Press Releases
08/08/2003
Horizon Shipping Sailing Smoothly After Swapping Mainframes For SQL Server
By: Antone Gonsalves
In early 2000 when many companies were still expanding their IT systems, Horizon Lines was looking to shed computers.
Parent CSX Corp. had sold the international operation of cargo shipper Sea-Land to Maersk Line for $800 million. Sea-Land's domestic operation was renamed CSX Lines LLC, which became Horizon three years later.
While Maersk took Sea-Land's global routes, it decided to phase out the company's IT system, leaving CIO Rick Kessler with the task of reducing its size to fit the computing needs of a slimmer CSX Lines.
Over the next 36 months, Kessler managed to swap most of the IBM mainframes on DB2 databases with Microsoft SQL Server on Windows 2000. Software that was written in older languages like Cobol and Adabas were eventually rewritten in Microsoft's new .Net framework.
In addition, Sea-Land's order entry and cargo tracking system were also rewritten in .Net and moved from Windows NT to Windows Server 2000. The old client/server system was built with Sybase's PowerBuilder, a popular application development system in the 90s.
In making all these changes, Kessler's IT organization managed to extend the order entry and tracking system to the web. Today, more than 70 percent of Horizon's shipments are booked online, the most in the industry.
With this added efficiency came reduced costs. Kessler's IT budget was $62 million in 1999. This year, Horizon plans to spend $13.5 million. At the end of 2002, Horizon's order-entry system was handling 40 percent more volume than in 2000, while the company had 20 percent fewer IT workers.
Decommissioning a lot of the Sea-Land systems was a major reason for the reduction in costs. "We're obviously starting to right-size the organization for Horizon Lines, and we also have technologies that require fewer staff," Kessler said. Where the company needed PowerBuilder, mainframe and Windows experts, it now has no PowerBuilder developers and fewer mainframe engineers.
Today, most of Horizon's orders arrive via the web. A customer goes to its own personal portal and fills out the forms required in ordering a container. Because 80 percent of Horizon's business is from customers who ship cargo regularly, a lot of the paperwork is already done for them. Most of what changes involve the volume of products shipped and the day and time of receiving the cargo container and shipping it back by either truck or train to a Horizon terminal.
Once the cargo leaves the customer, Horizon makes sure it can be tracked right to the time of delivery. "All the questions that they usually ask about shipments, we try to put on the web so customers can get their own answers," Kessler said.
In early 2000, CSX Lines had customer service reps handle all orders and tracking questions by telephone and faxes. By early 2001, the company had launched its first customer service web site. In the first quarter of this year, Horizon finished converting most of its IT systems to Windows, SQL Server and .Net. The only IBM mainframes left are those holding information related to ships and equipment, such as maintenance schedules and parts inventory. Horizon plans to replace those computers with SQL Server by mid-2005.
The extent to which Sea-Land was already invested in Windows was a key reason for CSX and later Horizon to stick with Microsoft products, Kessler said. The reason to move to .Net was to prepare Horizon for when customers are ready for system-to-system integration.
.Net enables Horizon to use XML, or extensible markup language, to move customer data from the web to SQL Server in the backend and Oracle financial applications. XML is a key technology in moving data between business applications over the Internet.
Horizon eventually wants to offer customers the option of placing an order or tracking a shipment right from their own IT systems, rather than having to go to a web site. The company, however, believes it will take awhile for customers to catch up with Horizon's capabilities.
"In the ocean world, the way data flows and moves is pretty antiquated, compared to other businesses," Kessler said. "Getting people from the phones and faxes to the Internet was a big step, so I think we're a couple of years away from integrating with shippers' systems. But when it happens, we're ready to be a leader, and not a follower."
