1. “What Got You Here……” Greg Smith, Industry Director, Freight and Logistics, Oracle Corporation

2. 2 Logistics Service Providers – Key Industry Processes

3. 3 Logistics In the Coming Decade… “ The next ten years will be all about mobile communication’s and real time data.” Noel Perry Managing Director, FTR Associates ITLC 2010 Conference

4. LSPs Are Becoming Supply Chain Orchestrators Timeline Core Competence Business Strategy Strategy Planning Coordination Execution Freight Transport Ware- housing Contract Logistics Lead Logistics/ 4PL (Decision Making) Lead Logistics/ 4PL (Decision Making) Customer Customer Customer Freight Trans- port Ware- housing Value Added Svcs Freight Trans- port 3PL Ware- housing 3PL Value Added Svcs 3PL Customer SupplyChainCoordination(Strategy)SupplyChainCoordination(Strategy) Transport- ation VASVAS WarehousingWarehousing EngineeringEngineering SourcingSourcing Mfgr / Assy PlanningPlanning Supply Chain Manager Traditional3PL Lead Logistics/4PL Supply Chain Services  Shippers want LSPs to support more and more supply chain functions  LSPs are driving growth and profitability through service expansion

5. Growth Through Service Expansion Is Forcing Structural Changes In The LSP Industry….. GEOGRAPHY: Local, Regional to National and Global MODES: Single Mode to Multiple Modes of Transportation SERVICES: Single Service to Multiple Services to Bundled Services CUSTOMER MIX: Fewer customers with larger spend/customer EMPLOYEE MIX: More positions, More specialized IT LANDSCAPE: Single Operational Platform to Multiple Platforms

6. 6 Almost 30 years ago…. “Information about the package is as important as the package itself…” Frederick W. Smith, Chairman and CEO

7. SPEAKER PPT TEMPLATE_M.PPT 7 Index of Logistics Costs as a Percent of GDP 1986 - 2007 9

8. Domestic Vendor Factory Off Shore Vendor Cross Dock Supplier Supplier Supplier Supplier SupplierSupplier Scheduled Collection Runs CONFIDENTIAL: All capabilities and dates are for planning purposes only and may not be used in any contract 8 Logistics Business Required Capabilities Transportation From Shipper To Consignee

9. 9 Management Excellence: The Next Competitive Edge Time Competitive Advantage OPERATIONAL OPERATIONAL EXCELLENCE EXCELLENCE MANAGEMENT EXCELLENCE Cost – Lean and Mean Quality – Six Sigma, TQM Speed – Real-time, JIT Cost – Lean and Mean Quality – Six Sigma, TQM Speed – Real-time, JIT Smart – Deep Insight Agile – Decisive Aligned – Across the enterprise Smart – Deep Insight Agile – Decisive Aligned – Across the enterprise

10. 10 Leaders will make information technology a strategic differentiator by using a platform strategy… LSP Leaders Will … Automate to scale the business and improve profitability Leverage technology to speed time to market Customize solutions without customizing processes and IT Collaborate… with customers, partners, employees Measure to drive improvement Have one version of the truth

11. Service 1 Service 2 Service 3Client 1Client 2Client 3 What LSPs Want: An Open Flexible Platform to Support Logistics Planning & Execution… Rationalize and modernize applications, data repositories, and infrastructure Link systems using SOA to create a business process platform that drives key processes such as quote-to-cash, procure-to-pay Streamline collaboration with customers, partners, suppliers, regulatory authorities through collaboration hubs Platform characteristics Supports best-of-breed solutions Can be configured Leverages legacy applications Supports industry standards Expandable, scalable Enterprise Logistics Planning & Execution Legacy Applications, Data Hubs, Infrastructure Transportation Mgt, Warehouse Mgt, Global Trade Enterprise SOA, Workflow Mgt, Event Mgt A Scalable, Sustainable, Differentiating Platform … the Technology Exists Today!

12. 12 An Example…….. Today, transportation is being shared as companies work together to load trucks and minimize costs. Candy makers in the mid-west have now banded together to not only share transportation but also share warehousing and warehouse labor expenses. Shipment patterns, delivery volumes, routing schedules are all coordinated to minimize costs of distribution to final retail site. Result is over 500,000 miles saved by just one candy maker in one region for one product in one year. Business can expect more and more of this kind of thinking. These kinds of savings are too large to be ignored.

13. 13 Transportation in a Capacity Short Environment… As load requests and shipment requests are coming in, they will be checked against “Network Value” before a load is accepted Pricing Commodity Empty Miles Available assets Profitability Route Optimization and Fleet Optimization for Profit Tools to do this, exist today Shipment patterns, delivery volumes, routing schedules are all coordinated to minimize costs of distribution to final retail site. Business can expect more and more of this kind of thinking. These kinds of savings are too large to be ignored.

14. 14 Fuel Savings and the Primary Cause From 2007 to today, America is using roughly 25% less diesel fuel, while hauling more freight What factors are going into this dramatic change ? More use of intermodal Tractor and trailer streamlining Wide tires and tire pressure sensors Speed governors Others? While all of the above factors have something to do with the fuel savings, industry experts believe most of the savings are coming from optimization Fleet optimization Route optimization Shipment optimization Business can expect more and more of this kind of thinking. These kinds of savings are too large to be ignored.

15. Summary Revenues The leading LSPs in the industry understand that IT is strategic and make Technology a central pillar in their corporate strategy.The leading LSPs in the industry understand that IT is strategic and make Technology a central pillar in their corporate strategy. Adopting a platform strategy will lower TCO, increase agility and adaptability by supporting multiple clients and multiple services on a single platform.Adopting a platform strategy will lower TCO, increase agility and adaptability by supporting multiple clients and multiple services on a single platform. LSPs who integrate their processes across the enterprise can expect to see 3-5% revenue improvement, 5-7% reductions in cost and a 30% reduction in DSOLSPs who integrate their processes across the enterprise can expect to see 3-5% revenue improvement, 5-7% reductions in cost and a 30% reduction in DSO Costs

16. 16