Mark Solomon joined DC VELOCITY as senior editor in August 2008, and was promoted to his current position on January 1, 2015. He has spent more than 30 years in the transportation, logistics and supply chain management fields as a journalist and public relations professional. From 1989 to 1994, he worked in Washington as a reporter for the Journal of Commerce, covering the aviation and trucking industries, the Department of Transportation, Congress and the U.S. Supreme Court. Prior to that, he worked for Traffic World for seven years in a similar role. From 1994 to 2008, Mr. Solomon ran Media-Based Solutions, a public relations firm based in Atlanta. He graduated in 1978 with a B.A. in journalism from The American University in Washington, D.C.
After more than 18 months of theorizing and tinkering, Maersk Line and IBM Corp. today announced the formation of a joint venture to apply blockchain technology, a distributed ledger that creates a transparent and indelible trail of each transaction, to global trade and transportation.
The venture, which had been rumored for some time, will use blockchain to, in the companies' words, "provide more efficient and secure methods" for conducting global trade. Today's announcement means that "a beta version involving all players of the ecosystem along a specific trade lane can be launched," said Michael J. White, former president of Maersk's North American division and the head of the new venture, in an email today.
Copenhagen-based Maersk, the world's largest container line, and IBM, based in Armonk, N.Y., began work in June 2016 to build technologies that would be relevant to the process. Since then, various corporations, marine terminal operators, and government organizations such as the U.S. Customs and Border Protection have piloted the platform.
The venture, which will be open for members across a trading network to join, will allow Maersk and IBM to market the process to a broader range of commercial and government interests, the companies said. The venture is subject to various government regulatory approvals, and it has yet to be named. It is expected to start six months after regulatory clearance is received, the companies said.
The companies said they are encouraging other shipping lines to join, noting that container flow data considered proprietary would not be visible unless the ship line wanted it to be. In an interview today at the National Retail Federation's (NRF) annual convention in New York, Karl Haller, partner and global leader for IBM's Consumer Center of Competency, compared the joint venture's platform to a big, distributed database with functionality constantly enabled so no user can change any details without those actions being logged for all to see.
Blockchain's name comes from parties in a transaction adding "blocks" of information to the wider chain. The blocks identify as much information as the stakeholders deem necessary for the transaction to progress and be completed. Fraudulent activity would be virtually impossible because the transaction would represent a single view shared and witnessed by all participants. A transaction can move forward free of hackers and the need for so-called trusted third parties such as lawyers, bankers, and other intermediaries who've historically filled overseer's roles.
At the core of a blockchain's appeal is the development of self-executing, or "smart," contracts that would not require a third party's validation. Contracts could be converted to computer code, stored, then replicated on the system and supervised by a network of computers that run the blockchain. Smart contracts enable the exchange of money, property, shares, or anything of value in a transparent and conflict-free way, while avoiding the services of a middleman, according to supporters of the blockchain process.
Originally utilized to support the Bitcoin crypto-currency, which buyers and sellers use to execute transactions outside of the normal banking ecosystem, Blockchain is gaining interest across multiple industries, not the least of which is transportation and trade. The "Blockchain in Transport Alliance," (BiTA), a group created in the U.S. to develop industry standards, has received 975 applications to join and has 175 members, according to Craig Fuller, a transport IT executive and the group's co-founder. It is by far the largest industry-specific blockchain association, Fuller said.
Maersk and IBM said blockchain could revolutionize the ocean shipping industry, which moves about $3.2 trillion of goods worldwide and which has been a notable laggard in digital development and implementation. According to the companies, the overreliance on paper transactions has driven up the costs of processing and administration to as high as 20 percent of the costs of transportation.
According to White, most inefficiencies are caused by "information silos and ineffective data and documentation sharing. For example, information at origin was not always known by the destination customers in a timely manner." Missing documentation has also attributed to delays, a scenario that could be avoided with a blockchain-enabled program in full swing, White said.
Connor DiGregorio, a procurement research analyst at supply chain market research firm IBIS World Inc., said the databases of parties involved in a transaction are stored separately, which requires the exchange of paperwork. The IBM-Maersk platform will "allow easier coordination of documents on a shared distributed ledger, eliminating much of the need for physical paperwork," said DiGregorio in an email. "Additionally, through the distributed ledger and with the use of smart contracts, approvals and clearing through customs can happen much faster, reducing the time goods are processed through ports and other checkpoints."
Inna Kuznetsova, president and chief operating officer of Parsippany, N.J.-based Inttra, a multicarrier pOréal that tracks the status of more than 40 percent of the world's ocean containers, said the success of the IBM-Maersk venture will depend on the companies' ability to attract a large number of shippers and customs authorities to the platform. "Blockchain represents an attractive means to build a distributed network," Kuznetsova said in an email. "Yet it requires certain changes to the IT and business process of each company joining the platform, in addition to adopting common standards. Both historically represent a challenge in shipping."
She added that participants with multilayered operations, which represent many in the sea carrier trade, will also need to decide if they want to invest in participation in many networks or wait for a true standard to emerge.
Haller of IBM said the venture is all about inclusiveness. "IBM wants to work with standards and regulatory bodies to make sure all these blockchain networks are interoperable," he said at NRF. "We're working to jointly develop a solution that will work for anyone in the industry that wants to be a part of it. Then it will go from being about blockchain to being a solution for global trade."
Supply chain planning (SCP) leaders working on transformation efforts are focused on two major high-impact technology trends, including composite AI and supply chain data governance, according to a study from Gartner, Inc.
"SCP leaders are in the process of developing transformation roadmaps that will prioritize delivering on advanced decision intelligence and automated decision making," Eva Dawkins, Director Analyst in Gartner’s Supply Chain practice, said in a release. "Composite AI, which is the combined application of different AI techniques to improve learning efficiency, will drive the optimization and automation of many planning activities at scale, while supply chain data governance is the foundational key for digital transformation.”
Their pursuit of those roadmaps is often complicated by frequent disruptions and the rapid pace of technological innovation. But Gartner says those leaders can accelerate the realized value of technology investments by facilitating a shift from IT-led to business-led digital leadership, with SCP leaders taking ownership of multidisciplinary teams to advance business operations, channels and products.
“A sound data governance strategy supports advanced technologies, such as composite AI, while also facilitating collaboration throughout the supply chain technology ecosystem,” said Dawkins. “Without attention to data governance, SCP leaders will likely struggle to achieve their expected ROI on key technology investments.”
The British logistics robot vendor Dexory this week said it has raised $80 million in venture funding to support an expansion of its artificial intelligence (AI) powered features, grow its global team, and accelerate the deployment of its autonomous robots.
A “significant focus” continues to be on expanding across the U.S. market, where Dexory is live with customers in seven states and last month opened a U.S. headquarters in Nashville. The Series B will also enhance development and production facilities at its UK headquarters, the firm said.
The “series B” funding round was led by DTCP, with participation from Latitude Ventures, Wave-X and Bootstrap Europe, along with existing investors Atomico, Lakestar, Capnamic, and several angels from the logistics industry. With the close of the round, Dexory has now raised $120 million over the past three years.
Dexory says its product, DexoryView, provides real-time visibility across warehouses of any size through its autonomous mobile robots and AI. The rolling bots use sensor and image data and continuous data collection to perform rapid warehouse scans and create digital twins of warehouse spaces, allowing for optimized performance and future scenario simulations.
Originally announced in September, the move will allow Deutsche Bahn to “fully focus on restructuring the rail infrastructure in Germany and providing climate-friendly passenger and freight transport operations in Germany and Europe,” Werner Gatzer, Chairman of the DB Supervisory Board, said in a release.
For its purchase price, DSV gains an organization with around 72,700 employees at over 1,850 locations. The new owner says it plans to investment around one billion euros in coming years to promote additional growth in German operations. Together, DSV and Schenker will have a combined workforce of approximately 147,000 employees in more than 90 countries, earning pro forma revenue of approximately $43.3 billion (based on 2023 numbers), DSV said.
After removing that unit, Deutsche Bahn retains its core business called the “Systemverbund Bahn,” which includes passenger transport activities in Germany, rail freight activities, operational service units, and railroad infrastructure companies. The DB Group, headquartered in Berlin, employs around 340,000 people.
“We have set clear goals to structurally modernize Deutsche Bahn in the areas of infrastructure, operations and profitability and focus on the core business. The proceeds from the sale will significantly reduce DB’s debt and thus make an important contribution to the financial stability of the DB Group. At the same time, DB Schenker will gain a strong strategic owner in DSV,” Deutsche Bahn CEO Richard Lutz said in a release.
Transportation industry veteran Anne Reinke will become president & CEO of trade group the Intermodal Association of North America (IANA) at the end of the year, stepping into the position from her previous post leading third party logistics (3PL) trade group the Transportation Intermediaries Association (TIA), both organizations said today.
Meanwhile, TIA today announced that insider Christopher Burroughs would fill Reinke’s shoes as president & CEO. Burroughs has been with TIA for 13 years, most recently as its vice president of Government Affairs for the past six years, during which time he oversaw all legislative and regulatory efforts before Congress and the federal agencies.
Before her four years leading TIA, Reinke spent two years as Deputy Assistant Secretary with the U.S. Department of Transportation and 16 years with CSX Corporation.
Serious inland flooding and widespread power outages are likely to sweep across Florida and other Southeast states in coming days with the arrival of Hurricane Helene, which is now predicted to make landfall Thursday evening along Florida’s northwest coast as a major hurricane, according to the National Oceanic and Atmospheric Administration (NOAA).
While the most catastrophic landfall impact is expected in the sparsely-population Big Bend area of Florida, it’s not only sea-front cities that are at risk. Since Helene is an “unusually large storm,” its flooding, rainfall, and high winds won’t be limited only to the Gulf Coast, but are expected to travel hundreds of miles inland, the weather service said. Heavy rainfall is expected to begin in the region even before the storm comes ashore, and the wet conditions will continue to move northward into the southern Appalachians region through Friday, dumping storm total rainfall amounts of up to 18 inches. Specifically, the major flood risk includes the urban areas around Tallahassee, metro Atlanta, and western North Carolina.
In addition to its human toll, the storm could exert serious business impacts, according to the supply chain mapping and monitoring firm Resilinc. Those will be largely triggered by significant flooding, which could halt oil operations, force mandatory evacuations, restrict ports, and disrupt air traffic.
While the storm’s track is currently forecast to miss the critical ports of Miami and New Orleans, it could still hurt operations throughout the Southeast agricultural belt, which produces products like soybeans, cotton, peanuts, corn, and tobacco, according to Everstream Analytics.
That widespread footprint could also hinder supply chain and logistics flows along stretches of interstate highways I-10 and I-75 and on regional rail lines operated by Norfolk Southern and CSX. And Hurricane Helene could also likely impact business operations by unleashing power outages, deep flooding, and wind damage in northern Florida portions of Georgia, Everstream Analytics said.
Before the storm had even touched Florida soil, recovery efforts were already being launched by humanitarian aid group the American Logistics Aid Network (ALAN). In a statement on Wednesday, the group said it is urging residents in the storm's path across the Southeast to heed evacuation notices and safety advisories, and reminding members of the logistics community that their post-storm help could be needed soon. The group will continue to update its Disaster Micro-Site with Hurricane Helene resources and with requests for donated logistics assistance, most of which will start arriving within 24 to 72 hours after the storm’s initial landfall, ALAN said.