Two types of Software for freight forwarders.
Programs and operating information used to operate a computer also known as software have undergone tremendous changes over time., not only for freight forwarders but in general.
Provision of this important part of the computer has also changed in equal measure.
In the past, it took a long process and high cost to start using a software.
Additionally, there were other running costs to update and support the software.
Today, software packaging and installation can be broadly divided into two categories: cloud software and packaged software.
Cloud Software Introduction
In order to understand cloud software, it is imperative to define cloud computing.
Cloud computing implies sharing of computing resources rather than having servers or other local resources to handle and use these applications individually.
´Cloud’ is a metaphor for `internet’. Therefore, cloud computing means delivering a set of services, storage, and applications to a computer through the internet.
Cloud software is a process of delivering or enabling scalable and at times perfectly elastic software service using the internet.
It is a method of delivering software as a service (SaaS) on a pay-per-use basis.
There are various types of cloud-based services.
- Infrastructure as a service (IaaS) and Platform as a Service (PaaS).
IaaS utilizes existing infrastructure to offer service that would otherwise require installing the infrastructure.
The use is based on a Pay-Per-Use scheme which greatly saves cost on buying, installing and maintaining the infrastructure.
PaaS take advantage of an existing platform but one uses his or her own software.
- Test and Development: These are readily development working environments for clients working on projects. It saves an entity the effort and investment required to develop a tailored solution for a project.
- Big Data Analytics: Here companies and individuals are able to remotely harvest and analyze data. Retailers, suppliers, and independent researchers can now harness data and analyze boosting understanding of their businesses.
- File Storage: This is a cloud platform that provides capacity for storage, access and retrieves your files. This brings convenience, speed, and security.
A bit of history of Cloud Software
Cloud computing started in the 1950s.
At that time, it would have been costly to buy or even to provide space for a mainframe computer.
As a result, companies bought one mainframe which would be accessed through thumb terminals.
The mainframe offered storage space and large processing capacity. Later in the 1970s, Virtual Machines (VMs) came into place. A single hardware was used to operate several virtual computers.
This boosted communication and information advancement. In the 1990s, telecommunication companies sold virtualized private networks at a lower cost.
Dedicated services were phased out. Entities could now avoid the cost of building their own physical infrastructure.
Throughout, the technology evolved through, Grid computing, Utility computing, SaaS computing and Cloud Computing.
In cloud software, someone logs into an enterprise or public portal provided by the cloud service provider.
Here, a person orders a service through the cloud service consumer.
The purchased application allows all other users to log into a web-based service portal. Here, they can access all programs they need for their job. Machines that run these applications are owned by the cloud service provider.
Freight Forwarding Companies and Cloud Software. Pros and Cons
Freight forwarding companies have heavily relied on computer solutions to continuously deliver services to its customers.
Due to frequent contact with customers, freight forwarders have to always scale up their service provision.
This includes scouring for new information technology solutions that improve service provision. Recent demands for tracking, security, online payment, and processing has resulted in more demands for cloud-based services for freight forwarding.
Use of cloud software platforms in managing freight forwarding business would bring the following benefit:
- There is ease of access at any time from anywhere. With such a platform, associates, agents, and the client are able to simultaneously access vital information about cargo. As a result documentation, payment, tracking, and inquiry can be done remotely.
- Low maintenance cost. All the infrastructure and administration of the system is done by the client. Therefore no costs for an upgrade, system maintenance or additional employment.
- High Availability. There is a high level of guarantee on the performance of the cloud-based software. NetSuite, for instance, commits to a 95.5% availability.
- Security. In freight forwarding, there is need to protect customer information as well as their cargo. This takes a notch higher with the implementation of cloud software. Information is better guarded while monitoring is in some instance made real-time.
- With a cloud software, there is no need for research and development for an in-house application.
- Cloud solutions can easily be adapted to the needs of the continuously changing logistics environment.
- Little or no training is needed, hence the personnel can start using the platform immediately.
Small and medium sized freight forwarder are able to operate as effectively as the large one.
Cons or Challenges
Despite the overwhelming advantages of cloud computing, the service also has its challenges.
The following are a few cons associated with the cloud platform.
- The applications must operate under a high-speed internet for efficiency.
- The limited control of infrastructure can sometimes be annoying especially when total privacy is required.
- Some cloud software offers very limited space for flexibility. This makes customization a challenge.
- Security is a major concern for entities that use public cloud applications.
Package Software. Introduction.
This is a software designed with the capability of being used by many people or companies.
The software can readily be bought off the shelf or in order from the vendor.
Previously, the term meant common packaged software such as Microsoft Office which has many programs in it. However, the term is nowadays commonly used to refer to the upscale enterprise software suites like ERP or CRM.
They are multiple software programs that work together and are sold by a vendor as a package.
In early computer days, a software that didn’t come as part of the computer had to be custom-built to order. In the 80’s a new generation of vendors started making pre-designed integrated software packages.
The software was designed for an array of business functions.
The most common packaged software include the following:
- Enterprise Resource Planner (ERP): This packaged software is used by business to manage all functions within and even around its environment. An ERP software can be implemented in virtually any type of business environment. This is because ERP can be readily edited to fit the specific needs or a company. An ERP can readily be used in a manufacturing, service, technology, processing and transport business.
Most companies in freight forwarding business use ERPs in the management of their operations.
- Customer Relationship (CRM) and Huma Resource Management (HRM) software: Both software are used in the management of specific areas of an entity. A CRM is used in the management of all customers and their activities. The software is meant to speed-up the process and improve a customer’s experience while interacting with the company. The HRM, on the other hand, is meant to manage all human resource and their interaction with a company. This includes contracts, leaves, payroll preparation, leave and all information regarding an employee.
- Other packaged software include Operating systems, office productivity software such as Intuit QuickBooks, Entertainment software, and protection software.
Freight Forwarding Companies and Packaged Software. Pros and Cons
For a long period now, freight forwarders have been using packaged software to run their operations.
The software can be a generic business software or freight management software from specialized vendors.
There is fewer relationships to manage. Once you buy the software, you do not have to contact the vendor especially if maintenance is done internally.
The overall cost is reduced. Compared to cloud applications, the cost of purchasing is only done once. On the other hand, there is a monthly cost to pay a cloud computing vendor.
There is less employee training. Where only a packaged software solution is bought from one vendor, employees are only trained on one system.o
In cases where the vendor makes specialized software for specific functions, the productivity is higher.
There is good vendor support, especially where the relationship has been built over time.
The vendor is immediately available when required.
An upgrade may come at a reduced cost.
Despite the evidence of numerous advantages, the software poses many challenges to freight forwarders.
This is due to the dynamic nature of freight business that requires real-time coordination. Some of the challenges include:
- Initially, the software is more expensive compared to cloud applications. It requires a higher initial investment.
- It may take a long time to have a fully functional tailored packaged software.
- It will be difficult for a freight forwarder to realize any competitive advantage since the software is not unique.
- A freight forwarder may have to alter the way it works to accommodate the software.
- Most packaged software have fewer functions meaning they are less powerful
Today, the technology is moving towards cloud computing and use of cloud applications.
The platform is becoming more and more preferred as it provides more functionalities at less cost.
Our recommendation for small freight forwarders o Startups freight forwarding companies is going directly to a software based on the cloud.
Pay per user. Work anywhere, anytime, forget to buy big servers, big computers…