Business Modeling

Business modeling is where you define data in OTM to model the business process of orders and shipments in your company. This includes locations, items, equipment, rates, itineraries, etc. This includes the following:

Locations

Locations represent physical places to which an order can be delivered or from which an order can be picked up. They include airports, ports, rail ramps/yards, container pool locations, distributors, assembly points, plants, vendors, and more. A customer or a buyer can also be a location.

OTM does not include out-of-the-box postal codes or locations. The easiest way to create locations and add postal codes, since you will typically have a lot, is via integration. See the Data Management Guide n the Oracle Help Center for additional details.

When creating a location, you should enter as much information as possible. This enables OTM to better plan your orders into shipments.

Calendars

Use calendars to define when a location is available for shipping activities, and which shipping activities occur. To help with shipment planning, associate calendars with locations, itineraries, accessorials, special services, and communication methods.

Contact

A contact is a person or system to which you want to send notifications or tenders. Use the Contact Manager to create a new contact and record its details, such as contact method, language, and time zone. Use the Notification tab to define the communication methods used to notify the contact and the events in which the contact will receive messages.

Freight Packaging

Items and/or ship units: Some combination of ship units, items, and/or packaged items are required for creating order bases and order releases. Ship Unit Specifications describe how freight is packaged for transportation. There are several important terms used throughout Oracle Transportation Management referring to items, how they are packaged, and how they are transported. These terms are hierarchical and include:

Packaged Item
Packaging Unit as specified on the packaged item
Transport Handling Unit as specified on the ship unit specification
Equipment Group

Equipment and Equipment Groups

There are various levels of equipment within OTM. Let’s review these levels starting at the most granular level (at the bottom of the slide):

Equipment represents any mode or method of storage or transport used for the movement of a shipment from one location to another. Accurate equipment information is critical to the shipment planning process, and equipment IDs are used to create equipment types that are used in capacity management.
Equipment Type defines the characteristics of an equipment group.
Equipment Group: Equipment Groups identify the different kinds of equipment (such as dry vans, flatbed trucks, container cars, hoppers, tankers, box cars, and so on) that are used to transport shipments from one destination to another.

You can have an equipment group of 40 foot containers. In that group, you have two equipment types: 40 foot with a rollup door or 40 foot with a swing door. You can then have multiple instances of 40 foot equipment with a rollup door, each with a specific equipment initial and number such as XYZU 987654.

Carriers or Service Providers

Service providers or carriers are companies that move freight from the source to the destination. To build a shipment from an order, you need to have service providers defined in OTM.

If you use settlement, you need to specify Match Rules and Invoice Approve Rules on your service providers.

Itineraries

A part of shipment planning, itineraries determine what route a shipment takes by specifying the requirements for destinations on shipping legs. For example, itineraries can define the sequencing priority, rates, mode of transportation, arrive time ranges, equipment, service provider, and commodity requirements for a destination location.

Single Leg

A single leg itinerary is a direct move between a source location and a destination location. The lane on the itinerary can be general or specific.

Multi-stop

A pool-crossdock itinerary represents one move with multiple stops. Each move must use the same rate. Both a single leg itinerary and a pool-crossdock itinerary can have the same lane. The difference is that the pool-crossdock itinerary allows stops for pick up or delivery of goods to occur in the lane. Multi-stop shipments take advantage of lower costs by creating efficient routes that save money.

Multi-leg

A pool-crossdock itinerary represents multiple moves that are related but differ. For example, each move may have a different transport mode, equipment, rate, or service provider.

A company has cargo moving from Frankfurt, Germany into Chicago, Illinois. The itinerary has three legs:

Truckload from Frankfurt to the Port of Bremerhaven (leg 1)
Vessel from the Port of Bremerhaven to the Port of New York (leg 2)
Truckload from the Port of New York to Chicago (leg 3)

To create an itinerary, follow these steps:

Step 1: Parameters define basic attributes for itineraries such as an ID and name, buy or sell perspective, and basic geographic elements.
Step 2: Lane Definitions define the details for the geography that the itinerary services.
Step 3: Leg Details define attributes associated with a particular destination.

Regions

A region is a user-defined geographic area. You can use regions for any of the following: itineraries, rate offerings, rate records, deconsolidation pools, dispatch- level tendering, and rate inquiry.

Rates

A rate is considered a contract between the user and a service provider or a user and their clients. You can create rates inbound and outbound goods for all transportation modes, including truckload and less-than-truckload, vessels, rail and air. OTM uses rates to determine shipment costs. You may choose to enter rates automatically via integration (See the Data Management Guide on the Oracle Help Center for more detail.).

Contract management contains four key components related to rating:

Rate distance (OTM ships with several default rate distances) determines the distance from one location to another. Distance is the amount of separation between the two points in a lane (you will need to create lanes). Distance, along with other information, helps determine the cost and time for travelling from one location to another.
Rate service determines the time required to transport goods from one location to another. The rate service determines how to calculate the time in transit based on the rate service type and taking into account other factors that may come into play (such as rest periods).
Rate offering is a general contract with a service provider. It may include multiple charges that provide for a variety of possible requirements. A single service provider may have several different rate offerings.
- Rate versions control the validity of a rate offering by defining the time period during which a rate applies. Typically, a rate is valid for a few months to a year, and then a new version takes effect.
Rate record contains specific costing data from one location to another. One or more rate records can be associated with a single rate offering. While the offering provides general contractual details, the record defines a cost for service between one location and another. A record relies on an associated rate offering for much of its information but can override some of the data in the offering, if necessary.

Accessorial Code and Cost

Accessorial cost is an extra cost charged by carriers for additional services such as waiting time, extra fuel, or storage, etc. Accessorial cost is not applied to a shipment unless you specify that accessorial in the rate offering or rate record. Create an Accessorial Cost.

Create an Accessorial Code. Accessorial code defines types of accessorial that may apply to a shipment.

See Configuring a Fuel Surcharge for details on configuring a specific accessorial.

Rate Preference

Rate Preferences allow you to configure which rates should be used for a specific lane or rate zone. See Configuring and Using Rate Preferences for details.

Rate Quality

You can define rate quality factors in Oracle Transportation Management to help weigh rate offerings. For instance, you may want to ensure that the rates from a certain service provider do not qualify for a shipment. To do so, you may increase the rate by a certain percentage or flat fee so that the rate does not meet cost requirements. Rate quality factors do not affect the actual cost to ship and are only used in qualifying a shipment.