NETTING IT OUT

For over 100 years, The Bekins Company has been one of the United States’ best known names in moving goods and households. One of Bekins business units--HomeDirectUSA--specializes in delivering and installing high-value consumer goods (such as appliances and large-screen TVs) from retailers to purchasers’ homes. Over the past four years, Bekins has turned to leading-edge technologies to implement an e-business strategy that provides information directly to customers and consumers, enables online ordering by agents and customers, and creates a virtual marketplace for offering shipping jobs to Bekins agents.

Bekins’ e-business strategy has been developed and rolled out in three specific applications: a Shipment Tracking System, which provides online order status to shipping customers and consumers; COMIS, an online ordering and inventory management system that enables customers and agents to create orders online; and Tonnage Broadcast Exchange, a virtual marketplace for agents to bid on shipping jobs.

Tonnage Broadcast Exchange (TBE)--the focus of this case study--solves a long-standing problem of how to tender shipping jobs to Bekins agents. In the past, jobs had to be tendered by phone or fax, often causing delays and sometimes a feeling of unfairness on the part of the agents. TBE automates this process by offering the opportunity to all qualified agents at the same time and enabling an agent to instantly claim the job (making it no longer available to anyone else).

The results have been significant in both qualitative and quantitative terms. Agents are happier because they have an easy and fair method of claiming jobs. Shipping customers are happier because they have more confidence that items will arrive at consumers’ homes when promised. For Bekins, this translates into direct financial benefits of increased revenue by $75 million, reduced operating costs by $1 million, and IT development savings of $100,000.

In addition to its notable payback, TBE is particularly interesting since it was built from scratch as a Web Services application. TBE represents a new breed of applications that will take advantage of emerging standards to bring high-value applications that connect across company boundaries.

BUSINESS CONTEXT: DELIVERING HIGH-VALUE PRODUCTS TO THE HOME

Bekins has been a well-recognized name in the moving business for over 100 years. While primarily known for its nationwide home-moving business, The Bekins Company has a growing business--HomeDirectUSA--in home delivery and inventory management for what it calls high-value products--large consumer items such as big screen TVs, mattresses, and appliances. These high-value products not only are large, but frequently require set up and installation in the home.

Bekins customers for HomeDirectUSA include some of the largest manufacturers and distributors of consumer goods.

Background

The Bekins Company, Hillside, IL, includes Bekins Worldwide Solutions, Inc., and Bekins Van Lines, LLC. Bekins Van Lines, founded in 1891, provides quality household-goods-relocation services for corporate accounts and private relocation customers. Bekins Worldwide Solutions is one of the largest North American integrated logistics networks. The company provides logistics services and solutions to manufacturers, distributors, and retailers of electronics and other high-value products.

Bekins Van Lines operates through a vast network of agents in North America with a combined fleet of over 1600 operators. Bekins Van Lines is the seventh largest provider of household goods relocation services to corporations, individuals, and the U.S. government. The household goods network is comprised of agents located throughout the U.S. with hauling capacity provided by 150 independent owner operators and 1,450 agent drivers. Bekins Worldwide Solutions (BWS) utilizes its dedicated agency network of over 60 distribution centers with a combined Bekins fleet of over 2,100 tractor/trailers and straight truck units to provide a variety of specialty transportation services. BWS also provides comprehensive logistics services and home delivery through 75 plus agent distribution centers, which supply in excess of four million square feet of warehouse space for the transportation, distribution, and warehousing of high-value products.

Bekins also has specialized divisions that move household goods, provide tradeshow services, warehousing, inventory management, distribution, delivery, set-up and light installation for computer companies, telecommunications, and office imaging equipment suppliers. HomeDirectUSA is one of these divisions that provide logistics and fulfillment for e-tailers as well as brick-and-mortar retailers who offer direct-to-home delivery for their customers.

New Ownership Structure

In January, 2002, The Bekins Company was purchased by members of its network of agents from GeoLogistics Corporation, becoming a totally agent-owned corporation. The purpose of the purchase was to enable faster growth by tying the agents more closely to the corporate mission and strategy, as well as to enhance Bekins local and regional presence.

THE E-BUSINESS INITIATIVE

Overview

Bekins embarked on an aggressive e-business initiative in 1998. According to Randy Mowen, Bekins Director of Data Management & e-business Architecture, the overall goal was to be “the premier e-commerce transportation company in North America.”

From 1999 to 2001, the initiative evolved over three phases, each of which addressed a critical business process. These phases were:

• STS--Shipment Tracking System, which provides shipping customers and consumers with online access to order status. Rolled out in 1999.
• COMIS--an online ordering and inventory management system that enables customers and agents to create orders online. Deployed in 2000.
• TBE--Tonnage Broadcast Exchange, a virtual marketplace for agents to bid on shipping jobs. Went live in 2001.

The first two phases were built with Java Servlets using IBM WebSphere Application Server and IBM WebSphere Studio Application Developer (then called VisualAge for Java). The third phase--the focus of this study--is built on pure J2EE and Web Services.

Selecting the Platform

In 1999, Bekins made a key architectural and vendor decision--to use Java for its e-business platform and to use ...