Sales system is in its majority an internal development of the IT department of ALSA, with a total budget of €300. 000 (€100. 000 corresponding to hardware and licences and €200. 000 to development.
and a proof of this is that ALSA is going to create the 4th generation website, including Web 2. 0 technologies, a content manager and external web features.
The internet sales currently represent 20%of total ticket sales (final users and travel agencies), and the mobile phone sales represent 1%of ticket sales.
One example of the advantages of the integrated sales system of ALSA is the integration of all the relevant information of the sales process into one single system.
For example one of the key benefits of having an online interlinked e-business sales system with these kind of features is the implementation of an intelligent seat management application (Plaza Inteligente.
as it can also be used to dispose of the needed statistics and data for: activity and service management;
database and analysis tools and it is designed to improve the planning and the optimisation of processes.
A modern data warehouse, which is implemented with business objects to provide the necessary information for the integrated sales system
and the resource planning system mentioned above. This system delivers information to all the organisation parts
This systems use the information of the data warehouse to perform special analyses and prognosis. They also include the Balance Scorecard system and the daily management.
intelligent proximity sensors onboard some of the vehicles or the use of integrated mobile data communications systems onboard the buses. Some of the high class buses (like the Supra class coach) have implemented also free Wifi Internet connection service for the clients.
such as the integrated data warehouse, the ITS (Intelligent Transport System) and the fleet control system have contributed also to improving business processes
GPS control, fleet management in real-time, intelligent sensors the onboard vehicles, Wifi bus communication systems or digital tachographs) have a double positive impact for the company,
like some final web interfaces have been outsourced, thus the company depends on the providers'response times (on average three to four months).
Interview with ALSA Development Director and ALSA Central Services Director (Madrid, 2008) Websites: ALSA, http://www. alsa. es E-business in the transport & logistics industry 139 5. 4 CEMAT (Italy) Abstract CEMAT (Combined European Management and Transportation
At the beginning of 2006, CEMAT launched a reorganisation programme of CEMAT information technology (IT) systems. The goal was to increase the performance of CEMAT IT systems
Information systems Case contact person (s: Marco Cipelletti, IT manager at CEMAT 5. 4. 1 Background and objectives CEMAT is an Italian company providing combined transport on land and sea to its European customers.
once a customer sends a transport order over the Web-based ordering service to CEMAT,
the data is integrated directly into the internal CEMAT transport management system. CEMAT sends a pre-filled bill of lading document to the customer
The terminal employee enters the data into the CEMAT transport management system and gives the signed paper to the customer (or his driver).
and data is rekeyed into the CEMAT transport management system. It is necessary that both, the customer and CEMAT, store paper documents.
Increased efficiency, due to the elimination of data duplication, the electronic management of the transport documents and the automatic delivery of documents.
Higher speed in transmission of data to the customer. Improved production mode in the terminals, with the elimination of manual processes leading to less errors
Terminal employees were used already to use information technology and the new process has simplified their working tasks.
Sending a fax to communicate an e-mail address to CEMAT illustrates quite well the IT approach of a company.
Another important point is to involve a representative panel of customers in the pilot phase.
E-business in the transport & logistics industry 143 Interview (s) with Marco Cipelletti, IT director at CEMAT, 16/10/07 and 17/10/07 Internal presentations about the solution Website of Cemat
and financial Data analysis of this data allows the company to take efficient decisions for the continuous modernisation of the railways.
Information systems (e-ticketing and e-reservation) Case contact person (s: Dorina Mironescu, CFR Information technology Director 5. 5. 1 Background and objectives Ever since the liberalisation of the railway market in 1998, Romanian railway companies have been facing intense competition from road
transport leading to a significant decrease in rail traffic. To remain competitive, CFR (Caile Ferate Române,
and market data about the passenger railway activities. 5. 5. 2 E-business activities The decision to implement an e-business solution was taken in 1993.
a central reservation system (xsellcentralseats) linked to more than 200 local servers that host the ticket sales system,
as well as a statistics/reporting system (xselldata) and a data maintenance warehouse (xsellwarehouse). For a nationwide system, a unitary hardware and standard software architecture has been chosen to offer long-term benefits, like improved technical support, technical operating services and reduced TCO (Total Cost of Ownership.
In this respect, the solution is based on Hewlett-packard hardware, Oracle RDBMS software and Practical Automation thermal printers, verified for more than 7 years in real-time operation
and being the architecture of an accepted system. The operating system is Microsoft windows NT for PC's & PC Net Servers and HP-UX for RISC machines.
The solution has been implemented in over 245 railway stations where each selling point is equipped with a PC
and a printer linked to the different systems. When a customer goes to a selling point to buy a ticket
the sales system sends the inquiry (entered by a CFR employee into the computer) to the reservation system
which checks if a seat is available. If so, it blocks the seat and sends seat number
and price to the sales system which stores these elements, together with information such as about the destination and the type of traveller.
The pilot system validated the technical solution (hardware and software) as well as the design and provided real data to determine the transaction volumes needed to operate such a system.
From 2000 to 2004 a new version of the software solution was designed by the CFR information technology team
and was rolled out between 2005 and 2007 in more than 245 railways stations. The costs of this project (not including the first pilot) were about 25 million euros,
20 million euros for the hardware including the services and 5 million euros for the application software and deployment.
Future major developments that are foreseen are to open the system for the public on the Web allowing customers to make an online reservation,
as well as to equip train staff with mobile devices connected to the systems to sell and print tickets in the train.
the information technology company of CFR, CFR Infrastructura,(managing the infrastructure on the Romanian railway network) as well as the ministry of Romania.
CFR Informatica Feroviara managed the software development, the infrastructure setup and the deployment of the solution.
The lack of data available before its implementation as well as its recent deployment does not allow the company to quantify the benefits achieved so far
Thanks to the availability of detailed data about destinations, passenger categories, distance choices etc. delivered by the system,
Thanks to the statistics provided by the data warehouse, the company is now able to estimate the flow of passengers,
like the deployment of a Web service for ticket reservation and selling, that can be connected to international travel agencies. 5. 5. 4 Lessons learned The project is considered a major success at CFR Calatori as its objectives have been achieved
Interviews with Dorina Mironescu, CFR IT manager 18/09/07 and 04/10/07 CFR Calatori annual report 2006 Website of CFR Calatori:
and aims to provide customer services over the Internet for a simpler, faster and more reliable exchange of information with the customer.
and in a convenient way through a Web interface the possibility to get clear visibility on their transport status
as well as hardware and software for the four deployed eservices. Maintenance cost for the portal is about 11000 Euros per month.
A big implementation challenge was to deal with the heterogeneous information systems infrastructure at Fret SNCF,
which is composed of SAP modules and proprietary information systems. The Clic Services Fret SNCF portal was developed using PHP and Dot net languages.
Security is guaranteed via SSL encryption of information and via a dedicated login and password for each user.
SNCF Fret customers can now log on to a Web platform that allows them to access the four different services that carry the following functionalities.
Commande@RESAFRET enables the customer to directly order transport services on the internet. Each customer possesses a personalised online catalogue that details the respective transport terms negotiated.
This service allows an easy data entry for the customer and a better order planning and management for Fret SNCF.
The web platform communicates with the internal SNCF information systems for the ordering and invoicing processes.
the data is sent to the Web platform where it is available to customers. For the ordering process, the customer consults the transport catalogue on the portal
and enters the transport order directly on the Web interface. The Web platform automatically sends the data to the internal order management system.
The ordering process is composed of a couple of events like reservation of resources, departure of wagons, delivery, incident etc.
The order management platform communicates data for each transport phase to the Web platform allowing the customer to follow up on the order.
The production mode E-business in the transport & logistics industry 152 needed to be adapted by deploying processes that allow the improvement of data quality
and is a driving force for improving data entry quality. Today, the e-services portal is operational
and publish the data on the website. 5. 6. 3 Impact The e-services solution affects the whole company and its working processes:
The second point is that the quality of information used by the information system is key for the quality of the service delivered.
A company investing in such a system should analyse precisely the different data creation processes and the quality of data produced.
If data quality is adapted not to the level required the processes should be adapted, the employees trained and the quality of information improved.
Interview (s) with Fabienne Girard, responsible for service offering and François Rannoux, responsible for e-services, 24/07/07 and 15/09/07 by Phone company internal newsletters and brochures Website
Companies in the Automotive, FMCG, Healthcare, High tech, Industry, Luxury, Retail sectors Most significant geographic market:
At Geodis, information systems are integrated fully into transportation and logistics plans. The information is used to promote productivity
Direct benefits expected from the implementation of such a solution were to increase accuracy decrease cost and reduce cycle times through:
The warehouse management solution is integrated with other information systems allowing therefore automatically integrating and exchanging information with customers and transporters.
E-business in the transport & logistics industry 157 5. 7. 3 Impact The warehouse management system provided Geodis with a couple of benefits resulting from the use of ICT that can be summarized in increased accuracy
and updated data, improved inventory management thanks to the visibility of exact stock variations and logistics and in a greater ability to serve the customer by reducing cycle times.
These benefits translate into direct costs savings like inventory cost reduction due to inventory visibility and accuracy;
less personnel handling picking orders through automated Radio frequency based picking or voice picking and reduction of personnel handling shipping documentation and confirmation.
Data accuracy and inventory accuracy both improve. Mistakes are pushed to an absolute minimum. Deliveries are timely,
yard management, automated data collection, automated material handling and equipment management. The resulting increase in process efficiency has translated into sizable labour efficiencies.
Interview (s) with Mr BAETENS, Managing director Geodis Logistics Belgium, 20/07/07, per Phone company annual report 2006 Website of Geodis:
Hupac has implemented an innovative information technology solution that manages transport information in real time and coordinates all phases of intermodal traffic from departure to arrival.
Aldo Croci, Hupac Information technology Director 5. 8. 1 Background and objectives The strategy of the Hupac Group has remained fundamentally unchanged for decades.
Information technology solutions are part of Hupac's strategy and Hupac ensures the efficient exchange of data with clients,
terminals, service providers and other operators through several information technology tools. Cesar is an Information technology system for combined transport that enables customers to make reservations,
track and trace goods, and verify traffic conditions. E-booking is a system which puts the customer's information system in contact with the Hupac system through standard XML technology,
offering considerable advantages in terms of time, security, and operational efficiency. E-billing is a service allowing the customer to receive,
verify, and integrate invoice information directly through its own accounting system, therefore reducing internal costs and potential errors.
an software that manages transport data in real time, coordinating all phases of intermodal traffic. GOAL is connected to e-train, an innovative GPS train control system.
In the past, Hupac was forced to search for information about its trains in the information systems of each railway company.
The need to control train movements with railway partners that use different monitoring systems in a context of an ever enlarging network has led to the creation of an integrated software management system with GPS train control The main driving forces for implementing this combined solution (GOAL
The implementation phase has taken 8 months most of it being the software implementation, followed by a 4-months test phase.
The overall cost for the solution including software, hardware and implementation were approximately 100.000 Euros.
The cost for one GPS unit is about 1200 euros and 60 units have been deployed so far.
specialised in traffic system GPS (hardware and software) and intelligence traffic systems. This firm was in charge of the integration and implementation of the system,
Hupac needed to find a solution that was independent from the information systems of railway companies and
An automated integration of the information coming from the location system into the central information system was required also.
Goal (Global Oriented Application for Logistics) is integrated an software designed by Hupac that coordinates intermodal transport from booking to billing.
In 2006 the project concerning the automatic integration within Goal of data originating from external systems such as clients,
and process data coming from peripheral terminals which do not use Goal. The second part of the solution is e-train, a new satellite-based train monitoring system that covers most of Hupac's traffic network.
This information is integrated then automatically within the Goal software, providing a constantly updated situation of the progression of each train.
and a GSM (Global System for Mobile communication) card that sends the information to the Goal system managing the information sent to
E-business in the transport & logistics industry 162 The server where the Goal software is stored at is connected fully to the Hupac central system.
Despite the fact that Hupac already has advanced internal information technology solutions in place, the impact of this solution on the employees previously in charge of searching information on the different railway information systems was significant.
They completely changed their jobs as this task was required no longer. Their new responsibility is to ensure that the GPS units are operational
Thanks to the implementation of this solution, Hupac is now independent from the railway information systems
The main contemporary downside of this solution is that telecommunication costs generated by the units are very high.
Another advantage with GPRS is that you are priced on the data volume and therefore this is less E-business in the transport & logistics industry 163 expensive.
and roaming costs with the telecom operator in order to address this cost issue. 5. 8. 4 Lessons learned The implementation of the Goal/e-train project was a real success
Many Mobility solutions that depend on the telecommunication infrastructure and operating in an international environment face the same issue.
An RFID solution would not have been a possible choice for Hupac. For an RFID solution the infrastructure must be put in place at the terminals to read the codes.
Since Hupac only owns 40%of the terminals that it uses, the coverage of the solution would not have been acceptable. 5. 8. 5 References Research for this case study was conducted by Caren Hochheimer, Altran on behalf of the Sectoral e-Businesswatch.
Sources and references used: Telephone interview with Aldo Croci, Information technology Director at Hupac, 26/07/07 Company annual report and brochures Websites:
Hupac (www. hupac. ch. E-business in the transport & logistics industry 164 5. 9 N c. Cammack &son, United kingdom Abstract From its base in Colchester, UK, N c. Cammack & Son provides transport, distribution
and monitor stock levels, keep pace with demand and check the order shipment status. Other effects acquired over the years include operational efficiency gains and improved profitability control.
N c. Cammack & Son believes that one of the reasons for its success is its investment in a specific Information technology (IT) solution called‘Truck Business'.
Traffic planners are in charge of collecting the different jobs sent by fax from the customers,
putting them together into a load by taking into account all different factors and constraints and entering the whole data into the computer.
which was developing the software. The project commenced with a 6-months analysis phase for defining the application needs,
The software developed is running on a WINDOWS NT 2000 server that is managed in house. 15 terminals are connected to the system.
(either entered by the customer over the Web or entered into the system by the Cammack employee),
and allow the traffic planner to easily put the jobs together on the screen into a load.
when this activity became part of N c. Cammack & Son's core activity. The third requirement was to give customers online access to the system allowing them to see their job status, history and invoices.
& Son's customers to view their own stock records, print reports, plus monitor incoming and outgoing goods, online.
'The sales and nominal ledger data is transferred from the‘Truck Business'solution by Transaction Broker automatically at the press of a button.
Thanks to the usage of‘Truck Business',N c. Cammack & Son remain competitive in its core markets trough improving operational performance while keeping the number of employees constant.
demonstration of the application Websites: Cammack (www. cammack. co. uk) E-business in the transport & logistics industry 171 5. 10 Cargo tracing at Saima Avandero, Italy Abstract Saima Avandero
and trace solution in 2002 to allow their customers to follow up their transport activities on a Web interface.
storage and distribution of products supported by state of art computing technology and robotics. A solid network of transport suppliers ensures that Saima Avandero can offer freight services like bulking, combined transport and special transports all over Europe.
E-business in the transport & logistics industry 172 Information technology (IT) plays an important role in the international freight-forwarding marketplace where it is critical to improve the efficiency of operational processes
'recognises Mr Scotti, Information technology Director at Saima Avandero.‘‘Today we still have to provide a good service but at the same time,
was managed in-house by Saima Avandero's information technology department. After a short analysis phase for the track and trace solution,
The main requirement for the solution was to give customers access to a database where information about their transports orders is stored.
Another requirement was that the system should be easily integrate-able with the existing information systems at Saima Avandero.
The solution was developed on the IBM tool Websphere. It is running on the company's main server (IBM AS 400.
Security requirements include user identification and password. The typical process is as follows: when a shipment is produced,
The supplier contacts are entered into the database. Suppliers are informed of their assignment. This is managed either directly through the system
fax or phone in case the supplier is connected not directly to the Saima Avandero database. The supplier will then confirm the transport order (through the system or other communication tools.
or through other communication channels and entered manually into the database. The customer can consult this information via theweb interface.
and trace solution with a central system connecting all local databases to the ABX central database.
in order to get the data from the suppliers according to the requirements defined by ABX group. Another future development planned is the extension of the existing solution through an SMS (Short Message Service) solution that should automate some of the information exchange with the suppliers
and will allow Saima Avandero to automatically integrate data received into the database. The solution has been operational for over 5 years
and integrated into the supplier's information system. That means that the supplier has direct access to the solution interface.
For the remaining 60%the information has to be collected manually by Saima Avandero through channels including e-mail, fax, and telephone.
One employee is assigned to manage the supplier relationships on a full-time basis. The quality of data received from the suppliers is an important issue for Saima Avandero..
Sometimes the quality of data is poor and sometimes data is not even available at all.
Since Saima Avandero works with a multitude of small suppliers (sometimes up to five suppliers for one single transport) it is very difficult to get them engaged to provide the requested data (either through the common system or in any other way.
The biggest issue faced by Saima Avandero, is to provide a homogenous level of data quality to the customers.
For some transport, the quality of data is very good while for others it is inexistent.
Another important issue is the additional work generated by the solution. The manual work generated by the data collection from suppliers
and entry into the system is costly and time consuming. In conclusion, the impact of the solution implementation is expected not as well as
Some strategic customers for whom the company puts many efforts in place to maintain the data quality at a high level are satisfied
The negative impacts in this case can be summarised in additional manual work to comply with the poor quality of data generated by the overall solution as well as poor customer satisfaction.
Solutions that are aimed at providing data to customers encounter huge issues if the quality of information cannot be guaranteed in cases where a company depends on a third party to provide the data it is very important to get a clear commitment of this third party on the respect
and correct application of processes deployed with the solution. The case of Saima Avandero, cooperating with a multitude of small transport suppliers seems to represent a typical example of the Italian transport market where lot's of small transport companies are coexisting.
The solution should allow sending an SMS in an automated way from the supplier's mobile phone
and directly integrating it into Saima Avandero's database. Even if this solution should improve the current situation by reducing the manual data entry of information provided
it is still fully dependant on the different suppliers. The best would probably be to deploy a solution that works independently on the different suppliers,
either through location positioning systems or through RFID technologies. Saima will investigate those solutions in the future. 5. 10.5 References Research for this case study was conducted by Caren Hochheimer, Altran, on behalf of the Sectoral e-Businesswatch.
Interview with Mr Scotti, Information technology director at Saima Avandero, 19/02/08 Websites: Saima Avandero (www. Saimaavandero. it.
In 2005, Trafikanten deployed an innovative real-time passenger information system providing travellers with reliable information on real-time departure times of public transport vehicles.
or provided through different channels like the Internet and mobile channels. It allows to better inform passengers regarding travels
*Information systems 5. 11.1 Background and objectives Trafikanten, founded in 1986, is the joint information provider for the two public transport authorities (PTA) in the Oslo region and the Norwegian state railways.
and to be able to serve an increasing number of telephone customers. In 1992 Trafikanten put the first travel planner in place did they develop it?.
%In 1997 the travel planner was launched on the Internet for public use; www. trafikanten. no.
and an SMS and WAP travel planner service. The objective of the real-time information project is to provide travellers with the accurate vehicle arrival and departure time information via the Internet,
mobile channels and through signs available at the stops. 5. 11.2 E-business activities The real-time passenger information project started in 2004.
& logistics industry 177 transport vehicles to the public over different channels including the Internet,
It should be based on timetable data from the existing travel planner tool. Another important requirement was that the suppliers could meet time and budget constraints.
1050 vehicles with computers, GPS systems and meter measuring systems, 350 stops with signs, 12 depots with dispatch systems to upload
and download data. The rollout is still ongoing and 90%of targeted vehicles are equipped with the solution today.
technical groups, training groups, data capture/testing groups, evaluation groups. Once a specific task for which the group was set up was finished the group was dissolved
Trafikanten has achieved its main goal of providing this real-time information on the punctuality of all targeted transport modes through the internet, mobile channels and signs to the public.
Passengers can now conveniently access the website from their home or office and conveniently gain information about the real departure times they need for planning their trip.
Passenger information data can be accessed using a dialogue-oriented user menu on a WAP-compatible mobile phone (Wireless application protocol.
%Another important benefit results from the planning capabilities given through the data analysis provided by the system.
The data administration and evaluation system is used for the evaluation and report generation of data recorded during operations.
The operators are able to gain an overview of complex daily activities, evaluate these and respond when needed.
The analysis of historical data is of great interest for Trafikanten and allows them to provide detailed reporting on all activities to the Public transport authorities.
Interview with Jarl Eliassen, Managing director Trafikanten, 03/01/08 Presentation of Trafikanten and their services Websites:
Information systems Case contact: Markus Bergman IT director at Värmlandstrafik AB 5. 12.1 Background and objectives Värmlandstrafik is a public transport authority (PTA) responsible for providing public transport services to passengers in the Värmland region
improving customer services and customer communication through Web based and mobile information services for passengers (Travel planner, Timetables etc), ticketing systems,
The FRIDA solution is based on software, entirely developed by Nordic Port. It is based a web system,
with a central database hosted by Nordic Port. The different users get an address and login and can access the solution via the Internet.
The region pays a monthly fee (about 5000 crones. Developments to match specific requirements are done by Nordic Port
and are paid by the region. E-business in the transport & logistics industry 182 Nordic port is in charge of the maintenance
The information is available for the PTA through a Web interface. Specific information such as environmental pollution is measured as well.
There is one person in charge of filling the data at each transport company working for the PTA.
They enter the information over the Web interface, an XML file is sent to the system
and FRIDA is fed automatically with the data. Every 6 months the operators send the data about miles ran
and fuel used for each vehicle. The system calculates the pollution generated. Each time an operator buys a new vehicle the data is entered into the system.
The information is stored centrally in the system and organising authorities have full access to the information as well the operators.
New functionalities that have been developed are the connection to the FRIDA system via mobile devices (through offline data synchronisation
to ease the process of data collection. Värmlandstrafik checks the vehicles on a regular basis to make sure that they are in good condition.
The person in charge of the bus control is equipped with a handheld PC and directly enters the information about the vehicle in the mobile device.
Once the bus check is finished, the handheld PC is connected to the PC at the office
and the data directly fed into the system. The solution allows today counting any vehicle that runs in Sweden whatever kind of vehicle is used:
busses, trains, boats and even cars. When more organising authorities became customers in the system,
which is being used in a way that makes it possible for SLTF to compile national data about the vehicles concerning environmental discharges, increased accessibility for disabled persons etc.
and sent to Värmlandstrafik by mail and fax. In order to plan the traffic and get figures on the bus operation,
The data provided by FRIDA supports the Swedish PTAS today in achieving an important objective
FRIDA demo presentation Websites: Värmlandstrafik (http://www. kollplatsen. com/index. html) Nordic Port (http://web. port. se/.
/E-business in the transport & logistics industry 185 6 Conclusions: outlook and policy implications Due to the high turnover and number of jobs in the European TLS industry and its interrelation with almost all other European economy sectors, any improvements to the competitiveness and effectiveness
of European transport and logistics enterprises will have a positive impact on other industries and, undoubtedly, will also have an impact on the European economy as a whole.
Nearly all TLS companies (97%)which use computers in the TLS sector are connected to Internet.
The TLS sector is characterised by a pronounced digital divide between small and large companies. In general, the ICT systems of large companies obviously tend to be more powerful and sophisticated than those of small firms.
There is still only a very limited use of RFID technologies in the TLS industry. Only 2%of firms (23 from a total of 1097 surveyed firms) have declared that they do use this technology,
*Data weighted by employment("firms representing%of employment in the sector expect that ICT will have a high/medium impact on Source:
Radio frequency identification (RFID) in Europe: steps towards a policy framework; E-business Watch 2007 study on RFID adoption and implications;
EPCGLOBAL: industry-driven standards for the Electronic Product Code (EPC) to support the use of RFID.
E-business in the transport & logistics industry 189 e-Skills for Europe: Towards 2010 and Beyond (2004;
Towards an RFID Policy for Europe (2007), RFID in Transport and Logistics RFID Consultation; COM (2007) 96 final:
Radio frequency identification (RFID) in Europe: steps towards a policy framework. Realising the potential of RFID technology,
this report addressed a number of interrelated issues pertaining to security and privacy, governance, radio spectrum and standards and called for an RFID Stakeholder Group to provide an open platform allowing a dialogue between consumer organisations, market actors,
and national and European authorities. Those studies, reports and working groups, have developed a great number of policy recommendations.
Furthermore, some of those groups are working hard to realize the suggested actions derived from those policies.
especially the development of affordable ERP systems for SMES Improve dialogue and cooperation with software providers.
In a nutshell SMES'ICT requirements are that they support their core business, work well, are user E-business in the transport & logistics industry 191 friendly,
"The use of SCM software is limited also very among smaller companies (6%).Against this background,
In micro and small companies in particular, the usage of ICT equipment and the access to the internet are limited often to the owner and a few key people.
While large dominant organisations can implement information systems using their own proprietary solutions it is important to ensure that the requirements of small firms are advocated properly,
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The E-business Survey 2007 methodological notes Background and scope The Sectoral E-business Watch collects data relating to the use of ICT and e-business in European enterprises by means of representative surveys.
using computer-aided telephone interview (CATI) technology. The overall survey was divided into four separate projects (each using a separate questionnaire) focussing on different sectors
in retail, transport & logistics Retail Transport & logistics services 2248 3 RFID adoption Manufacturing sectors Retail Transport services Hospitals 434 4 Intellectual
Property rights in ICT SMES ICT manufacturing ICT services Software publishing 683 Questionnaire The questionnaires for Projects 1 and 2 contained about 70 questions
ICT Infrastructure and E-business software systems B: Automated data exchange (Project 1)/ E-business with customers and suppliers (Project 2) C:
e-Standards and interoperability issues (Project 1) D: Innovation activity of the company E: ICT Skills requirements and ICT costs F:
and manually processed exchanges with business partners had been substituted by electronic data exchanges. Some questions were filtered,
E-business in the transport & logistics industry 203 The questionnaires of all E-business Watch surveys since 2002 can be downloaded from the project website (www. ebusiness-watch. org/about/methodology. htm). Population
the survey considered only companies that used computers. For the first time, a cut off was introduced with regard to company size.
The highest level of the population was the set of all computer-using enterprises (and, in Project 1
and whose primary business activity was covered by one of the five sectors specified in the NACE Rev. 1. 1. 129 Evidence from previous surveys shows that computer use can be expected to reach 99%or more among medium-sized and large firms
Population coverage of the E-business Survey 2007 No. Sector name NACE Rev. 1. 1 activities covered Population definition No. of interviews conducted Project 1 Manufacturing 1. 1 Chemicals, rubber & plastics
24,25 911 911 1. 2 Steel 27.1-3, 27.51-52 449 1. 3 Furniture 36.12-14 Companies which have at least 10 employees and use computers
63.11+12+40 Companies that use computers 1, 097 Sampling frame and method For each sector
data collection and reporting focus on the enterprise, defined as a business organisation (legal unit) with one or more establishments.
In a voluntary telephone survey, in order to achieve the targeted interview totals, it is always necessary to contact more companies than the number targeted.
and wrong and/or unobtainable telephone numbers. Exhibit A1-6 shows the completion rate by country (completed interviews as percentage of contacts made) and reasons for non-completion of interviews.
However, this effect cannot be avoided in any voluntary survey (whether telephone-or paper-based. Exhibit A1-6:
3016 8246 15862 1. 1 Telephone number not valid 541 31 53 299 645 38 611 1811 1. 2 Not a company (e g. private household
) 82 209 6 36 327 2 57 431 1. 3 Fax machine/modem 19 0 72 9 300 33 69
1 9 1 6 24 1. 8 Company does not use computers 35 75 32 76 35 5 110 398 1. 9 Company
(net) 4112 3781 4567 2416 5700 2743 4954 11678 2. 1 Nobody picks up phone 65 462 1061 0 440 147 112 2280
which can be downloaded from the E-business Watch website at www. ebusinesswatch. org/about/methodology. htm. Weighting schemes Due to stratified sampling,
Statistical accuracy of the survey: confidence intervals Statistics vary in their accuracy, depending on the kind of data and sources.
A'confidence interval'is a measure that helps to assess the accuracy that can be expected from data.
The confidence interval is estimated the range of values on a certain level of significance. Confidence intervals for estimates of a population fraction (percentages) depend on the sample size, the probability of error,
Exhibit A1-7 gives some indication of the accuracy that can be expected for EU-7131 industry totals (based on all respondents) according to the weighting scheme used.
data are presented normally in both ways, except for data by sizebands. These are shown in%of firms within a size-band,
where employment-weighting is implicit. 131 The EU-7 are composed of those countries which were covered by the survey.
To ensure data comparability, only interviews from these countries are included in the aggregated"total"values.
Confidence intervals for employment-weighted data are highest for the steel industry, due to the small number of observations and because this sector's structure makes it more sensitive to data weighting
(i e. large firms dominate in a comparatively small population). Employment-weighted data for this industry therefore have lower statistical accuracy than for the other sectors.
The calculation of confidence intervals is based on the assumption of (quasi-)infinite population universes. In practice, however, in some industries and in some countries the complete population of businesses consists of only several hundred or even a few dozen enterprises.
For this analysis a panel-data approach was used because of the low number of countries sampled.
The only way a cross-section approach could be used would be by pooling industry and country data.
frontier for an industry across all countries, we obtain a multicountry data panel with a common stochastic production possibility frontier.,
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