Why You Care About Who Owns Your Technology Platform

Article written by Tom Mahlke – Vice President & CIO of C.H.Robinson on why companies are investing in technology.
 
I am often asked why we invest a substantial amount of capital in technology. It’s a good question. This is why: we believe that the best way to efficiently support our customers’ supply chains is to own the platform. And this is one of the most critical technology questions you can ask before settling on a potential logistics service provider (LSP) or 3PL. Who owns the software they will use to help run your supply chain? The answer can either set you up for an easier life as your company grows or for potential problems down the road.

 
Does the LSP or 3PL own the technology? Or (as is more often the case), does your provider license the technology from a software company? It’s an important distinction. Listen to how their technology automates processes and paperwork. Find out about the level of visibility you’ll get, along with tracking and reporting. It all sounds good, right? But many technology vendors allow their technology to be re-branded by providers, and even a name that you recognize is not a clear sign of ownership. So be sure to ask who controls the technology and if it truly can be customized to meet your needs.
 
This chart is one way to highlight the differences between owned and licensed technology.
 
Benefit Owned Technology Licensed Technology
Ability to Change Flexible and open to requested improvements Less flexible
  Easy to incorporate feedback from you and other customers Dependent on software company’s appetite for tailoring the system to your requirements
Accountability Directly accountable to you for system/platform changes Gap between you and the software company can result in less direct accountability
Speed of Change Can quickly accommodate customization requests and execute major upgrades Updates and changes may be slowed by contractual obligations (e.g., licensing agreements)
 
The first time you experience a business change, you’ll care about who owns the technology. For example, say you identify a service gap that can only be resolved by tweaking an existing software feature. Or, you acquire a company on a new continent, and you need reporting to directly compare transportation costs in Shreveport and Shanghai, irrespective of differing languages and currencies. Or, your company needs to incorporate totally new products and services, but that requires a software upgrade.
 
Flexibility is what you need at such times. You will turn first to your LSP or 3PL because they have direct accountability to you, work with you every day, and understand what you’re trying to accomplish. If they own the technology and are a good provider, they can aggregate your suggestions with ideas for improvement from other customers. They can develop solutions more quickly that will evolve with your business. And because many problems from many businesses are being solved at once, you get improvements faster, even if you’re a very small company.
 
A logistics provider that can execute with its own technology will be able to perform well for you with a high level of accountability. They can incorporate changes quickly and issue more frequent updates. They have clear, direct accountability to you, and it’s likely that you can sit down with them, discuss your problems, and get fast solutions. By contrast, an LSP or 3PL who relies on an outside technology vendor leaves you with a dependency on a third party who can have no direct accountability to your firm. 
 
This is why C.H. Robinson is committed to investing in, developing, and maintaining a proprietary technology platform called Navisphere®: because our customers need a comprehensive, global technology solution that adapts to their needs and doesn’t hold their business back. So your needs are met whether you are a global customer with a need to connect with suppliers across continents in multiple languages, or a small customer who just needs the scale and visibility that technology brings.
 
What you’re really after is technology that grows with your company. If your LSP or 3PL does not own their transportation technology, they might not be able to evolve fast enough to accommodate your business requirements in the future. When the LSP or 3PL owns the software, you get flexibility, along with a competitive advantage, because you can more rapidly adapt to changing business conditions.   
 
Ultimately, a company that owns its technology can make continuous changes that directly address its users’ needs. When this happens, you get technology with aggregated improvements.

Quelle: eyefortransport

Portal: www.logistik-express.com