How global supply chain issues can be an opportunity for Seattle maritime tech companies

[ad_1]

Containers at the Port of Seattle. (Photo GeekWire/Kurt Schlosser)

Since the start of the COVID-19 pandemic, the global supply chain has choked and spat, causing shortages of everything from computer chips to certain foods. Ports are so overwhelmed that dozens of container ships linger near US ports, often waiting weeks to unload.

But supply chain issues could become a boon for Seattle-area tech companies, including giants such as Microsoft and Amazon, as well as a growing number of startups focused on shipping and logistics.

The pandemic “has fundamentally accelerated the trucking industry’s focus on digital transformation,” said Ryan Gavin, a Microsoft and Amazon veteran who is now chief growth officer at Seattle trucking startup Convoy. .

Gavin was at the forefront of the pandemic supply chain collapse. Convoy software uses an app to connect truck drivers to freight jobs. Its data can show trucks idling for hours waiting for cargo.

The supply chain industry is flying blind, according to Gavin and other supply chain experts. That’s largely because the majority of its employees are still handling phone, email, and fax shipments, instead of turning to Internet of Things sensors, edge devices, cloud computing, and more. machine learning, all capable of producing and analyzing vast streams of data.

The pain brought by the pandemic — that doesn’t seem to be ending any time soon – could finally push regulators and freight managers to widely deploy new technologies.

The old way, Gavin said, “is no longer going to hold up in a world of high volatility, where black swan events happen much more regularly.”

An Amazon Prime truck heads north on Interstate 5 in Washington. (Photo GeekWire/Kurt Schlosser)

Large cloud companies such as AWS and Microsoft are uniquely positioned to capitalize on an infusion of data and connected devices into global logistics networks, said Michael Crane, vice president of global growth and business development. at Imprint Energy in Alameda, California. maker of ultra-thin batteries that can power IoT devices used to track freight.

“This ‘big data’ in the supply chain is best, and perhaps only, handled by cloud infrastructures like AWS and Azure,” Crane said in an email.

At its Ignite Developer and IT conference in November, Microsoft announced a new product called Dynamics 365 Supply Chain Insights. The software, Microsoft said, is designed to avert situations like the current supply chain crisis by providing businesses with “near real-time data, allowing them to assess risk and mitigate issues before that a massive disruption does not occur”.

AWS offers similar supply chain solutions, including Amazon Forecast, which a spokesperson says helps “track and trace the entire production process.” Another AWS offering, Amazon SageMaker, helps build custom machine learning models that can analyze supply chain data. Google and Oracle also market their own supply chain-related cloud products.

There are a host of Seattle-area startups with potential solutions.

In addition to Convoy, the Seattle area is home to Flexe, an on-demand warehouse logistics company serving e-commerce sellers; Logixboard, which provides logistics tracking and management software; Shipium, an e-commerce logistics company; Pandion, an online shopping “parcel network”; and many others.

The executives of these companies claim that their technology has somehow helped companies circumvent global supply chain problems. Many say the shipping industry will need to turn to vast pools of data before putting the current crisis behind it.

“In today’s tight supply chain, not having visibility means operating blindly and not being able to course-correct when issues arise,” said the co-founder and CEO of Logixboard, Julian Alvarez, in an email. “It’s impossible for companies to plan their supply chain if they don’t have visibility into where their freight is, and that’s exactly what’s happening today.”

(GeekWire Photo/Kevin Lisota)

Yet, as laptops, new cars, shampoo bottles, and a variety of other products cross the oceans of the world, they encounter obstacles that software cannot solve.

A respite from an otherwise bleak shipping forecast was that most Americans were getting their retail orders in time for the holidays. This is largely because consumers started shopping early and parcel carriers staffed up and expanded warehouse space to accommodate the crush.

But experts say supply chain issues are likely to persist at least until this year. The indices used by shipping companies to measure average shipping times show that from this month, it can take more than three months to ship goods from Asia to the United States via freighters.

Besides, the dockers were sick. Extreme weather events, such as a typhoon that hit China in July, have also slowed shipping. And trade tensions with China that escalated under President Trump’s administration still simmer.

Moreover, the cost of transporting a single sea container from China increased by a factor of 13, according to Forbes.

Things were not smoothed out when, in August, the Chinese government suspended terminal operations at the port of Ningbo-Zhoushan, the third busiest port in the world, after only one worker tested positive for COVID-19.

More generally, the supply chain infrastructure in the United States, from port facilities to warehouses, needs to be expanded. The Biden administration has announcement more than $241 million in grants for infrastructure improvement projects at U.S. ports, including nearly $16 million for the Port of Tacoma near Seattle, which will build a new container storage facility to transport cargo. Meanwhile, many major ports remain stretched to the limit and these projects will take months or years to complete.

Throwing tech at these issues can be like giving Google Maps to someone stuck in traffic. The app shows your exact location, but it can’t move other cars anymore.

With this in mind, Apurva Jain, associate professor of operations management at the University of Washington’s Foster School of Business, pondered the impact that the widespread adoption of big data, cloud, AI and other technologies may have on the current crisis.

“It looks like it’s a global capacity issue,” Jain said of the supply chain crisis. “If storage space or the number of trucks is the real problem, how much more can you squeeze out of it at this exact moment?”

Furthermore, Jain said, one of the big challenges facing the shipping industry is that it is made up of countless independent operators, many of them small businesses. This, he said, makes it difficult to unify hardware and software systems across the many components of the supply chain.

“The structure of the industry is so fragmented due to the ownership of many assets by small companies,” Jain said.

Still, he said, any effort to unify freight tracking across disparate points in the supply chain will help.

“It’s definitely something that’s going to be the story for the next four or five years,” Jain said. “There is a demand for automation…in this rather fragmented and somewhat hidden industry.”

[ad_2]
Source link

Comments are closed.