“Eye” in the sky: IoT powers vaccine delivery blitz
Charged with transporting rush shipments of Covid-19 vaccines around the globe, logistics service providers turned to the latest internet of things (IoT) tools to monitor and safeguard their lifesaving cargo.
Ben Ames has spent 20 years as a journalist since starting out as a daily newspaper reporter in Pennsylvania in 1995. From 1999 forward, he has focused on business and technology reporting for a number of trade journals, beginning when he joined Design News and Modern Materials Handling magazines. Ames is author of the trail guide "Hiking Massachusetts" and is a graduate of the Columbia School of Journalism.
When logistics service providers were first charged with delivering the new Covid-19 vaccines in late 2020, they may have wished for a magic wand to solve the extraordinary challenges their mission would present. While some already had specialized pharmaceutical divisions and cold chain warehouses to serve the typical trade in medicines and biological products, those networks were designed for a lighter flow of goods to predetermined destinations like hospitals, not an all-out blitz to reach every corner of the globe as quickly as possible.
The vials of the precious vaccine had to be moved in huge quantities, kept at ultra-low temperatures, and shipped and delivered at top speed … all at a time when commercial aircraft—whose belly space has long been the main means of expedited international cargo transport—were largely grounded due to pandemic-related restrictions on passenger travel. At the same time, the service providers’ employees had to work in conditions where they faced exposure to the very virus they were fighting. To cap it off, the contractors were under colossal pressure to distribute the vaccines before the deadly disease could spread among vulnerable populations.
Citing severe capacity constraints in the aircargo market, the International Air Transport Association (IATA) dubbed the effort “the mission of the century” for the sector.
Yet despite those and other challenges, logistics service companies—and parcel carriers, in particular—have been successful in their efforts to swiftly distribute Covid-19 vaccines. One of the key tools players have brought to bear is the internet of things (IoT), a vast network of connected sensors that allowed shippers and carriers to monitor and track this critical cargo as it passed through multiple hands, transportation modes, and countries.
MOVE IT QUICKLY, KEEP IT COLD
To help them track shipments and manage the complexities of time-sensitive vaccine distribution, the major parcel carriers—DHL, FedEx Corp., and UPS Inc.—all turned to variations of IoT technology.
For DHL, IoT tools were critical for monitoring cargo that had to be maintained at subzero temperatures (-70 degrees Fahrenheit for the Pfizer vaccine and -20 degrees for the Moderna version) and for reassuring trading partners who were pushing for urgent delivery. Those partners stretched across the globe: Through May of 2021, the company had transported more than 200 million doses of the various Covid-19 vaccines on about 9,000 flights to more than 120 countries.
While DHL has a well-established network for transporting vaccines and other pharmaceuticals, it looked to the IoT part of its existing system to meet the specific demands of Covid vaccine distribution, said Claudia Roa, the company’s president, Life Sciences and Healthcare.
“The three main differences or unique features with the Covid-19 vaccine were its extremely low temperature requirement; the lack of data available to know the risks and the effects of changes in temperature, time, etc.; and its global urgency—which is probably the most sensitive aspect of this distribution effort,” Roa said. Thanks to its IoT network, DHL had the resources in place to manage the first two challenges, thereby freeing company leaders to concentrate on the third one. “Using sensors, we have been able to monitor the temperature and location of every vaccine shipment to guarantee that the temperature stays within the required range,” she said.
For FedEx, IoT networks were crucial for tracking a steady stream of vaccine shipments to all 50 states as well as destinations around the world. Through the use of connected sensors, every shipment of vaccines has generated a cloud of detailed tracking data, the company said. As of mid-June, FedEx had delivered Covid-19 vaccines and related ingredients and supplies to 40 countries, including a shipment of 1.35 million Johnson & Johnson vaccine doses from Memphis, Tennessee, to Toluca, Mexico, in coordination with the nonprofit aid agency Direct Relief and the U.S. and Mexican governments.
In a statement about its role in the vaccine delivery effort, FedEx cited its standard dictum about tracking packages, saying “The information about the package is as important as the package itself as it moves through the network.” The Memphis-based company has invoked that motto for years, but it added something new when it tackled the vaccine delivery challenge: its “FedEx SenseAware ID” tracking technology, which it unveiled in May 2020, about six months before the first public vaccine shipments began.
That new tracking system incorporates sensors designed with the Bluetooth low-energy (BLE) communications standard, which uses less power and costs less than previous versions. That makes the IoT devices affordable enough that users can attach a sensor to each vaccine shipment, not just to pallets or containers. The sensors allow FedEx to track the location of vaccine shipments in near real time. The company then analyzes the data it collects with a platform that leverages artificial intelligence and predictive tools to monitor conditions surrounding the packages; this allows customer-support agents to intervene if weather or traffic delays threaten to impede deliveries, the company said.
And for UPS, IoT devices are enabling the company and its customers to actively monitor temperature-controlled cargo, including pinpointing the location of any Covid-19 vaccine shipment within its worldwide network. Using its “UPS Premier” service, the Atlanta-based company attaches a small mesh sensor, about the size of a credit card, to every vaccine shipment. The technology provides visibility into the location of every package, to within 10 feet, anywhere in the network. Like FedEx, UPS analyzes the data it collects using software that can detect network disruptions before they occur and then recommend countermeasures in real time.
NEW TECH SOLVES OLD PROBLEMS
The successful application of IoT technology in vaccine distribution can be attributed to two main factors, according to companies that manufacture the sensors and networks that make the system work. The first is the industry’s deep experience with the technology: Vendors have been deploying simpler versions of IoT devices to solve similar logistics challenges for years, which meant that when the call for more-sophisticated versions came, they had a solid foundation to build on. The second is a spate of technological advances that occurred just before the pandemic began, solving several longstanding problems with the technology and greatly expanding its capabilities.
For example, California-based IoT technology vendor Identiv has long been providing systems that use radio-frequency identification (RFID) tags to monitor the temperature of wine shipments in transit. These systems help shippers determine whether their products have been exposed to out-of-range temperatures while en route—a concern that vaccine shippers share. So when the need arose, the company was able to use the same approach to develop a monitoring system for ultra-cold shipments.
“‘Smart’ packaging with temperature control, anti-tampering [features], and location tracking is critical in efficient vaccine delivery,” Identiv CEO Steve Humphreys said, adding that Covid-19 has forced “exponential growth” in this technology.
That “exponential growth” came just in time to solve several key challenges with Covid-19 vaccine distribution. Thanks to a “technology convergence” of recent advances in sensors, readers, and other devices, IoT systems were able to overcome past shortcomings, according to Chris Jones, executive vice president, marketing and services for Descartes Systems Group, a provider of IoT devices and logistics technology.
Until recently, most tracking tags suffered from short battery life, but modern units using Bluetooth low-energy technology can run for seven years on one of the coin-shaped batteries commonly used to power wristwatches, Jones said. Earlier sensors were also too expensive to use on anything but the highest-value shipments, but their cost today is just one-tenth or one-twentieth of what it was half a dozen years ago, he said. Thanks to those price drops, users can now toss a tag into each carton of goods being shipped or attach it to the outside of the parcel, the pallet it’s stacked on, or the unit load device (ULD) that airlines use to roll cargo into the bellies of planes.
Yet another recent technology advance has helped the industry overcome some longstanding problems with collecting data from those sensors. Older systems that relied on cellular data networks had limited capacity to collect and then share the information they recorded, since airports limit cellphone connectivity to protect planes’ communications channels, and because shipments sitting in cold storage are insulated by thick metal walls. But in recent months, Descartes has provided some of its customers with readers that are tuned to Bluetooth low-energy signals, creating networks of local antennas that operate on a different bandwidth than airplane wireless signals and can therefore be placed close to cargo. Airfreight carriers, including Delta, Air New Zealand, and Cathay Pacific, are installing the solar-powered units on light poles and other sites around an airport; the resulting coverage is far more effective than anything cellular networks can offer, Jones said.
For example, Cathay Pacific Cargo said in June that it was launching Descartes’ BLE-based network, tags, and readers at dozens of airports across the globe. This investment will allow customers to monitor vaccine and other shipments in near real time through the airport-to-airport leg of each shipment’s journey, the airline said. With the new system, Cathay Pacific’s data loggers can now record and transmit data to Bluetooth readers in the cargo terminal and the airside ramp area, providing such information as the GPS location, temperature, humidity level, and vibration.
HISTORIC ACHIEVEMENTS
By collecting and sharing crucial data about shipments in transit, IoT technology has played a critical role in logistics companies’ historic effort to deliver Covid-19 vaccines. Thanks to engineering upgrades, modern IoT sensors and networks have allowed users to overcome extraordinary challenges in this global race to save lives.
The benefits of improved IoT technology will extend far into the future, Identiv’s Humphreys believes. “Manufacturers, distributors, government leaders, NGOs, and the health-care community have an opportunity right now to troubleshoot methodologies and identify best practices to better prepare for a future pandemic,” he said.
This story first appeared in the September/October issue of Supply Chain Xchange, a journal of thought leadership for the supply chain management profession and a sister publication to AGiLE Business Media & Events’' DC Velocity.
For the trucking industry, operational costs have become the most urgent issue of 2024, even more so than issues around driver shortages and driver retention. That’s because while demand has dropped and rates have plummeted, costs have risen significantly since 2022.
As reported by the American Transportation Research Institute (ATRI), every cost element has increased over the past two years, including diesel prices, insurance premiums, driver rates, and trailer and truck payments. Operating costs increased beyond $2.00 per mile for the first time ever in 2022. This trend continued in 2023, with the total marginal cost of operating a truck rising to $2.27 per mile, marking a new record-high cost. At the same time, the average spot rate for a dry van was $2.02 per mile, meaning that trucking companies would lose $0.25 per mile to haul a dry van load at spot rates.
These high costs have placed a significant burden on the operations of trucking companies, challenging their financial sustainability over the last two years. As a result, 2023 saw approximately 8,000 brokers and 88,000 trucking companies cease operations, including some marquee names, such as Yellow Corp. and Convoy, and decades-long businesses, such as Matheson Trucking and Arnold Transportation Services.
More so than ever before, trucking companies need to get better at efficiently using their assets and reducing operational costs. So, what is a trucking company to do? Technology is the answer! Given the nature of the problem, technology-led innovation will be critical to ensure companies can balance rising costs through efficient operations.
One technology that could be the answer to many of the trucking industry’s issues is the concept of digital twins. A digital twin is a virtual model of a real system and simulates the physical state and behavior of the real system. As the physical system changes state, the digital twin keeps up with the real-world changes and provides predictive and decision-making capabilities built on top of the digital model.
DHL, in a 2023 white paper, suggests that—due to the maturation of technologies such as the internet of things (IoT), cloud computing, artificial intelligence (AI), advanced software engineering paradigms, and virtual reality—digital twins have “come of age” and are now viable across multiple sectors, including transportation. We agree with this assessment and believe that digital twins are essential to radically improving the processes of fleet planning and dispatch.
THE NEED TO AUTOMATE
Outside of attaining procurement efficiencies, trucking companies can achieve lower costs by focusing on critical operational levers such as minimizing deadheads, reducing driver dwell time, and maximizing driver and asset utilization.
However, manual methods of planning and dispatch cannot optimally balance these levers to achieve efficiency and cost control. Even when planners work very hard and owners strive to improve processes, optimizing fleet planning is not a problem humans can solve routinely. Planning is a computationally intensive activity. To achieve fleet-level efficiencies, the planner has to consider all possible truck-to-load combinations in real time and solve for many operational constraints such as drivers’ hours of service, customer windows, and driver home time, to name just a few. These computations become even more complex when you add in the dynamic nature of real-world conditions such as trucks getting stuck in traffic or breaking down or orders getting delayed. This is not a task humans do best! For these sorts of tasks, technology has the upper hand.
When a company creates a digital twin of its trucking network, it has a real-time model that factors in truck locations, drivers’ hours of service, and loads being executed and planned. Planners can then use this digital model to assess possible decisions and select ones that increase asset utilization, improve customer and driver satisfaction, and lower costs.
For example, a digital twin of the network can offer significant insights and analysis on the state of the network, including exceptions such as delayed pickups and deliveries, unassigned loads, and trucks needing assignments. Backed by AI that takes business rules into account, digital twins can allow companies to optimize their fleet performance by finding the most efficient load assignments and dynamically adjusting in real time to changes in traffic patterns and weather, customer delays, truck issues, and so on.
With a digital twin, carriers can optimize the matching of assets, drivers, and freight. Typically, an investment in this innovative technology results in a 20%+ increase in productive miles per truck, while also improving driver pay and significantly decreasing driver churn. Drivers get paid by the miles they run, so when they run more, they are able to make more money, resulting in less need to chase the next job in search of better pay.
ADDITIONAL BENEFITS
Digital twins also combat deadheading, another source of driver dissatisfaction and cost inefficiencies. On average, over-the-road drivers spend 17%–20% of road miles driving empty. Using a digital twin, a company can search across several freight sources to find a load that perfectly matches the deadhead leg without impacting downstream commitments. These additional revenue miles will help drivers to maximize their earnings on the road and carriers to maximize their asset utilization and profitability.
The traditional manual dispatch planning model is becoming increasingly outdated—each planner and fleet manager tasked with overseeing 30 to 40 vehicles. Carriers try to manage this problem by dividing the fleet into manageable chunks, which results in cross-fleet inefficiencies. Such a system isn’t scalable. A digital twin acts as an equalizer for small and mid-sized fleets. It enables carriers to expand by venturing beyond the fixed routes and network they were forced to run out of fear of additional logistical complexity.
A digital twin can also give an organization the transparency and visibility it needs to find and fix inefficiencies. A successful carrier will leverage the technology to learn from the hitches in its operations. While this visibility is beneficial in its own right, it also provides the first step toward a seamless, digitized operation. “Digital revolution” is a buzzword frequently heard at transportation conferences. Yet not too many organizations are dedicated to digitizing their operations past the visibility stage. The end goal should be using decision-support systems to automate key elements of the system, thus freeing up planners from their daily rote tasks to focus on problems that only humans can solve.
Finally incorporating a digital twin can also help trucking companies work toward the broader trend of creating greener supply chains. Because they have lower deadhead and dwell times, trucking companies that have adopted a digital twin can be more attractive to shippers that are looking for more efficient operations that meet their environmental, social, and governance (ESG) goals.
THE FUTURE IS HERE
It is important to note that the benefits described here are not dreams for the future; digital twin technology is already here. In fact, choosing a digital twin can seem daunting because there are already a spectrum of options out there. First and foremost, an organization must ensure that the digital twin it selects aligns with both the goals and the scope of its operation.
Additionally, the ideal digital twin should:
Operate in near real time. A digital twin should be able to refresh as often as the network changes.
Be able to factor in specific customer delivery requirements as well as asset- and operator-specific constraints.
Be computationally efficient and comprehensive as it considers thousands of permutations in milliseconds. The digital twin should be able to reoptimize an entire fleet’s schedule of multi-day routes on the fly.
Before implementing a digital twin, carriers need to make sure that they have robust data management processes in place. Electronic logging devices (ELDs), customers’ tenders, billing, shipments, and so on are already inundating carriers with a glut of data. However, the manual nature of operations in many carriers leads to poor data quality. Carriers will need to invest in data management approaches to improve data quality to support the generation and use of high-fidelity digital twins. Otherwise, the digital twin will not be representative of reality and companies will run into an issue of “garbage in, garbage out.”
REINVENTION AND TRANSFORMATION
While data management is critical, change management through the ranks of dispatch operations is often a harder task. In fact, the largest roadblock carriers face when undergoing a digital transformation is the lack of willingness to change, not the technology itself. Many carriers cling to outmoded planning methods. Planners, used to operating based on well-worn business rules and tribal knowledge, could be wary of the technology and resistant to change. They may need to be assured that, while it is true that every trucking network is uniquely complex, digital twins can be set up to model the intricacies of their specific dispatch operations and drive value to the network. A significant amount of time and resources will need to be expended on change management. Otherwise even though trucking companies may invest in cutting-edge technology, they won't be able to fully capitalize on the added value it can provide.
As the truckload industry works through the current freight cycle, it is important to realize that change is inevitable. Carriers will need to reinvent their operations and invest in technologies to ride through the busts and booms of future freight cycles. Recent global events point to the many ways that wrenches can be thrown into global transportation networks, and the fact that such volatility is here to stay. Digital twins can provide companies with the visibility to navigate such changes. But above all, an operation that uses the digital twin to drive decisions can make customers and drivers happy, and help the carriers keep their heads above water during times such as now.
Regular online readers of DC Velocity and Supply Chain Xchange have probably noticed something new during the past few weeks. Our team has been working for months to produce shiny new websites that allow you to find the supply chain news and stories you need more easily.
It is always good for a media brand to undergo a refresh every once in a while. We certainly are not alone in retooling our websites; most of you likely go through that rather complex process every few years. But this was more than just your average refresh. We did it to take advantage of the most recent developments in artificial intelligence (AI).
Most of the AI work will take place behind the scenes. We will not, for instance, use AI to generate our stories. Those will still be written by our award-winning editorial team (I realize I’m biased, but I believe them to be the best in the business). Instead, we will be applying AI to things like graphics, search functions, and prioritizing relevant stories to make it easier for you to find the information you need along with related content.
We have also redesigned the websites’ layouts to make it quick and easy to find articles on specific topics. For example, content on DC Velocity’s new site is divided into five categories: material handling, robotics, transportation, technology, and supply chain services. We also offer a robust video section, including case histories, webcasts, and executive interviews, plus our weekly podcasts.
Over on the Supply Chain Xchange site, we have organized articles into categories that align with the traditional five phases of supply chain management: plan, procure, produce, move, and store. Plus, we added a “tech” category just to round it off. You can also find links to our videos, newsletters, podcasts, webcasts, blogs, and much more on the site.
Our mobile-app users will also notice some enhancements. An increasing number of you are receiving your daily supply chain news on your phones and tablets, so we have revamped our sites for optimal performance on those devices. For instance, you’ll find that related stories will appear right after the article you’re reading in case you want to delve further into the topic.
However you view us, you will find snappier headlines, more graphics and illustrations, and sites that are easier to navigate.
I would personally like to thank our management, IT department, and editors for their work in making this transition a reality. In our more than 20 years as a media company, this is our largest expansion into digital yet.
We hope you enjoy the experience.
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In this chart, the red and green bars represent Trucking Conditions Index for 2024. The blue line represents the Trucking Conditions Index for 2023. The index shows that while business conditions for trucking companies improved in August of 2024 versus July of 2024, they are still overall negative.
FTR’s Trucking Conditions Index improved in August to -1.39 from the reading of -5.59 in July. The Bloomington, Indiana-based firm forecasts that its TCI readings will remain mostly negative-to-neutral through the beginning of 2025.
“Trucking is en route to more favorable conditions next year, but the road remains bumpy as both freight volume and capacity utilization are still soft, keeping rates weak. Our forecasts continue to show the truck freight market starting to favor carriers modestly before the second quarter of next year,” Avery Vise, FTR’s vice president of trucking, said in a release.
The TCI tracks the changes representing five major conditions in the U.S. truck market: freight volumes, freight rates, fleet capacity, fuel prices, and financing costs. Combined into a single index, a positive score represents good, optimistic conditions, and a negative score shows the opposite.
A coalition of truckers is applauding the latest round of $30 million in federal funding to address what they call a “national truck parking crisis,” created when drivers face an imperative to pull over and stop when they cap out their hours of service, yet can seldom find a safe spot for their vehicle.
According to the White House, a total of 44 projects were selected in this round of funding, including projects that improve safety, mobility, and economic competitiveness, constructing major bridges, expanding port capacity, and redesigning interchanges. The money is the latest in a series of large infrastructure investments that have included nearly $12.8 billion in funding through the INFRA and Mega programs for 140 projects across 42 states, Washington D.C., and Puerto Rico. The money funds: 35 bridge projects, 18 port projects, 20 rail projects, and 85 highway improvement projects.
In a statement, the Owner-Operator Independent Drivers Association (OOIDA) said the federal funds would make a big difference in driver safety and transportation networks.
"Lack of safe truck parking has been a top concern of truckers for decades and as a truck driver, I can tell you firsthand that when truckers don’t have a safe place to park, we are put in a no-win situation. We must either continue to drive while fatigued or out of legal driving time, or park in an undesignated and unsafe location like the side of the road or abandoned lot,” OOIDA President Todd Spencer said in a release. “It forces truck drivers to make a choice between safety and following federal Hours-of-Service rules. OOIDA and the 150,000 small business truckers we represent thank Secretary Buttigieg and the Department for their increased focus on resolving an issue that has plagued our industry for decades.”
“While there have been some signs of tightening in consumer spending, September’s numbers show consumers are willing to spend where they see value,” NRF Chief Economist Jack Kleinhenz said in a release. “September sales come amid the recent trend of payroll gains and other positive economic signs. Clearly, consumers continue to carry the economy, and conditions for the retail sector remain favorable as we move into the holiday season.”
The Census Bureau said overall retail sales in September were up 0.4% seasonally adjusted month over month and up 1.7% unadjusted year over year. That compared with increases of 0.1% month over month and 2.2% year over year in August.
Likewise, September’s core retail sales as defined by NRF — based on the Census data but excluding automobile dealers, gasoline stations and restaurants — were up 0.7% seasonally adjusted month over month and up 2.4% unadjusted year over year. NRF is now forecasting that 2024 holiday sales will increase between 2.5% and 3.5% over the same time last year.
Despite those upward trends, consumer resilience isn’t a free pass for retailers to underinvest in their stores by overlooking labor, customer experience tech, or digital transformation, several analysts warned.
"The 2024 holiday season offers more ‘normalcy’ for retailers with inflation cooling. Still, there is no doubt that consumers continue to seek value. Promotions in general will play a larger role in the 2024 holiday season. Retailers are dealing with shrinking shopper loyalties, a larger number of competitors across more channels – and, of course, a more dynamic landscape where prices are shifting more frequently to win over consumers who are looking for great deals,” Matt Pavich, senior director of strategy & innovation at pricing optimization solutions provider Revionics, said in an email.
Nikki Baird, VP of strategy & product at retail technology company Aptos, likewise said that retailers need to keep their focus on improving their value proposition and customer experience. “Retailers aren’t just competing with other retailers when it comes to consumers’ discretionary spending. If consumers feel like the shopping experience isn’t worth their time and effort, they are going to spend their money elsewhere. A trip to Italy, a dinner out, catching the latest Blake Lively and Ryan Reynolds films — there is no shortage of ways that consumers can spend their discretionary dollars,” she said.
Editor's note:This article was revised on October 18 to correct the attribution for a quote to Matt Pavich instead of Nikki Baird.