A software vendor called "project44" has introduced a program it says will dramatically improve the speed of data exchanges among shippers, less-than-truckload (LTL) carriers, and third-party logistics providers (3PLs) from the technology that has existed for decades.
In an effort to "walk the walk," the Chicago-based vendor is inviting companies to participate in free tests of the speed of their data-interchange connections. Project44 will run a 72-hour health scan to evaluate more than 15 key technical capabilities of the companies' application programming interface—better known in the IT trade as APIs—which are add-ons to transportation management system (TMS) platforms now in widespread use. The scans will grade the effectiveness of each user's ability to provide fast and accurate rate quotes, automate pickup requests from shippers and 3PLs, provide clear tracking codes, and confirm delivery with real-time documentation, project44 said.
Armed with that information, carriers can decide whether their current networks meet their needs and find out how they compare to other carriers and industry averages in the ongoing effort to reduce billing errors, provide increased visibility to customers, and ultimately increase profits, the company said.
The web-enabled tool is the latest step of a rapid rollout that has seen project44 link its APIs to the TMS platforms of firms such as MercuryGate International Inc. and McLeod Software Corp. The tool performs in much the same manner as an engine that supports online travel booking sites like Kayak and Travelocity.
Like adding nitrous oxide to a drag racer's fuel line, linking a nimble API to a lumbering TMS allows it to produce faster, more accurate price quotes than through the standard electronic data interchange (EDI) approach, according to Jett McCandless, project44's cofounder. McCandless has made a name for himself by applying new technologies to a business that has not been known as a first-mover in adopting new IT tools.
Created in 1948, EDI is a one-way communication standard that requires users to communicate in batches that are processed every 15 to 45 minutes. In a world where shippers and 3PLs are constantly trying to match rates with carriers, that slow pace of conversation forces users to rely on static rate tables compiled once a year or, at best, on a seasonal basis, McCandless said.
In contrast, an API-based communication system automates that exchange, allowing users to generate dynamic price quotes that can vary from day to day, reflecting the complexities of the modern transportation industry.
"It's like having a fax machine, and then upgrading to email, text, and social media," McCandless said. "Imagine how successful text messaging would be if it took 30 minutes to get each response? You'd never get anything done."
EXPERT SAYS API MUST COEXIST WITH EDIThough supplementing TMS platforms with APIs is a crucial ingredient in generating quick price quotes, it can't solve every challenge alone, said Danny Slaton, EVP and COO of SMC3 Inc., a transportation pricing software provider that has been providing LTL pricing content for 85 years.
SMC3 integrates its web service APIs with supply chain software providers to support its products, such as "CzarLite," "Bid$ense," and "RateWare," which combine to support end-to-end predictability in shipper and 3PL-carrier relationships, the Peachtree City, Ga.-based company said.
However, Slaton draws a distinction between transactional APIs, which are effective at simple tasks like collecting a price estimate for a single shipment from a carrier's website, and analytical APIs, which can handle complex jobs such as pricing 100,000 shipments over five different carriers. That is why companies have used the EDI standard for decades, and continue to do so, Slaton said.
"EDI is used by large carriers and 3PLs because it is integrated into ERP and TMS systems," Slaton said. "Processes in the B2B sphere are very slow to evolve, and in the supply chain they are even slower; they will be there for some time."
Over the years, industry users have standardized about a hundred EDI sets for supply chain applications—generating such calculations as the bill of lading, merchandise return, shipment status, pickup manifest, inspection reports, and motor carrier load tender—but most API interfaces cover only five or six variables.
"There's going to be a long term of coexistence between EDI and API," Slaton said. "Any time you launch something like this, it's really a relationship play; what's really important is your infrastructure."
SMC3 will follow that strategy when it releases its next product in the third quarter of 2016, launching an industry platform capable of integrating the content of its own APIs with other providers' APIs. The combination will allow users to orchestrate a series of supply chain events as a unified package, including for example a rate quote, points of service routing, shipment booking, and proof of delivery.
ACCURATE SHIPPING DATA REQUIRES A WIDE NETWORKWhile project44 and SMC3 might disagree on the means of sharing shipping data, they both agree that a rating system is only as powerful as its network.
Project44 is also driving its growth by integrating its API with a rising number of TMS providers. The company is reaching out both to 3PLs with proprietary TMS platforms and to major providers such as Oracle Corp., SAP SE, and JDA Software Group Inc., McCandless said.
As the network of participating transportation firms expands, the value of embellishing a TMS with an API will grow accordingly, he said.
"APIs are only as good as the trucking companies they are connected to," McCandless said. "It's already significantly better than EDI, but we've only been in the industry for two years, so we are nowhere near our potential yet."
Project44 plans to release a "significant" 2.0 release of its freight API in January 2016, according to McCandless.
