This Week in Logistics News (July 11-15, 2016)

When was the last time you checked your mailbox with excitement and anticipation? Not your email inbox, but the one your postman uses to deliver your mail? Back in college, I couldn’t wait to get back to my dorm to see if I had received a letter or package from a friend. And when one arrived, it was often the highlight of my day. And somewhere in my attic, there is a box full of those letters I received many years ago, which one of these days I’ll bring down and read again. So many words, so many memories.

Then email came along, and Facebook too, and the letters stopped coming (although the packages keep arriving, but from Amazon, not family and friends).

Two of my kids have been at sleepaway camp for the past two and a half weeks, and every day I wait with excitement and anticipation for the postman to deliver the mail. My kids are not allowed to call home or send emails; they can only write letters, using pen and paper, the old-fashioned way. I wish there was a word to adequately describe what I feel the instant I see their handwriting, unique as a fingerprint, on an envelope addressed to “Mommy and Papi” — and a word for what I feel afterwards, after reading their letters, again and again, about how they’re spending their days without us. Maybe it’s just love.

Moving on to this week’s supply chain and logistics news…

Yesterday, IBM announced “a cloud service for organizations requiring a secure environment for blockchain networks.” As reported by the Wall Street Journal:  

IBM’s new service lets supply chain customers build and test blockchains in a secure cloud using a version of the company’s LinuxOne system. The service is aimed at companies that need to track high-value items through complex supply chains. One of the inaugural clients is Everledger, which helps companies track the provenance of diamonds, allowing buyers to screen for stones mined in regions where forced labor is common or where proceeds from previous sales were used to fund violence.

Everledger is building systems to record the movement of diamonds from mines to jewelry stores and has been using various blockchain tools, including Bitcoin’s ledger. Everledger is testing IBM Blockchain for a global rollout possibly by the end of the year, said CEO Leanne Kemp.

As I noted in a recent post, Toyota and USPS also see opportunities for blockchain technology in supply chain management. Simply put, while there’s more hype than reality surrounding blockchain technology at the moment, the activity level continues to rise, not only by entrepreneurs and the investment community, but also by the likes of IBM and other industry leaders. It’s a trend worth keeping a pulse on.

Another technology generating a lot of buzz today is 3D printing. Although it’s been around for a long time, it’s adoption is growing thanks to improved capabilities and lower costs. The automotive industry was an early adopter of 3D printing and it continues to push the envelope, as the news by Daimler Trucks this week demonstrates. According to Reuters:

Daimler Trucks said on Wednesday that from September, it will use 3D printing processes for plastic spare parts including spring caps, air and cable ducts, clamps, mountings and control elements.

Daimler, which owns the Mercedes-Benz brand, has more than 100,000 printed prototype parts, and said it will expand production using 3D printing methods.

The truck maker’s “printed” spare parts are created with 3D printers based on what is known as a selective laser sintering (SLS) printing process, and ordered using a special spare part number, even for parts on models that are several decades old or even out of production.

With the UPS already in the process of building out a distributed, on-demand manufacturing network, it’s not hard to imagine a time in the not-too-distant future where 3D printers are distributed across various nodes in the supply chain — from warehouses, to retail stores, to even trucks — to further shrink order-to-delivery times.

On the software front, TransVoyant announced the availability of Precise Predictive Logistics (P2L), its supply chain-focused live and predictive big data analytics solution. According to the press release:

By tracking the real-time behavior and location of aircraft, ocean vessels, rail cars, trucks, ports, airports, routes and other supply chain nodes via the Internet of Things (IoT), TransVoyant’s P2L solution provides supply chain professionals with live status updates and predictions for shipments, orders and items.

TransVoyant P2L is piloting estimated times of arrival on shipments for Brooks Running. Under the pilot Brooks is finding that P2L ETA’s are far more accurate than what the company had been receiving from its carriers and 3PLs. Most importantly P2L ETA’s are significantly more precise ten days from arrival. This is particularly important to Brooks because it is the trigger the company would like to use to commit inventory in motion.

“Supply chains that rely on latent status updates from legacy communication methods and networks, including EDI transmissions, are no longer competitive,” said Dennis Groseclose, CEO of TransVoyant. I agree, but considering that EDI is still the dominant form of B2B communication, this implies that most companies are still Companies of Yesterday.

Nonetheless, as APIs, sensors, GPS, wireless systems, and other technologies become more affordable and widely adopted, the ability for companies to make smarter decisions faster will improve. But as I wrote about recently, having more data (real-time or not) by itself does not create business value; it’s the ability to make smart and timely decisions that matters most today, which is enabled by transforming data into information and knowledge and combining it with analytics, optimization, and decision-support capabilities.

Finally, in the trucking realm, 120 trucking companies with an average fleet size of 17 tractor-trailers went out of business in Q2 2016, up from 70 firms in the same period last year, according to Avondale Partners LLC. As reported in the Wall Street Journal:

The failures are mainly the result of rising fuel prices and weak demand, said Avondale Managing Director Donald Broughton.

“There aren’t enough loads to fill the trucks that are on the road now,” Mr. Broughton said. “Unless you are one of the ones who failed, you should be cheering [capacity leaving the market]. The industry needs to put capacity and demand back into balance, although 2,000 trucks being removed from the road is not enough.”

In case you missed it, for additional insights on the state of the trucking industry, check out the guest commentary by Tom Sanderson, CEO of Transplace (a Talking Logistics sponsor).

And with that, have a happy weekend!

Song of the Week: “Something Good Can Work” by Two Door Cinema Club