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<div align='center'><b><span style='font-size: medium'>Logistics Innovation Learned from Romans </span></b></div> <div><b><span style='font-size: medium'> </span></b></div> <div align='right'><b><span style='font-size: larger'>Yeo Sung-koo, CEO of Pantos Logistics</span></b></div> <div><span style='font-size: larger'> </span></div> <div style='layout-grid-mode: char; text-indent: 13pt' align='justify'><span style='font-size: larger'> </span></div> <div style='layout-grid-mode: char; text-indent: 13pt; text-align: justify'><span style='font-size: larger'> ‘Rome was not built in a day!” This is a description of the Roman Empire, which attained great advances by overcoming challenges and hardships for an extended period of time. Rome enjoyed prosperity for about 1,000 years, and tangible and intangible legacies from this period are truly amazing. Rome was able to become a great empire because it gained extraordinary capacity to manage the empire. This capacity is none other than its roads. Roman roads were so famous that they even left the proverb, “All roads lead to Rome.”</span></div> <div style='layout-grid-mode: char; text-indent: 13pt; text-align: justify'><span style='font-size: larger'> </span></div> <div style='layout-grid-mode: char; text-indent: 13pt; text-align: justify'><span style='font-size: larger'>Road construction work, which began 3 Century BC, continued for more than 500 years in tune with the prosperity of the empire. During its hay day, Rome ruled three continents, namely Europe, Asia, and Africa. In the course of doing that, Roman roads reached out to Britain to the north, Spain and Portugal to the west, North Africa and Egypt to the south, and Asia Minor to the east. The roads extended a total of 80,000 km, and as much as 150,000 km when including tertiary routes, which are truly massive even by the standards of people living in the 21^st Century.</span></div> <div style='layout-grid-mode: char; text-indent: 13pt; text-align: justify'><span style='font-size: larger'> </span></div> <div style='layout-grid-mode: char; text-indent: 13pt; text-align: justify'><span style='font-size: larger'>Rome started from a small city state by the River Tevere around the 8 Century BC. Rome was able to expand the scope of its empire and manage its extensive territory through the construction of ‘roads.’ Notably, despite its inferiority in quantity, the Roman military secured mobility through ‘roads,’ and hence was able to reverse the situation of warfare by gaining mobility through roads. Roman roads were designed to be as straight and flat as possible and standardized in width. Paved with gravels and stones, they allowed soldiers to march even on rainy days, and enabled armored vehicles and wagons to speed up. The Roman military staged a speedy warfare by ‘strategically shifting deployments’ of its troops, a strategy in which it promptly transported elite soldiers, diverse weapons, and military supplies via those roads. Moreover, Roman roads were networked, which rendered it possible to form various combinations of routes such as ‘A→B→D’, and ‘A→C→D,’ when one travels from A to D. Hence, the roads allowed the Roman troops to travel fast even if a certain road was occupied by enemy forces, or blocked by a natural disaster. </span></div> <div style='layout-grid-mode: char; text-indent: 13pt; text-align: justify'><span style='font-size: larger'> </span></div> <div style='layout-grid-mode: char; text-indent: 13pt; text-align: justify'><span style='font-size: larger'>The use of roads by Romans has many implications to the logistics business of today. What we need to value most is Romans’ creative ways to address problems. The change of perception toward one, in which Romans regarded military operations a duel not between ‘strength’ but between ‘wisdom,’ was the driving force that helped develop Rome. To shift the rule of game from a matter of “quantity” to that of “quality,” and to control the matter of quantity through quality is the goal of supply chain management (SCM), the buzzword of today’s logistics industry. SCM effectively refers to a process of optimization, in which a company predicts demand in the market, and mobilize its resources to meet the demand, and to ensure that production in tune with the demand is optimally supplied to final consumers. In this context, logistics now must evolve itself into a knowledge-based service industry that backs up the competitiveness of freight owners.</span></div> <div style='layout-grid-mode: char; text-indent: 13pt; text-align: justify'><span style='font-size: larger'> </span></div> <div style='layout-grid-mode: char; text-indent: 13pt; text-align: justify'><span style='font-size: larger'>Another implication of Romans’ use of roads in the modern logistics business is the perspective from which Romans viewed “roads.” Roman roads contained the philosophy of “opening, participation and sharing” hidden in them, the values that today’s Web 2.0 pursues. Rome constructed roads rather than building fortresses, and used policy of engagement, rather than ruling out the culture of territories it occupied. Against this backdrop, just as all roads lead to Rome, all information and knowledge converged in Rome before being dispersed to across the world. Such a trend resulted in fusion and creation of ideas not only in military operation but also in diverse other fields, including politics, economy, society and culture, helping the development of the Roman Empire.</span></div> <div style='layout-grid-mode: char; text-indent: 13pt; text-align: justify'><span style='font-size: larger'> </span></div> <div style='layout-grid-mode: char; text-indent: 13pt; text-align: justify'><span style='font-size: larger'>What are ‘roads’ in the logistics industry, which can serve as a creative way to resolve problems and as the framework for the philosophy of ‘opening, participation and sharing’? Logistics IT must be such roads. The success and failure of the logistics industry will depend on how we interpret logistics IT, and how we continue to utilize it, going forward.</span></div> <div style='layout-grid-mode: char; text-indent: 13pt; text-align: justify'><span style='font-size: larger'> </span></div> <div style='layout-grid-mode: char; text-indent: 13pt; text-align: justify'><span style='font-size: larger'>Pantos Logistics launched for the first time in Korea in 2006 an integrated global logistics system, called the ‘Pantos Visibility System (PVS),’ which shows customers the situation of freight being transported and logistical information at once, by simultaneously processing shipping management, warehouse management, and inventory management, or the three factors of corporate logistics. Pantos Logistics went a step further, and added intelligent services, including consulting factors such as the optimization of logistics routes, and cost simulation beginning in 2009, in order to adopt the integrated global logistics system to creative resolution of problems, and is in the process of further enhancing its functions by systemically linking it with production, finance and trade.</span></div> <div style='layout-grid-mode: char; text-indent: 13pt; text-align: justify'><span style='font-size: larger'> </span></div> <div style='layout-grid-mode: char; text-indent: 13pt; text-align: justify'><span style='font-size: larger'>In order to best utilize “opening, participation, and sharing,” the advantages of Web 2.0, Pantos Logistics is conducting a Global Single Instance (GSI), which integrates and unifies all systems at its headquarters and 83 affiliates and subsidiaries in 35 countries worldwide based on the Web for the first time among the Korean logistics firms. Notably, the GSI project will allow the company to integrate all different logistics projects at its affiliates and branches worldwide throughout the process of planning to execution, and closely manage them with fingertips, thus significantly enhancing the level of visualized supply network services.</span></div> <div style='layout-grid-mode: char; text-indent: 13pt; text-align: justify'><span style='font-size: larger'> </span></div> <div style='layout-grid-mode: char; text-indent: 13pt; text-align: justify'><span style='font-size: larger'>As competition heats up between manufacturing companies in the global market, the need to strengthen the competitiveness of the Korean logistics industry is frequently raised and discussed as a key issue. Wisdom of the Romans 2,000 years ago great alarms us with a message that we must continue innovations to creatively resolve problems, and embrace newness and diversity with the attitude of opening, participation and sharing.</span></div>