By Candee Wilde

In August, Roadway launched a secure, private extranet that lets users customize information by selecting which functions they would like to see when they log on to the site. The system requires a password and an ID for access, and customers areable to view only their own shipments.

Included are rating programs that give customers the exact price of a planned shipment, says Bob Obee, Roadway's chief technology officer. Most sites today give an estimated or standard price, but not an accurate customized quote. Roadway hopes to expand its Web presence in the business-to-business category by adding its icon to sites that sell products delivered in packages larger than those that United Parcel Service of America Inc. or FedEx carry, but smaller than a full truckload. "People are working on developing commercial analogies to eBay that sell machinery and electronics rather than small, individual items," Obee says. Like FedEx, Roadway will bundle the functionality of its extranet into APIs and offer them to Web developers worldwide.

More Choices
FedEx and UAL Corp. subsidiary United Airlines are working with manufacturers of palm-computing devices to make their Web sites accessible to customers using satellite-enabled, handheld computers. United, in Elk Grove, Ill., is also experimenting with speech-recognition technology in a variety of applications, including a system that will let customers access baggage information. "Our intention is to make the same data available through any media interface our customers want to use," says Bruce Parker, CIO and senior VP of information services for United.

Alaska Airlines, a subsidiary of Alaska Air Group Inc. in Seattle, is developing a Web-site application that will let people pull up their reservations on the Internet, answer security questions, and check themselves in-all before they leave for the airport. The airline's Web site already accounts for 8% of sales, and Robert Reeder, VP of information and communication services, says that figure will continue to grow dramatically. Like other transportation companies, Alaska Air is preparing to release a personalized site that will let people "tailor the site to meet their needs. We want people to buy travel using money or miles and make it much easier to redeem mileage awards out of the customer system," says Reeder.

Another critical focus of IT development among transportation companies is their asset-management systems-the technology that schedules and routes pilots, planes, and passengers, or drivers, trucks, and boxes. This year, FedEx developed what it calls its "electronic merge capability." By taking information about shipments from different locations and calculating arrival times, "we can create a bundle of shipments that come together at the right place for the customer, at the right time," Carter says.

Although it may sound simple, constructing a database that can identify related shipments and ensure that they move in concert is complex. For example, when couriers scan a shipment's bar code, their handheld computers will identify the box or package as the second in a bundle of three. By accessing up-to-the-minute information about each piece of the shipment, couriers then can determine how to route the package so all three arrive at the final destination simultaneously.

Because of FedEx's rate structure, determining the precise size of a package can add dollars directly to the bottom line. Rates are based on the zones a package is sent to and from, the type of service chosen, and the weight. The exception is with very large, light packages, for which the delivery rate is based on "volumetric weight" rather than actual weight. To determine the precise volume of packages, FedEx created a Mass Scanning and Dimensioning System, which uses radar technology to measure packages as they move along a conveyer belt at 300 feet per minute. Without this capability, FedEx could undercharge for lightweight, oversized packages.

American Airlines Inc., a subsidiary of AMR Corp. in Dallas, this year created a revenue-management system that helps it determine which of the myriad fares available between two cities to offer a customer. The system attempts to forecast customer behavior, says Scott Nason, American's CIO and VP of IT services.

The airline uses complex algorithms that combine statistical analyses with a forecasting system to determine the best rate to charge for each seat. Ideally, it maximizes revenue and loads on flights between each of its 40,000 city pairs. The system evaluates American's flight schedule for the next 11 months and continues to process possibilities almost until a plane finishes boarding. This system, running on a Sun E10000, supports American employees who monitor each market to add human judgment to the mechanized calculations. In the past, revenue management was based on evaluating the airline's 2,200 daily flights.

United has developed a flight-planning application built on a parallel processing system that combines HP-UX high-availability servers with a Unisys 2200 mainframe. The system, which analyzes variables such as latitude, longitude, altitude, aircraft speed, and weather data, has saved United millions of dollars by cutting flying time, saving fuel, and improving on-time performance. The system also optimizes scheduling for crews, considering preferences and work-life issues as well as business costs and profitability, Parker says.

"The fun in the transportation industry is that there's an insatiable demand for innovation in technology," Parker says. "From the front line of customer service to back-end systems that account for revenue, the key challenge for IT is to deliver innovation."

return to page 1