The cargo owner’s case for smart containers
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This article, which was originally published here, was authored by Hanane Becha, Todd Frazier, Mikael Lind, Jaco Voorspuij and Michael Schröder
How many times have you asked yourself the following questions: Where is the container I shipped? When will the container arrive at the agreed destination? In what condition are my goods?
Imagine a situation where you as the cargo owner, as well as the other parties involved in the door-to-door trip, could be informed of the progress and status of a container transport in near real-time, independent of the mode of transport. This is now feasible thanks to the maturity of IoT technologies and the contemporary development of standards for data communication in inter-modal transports.
The use of Smart Containers within the supply chain provides many benefits to transport chain stakeholders. The transparency of operational movements and events, and the near real-time reporting of such events allows the involved parties to be more responsive to hazards that cost time and money, and to be able to react quickly to mitigate such issues.
Smart Containers provide the necessary complementary data streams to allow for the status of the goods and carrier operations, as advocated in traffic management approaches, to go hand in hand. This enhances the safety and security of consignment and transport equipment and facilitates the movement of goods across country borders.
In addition to productivity gains, more efficient transportation will lead to better resource usage, facilitating the shift to cleaner modes of transportation, and an eco-friendlier environment.
Emerging concepts for supply chain visibility ensure that involved actors share common situational awareness. Situational awareness can be defined simply as “knowing what is going on around us”, or – more technically – as “the perception of the elements in the environment within a volume of time and space, the comprehension of their meaning and the projection of their status in the near future.”
Although the smart container provides value throughout the whole intermodal chain, in this article we will focus on how the smart container can provide enhanced situational awareness for beneficial cargo owners – i.e. the benefits of smart containers for the BCOs who ultimately pay for the transportation of their goods.
In the door-to-door supply chain, goods are transported by several modes of transport, and are transshippped through multiple transshipment hubs. The transfer of goods provides an important key event which can enrich situational awareness for the BCO and other supply chain actors, none of whom have visibility of the full trip execution.
Different use cases for BCOs
A BCO seeks to optimise its incoming and outgoing flows, as well as warehousing of cargo, by relying on forecasted and progressive movements throughout the inter-modal chain, making them highly dependent on predictions of goods’ movements managed by actors in the inter-modal chain. The higher the precision of this information, the lower the need for the BCO to keep high stock-levels, so the situational awareness provided by logistic service providers along the transport chain constitutes a vital component of situational awareness for the BCO.
Current initiatives associated with traffic management and connected smart containers both seek to provide better supply chain visibility and situational awareness. Combining these data sources could support an even more detailed situational awareness for the BCO.
Capacity planning based on transport chain progress – As the smart container provides reliable physical sensor data, the BCO would know the condition of the container (contents) and not have to rely on the provision of data from each means of transport involved.
As a foundation, the smart container would have the capability to communicate location progress. Combining this data with plans/forecasts of movements and operations of containers would allow goods’ time-of-arrival at the final destination to be predicted with high precision. Figure 2 below depicts movements and an inter-modal shift at a transshipment hub involving two means of transport.
The smart container provides a complementary source of information for traffic management, and traffic management information provides for a better understanding of what container movements and operations have occurred. This will create additional awareness of which containers are on the move, their status, or which have been forgotten or delayed, allowing BCOs to optimise capacity.
Monitoring the condition of goods – As the contents of some containers (e.g. refrigerated) need to be kept at a particular temperature, it is essential that a container’s temperature is continuously monitored. Other times, it is necessary a container is handled properly to avoid damage to the goods inside.
Smart containers can provide measures of temperature, shock and vibration adding to the situational awareness image and continuous monitoring of the goods throughout their journey. By using traffic information in combination with the past and present conditions inside the container, proactive actions may be taken to maintain the quality of the container’s contents, as well as informing on the stage in the transport process where potential damage to the container contents may have occurred.
Smart container solutions may send out an alert based on the awareness of breaches of parameters’ thresholds that may affect the conditions of the cargo (e.g., temperature, shock, humidity, etc.), which may trigger actions necessary to take on the container.
This can be done when the measured humidity rises above or falls below a predefined threshold, for example, or the level of O2, CO2 or N2 in a controlled atmosphere is outside the acceptable range. Alerts can also be sent to notify of unexpected container movements, such as shock or vibration. an unexpected door opening, or some other change in its physical parameters.
Facilitating customs clearance – The smooth flow of goods along the transport chain depends on every actor involved performing their operations in an integrated manner, avoiding unnecessary waiting times. Through the combination of a variety of digital data streams, involved actors may be able to coordinate their operations, based both on the content, the value and the status of the container, as well as, the timing of movement and operations.
This is of special concern for customs clearance, as evaluations regarding the container and its contents need to be processed as quickly as possible. By combining traffic management data with smart container data and data associated with the goods, the customs clearance process may be smoothened substantially. As of today, customs clearance is seen as a bottle neck by BCOs.
Standards to improve situational awareness
Many standardisation initiatives have focused on the efficiency and safety of carrier movements and operations associated with carriers, most often of a specific type (such as ship, aircraft, train, or truck), and, in particular, transshipment hubs.
Some examples include global formal standards detailing smart container data models associating the identity of, and the status of, the goods being carried by dry and/or refrigerated containers.
This data model is the basis for standardised communication and the prerequisite building blocks for the smart container API definitions. A typical BCO would not have only one or two shipments, but more likely ten or twenty at the same time. Those could be operated, e.g., by five different carriers.
The BCO wants all status and alert messages to flow automatically into their own IT system and update the status of the shipments, irrespective of the container operator and the IoT solution. That level of automation can only be achieved by a standard message structure, standard codes and standard communication channel, supported by all operators. For the BCO, this means that there is a need for one single interface.
Current ‘Cross-Industry Supply Chain Track & Trace’ standardisation initiatives by UN/CEFACT aim to deliver the data model that enables inter-modal tracking (monitoring the present and forecasted future movements of the asset) and tracing (monitoring the history of a traceable asset) from seller to buyer.
The information exchanged concerns trade, transport and/or their products. This builds on the smart container project offering a more granular view of tracked and monitored assets.
Standards are also being introduced to define radio interfaces supporting the infrastructure of gateways located on board of carriers (vessel and other means of transports) and/or on land in terminals and private depots, to ensure an uninterrupted flow of smart container data.
By combining the UN/CEFACT smart container data model and the requirements of the communication physical layer, the BCO can create significant benefits.
Beneficial cargo owners, as well as logistic service providers, involved in the inter-modal transport chain all benefit from information about what is happening around them, in order to plan and undertake actions associated with the goods and/or the transport carriers carrying the goods.
The various sources of data that are becoming available may only be able to provide part of the situational awareness picture, but having any record of the environmental conditions within a container along its journey is valuable information to help in coordination, predictability, and to assure quality, security and responsibility in case of incidents.
Just knowing that a particular container is on board a vessel or is being managed by a terminal operator within a transshipment hub at a particular time can enable accurate forecasts of when the container will be ready for the next operation.
Therefore, all stakeholders involved are encouraged to share more information regarding those containers and ensure that the status and position of a particular container becomes a component in common situational awareness shared among engaged stakeholders – ultimately providing better service to the BCO.
Note: This article is an abridged version of a longer paper by the authors, which includes further details on the use cases mentioned above, as well as a full list of references. The full paper can be downloaded here.