VOL. 6 | NO. 50 | Saturday, December 07, 2013
SMALL BUSINESS SPOTLIGHT
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EMPHASIS: Distribution & Logistics
CTSI Stays Competitive by Adapting to Client Needs
By RICHARD J. ALLEY
It might take a freight train to hold all of the services offered by CTSI-Global, the Memphis-based global supplier of supply chain management expertise and technology to the logistics industry.
With innovative technology and offices located worldwide, CTSI works with shippers and third-party logistics providers (3PLs) to manage their business through a database 150 terabytes strong.
Those services include freight audit and payment, rate negotiations, logistics management, claims management, benchmarking and consulting.
Phillip Mashburn is senior vice president of information technology operations for CTSI-Global, a Memphis-based global supplier of supply chain management.
(Memphis News/Andrew J. Breig)
As an example, Technicolor has a facility in Southaven that distributes 10 million DVDs a year for clients such as Paramount, Disney and Universal, which are also clients of CTSI.
“So every time they have a new DVD rollout, on a Tuesday, we help facilitate the shipments through our TMS software; we track every shipment and then we process it, pay it and put it into a massive data warehouse for them,” said Ken Hazen, president and CEO of CTSI.
That data warehouse is backed up in a real-time offsite disaster recovery location in Atlanta, the same used by other giants such as Google, offering a greater level of protection for clients.
The key to success has been in staying ahead of the game. For CTSI, Hazen says, this means “being 18 months ahead of our clients and the industry on new software, new development, new technology. … It’s whoever can be the most innovative.”
Much of this innovation for CTSI began with the Y2K panic of the late 20th century, prompting a new system and the company reinventing itself. This involved Web-based TMS software that offered clients one of 10 modules for improving their operations, whether load consolidation, shipment execution or tracking of shipments, along with the core business of auditing and paying freight bills.
“So we’re continually developing new products as well as refining a lot of our old products internally,” Hazen said. “We’re still having fun.”
In India during that time, the infrastructure wasn’t in place – the T-1 pipelines weren’t efficient enough – to handle the imaging technology CTSI would develop. As they came online, CTSI opened an office there in 2006.
“They’re working in India while we’re sleeping, so we’re still doing a ton of business in Memphis every day, but we’re also sending a thousand batches of records to our Chennai office every night to be processed and they’re waiting in the queue every morning,” Hazen said. “So we’re feeding it to them and they’re feeding it back to us.”
CTSI was founded in 1955 as Continental Traffic Service and was purchased in 1982 by Hazen, then 28 years old. Back then it was a regional concern, the 40,000 annual freight bills handled out of 220 square feet in the Falls Building Downtown.
Hazen said he threw a pizza party every Thursday night when they would manually file some of the 800,000 carrier tariff pages. The cutting-edge technology consisted of an electric IBM Selectric typewriter.
These days, the worldwide company – offices can be found in Singapore, Atlanta, Austin, Toronto and Limerick, Ireland, as well as India – is run from 30,000 square feet in the Clark Tower in East Memphis, writing upward of 200,000 checks and processing about 40,000 wire and ACH payments for clients each year for a total of $5 billion processed.
“We’re still a number-crunching facility as well as a custom software house,” Hazen said.
The company today employs nearly 250, with 140 in Memphis. As clients’ needs and demands have changed, so has the industry and Hazen’s business. They require real-time, up-to-the-minute information on location, received data and any potential problems from carriers.
“They’re wanting it done faster and cheaper and it’s up to us to provide the technology to keep our costs down to be able to pass it along to our clients,” Hazen said.
As ever, the name of the game in logistics is efficiency. Hazen and CTSI have stayed competitive and an industry leader by being ahead of the curve when it comes to the technology and trends that will allow them to be on top of their clients’ needs. Future growth will be a partnership between leaps in technology and an expansion of the client base worldwide.
“We feel like the world is our oyster as far as the ability to expand in different parts of the world depending on our ability to open up the right office in the most strategic locations,” Hazen said.