Roadway

Web Technologies Help Trucker Roll (Internet Week) [08.22.2001]

Roadway blends next-gen site, legacy database
By TIM WILSON
Internet Week

As it seeks to boost profits and increase market share in an increasingly volatile transportation market, trucking giant Roadway Express Inc. is relying heavily on two key weapons: the most current Web technologies available and one of the oldest databases ever created.

Roadway has spent the past two years building a sophisticated, homegrown B2B Web site that lets its customers request pickups, track shipments and collect proof-of-delivery information using a personalized browser interface. The company is a $3 billion leader in the less-than-truckload (LTL) freight carrier market, where it takes small shipments from many customers and then consolidates them onto one truck to create lower-cost shipments.

"The ability to recognize the customers immediately [as they enter the site] and react with the specific data they need gives us an edge," said Roadway vice president and CIO Robert Obee.

Many companies have achieved that goal by ripping out their legacy back-end systems and starting over with next-generation hardware and applications designed for the Web. But Roadway is doing just the opposite: It's building its next-generation Web customer service system on a database first developed in the late 1960s. The data for the system is being drawn from an IBM mainframe application called Model 204, a transaction-oriented system based on technology created by Computer Corp. of America (CCA) in 1965 and still employed by a small but loyal group of database users in corporations worldwide.

Roadway, itself a 75-year-old company, has been using Model 204 since 1988, and its IT organization still believes that the CCA database provides a competitive advantage over its chief rivals, which are also moving swiftly toward the Web.

"We're tracking 300,000 active shipments a day, and with Model 204, we can do 1,800 transactions per second," Obee said. "If there is another database out there that can perform that fast, we haven't seen it."

Unlike other mainframe apps, Model 204 is tied directly to the mainframe hardware and performs only transaction processing. The app's configuration lets it operate much faster than most newer mainframe apps, which share space on the processor with an operating system and other apps.

The drawback is that Model 204 is the only app that can run on that particular mainframe. So the trade-off is that Roadway must use other hardware for nondatabase apps, such as Web services, which reside on Unix systems.

Experts said Roadway's unique combination of new Web technology and a high-speed legacy database may indeed give the company an edge in delivering detailed shipment data and transaction information over the Internet.

"The Roadway site is one of the most amazing, in-depth tools I have seen, even among the top [trucking] players," said Ken Stadden, president of Stadden Web Technologies, which develops Internet sites for trucking companies, though he had no involvement with Roadway's deployment. "I've never seen a [trucking] site with this level of detail."

The fast performance of the Roadway database, coupled with a broad range of tracking and documentation information, sets the Roadway site apart from other trucking sites, Stadden said.

Roadway's Web efforts have also helped the company keep its head above water and even pick up some market share in an industry that's been decimated by skyrocketing fuel costs and a slow economy. Although the company's revenue has declined 0.8 percent, its net profit margins and its earnings per share have nearly doubled since the company unveiled its personalized Web site, my.roadway.com, two years ago.

"There's no doubt that Internet technology has helped Roadway offset some of its costs during some tough times," said Standard & Poors analyst Richard Stice, who covers the trucking industry. "It may also have helped them pick up some market share as some of the smaller [trucking] players have gone out of business."

Competitive Advantage
In the late 1990s, most of Roadway's competitors had Web sites, but they tended to be static "brochureware," Obee said. Roadway had a different idea: to provide Web transaction services that leveraged the fast performance of the company's unusual database technology.

"The big difference with the Model 204 database is that whether you're scanning information or updating it, everything is happening in real time," said Dave Pavlich, Roadway director of E-commerce. "When there's a change in [shipment] status, you see it right away, and that's important in our business."

Implementing one of the latest mainframe databases, such as IBM's DB2, would have cost Roadway nearly as much as it's spent on its entire Web project, but without improving performance, Roadway executives said. By leveraging the legacy Model 204, the company saved money and avoided cuts in database performance.

Roadway customers can use the real-time data to build schedules for loading-dock workers, enabling them to prioritize tasks and spend less time overworked or idle, Obee said. This concept is at the core of the LTL business.

"Essentially, we're exposing the same data to the customer that we use for our own internal operations," Pavlich said.

But to provide that interface, Roadway had to develop a way to link its 11-year-old Model 204 database with cutting-edge Sun Unix workstations. After evaluating the available off-the-shelf technology--there isn't much for Model 204--Roadway decided to do its own integration between the legacy systems and the Web.

"We custom-write all of our own software [for my.roadway.com] using a common interface that runs across all of our applications," Pavlich said. "We do some screen-scraping from Model 204, but there's no middleware on our mainframe."

This strategy has saved Roadway a significant amount of money on its Internet initiative, since much of the new environment is based on existing hardware and applications. The my.roadway.com site cost less than $1 million to build, Obee said.

Customer Impact
Despite its relatively low cost, my.roadway.com has made a significant impact on Roadway's customers, executives said. The tracking and tracing capability lets shippers see the status of any given shipment in real time, and an online pickup request feature helps Roadway schedule pickups more quickly and efficiently, Obee said.

But for many Roadway customers, kudos for the online service are coming not only from shipping or receiving, but from the accounting department as well. The Web has enabled Roadway to provide online bills of lading--the paper documents that accompany each shipment--and proof-of-delivery documentation directly to the receiving company's accounts payable department. Since most accounting departments require proof of delivery before they pay an invoice, Roadway shippers now can expedite those payments by delivering the data online.

"Our customers are telling us that they're now capturing information they need to have in order to get paid," Obee said.

Similarly, Roadway has linked my.roadway.com to an internally built imaging system that scans bills of lading to let shippers and receivers share those documents electronically. Previously, bills of lading were exchanged via mail or fax, sometimes slowing payment or the resolution of disagreements between shippers and receivers, Obee said.

The Model 204 database also gives Roadway more interactive capabilities than are available on standard HTML sites, according to Roadway executives. For example, the system offers up-to-the-minute projections of shipment arrival times based on route history and trucker reports. If a delay occurs, the system recalculates the variables and gives the shipper a new projection on arrival time.

Initially, Roadway expected the site's sophisticated Web features to bring in smaller, more profitable customers that otherwise couldn't afford online transaction and document exchange capabilities previously provided only through expensive EDI systems. But small customers aren't the only ones using my.roadway.com, Obee said.

"The larger customers are using it for tracking, even though they may use EDI for their document transmission," Obee said. "All our customers are using it. We haven't seen any dramatic shift in our customer base since my.roadway.com went up."

Work In Progress
Although Roadway has reaped some benefits from its Internet initiatives, a lot of work still needs to be done, executives said. One of the chief areas of attention is security.

"We actually delayed the rollout of my.roadway.com because our customers raised so many concerns about security," Pavlich said. "We wanted to make sure that we had a structure that worked for them."

Currently, each Roadway customer can designate a "power user" responsible for determining which employees should have access to my.roadway.com and what information they can view. These access privileges are administered by the user and monitored by a central security group at Roadway. The system was also developed internally using Remote Access Control Facility (RACF), the access control technology built into IBM's mainframes. Over time, Roadway hopes to offer more sophisticated security administration capabilities and simpler controls for smaller customers, Pavlich said. Roadway wants to be able to restrict access to data on a more granular level.

Roadway also is looking into the possibility of tying its suppliers into its Web environment. One of the company's biggest suppliers is the International Brotherhood of Teamsters, which already uses the Roadway intranet for information and employee development services.

So far, Roadway hasn't tied its Web systems to any of the emerging transportation e-marketplaces. But the company is an equity investor in Integres Global Logistics Inc., a 3-month-old transportation exchange led by United Airlines and American Airlines.

"We think Integres will be a good chance for us to be tied into the expedited air freight business, and it could be a good source of new customers," Obee said. "But obviously, it's too early to tell what its impact will be."

Meantime, Roadway is reprioritizing its IT projects to reflect a much more difficult economic environment for trucking companies.

"We have to focus on projects that have a clear return on investment and defer those where the benefits are softer," Obee said. One area where the benefits are clear, Obee said, are Roadway's reporting tools, which are used widely. By adding more tools, my.roadway.com has drawn more repeat customers.