WO2001046884A2

WO2001046884A2 - System for interdependent integration and aggregation

Info

Publication number: WO2001046884A2
Application number: PCT/US2000/033319
Authority: WO
Inventors: Peter Biffar
Original assignee: Ecargoservice, Inc.
Priority date: 1999-12-21
Filing date: 2000-12-07
Publication date: 2001-06-28
Also published as: WO2001046884A8; AU1955101A

Abstract

A business system for conducting integration and aggregation interdependently is disclosed. The system combines integration and aggregation for the benefit of various providers that could not otherwise take advantage of such business models. The system combines small, nonintegrated providers via a common platform to achieve a level of integration and aggregation to allow such providers to operate more competitively and efficiently. The system can operate in either a vertical or horizontal mode. The system can also be operated in a neutral manner or in a manner where an operator takes a position. The system provides for collaboration and negotiation among providers and access by third parties to integrated information. The system is governed by integration rules and aggregation rules which form the basis for the decision logic used to optimize a set of objectives. The system may also incorporate a bi-directional rating system for the benefit of providers and third parties. The system may also function as an exchange or spot market for providers to increase capacity utilization and allocation.

Description

SYSTEM FOR INTERDEPENDENT INTEGRATION AND AGGREGATION

FIELD OF THE INVENTION

This invention relates to the general field of business systems or forms of conducting business, and more particularly, to a business system for conducting integration and aggregation interdependently so that businesses may benefit from the advantages inherent in these two broad business models.

BACKGROUND OF THE INVENTION

In the world of business there are two broad business models pertaining to the way businesses function. These broad business models are commonly referred to as wholesale and integration, and today are typically very separate forms of business.

Wholesale is a business model, which is here defined as including classical wholesale, reselling, brokering, and aggregation. A classical wholesaler purchases products or services in larger quantities and resells them in smaller quantities. Brokers or agents link buyers and sellers, mostly without taking possession of the products or services. Aggregators bundle smaller orders into larger orders to achieve better pricing, which is often referred to as group buying. Throughout this disclosure, the terms wholesale and aggregation are used synonymously.

Each of these forms of business are centered around a particular type of product or service and are always product or service specific. There are wholesalers for most physical products, but also for services such as airplane tickets and vacation trips. There are brokers, for example, for insurance service and investments. There are aggregators for shipments, aggregating small shipments to fill, for example, a large, standard sized forty foot shipping container. Telecommunication services are services that also can be sold through any of the formats outlined above.

These wholesale concepts are also used by Internet companies. CarsDirect is a classical wholesale concept, whereas AutoWeb closely follows a broker type of business model. Aggregation or group buying is a new format for the Internet, and Mercata and Accompany are current pioneers in this area. As indicated, another common form of business model is integration Integrators typically purchase products or services from multiple businesses and integrate them into one product or service One such example are systems integrators. A general contractor when building a house is another form of integrator The Internet allows collaboration, which could be viewed as, or is part of, an integration Collaboration allows different parties to work on one and the same document or project.

Integration through information is another new Internet concept, where Healtheon is a pioneer allowing health service providers to link to and use a common platform operated by the company to exchange and manage information

Today, however, all of these business forms are specialized, / e. they are mostly operated in isolation from each other and are not interrelated. The exception are large integrated companies, which as a by-product of their size, also can achieve a high level of aggregation A good example of this type of large integrated company is FedEx. They offer worldwide, door-to-door shipping solutions. To do this they operate small offices and distribution centers at thousands of locations. Their sheer size makes them one of the biggest and most powerful buyers of equipment, packaging materials and services needed to handle such shipments For example, FedEx is the world's largest cargo airline Furtheπnore, all of their operations are linked by excellent information management systems. FedEx, therefore, can provide their customers with up-to-date tracking information, which is of ever increasing value to a customer at a time of ever tighter supply chain management.

The level of integration inherent in such large transportation companies, combined with their enormous buying power, has made it increasingly difficult for small, non-integrated transportation companies such as, for example, trucking companies, cargo airlines, or freight forwarders to compete These smaller companies do not have the level of integration to offer the customer door-to-door services, they do not have the information systems to offer integrated information, for tracking for example, and they do not have the scale to achieve a level of buying power to lower costs and offer more competitive rates as efficiently as can the larger companies

Due to these factors, the market for packages up to about 100 lbs is nearly exclusively operated by integrated players (i.e. US Postal Service, UPS, FedEx,

DHL, and a few others) Currently, however, the market for larger shipments has not yet reached that level The biggest players in this segment have a market share of only about 20% The remainder of this market is handled by thousands of small and mid-sized companies

It would be advantageous to provide a business system for conducting integration and aggregation interdependently so that businesses may benefit from the advantages inherent in these two broad business models

SUMMARY OF THE INVENTION

This invention comprises a system which links two basic forms of conducting business, namely aggregation and integration, into a new type of business The invention combines aggregation and integration interdependently The invention also links businesses to take advantage of such a combination The system allows small independent elements, such as businesses, to integrate to deliver a higher level of product or service, and to aggregate at the same time to achieve better efficiencies and buying powers. The invention, therefore, allows smaller, specialized entities to compete with larger, often more integrated companies

By way of example, the package shipping business is split into a number of tasks, which, in general terms, are-

• Local pick-up of the shipment from the shipper and transport to a transportation hub,

• Long distance transport via land (truck or rail), air or sea, and

• Local distribution from the arrival hub to the consignee

There are thousands of local trucking and distribution companies, over two hundred air cargo earners (not all serving all routes), many railroads, thousands of long distance trucking companies, many ocean lines, and possibly over 10,000 freight forwarders or agents Presently, there is no mechanism to connect these companies in such a fashion so as to allow them to take advantage of the benefits of integration or aggregation The system of the invention can be used by all types of companies to achieve a superior level of integration and aggregation not otherwise available. In the shipping example, use of this invention allows businesses:

• To collaborate and integrate on-the-fly;

• To offer door-to-door service;

• To offer integrated information, such as, for example, tracking information, shipment documentation, and payment reconciliation;

• To aggregate the demand of the participating companies along the product or service axis to increase overall buying power;

• To increase their efficiency of operations by:

• Reducing the "search or friction cost" (i.e. the cost and effort it takes to find partners, research rates, provide a quote, and negotiate the final rates);

• Reducing the sales costs, for example, fewer sales calls by airlines to forwarders;

• Reducing order entry and processing cost because there is one centrally kept master document, with error checking capabilities, avoiding redundant data management, and thereby avoiding potential errors; and

• Increasing invoicing and payment process.

• To increase overall capacity utilization and allocation of all participants involved. The system also functions as an exchange or spot market, filling or using spare capacities at marginal costs. This forces out the marginal providers and forces others to reallocate their capacities to areas where the pricing is higher, due to tighter capacities; and

To increase the service level, i.e. the system allows for a particular job to be performed closest to the optimal combination of providers. Therefore, it is an object of this invention to link the business functions of integration and aggregation into a new type of business such that these functions are interdependent

It is an additional object of this invention to link non-integrated companies via a common platform so that they can take advantage of the interdependence of these business functions

It is an additional object of this invention to provide a system to combine smaller, independent entities to integrate, to deliver a higher level of product or service, and to aggregate at the same time to achieve better efficiencies and buying powers, thereby allowing these entities to compete more effectively with larger, more integrated companies and businesses

In accordance with the above objects and those that will be mentioned and will become apparent below, the system in accordance with this invention comprises.

In a preferred embodiment, the invention comprises a system for combining two basic forms of conducting business, namely aggregation and integration, interdependently into a new type of business.

In an additional preferred embodiment, the invention comprises a system for combining small, non-integrated providers via a common platform to achieve a level of integration and aggregation to allow such providers to operate more competitively and efficiently.

In an additional preferred embodiment of the system, input comprising task information, provider information and objectives, along with a set of integration rules and aggregation rules drive the decision logic of the system The output of the system is the result of this decision logic

In an additional preferred embodiment, feedback or data reflecting certain information including past transactions and providers is collected, processed and used to determine both input and decision logic

In any or all of the above embodiments, the system is linked to an information envelope or structure that can interact with all of the above elements Within this structure, information is created, stored, edited, changed, deleted, and managed n various ways This structure includes documents, supporting documents, and any other information exchanged between providers or third parties. This includes, for example, blue-prints, plans, customs documents, air waybills, manifests describing goods transported, or other information. Such information is viewable, but not editable, by some or all users or users could be given only restricted access. Such information is also secure.

In an additional embodiment, the information management structure provides value added services, whereby the system operates using the information available and gathered and provide additional functions such as, payment systems, customs documentation, permit creation or management, such as building or environmental permits, and any other regulatory or government documentation or reporting system.

In an additional embodiment, the information envelope is accessible by third parties, such as in the transportation example, the shipper, who receives a tracking number and wishes to track his freight, or a home owner wishing to review a Gantt chart to see the progress of a contractor or construction, or a manufacturer wishing to view the progress of an assembly process.

In an additional preferred embodiment, the system of the invention is operated in one of at least two different modes:

The first possible mode is referred to as a "neutral market place" where an operator is impartial to any of the companies using the system. The operator manages, and possibly owns, the system and receives some income, either fixed fee (e.g., membership fee), transaction based (i.e., per transaction), or value based (e.g. percentage of transaction value), or a combination thereof.

A second mode is referred to as "taking a position," where the operator is no longer neutral. The operator aggregates the volumes and negotiates rates with the carriers. The operator can purchase freight capacities, and resell them together with the aggregation services. In this model, the participants or providers do not negotiate with each other, but with the operator. Consequently, the operator has potentially higher risks, because it might enter into contractual obligations to fill certain positions, but the operator also has greater profit opportunities. In this fashion, the operator has the potential for becoming one of the world's largest buyers of transportation capacities. This allows the operator to provide competitive rates and yet make a healthy profit margin. In this model, the operator benefits from the "network effect." The more that forwarders participate, the more space the operator can buy, the more space the operator purchases, the better the rate, the better the rate the more participants.

In addition, the operator in this business model benefits from the huge amount of data the operator collects from the use of the system. The operator has more data than any individual company from which to recognize patterns, or shifts in patterns. This again allows the operator to optimize, for example, the amount of capacities purchased in a future market, straight contract or spot. This can be further differentiated by routes, time of week, time of day, or any other parameter.

Both of the above business modes clearly increase the overall efficiency, and increase speed and transparency, needed to be able to operate tight supply chains. The difference is how the economic benefits are distributed, between the shipper, the participating companies, and the operator.

In an additional preferred embodiment, the system operates in a horizontal manner as well as vertical manner. In a vertical or hierarchical structure there is one "leader", who integrates the different elements. For example, when building a home, a user acting as a general contractor can disaggregate the plan or tasks into sub-tasks. These sub- tasks are linked or related to each other through a logic rule, such as a Gantt chart (showing time and other interdependence, such as step two must be completed before step three can start), and/or a budget. Interested providers then offer to compete for these sub-tasks. When evaluating options and during the negotiation the contractor is guided by optimizing the overall task. In the case of a horizontal or flat structure, there is no contractor and all participants work and negotiate together to find an optimal solution. The system automatically evaluates the outcome along a set of criteria, such as time and costs. Each participant quotes their sub-task and the system elects the best fitting overall solution. The system also allows and encourages providers of sub-tasks to collaborate to offer their sub-tasks as a linked sub-task, thereby opitmizing their working together. For example, an electrician and a computer network cabling provider, assuming they are two different providers, could work together to optimize the synergies between their work.

The system can be run in an open evaluation and negotiation process which allows all subcontractors to view the options and invites them to work together jointly to find an optimal, overall, integrated solution. For example, the system gives an incentive for optimization and collaboration, such as a share of the cost savings below a certain threshold, to be shared among the providers. A Web based implementation of such an open system includes tools such as a chat feature, messaging, and/or allowing a user to make and track changes to the blueprint and time table

In a further embodiment, there are mixed structures, such as where the highest level is horizontal, but sub-tasks are themselves structured as a set of vertical sub-sub-tasks

In a preferred embodiment the system incorporates a User Driven, Integrated, Dynamic Product and Service Ratings and Purchasing System, as described in U.S. Patent Application Serial No 09/426,784, filed 10/22/1999, which application is herein incorporated by reference After a transaction is completed, all interacting parties rate each other along a set of cπtena Over time, each company develops a performance profile or reputation Such a performance profile or reputation is used as an indication of how a company performs on the next job Once all players have a well established reputation/performance profile, the system operates on an anonymous basis Such a rating system plays a crucial part in the long run because it gives continuous and detailed information about the performance of the players. These ratings help to calculate probabilities during the negotiation and evaluation of options steps, for instance, that the time and budget is kept as promised by the providers. When rating the providers during the process, objective ratings are automatically measured against plan and actual of time and budget.

A further level of rating is included to measure the flexibility of the providers. For example, assume provider A is behind schedule, but provider B is able to get the project back on track, then such flexibility should be favorably rated. Furthermore, the rating system provides insights into the user and/or contractor, such as how many changes are caused by the contractors The ratings against original plan are adjusted for the changes not caused by the providers. Furthermore, the rating system of this invention allows one to factor in the degree of difficulty of the overall project, such as a routine or very unusual project The ratings are also used to determine or calculate rewards and bonuses for the participants Such an open system can replace today's agents, such as a freight forwarder or the contractor, and if not replace, assume many of their functions

Another embodiment of the invention involves an implementation in connection with a supply chain Today s supply chains are mostly a series of integration steps which integrate or link all parties involved, including such activities as placing an order, producing, and shipping The next step and dimension of complexity is to add steps of aggregation, as outlined above Aggregation is performed across multiple supply chains, so a company works across its multiple chains to benefit synergistically. The next level aggregates across multiple supply chains and across multiple companies. This system is complex and is most likely implemented by a independent third party operator.

BRIEF DESCRIPTION OF THE DRAWING

FIG. 1 is a block diagram depicting how providers handle integrated subtasks in a non- aggregated system;

FIG. 2 is a block diagram further depicting how providers handle a different set of integrated subtasks in a non-aggregated system;

FIG. 3 is a block diagram depicting how providers handle different sets of integrated subtasks in accordance with the invention;

FIG. 4 is a simplified diagram where integration and aggregation are enclosed in an information envelope in accordance with the invention;

FIG. 5 is a simplified diagram depicting a system in accordance with the invention;

FIG. 6 is a block diagram of an integrated provider in the shipping business;

FIG. 7 is a block diagram of non-integrated carriers in the shipping business; and

FIG. 8 is a block diagram of the implementation of a system in accordance with the invention.

DETAILED DESCRIPTION OF THE INVENTION

The following definitions are used in connection with the discussion of the invention herein:

o Task: A task is comprised of subtasks;

• Subtasks are comprised of sub-subtasks; • Sub-subtasks are comprised of sub-sub-sub tasks, and so forth,

• As with a task subtasks can be a service, product, part, or component

o Job: A job is a set of integrated tasks,

• A mega-job consists of multiple jobs

o Integration Rules: Integration rules are rules that describe how tasks are integrated to form a job For example, completion of a product requires that an item must have been produced before it can be packaged

o Providers: Providers are companies or any other entity that perform tasks or sub-tasks, and/or sub-sub tasks, and/or so forth The same provider can deliver different kind of tasks and/or subtasks

Example- The transportation of a shipment from SFO to FRA on a date is a job. The tasks in such an example are local pick-up from shipper, air transport, and local distribution The subtasks for the pick-up task are driving to shipper, receiving goods, packaging them for air transport, and delivering the goods to a earner The integration rules in this example are the time requirement and sequential logic, such as the requirement that pick-up must occur before flight can happen Other rules could include cost targets, quality requirements, use of a certain type of carrier (such as a requirement that it must be a US earner), and type of equipment to be used (e.g a wide-body plane) Also, the overall timeline for the tasks must be scheduled such that the job is completed by a specified time

o Aggregation Rules: Aggregation rules describe the benefit of aggregation of tasks and/or subtasks It must be noted that integration occurs across one job, whereas aggregation occurs across multiple jobs Therefore, aggregation basically turns a one-dimensional problem (/ e , looking only at one job) into a multidimensional problem (looking at multiple jobs) This complexity is further increased when simultaneously aggregating across more than one task

The simplest rules are volume discounts, where the price is reduced with increased volume More complex rules are preferential treatment, for example, where the probability that particular shipment is "bumped" from a particular flight is reduced

• The aggregation rules can be fixed over time, they do not change with time along any parameter

• The aggregation rules are dynamic they change over time along one or more parameters For example, the rules change as capacity availability changes As long as there is adequate capacity, price benefits due to aggregation are large, but if capacity is scarce, the aggregation benefits may be reduced

• The aggregation rules take into consideration type of underlying market and/or tools used such as

• Spot Buy what is available at the time of need, usually based on a demand/availability basis, prices may accordingly vary widely, availability is not assured;

• Contract Guaranteed availability at a predetermined time and price

Requirement to take delivery of goods, services as outlined in contract, (for example, select a certain provider in order to fulfill contractual obligations),

• Futures Contractual commitment for future point in time,

• Options The option, but not obligation for future time, and

• Other instruments used in the financial environment to the extent they can be made fit for this application

Objectives: Objectives are the parameters that are used to make a final decision, and that are used to make trade-offs For example, the time objective may be more important than the cost objective, where the first priority is to make sure shipment arrives at certain time, second is cost, and third is minimum of transloads More complex trade-off is the optimization of just one job or the optimization of multiple jobs where it is possible that a particular job might be sub-optimized This may also include "biased" objectives such as parameters to manage or optimize the profit objectives of the operator, or favor certain members/users. Objectives also include, for example, price maximum and/or completion rate, or profit objectives of the operator or any other priorities or parameters.

o Output: Output is the result of the integration and aggregation. Sub-tasks (and tasks in case of mega-tasks) are assigned to a set of providers. Note that, for example, for the same task and objectives this set of providers might vary over time based on time dependent variables, such as capacity utilization, or aggregation factors, such as the need to reach certain commitments of a certain provider. Therefore the outcome is termed a "virtual integration on-the-fly.

o Information Envelope or Information Platform or Information

Structure: These terms refer to a situation where the above integration and aggregation system is surrounded by an information structure. Within this structure, information is created, stored, edited/changed, deleted, or managed h other ways. This structure includes documents, supporting documents, and any other information exchanged. This includes, for example, blue-prints, plans, customs documents, air waybills, manifests describing goods transported, or any other information. In some embodiment of the invention, the information on the documents is not visible, creatable and/or editable by all users or restricted in access. The information may also be secure. This information within this structure includes:

• The system^'s own information, or internally all supporting documentation;

• Member information which is obtained and added to by participating members, through a link to their systems;

• Third party information, including any information from third parties, for example, a third party might manage the issuing of permits for a city, or other entity; or

• A combination of all of the above.

The information envelope is accessible to third parties, such as in the transportation example, the shipper who has received a tracking number and wishes to track his freight It could also be a home owner wishing to look at a Gantt chart to see the progress of the contractor/construction, or a manufacturer wishing to see the progress of an assembly process.

The information envelope, is most likely a Web based application, hosted on a server. This application can be rather complex, integrating large volumes of data and complex transactions. It can include some of the latest technologies of document control and access management, logistics systems and other. All participants use standard browsers to access the system to interact with the system. Some of the interaction is a link to a legacy system, such as a link to the systems of airlines.

Tracking is another example for value added information services. One new and innovative way of tracking is the following:

The problem today with tracking is the human element, which needs to scan a shipment at different points along its route. This step is often forgotten, skipped, or even impossible to perform based on incompatible hardware and/or software. The system herein (or a third party) provides data on where, for example, a shipment is using a different method. A simple wireless device is attached or included in a box or container. The device periodically sends simple information, such as an ID number. The system, linked to a wireless infrastructure company, receives the information about the location of that device (such as in which area the ID is found). The wireless device uses the global positioning system. However, it is not necessary to do in all embodiments because the system knows where the shipment should or could be and, in accordance therewith, searches for the presence of that ID only those regions. For example, for a shipment from San Francisco to a Duesseldorf the system looks at the expected arrival and departure dates. It then starts with a best guess where the shipment is. If not found there, the system goes to each of the next likely locations until the item is found. The system includes intelligence which lets it know that the shipment might be in the air where it is temporarily out of reach or turned off. In such case, the system checks back at a later time. Therefore, the above outlined tracking system is inexpensive to operate, using very little bandwidth, e.g. it could use older paging/wireless infrastructures.

Feedback: Feedback is the collection, processing, and use of data concerning such information as past transactions and providers. Additional data may b e obtained from third parties or may be collected by the system directly or indirectly (for example user ratings or observing the pattern of usage of the system). Such data can be used in many ways, including:

• Providing profiles, of for example, the provider, tasks, jobs, and the person or entity requesting the job. Such profiles allow anonymity over time, where any or even all of the users are not aware of the identity of other parties;

• Recognizing pricing or other patterns or trends. Such information is used for negotiations, or for volume or contract commitments (for example, the system, based on past patterns, can forecast demand for a certain month/time); and

• For optimizing the integration. For example, certain providers may work better with some providers than others, or with a certain type of provider.

o Data: Data include current and historic data, and may collect additional data over time from any source. Data can include job, task, and sub-task information, provider data, customer data, transaction data, usage data, support information, and other data (such as help functions).

FIG. 1 is a block diagram depicting how providers handle integrated subtasks in a non- aggregated system where task 1 00 is made up of subtasks A, B, C, wherein provider P1 performs sub task A, provider P3 performs subtask B, and provider P5 performs subtask C.

FIG. 2 is a block diagram further depicting how providers handle a different set of integrated subtasks in a non-aggregated system where task 200 is made up of subtasks A, B, C, wherein provider P4 performs subtask A, provider P3 performs subtask B, and provider P7 performs subtask C. In FIG. 1 and FIG. 2 there is no relationship or interdependence between task 100 and task 200.

FIG. 3 is a block diagram depicting how providers handle different sets of integrated subtasks in accordance with the invention. Provider P3, who is performing subtask B for both task 100 and task 200, is aggregated 5200.

Assume in Figure 3 for task B one could choose provider P3 or P6. • In case A integration 100 chooses service provider P3 Fig 1 and 200 chooses service provider P6 Fig 2,

• In case B both 100 and 200 choose P3 Fig 3, they are aggregating their demand.

Assume based on the aggregation they get a better price from P3 Part of this saving can be passed on to their customer, which makes the aggregated service 100 and 200 more competitive In other words, by using the system to aggregate the integrated product/service becomes better, but also may change as in the example of 200, which in case B uses a different provider for task B, P3 instead of P6 in case A This is the interdependence.

Example: A is local trucking service at origination point, B is flight service, C is local trucking service at destination 100 and 200 are freight forwarders, integrating the services for door-to-door delivery. In case A, the cost for door-to-door services are $2.00 per kilogram. In case B, where they aggregate their volume with one earner/flight they can negotiate a lower rate with the carrier, getting into a better rate class. Assume this saves them $.20Kg. They now have a cost of $1.80kg This makes them competitive and they get the job. In other words, how they integrate (use P3 or P6) is dependent on how they aggregate B. If there are many different players and one can see that only a computer based system can help to find best ways to integrate and aggregate on the fly. The logical next step is an attempt to aggregate for task C and A to reduce the costs further, and to find a third forwarder 300 to join them for some of the tasks.

Table 1 below is an example of a table showing the costs of forwarder 100.

Table 1. Cost for Forwarder 100, in $ per kg

Assume Forwarder 100 has a 400 kg shipment from Origination to Destination. Table 1 above shows the costs Forwarder 100 can get from his service providers. Forwarder 100, without any aggregation would choose the following integration path:

• Trucking Origination A for $.50/kg

• Carrier A for $2.00/kg

• Trucking Destination A for $.50/kg

• Total cost $3.00/kg.

Assume Forwarder 200 has also a 400 kg shipment from the same Origination to Destination. Table 2 below shows the costs Forwarder 200 can receive from his service providers. Forwarder 200, without any aggregation would choose the following integration path:

• Trucking Origination C for $.55/kg

• Carrier C for $2.05/kg

• Trucking Destination A for $.50/kg

• Total cost $3.10/kg.

Table 2. Cost for Forwarder 200, in $ per kg

Now, if A and B aggregate their demand, now demanding 800 kg, their best solution would be:

• Trucking Origination C for $.35/kg • Carrier C for $1 75/kg

• Trucking Destination B for $ 35/kg • Total cost $2 45/kg

Aggregating and integrating as shown above reduces the costs for Forwarder 100 from $3.00 to $2 45, and for Forwarder 200 from $3.10 to $2.45 Also, notice that the combination of providers used shifted as the result of the integration In other words the integration is interdependent on the aggregation (see Table 3 below).

Table 3. Integration, combination of providers, dependent on aggregation

This simple example shows that the complexity of interdependent integration and aggregation increases rapidly as the number of service buyers (forwarders) and providers increases. To handle this complexity of finding optimal or close to optimal solutions a computer system is required.

In FIG. 4 the integration and aggregation are enclosed in an information envelope 1 0000.

The invention is now described with respect to FIG. 5, which illustrates generally a preferred embodiment of the invention Input 4000 is comprised of Task Information 4100, Provider Information 4200, Objectives 4300 and Other Information 4400 . A task can be a service, or a product, part, or component, Task Information 4100 comprises (a) task description, task definition, (b) sub-task description, subtask definition and restrictions rules, and charactenstics regarding how these fit together into task, (c) mega-task, sub-subtask information, (d) requirements, (e) other information parameters describing tasks, and links to mega-jobs and sub-tasks

Provider Information 4200 comprises (a) provider profiles including information such as geographic location, quality ratings, price lists, size, any other relevant provider specific information, (b) provider link to task (e g which tasks/sub-tasks can a provider service) and to what degree can a provider or service product provided by provider be integrated with a task (for example, kind of compatibility, ease of integration data), (c) availability, capacity utilization information, information as function of time, (d) aggregation information, information regarding to degree of aggregability of provider (e.g., discount structure of provider with volume), although this information may not be available and may need to be negotiated from case to case.

Objectives 4300 describe the objectives that are to be achieved through the interdependence of integration and aggregation.

Other Information 4400 is any other information which is relevant but not included above. It may include system operator relevant information such as account number, or payment related information.

Logic 5000 is driven by Input 4000, Integration Rules 5100, and Aggregation Rules 5200. The process may be automatic, based on negotiations (both online and offline), or on using mechanisms such as auction, exchanges and others. The interdependence and sequencing of the process may also be different. Output 6000 is the result of Logic 5000. Feedback 8000 can have input in both Logic 5000 and Input 4000.

Information Envelope 7000 can be linked to and interact with all above elements 4000 through 8000. A Third Party 10000 can also interact with Information Envelope 7000. Information Envelope 7000 is shown as a separate unit in FIG. 5, but in an implementation could be integrated with all other elements 4000 through 8000.

FIG. 6 is a block diagram of an integrated provider in the shipping business, such as FedEx or UPS. This illustration demonstrates how, when managing tight supply chains, the shipper and consignee need and want to know where there goods are, because these goods often represent the only inventory these parties have. FedEx and UPS are integrated companies offering shipping service for packages up to approximately 100 lbs.

FIG. 7 is a simplified illustration of non-integrated carriers in the shipping business. This diagram depicts the reality today, especially for larger shipments, where many companies are involved, with mostly poor systems utilization. Agents, the freight forwarders, coordinate shipments and try to manage the information flow, as well as customs and other documents, and other tasks. The result is often frustrating, with no party knowing where a shipment is at a given time Furthermore the combination of providers is sub-optimal, and agents often work with whom they know or have a relationship, and not with the provider that is the best for the job at a given time This may be due to a variety of factors, including insufficient information

FIG. 8 is a simplified illustration of the implementation of a system in accordance with the invention This figure depicts the world after the implementation of the invention. All independent providers are united under the Information Envelope, with third parties, such as the shipper and consignee, having access to such information, e g. to track a shipment Based on information about the task, subtask, provider, feedback ratings, and sophisticated rules and processes for aggregation and integration a more optimal (or optimal for the objectives, which include achieving high margins for the operator of the system) integration or combination of service providers is achieved Essentially, the system combines a number of sub-task providers to perform as a virtually integrated company, an integration which changes from time to time, or on-the- fly.

Other Aspects of the Invention

The invention comprehends various other features, which may include any of the following:

Decision Logic

Decision logic is driven by the objective It is logic that is used to arrive at the optimal (or close to optimal) solution for a job For example, which task provider should perform which task for a given job Decision logic may be automatic, / e no human intervention, which is likely in simpler problems, or decision logic can be made with human intervention, via judgment, final selection of options, creation of scenarios, and selection of scenario

Negotiations

Negotiations occur where all rules (integration, aggregation, and decision) are not well defined, such that an automatic solution cannot be calculated and negotiations are not necessary However, where the rules are not well defined, any of the above steps might include a series of negotiations between humans, and/or between the system and humans These negotiations are conducted online using the system or partially offline. They consist of a series of offers and counteroffers or they may be in form of an auction, reverse auction or other such newer Internet-based instrument. The result of these negotiations (unless they determined the final solution) is incorporated into other steps of the system, such as decision making. Furthermore, multidimensional, simultaneous negotiations are possible, for example a task provider can negotiate with multiple potential customers, or the job requester can negotiate simultaneously with multiple providers.

Interdependence and Sequencing

Interdependence and sequencing refer to the manner in which the integration and aggregation steps are sequenced, for example, first integration, then aggregation, or aggregation, then integration, or any sequence of these steps. Also, simultaneous aggregation and integration may be, for practical reasons, a nearly simultaneous step, which does exist out of a number of sequenced integration and aggregation steps, as in an attempt to model the best solution, e.g. trial and error, or run many solutions (scenarios) to pick the best one.

Value added services

The information management structure allows the system to provide value added services, wherein the system uses the information available and gathers additional functions such as:

• Payment system;

• Customs documentation;

• Permits; and

• Any other regulatory or government documentation, reporting system.

Market Positioning

Market Positioning describes how the is positioned between a seller and wholesaler (for example between forwarder and carrier), or a seller and retailer, defined as end- user (for example between seller and shipper), or a combination of these. In the simplest form, the system is open to anyone. In a longer term more practical version, the membership is differentiated between for example the agent and shipper This differentiation can include functionality e g where a shipper can only access certain functions, such as some simple form of booking and tracking, pricing, e g. where each party sees other prices or any other method

Payment

Payment refers to different payment mechanisms integrated into the system and include-

• Post-transaction payment, where the provider is paid after the transaction. In this scenario the system is linked to an accounting system, delivers online invoices and accepts payments of any kind, including digital, credit card, or offline, e g checks,

Pre-paid payment, where the payment is made before the transaction;

• Conditional payment or payment authonzation, where the buyer agrees to be contractually bound to make a predetermined payment if the buyer's offer is accepted, or the provider is bound to perform services if the buyer accepts the offer and the payment terms; and

• Payment distribution, where the user pays for the services and the system distributes the total amount to the different providers, as well as third parties, if necessary

Time

Time is an additional dimension inherent in the system The system includes integration as one dimension, aggregation as a second dimension, and optionally, time as a third dimension For example, faster service, e g in building a house or a making a shipment, results in a higher cost when compared to slower service In the slow service when, for example aggregating one might take into consideration the benefits of using a certain provider but that provider might not have capacity at a given time, one can wait until capacity is available again, unless the cost of waiting, such as inventory costs or follow on costs makes waiting more expensive Another reason to wait might be aggregation benefits, i e wait until there is more to aggregate It is obvious that introducing the third dimension of time results in a high level of complexity which can only be handled with a computer based approach as outlined in this invention.

Modes of Operation

Modes of Operation refers to the different manners in which the system is operated by an operator, and include:

• Organizational Structure:

• Hierarchical: Where the operator, or someone acting as the operator, takes a leadership position, and is at the center of the system. Such leadership can include setting the rules, and directly influencing and managing the system: and

• Horizontal: This is a form of self-governance where there is not an active operator, as in the hierarchical structure. The rules are, for example, set all members or providers, or a body representing the members. There is a "policing function" to monitor that the rules are being followed.

• Philosophical structure where both of the above organizational structures could be managed as either:

• A neutral market place in which no provider is favored over others. The parties have a market place where the dynamics of an unbiased market rule the behavior; and

• A "taking a position" structure where either the operator or one or more members (potentially allied members) hold certain biases and act accordingly. A hierarchical organization often takes this structure.

While the foregoing detailed description has described several embodiments of the system in accordance with this invention, it is to be understood that the above description is illustrative only and not limiting of the disclosed invention. It will be appreciated that the embodiments discussed above and the virtually infinite embodiments that are not mentioned could easily be within the scope and spirit of this invention. Thus, the invention is limited only by the claims as set forth below.

Claims

1 A system for combining forms of conducting business, comprising: integrating means for integrating a first set of business activities of a plurality of first providers; and aggregating means for aggregating a second set of business activities of a plurality of second providers, wherein one or more of said providers are part of said first plurality of providers and said second plurality of providers; and wherein said integrating means and said aggregating means operate interdependently.

2. The system of Claim 1 , further compπsing- collaborating means for allowing different providers to collaborate on a same job.

3. The system of Claim 1 , further comprising: means for integrating information across a common information platform.

4. The system of Claim 1 , further comprising: negotiation means for allowing providers to negotiate with other providers

5. The system of Claim 1 , further comprising: integration means for combining products of said providers.

6. The system of Claim 1 , further compπsing- means for integrating information concerning said provider's business activities.

7. The system of Claim 1 , wherein a task is dictated by integration rules

8. The system of Claim 1 , wherein said aggregation is dictated by aggregation rules which in turn are based on a set of objectives.

9. The system of Claim 1 , wherein said integration and aggregation are sequenced in different manners.

10. The system of Claim 1 , wherein said integration and said aggregation are conducted within an information structure.

11. The system of Claim 10, said information structure, further comprising means for providing value added services.

12. The system of Claim 10, said information structure, further comprising: interacting means to allow a third party to access information contained in said information structure.

13. The system of Claim 10, wherein said information structure is secure.

14. The system of Claim 1 , wherein a payment mechanism is used.

15. The system of Claim 1 , further comprising: means for operating a bi-directional rating system.

16. A method for combining forms of conducting business, comprising: integrating a first set of business activities of a plurality of first providers; and aggregating a second set of business activities of a plurality of second providers; wherein one or more of said providers are part of said first plurality of providers and said second plurality of providers; and wherein said integrating steps and said aggregating steps proceed interdependently.

17. The method of Claim 16, further comprising: allowing different providers to collaborate on a same job.

18. The method of Claim 16, further comprising: integrating information across a common information platform.

19. The method of Claim 16, further comprising: allowing providers to negotiate with other providers.

20. The method of Claim 16, further comprising: combining products of said providers.

21. The method of Claim 16, further comprising: integrating information concerning said provider's business activities.

22. The method of Claim 16, wherein a task is dictated by integration rules.

23. The method of Claim 16, wherein said aggregation is dictated b y aggregation rules which in turn are based on a set of objectives.

24. The method of Claim 16, wherein said integration and aggregation are sequenced in different manners.

25. The method of Claim 16, wherein said integration and said aggregation are conducted within an information structure.

26. The method of Claim 25. said information structure providing value added services.

27. The method of Claim 25, said information structure allowing a third party to access information contained in said information structure.

28. The method of Claim 25, wherein said information structure is secure.

29. The method of Claim 16, wherein a payment mechanism is used.

30. The method of Claim 16, further comprising: operating a bi-directional rating system.

31 . A business system for conducting integration and aggregation interdependently, comprising: a common platform accessible by nonintegrated providers, said platform comprising: a module for collaboration and negotiation among providers; a module for access by third parties to integrated information; and integration rules that describe how tasks are integrated to form a job; and aggregation rules that describe one or more benefits of aggregation of tasks and/or subtasks; wherein integration occurs across one job; wherein aggregation occurs across multiple jobs; wherein said integration rules and said aggregation rules form a basis for decision logic; and wherein said decision logic is used to optimize a set of objectives.

32. The system of Claim 31 , said platform further comprising: an input comprised of any of task information, provider information, objectives, and other information; wherein a task comprises any of a service, a product, a part, and a component; wherein task information comprises any of a task description; a task definition; a sub-task description, a subtask definition, and restrictions, rules, and characteristics regarding how these fit together into a task; a mega-task; sub-subtask information; requirements; other information parameters describing tasks; and links to mega-jobs and sub-tasks; wherein provider information comprises any of provider profiles which may comprise information comprising of any of geographic location, quality ratings, price lists, size, and other relevant provider specific information; provider link to task and to what degree can a provider or service product provided by a provider be integrated with a task; availability, capacity utilization information, and information as function of time; aggregation information and information regarding to degree of aggregability of a provider; wherein objectives describe these objectives that are to be achieved through interdependence of integration and aggregation; and wherein other information comprises any of account number and payment related information.

33. The system of Claim 32, said platform further comprising: a logic module in communication with said input, said integration rules, and said aggregation rules; wherein said logic module is used to arrive at an optimal or close to optimal solution for a job; and wherein operation of said logic module is any of automatic or in concert with human intervention via any of judgment, final selection of options, creation of scenarios, and selection of scenario.

34. The system of Claim 31 , wherein said system operates in any of an automatic mode; based on negotiations, either both online and offline; and on other mechanisms which comprise any of an auction and an exchange.

35. The system of Claim 31 , wherein interdependence elements of said system and sequencing of operations in said system are independent of each other and each of which is implemented in a predetermined manner.

36. The system of Claim 32, said platform further comprising an output which comprises a result of an integration and aggregati on operation

37 The system of Claim 32, said platform further comprising a feedback path in communication with any of a logic module and an input for collection, processing, and use of data concerning information which may include any of past transactions and providers, wherein additional data may be obtained from any of third parties and collected by the system directly or indirectly, wherein said data can be used in any of providing profiles of any of a provider, a task, a job, and a person or entity requesting a job recognizing pricing or other patterns or trends, and optimizing the integration

38. The system of Claim 32, said platform further comprising an information envelope comprising a structure within which information is any of created, stored, edited/changed, deleted, and managed in other ways; wherein said structure comprises any of documents, supporting documents, and any other information exchanged; wherein said information on said documents optionally is any of the following. not visible, creatable and/or editable by all users, restricted in access, and secure; wherein information within said structure comprises any of said system's own information; member information which is obtained and added to by participating members, through a link to their systems and third party information comprising any information from third parties and wherein said information envelope is accessible to third parties

39 The system of Claim 31 , wherein said aggregation rules are any of fixed over time so that they do not change with time along any parameter, and dynamic so that they change over time along one or more parameters

40. The system of Claim 31 , wherein said aggregation rules take into consideration type of underlying market and/or tools used, which optionally include any of spot, contract, futures, options, and other instruments.

41 . The system of Claim 31 , wherein said objectives comprise any of parameters that are used to make a final decision and that are used to make trade-offs.

42. The system of Claim 31 , said platform implementing one or more modes of operation in which said system is operated by an operator; wherein said modes one or more modes of operation comprise any of: organizational structure, which comprises any of: hierarchical structure where an operator, or someone acting as an operator, takes a leadership position, and is at a center of said system, wherein said leadership comprises any of setting rules, and directly influencing and managing said system; and horizontal structure which comprises a form of self-governance where there is not an active operator; and philosophical structure said organizational structures are managed as any of: a neutral market place in which no provider is favored over others; and a taking a position structure where either an operator or one or more members hold certain biases and act accordingly.