Arshiya speeds cargo distribution by 91 percent with IBM solution

The world-class supply chain infrastructure leverages IBM communications and data center services

Published on 03-Dec-2012

"We were building a world-class infrastructure; therefore we needed [an IT] partner who understood our business and had expertise in those areas. …IBM had a clear roadmap. The IBM solution was the most valuable and very flexible." - Jagmohan Bhatt, senior vice president of information technology, Arshiya International Ltd.


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An international supply chain management and logistics organization with headquarters in India achieves a 91 percent improvement in its distribution time with a scalable, modular data center and networked fiber and wireless technology provided by IBM Global Technology Services

Business need:
Arshiya International sought a rapidly deployed, standardized IT infrastructure to support the end-to-end enterprise communications and data center needs of its free trade warehousing zone locations.

IBM® Global Technology Services® designed and implemented a repeatable converged communications infrastructure with a scalable modular data center to adapt to the client’s vast FTWZ expansion plans.

● Reduces freight transfers by 91 percent through the implementation and utilization of wireless and barcode technology ● Increased customer productivity up to 25 percent by using on-site supply chain and logistics tracking capabilities ● Provides the expertise to design, implement and operate communication operations for greater client productivity

Case Study

In 2005, the Parliament of India launched a strategic initiative to establish free trade warehousing zones (FTWZs) to eliminate trade barriers within the country. Modeled after supply chain management systems in Dubai and Singapore, the network of product transportation and storage was designed to speed product delivery and significantly reduce cross-country shipping and warehouse storage costs. To help efficiently and effectively design warehouses and distribution hubs as well as transportation methods, the government sought world-class supply chain management providers. Arshiya International Ltd., headquartered in India, was selected as one of the pioneers of the new logistics infrastructure. Arshiya possesses seven strategically integrated international logistics vertical services that provide operational expertise and solution capabilities across the entire spectrum of a supply chain. As a result, Arshiya was awarded the status of “Star Export House” in accordance with the provisions of the Foreign Trade Policy.

Transforming supply chain expertise to a world-class infrastructure

Although the FTWZ was a new and promising concept for the Government of India, the intricacies of designing and bringing a fully functioning supply chain support system to fruition are quite challenging. Arshiya aspired to be India’s first FTWZ. Though the experts at Arshiya were thoroughly versed in the requirements for a highly efficient supply chain infrastructure, the company recognized it needed a vendor with high-level expertise in IT communications and data center infrastructure. Arshiya sought a global IT systems integrator that could design its network; build and manage its network backbone for voice, data and video capabilities at its initial site in Panvel, India; as well as integrate communications between future FTWZ sites planned for points throughout the country. Jagmohan Bhatt, senior vice president of information technology, Arshiya International Ltd. explains, “We were building a world-class infrastructure; therefore we needed [an IT] partner who understood our business and had expertise in those areas.”

Implementing a roadmap to maximize communication possibilities

After considering proposals from several systems integrators, Arshiya selected IBM® Global Technology Services®—Integrated Technology Services. “IBM had a clear roadmap. The IBM solution was the most valuable and very flexible,” recalls Mr. Bhatt. The IBM Integrated Communications Services team worked closely with the Arshiya IT team to define the requirements of supply chain management and logistics organization and then created a plan to address its short-term and longer-term needs. The scope of the Panvel project included Cisco Systems hardware; installation of a fiber network for warehouse, utility building and server room communications; network infrastructure design for data, voice and video; IP telephony infrastructure; a wireless infrastructure for its warehouses; an intrusion prevention system; Internet and intranet capabilities; and break-fix support. In addition, the IBM IT Facilities Assessment, Design, and Construction Services team implemented a scalable modular data center within the client’s warehouse environment. The flexible data center configuration helps Arshiya easily adapt to changing business and IT needs.

Speeding communications fast-tracks product distribution

The extensive communications network capabilities of the warehouse improved the productivity of Arshiya and its’ customers. The new warehouse barcode system reports and tracks shipments from its initial FTWZ entry point to its final destination. To help expedite communications, Arshiya staged on-site work areas that provide customers with self-service opportunities to monitor their own supply chain status and receive continuous updates. These capabilities minimize the intervention of Arshiya customer service representatives. In addition, if at any point customer distribution orders change, redistribution requests can be electronically sent to the Arshiya warehouse systems. The communications solution identifies the specific location of the cargo and redirects it as requested. In comparison, paper-based shipping orders caused Arshiya staff to produce a physical paper, manually find the customer’s stock and pull out the containers one by one to implement the customer change. The tedious change order creation and reconciliation took 20 to 25 percent of the customer’s logistics workforce and reduced Arshiya productivity by 15 to 20 percent. The midstream changes also increased the propensity for error. The wrong product batch, staged with a product mix of a different value, could result in customs penalties. The new, highly flexible communications solution significantly improved the distribution timeframe. “If we did not have the [IBM] systems infrastructure supporting us, it would take at least 24 hours, which means the customer would pay more for storage and face customs implications,” states Mr. Bhatt. For example: One of the client service level agreements is set at two hours, a 91 percent reduction in distribution redeployment time.

Going above and beyond to maintain client capabilities

IBM was just one of many vendors participating in the Arshiya FTWZ campus-wide construction project. “There were multiple instances where IBM went out of its way to work around the activities of other vendors,” states Mr. Bhatt. However, he was exceptionally impressed with one particular experience. After the communications backbone of the data center and warehouse were in place, another construction vendor accidently cut some critical cable, disabling the company’s key software capabilities. The IBM team reconstructed the network in time for the arrival of a critical business prospect. This example forged the relationship with Arshiya and IBM. “The support we got from IBM was wonderful. [IBM] truly worked as a partner, understood the critical business need and facilitated the success,” concludes Mr. Bhatt.

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