Existing and emerging technologies cannot truly enhance ocean supply chain efficiency if we don’t unlock the potential of connecting processes and leveraging data to enable synchronised and intelligent planning across multiple operational silos. Ahead of TOC Europe 2017, Dr. Oscar Pernia explores the issues
These are exciting times to be in the global container shipping and ports industry, especially for those of us who have been around a while. Traction is gathering around technology and its transformative potential, with a new willingness from all the actors involved to engage in the process and a sense of urgency that we need to drive towards concrete and simple evolution to the benefit of all.
The digital shake-up
As a technologist, I try to stay positive and confident in the future to be created. But I am also a pragmatist and believe we must retain a healthy scepticism under this new ‘digital rainbow’.
“Digitisation is here, but are we realistic about the impact it will create in our industry in the short term? The playing field is promising but while we are all talking a lot about change and disruption, there are necessary and important changes around core processes that must occur to enable all this. These are not trivial to implement”
I come to technology from the terminal side, where the main problem for automation success is change management. This is a turning point in our industry and any small progress around hardware, systems, and people is a step forward to push the automation boundaries. But, consolidation, standardisation, and confidence are still needed for automation to become a vehicle for consistent, productive, and reliable operations.
We also need to think carefully about the new data “gold rush”. Today, data is not always accessible, not standardised, and does not even exist in some cases. There is generally a lot of data within the operational applications that support the container flow, but we lack the capabilities to make sense of the data. Interpreting the data to make it meaningful is a basic step towards being able to combine data so processes can be connected to each other.
And keeping the bigger picture in mind, there are fundamental changes needed in planning processes. Today, decisions are made in isolation, especially among shippers, ocean carriers and container terminals, without the right level of visibility and connectivity and focused on myopic KPIs. This blocks an integrated practice and mindset.
The existing and emerging technologies cannot enable change if we don’t unlock the potential of connecting processes, leveraging data, and cultivating value-creation mindsets for operational and environmental efficiency and sustainability.
Planning process synchronization
To streamline and synchronize planning processes, the focus must be on supply chain network reliability, flexibility, and cost effectiveness. We are entering an era in which the people involved in planning will be moving towards real synchronised and intelligent planning where:
- The long-term needs to be prescriptive and able to look ahead. Advanced analytics and forecasting capabilities will be key, as well as reducing the overall planning lead time
- The short-term needs to be dynamic to deal with planning changes and the need for scheduling and monitoring systems that include proactive assessment and flexibility
- The execution needs to be resilient and adaptive. The focus on control systems effectively integrating exception management is fundamental, as it will ultimately provide reliability to the network
In particular for ocean carriers and container terminals, there will be a need to drive stowage, marine, berthing, vessel, and yard planning processes seamlessly with all being a part of the same value chain. The platforms must be able to tap that hidden potential, and will take the first steps towards moving beyond APIs and microservices, to use data to connect core processes and create tangible business value. This is what will enable a real evolution in the carrier-terminal interaction, leveraging incentives on both sides.
A joint effort for systematic innovation
Of course, the new way of operating from the shipper side, in terms of transparency and visibility, will be proactive assessment of supply chain disruptions. Also, the way contracts and SLAs are set today will change with the introduction of more and more practices focused on dynamic pricing or customer end-to-end experience, which is already consolidated in other industries.
Beyond the shippers, I see the port authority role changing to be more of an efficiency partner and not just infrastructure providers. So, the ports that are using digitalisation consistently will be taking steps towards competitive intelligence and will be fundamentally connected to process changes and technology enablement.
Looking at the unfolding scene, new actors like Amazon and Alibaba will be important players for digitalisation enabling an intelligent supply chain. The way they are providing intelligence to operations is already impacting how we consume and live. In that same vein, startups that can create impact and speed in the industry will also be connected to the coming changes.
The whole shipping industry needs to work together to better understand the greatest areas of inefficiency across the supply chain and to try to quantify them, understand how they were caused and how technology can help remove waste. The future is not something we will be travelling to, but something we all will create together.
Dr. Oscar Pernia is VP Terminal Innovation for XVELA , a cloud collaboration platform for carriers and terminals, and Navis, a terminal technology provider, and part of the ATOM Labs team, an applied research and innovation laboratory. He speaks on 28 June in the TECH TOC session on Digitisation, Automation and Innovation and jointly with Guy Rey-Herme, XVELA CEO and previously co-founder and COO of GT Nexus, in The Digital Debate at TOC Europe 2017
27 to 29 June 2017
RAI Amsterdam, The Netherlands
About TOC Worldwide
For 40 years, TOC Worldwide has provided the market-leading conference and exhibition forums for the global port and terminal industries and their customers. With a change of name to TOC Container Supply Chain, the TOC event portfolio is now evolving fast to attract a wider audience of container supply chain professionals.
Taking place each year in the world’s four key shipping hubs – Europe, Middle East, Americas and Asia – each TOC is now a complete container supply chain event for its region, bringing together cargo owners, logistics providers, carriers, ports, terminals and other key members of the container supply chain to learn, debate, network and foster new business solutions.
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