KL-Net CEO Jung You SubKL-Net CEO Jung You Sub

www.klnet.co.krwww.klnet.co.kr

L/O/G/O

2

Contents Contents

Status and Problem Analysis

Solving Method

Action Plan

Future Plan

Status and Problem Analysis

Solving Method

Action Plan

Future Plan

1.1.

2.2.

3.3.

4.4.

L/O/G/O

3

Status and Problem Analysis

L/O/G/O

Global Logistics Supply Chain

L/O/G/O

5

International Logistics Environment Changing

The expansion of Economic scale and

the appearance of Multinational corporation

Demand high-quality logistics service

Background

GSC (Global Supply Chain)GSC (Global Supply Chain)GSC (Global Supply Chain)GSC (Global Supply Chain)

L/O/G/O

6

Spread

Technical ChangingTechnical ChangingEnvironment ChangingEnvironment Changing

Reflects international/domestic logistics changing environmentConstructs a Standard Plan for Logistics Information`

Reflects international/domestic logistics changing environmentConstructs a Standard Plan for Logistics Information`

Logistics InformationLinking and Standardization

International/Domestic Standardfor Korean Logistics Information

• Logistics Systemized Project under

government leading in Korea

• Needs National Logistics Standard

because of Heterogeneous system

or data

• Logistics Systemized Project under

government leading in Korea

• Needs National Logistics Standard

because of Heterogeneous system

or data

•Increase a Association Needs

between business entities

• Needs High-Quality Logistics

Service

• Request to integrate with u-

Business service

•Increase a Association Needs

between business entities

• Needs High-Quality Logistics

Service

• Request to integrate with u-

Business service

L/O/G/O

Diversification on Strategic goal

- Simply inventory control flexibility, green, customer orientation etc.

Flexibility : establishment of risk supply chain management (NOKIA)

- Fire in New Mexico prompt product supply from overseas factories

->Increase Worldwide market share 27% to 30%

Green : Reverse SCM (HP)

- recall & re-producing center

- Generate additional profit from resale a reproduced products

Customer orientation : Need (McDonald)

- moving toward to customer oriented from product

- Mc cafe is not only low price policy but also quality for customer’s

preference

Logistics Environment Changing

L/O/G/O

8

Structured problems

- Complicated network structure : coexist with existing system, EDI,

telephone, email and etc.

- Difficulty on interconnection among systems

Severance & Security problems

- Severance and information gap on cargo movement and tracking

- Unpredictable delay and recovery on supply chain

- Insufficient on visibility and security

Resource management problems

- Resource waste : unpredictable activities such as additional charge

and request on express delivering order

Barrier Factors to Implementation

L/O/G/O

Working process

- overuse on paper and overtime from manual working process

- Human intervention on information sharing during interoperation

among public sector

Technology

- different types of data and data transfer protocol

(Enable to interconnect)

- Coexist with difference data information system

- Lack of verification of meaning on biz process and data contents

Standardization

- unable to correspondence with global standard

Critical Issue

L/O/G/O

10

Solving Method

L/O/G/O

Standardization on DATA

- Data sharing and utilizing by using common use forms

- Standard Data & Code, global mutual-application

Visibility on Logistics Flow

- Real-time data integration based on u-IT

- Reduce logistic cost from capturing data with seamless logistics flow

Enhancement on Security

- Prompt and safe cargo movement to meet with the standard

security requirement

Resolving Method

L/O/G/O

System Integration => Single Window

Information (data, code) Standardization => UN/CEFACT

Reducing paper forms => Electronic Message

Real-time based cargo and vehicles tracking system

=> u-IT (RFID, GPS)

Security Enhancement => AEO, C-TPAT, e-Seal …

Resolving Method

L/O/G/O

13

Strategic

Vitalization of Logistics Informationization

Information and System standardization

Ensure Visibility

Integration with u-IT

Closely linking with Sea, Air and Railroad network

Set up National Logistics and ITS Set up National Logistics and ITS

Derive u-IT expansion projectDerive u-IT expansion project

Bio and logistics activities StrengthenBio and logistics activities Strengthen

Land transport volume increasingLand transport volume increasing

Strengthen security for LogisticsStrengthen security for Logistics

Using RFID for flow trackingUsing RFID for flow tracking

Apply USA container security management e-SEALApply USA container security management e-SEAL

Promote Pan-European policyPromote Pan-European policy

investment in equipment for government financedinvestment in equipment for government financed

Accumulate RFID Construction knowledgeAccumulate RFID Construction knowledge

No-connecting of logistics flowNo-connecting of logistics flow

Lack of inland information planLack of inland information plan

Activate Maritime Information Infra Activate Maritime Information Infra

High IT maturity and infra construction capabilityHigh IT maturity and infra construction capability

Exists various organization and systemExists various organization and system

Set up National Logistics and ITS Set up National Logistics and ITS

Derive u-IT expansion projectDerive u-IT expansion project

Bio and logistics activities StrengthenBio and logistics activities Strengthen

Land transport volume increasingLand transport volume increasing

Strengthen security for LogisticsStrengthen security for Logistics

Using RFID for flow trackingUsing RFID for flow tracking

Apply USA container security management e-SEALApply USA container security management e-SEAL

Promote Pan-European policyPromote Pan-European policy

investment in equipment for government financedinvestment in equipment for government financed

Accumulate RFID Construction knowledgeAccumulate RFID Construction knowledge

No-connecting of logistics flowNo-connecting of logistics flow

Lack of inland information planLack of inland information plan

Activate Maritime Information Infra Activate Maritime Information Infra

High IT maturity and infra construction capabilityHigh IT maturity and infra construction capability

Exists various organization and systemExists various organization and system

L/O/G/O

14

Final Goal of GSC

User-oriented single entry construction

Information linking and sharing in common

Seamless the advanced

logistics policy setup

Informationization of logistics

• Realization of Logistics-oriented nation• Enhance global logistics competitiveness

Logistics information system improvement

L/O/G/O

15

Action Plan

L/O/G/O

16

Action Plan

Logistics Information System IntegrationLogistics Information System Integration

-> Single Window-> Single Window

e-Document Standardizatione-Document Standardization : XML: XML

International CooperationInternational Cooperation

-> Business process standardization, -> Business process standardization,

-> Collaboration model setup-> Collaboration model setup

Logistics Information System IntegrationLogistics Information System Integration

-> Single Window-> Single Window

e-Document Standardizatione-Document Standardization : XML: XML

International CooperationInternational Cooperation

-> Business process standardization, -> Business process standardization,

-> Collaboration model setup-> Collaboration model setup

L/O/G/O

17

Logistics Information System ?

This system supports logistics management to be closely associated with

information which is related to transportation, shipping and discharging,

keeping, packaging, etc. for goods moving.

Area Logistics System Logistics Information System

Sea

- Port Management System

- Terminal Gate In/Out System

- Dangerous Declaration System

- Port-MIS, SP-IDC(B2G)

- PLISM(B2B)

- Manifest, Customs(B2G)

Railroad

- Railroad Cargo Transport System

- Railroad CY Gate In/Out System

- In-Land Gate In/Out System

- KROIS(B2G)

- Busanjin CY(B2G)

- In Land(B2B)

Others - Immigration

- Door-to-Door Delivery System

- Immigration Declaration(B2G)

- Not Yet

L/O/G/O

KCS

MOJ

Dang.er. GoodsInspection

KORAIL

MLTM

Administration

NationalQuarantine

Station

18

Single Window

A single point for the one-time submission of all required information and documentation to all governmental agencies involved in export, import or transit procedures

UserUser

XMLEDI

EDI SystemEDI System

User Authentication/Authorization

WEB Service Portal

WEB Service Portal

XML/EDIXML/EDI

Secured Authentication

(EAM)

Secured Authentication

(EAM)

User Info.User Info.

Single Window

InternetInternet

VANVAN

Declaration

Approval

Shipper

Forwarder

ICD

ShippingCompany

Carrier

Terminal/Pier/Airport

L/O/G/O

19

Domestic Standard Activity

KEC (Korea E-Document Standard Committee) by NIPA (MKE)

ISO TC 154, ISO/JTC SC34 by KSA

TAG(Technical Assessment Group) by NIPA

Working Group by KIEC

- e-Document : XML Library,

Business Information

- Code, Business Process

- Standard Tax Invoice, guideline

- Standard C/O, guideline

Standardization by KL-Net

International Standard Activity

International Standardization : UN/CEFACT

Asia Standardization : AFACT

IMO FAL : (Single Window, UNeDocs)

Consulting Service

- Technical Inspection for Dominican Republic DGA (Direction General De Aduanas) Computerization Project - Technical Inspection of Republic of

Guatemala ministry of Education Educative Informatics Highway Project - Feasibility study at Tanzania, Guatemala,

Dominica

- Single window training program for IMO ,

member states

L/O/G/O

20

A singleA single data data modelmodellingling approach approach forfor::

Data exchanging standard instead of paper documentData exchanging standard instead of paper document

Government driven applying for work efficiencyGovernment driven applying for work efficiency

Structured e-document : Structured e-document : UNUNEDIFACT, EDIFACT, Cargoimp, VDA, XML etc.Cargoimp, VDA, XML etc.

WEBWEB ServiceService

XMLXML

e-Document Standard - XML

L/O/G/O

21

Collaboration model Setup

Meeting of Korea, China and Japan minister of logistics : Logistics information Meeting of Korea, China and Japan minister of logistics : Logistics information

standardization, Cargo tracking resolutionstandardization, Cargo tracking resolution

Collaboration Mode between Korea, China and Japan : NEAL-NETCollaboration Mode between Korea, China and Japan : NEAL-NET

International R&D Program for co-workInternational R&D Program for co-work

Define collaboration business model discussed with UN/CEFACT, AFACT, IMO Define collaboration business model discussed with UN/CEFACT, AFACT, IMO

member states, propose as international standardmember states, propose as international standard

L/O/G/O

22

Future Plan

L/O/G/O Logistics Environment Perspective

Green LogisticsGreen

Logistics

Maritime transport volume

increasing

Maritime transport volume

increasing

The competition of maritime industry is deepening

The competition of maritime industry is deepening

Strengthen Security

Strengthen Security

• Asia-Europe course : annually 7.3% growth until 2010 (2010 : 2.6 Million TEU)

• Asia-Europe course : annually 7.3% growth until 2010 (2010 : 2.6 Million TEU)

• Far east-North America : annually 5.7% growth until 2010 (2010 : 2.1 million TEU)

• Far east-North America : annually 5.7% growth until 2010 (2010 : 2.1 million TEU)

• Expand alliance between shipping companies

• Port investment of global company

• Shipping conference Revocation

• Expand alliance between shipping companies

• Port investment of global company

• Shipping conference Revocation

• Reduce CO2 from vessel according to IMO convention

• Modal Shift

•Introduce Automated loading/unloading equipment

• Reduce CO2 from vessel according to IMO convention

• Modal Shift

•Introduce Automated loading/unloading equipment

• Prevent terrorism against vessel and port facilities

• Maritime accident prevention and safety of life at sea

• Prevent terrorism against vessel and port facilities

• Maritime accident prevention and safety of life at sea

23

L/O/G/O

24

Intelligent & Sensible LogisticsIntelligent & Sensible Logistics SystemSystem

- Use Sensing, GPS and Image Processing technology

- Enhance validation functionality

Must support global supply chain’s visibility for inter-

continental business

- Use Standard document and exchange protocol

- provide interoperability

Future Logistics System

L/O/G/O

Information searching service improvement: 26.4 billion Korean won - Enhance work efficiency with information searching service improvement

▷ Estimate 300,000 by annual average searching count ▷ Searching time reduction(10 minutes) per one B/L(or container number) × 300,000 × the average wage per time (8,800 Korean won) = 26,400,000,00026,400,000,000 (26.4 Billion) Korean won(26.4 Billion) Korean won

Information searching method improvement : 13.2 billion Korean won - Enhance work efficiency with information searching method improvement

▷ Estimate 300,000 by annual average searching count ▷ Visiting times reduction(5 times) per one B/L(or container number) × 300,000 × the average wage per time (8,800 Korean won) = 13,200,000,00013,200,000,000 (13.2 billion) Korean won(13.2 billion) Korean won

Green logistics realization - Resource reduction through paperless, Easy management of waste and repossessed goods through visibility ensuring - Easy transportation management (Oil prices reduction through lower emissions)

The expected Effects

L/O/G/O

Future Goal

GoalGoal

VISIONVISION

GoalⅡGoalⅡ

InitiativesInitiatives

EnvironmentEnvironment

Simplified Association Efficiency

Standard Methodology Standrad Protocol Logistics Lead Time

• Analyze delay reason• Analyze disruption reason• Extract resolving Method

• Collaboration Process• Link with each Country• Provide user-friendly

requirements

• Re-Define Business Process• Define Common Elements• Define the related Entities

Define Logistics Business Model and International standard based IT system

Changing Factor (Policy/Social/International)

Changing Factor (Market/Data/Economy)

• Apply New Technology => (RFID, Mobile, Ubiquitous)• Strengthen the competitiveness• Increase without border and paperless trade

U-Logistics for seamless Logistics

Standard, Visibility, Information Linking

• Logistics environment and Trend Changing• Logistics Business viewpoint changing due to FTA• Logistics Process Improvement through Standardizaton