The first phase of a Blockchain and Traceability Framework for Australian Dairy Farmers is underway to reduce the threat of fraudulent product entering the supply chain, protecting farmers, processors and consumers by building on standards already used in transport and logistics.
DP World, a leading enabler of global trade, has completed the early stages of integration with TradeLens a blockchain-based digital container logistics platform, jointly developed by A.P. Moller – Maersk. Read more
CMA CGM and MSC have announced they will join TradeLens, a blockchain-enabled digital shipping platform jointly developed by A.P. Moller – Maersk and IBM.
With CMA CGM, MSC, Maersk, and other carriers committed to the platform, data for nearly half of the world’s ocean container cargo will be available on TradeLens, says CMA CGM.
The addition of CMA CGM and MSC will provide a significant boost to the TradeLens vision of greater trust, transparency, and collaboration across supply chains to help promote global trade. The companies will promote TradeLens and create complementary services on top of the platform for their customers and partners.
“Digitisation is a cornerstone of the CMA CGM Group’s strategy to provide an end-to-end offer tailored to our customers’ needs. We believe that TradeLens, with its commitment to open standards and open governance, is a key platform to help usher in this digital transformation,” Rajesh Krishnamurthy, Executive Vice President, IT & Transformations, CMA CGM Group said.
“Digital collaboration is a key to the evolution of the container shipping industry. The TradeLens platform has enormous potential to spur the industry to digitize the supply chain and build collaboration around common standards,” André Simha, Chief Digital & Information Officer, MSC said.
TradeLens enables participants to connect, share information and collaborate across the shipping supply chain ecosystem. Members gain a comprehensive view of their data and can digitally collaborate as cargo moves around the world, helping create a transparent, secured, immutable record of transactions.
Artificial Intelligence (AI)
AI technology in supply chain seeks to augment human performance. Through self-learning and natural language, AI capabilities can help automate various supply chain processes such as demand forecasting, production planning or predictive maintenance.
“AI supports the shift to broader supply chain automation that many organisations are seeking,” said Mr Titze. “For example, AI can enhance risk mitigation by analysing large sets of data, continuously identifying evolving patterns, and predicting disruptive events along with potential resolutions.”
Advanced analytics span predictive analytics — those that identify data patterns and anticipate future scenarios — as well as prescriptive analytics — a set of capabilities that finds a course of action to meet a predefined objective. The increased availability of Internet of Things (IoT) data and extended external data sources such as weather or traffic conditions allow organisations to anticipate future scenarios and make better recommendations in areas such as supply chain planning, sourcing and transportation.
“Advanced analytics are not new, but their impact on today’s supply chains are significant,” said Mr Titze. “They will help organisations become more proactive and actionable in managing their supply chains, both in taking advantage of future opportunities and avoiding potential future disruptions.”
The IoT is the network of physical objects that contain embedded technology to interact with their internal states or the external environment. “We are seeing more supply chain practitioners exploring the potential of IoT,” said Mr Titze. “Areas on which IoT might have a profound impact are enhanced logistics management, improved customer service and improved supply availability.”
Robotic Process Automation (RPA)
RPA tools operate by mapping a process in the tool language for the software ‘robot’ to follow. They cut costs and eliminate keying errors. “We are seeing a significant reduction in process lead times RPA technology is used to automate the creation of purchase and sales orders or shipments, for instance,” said Mr Titze. “RPA technology reduces human intervention and improves consistency across manual data sources within manufacturing.”
Autonomous things use AI to automate functions previously performed by humans, such as autonomous vehicles and drones. They exploit AI to deliver advanced behaviours that interact more naturally with their surroundings and with people.
“The rapid explosion in the number of connected, intelligent things has given this trend a huge push,” said Mr Titze. “The once distant thought of reducing time for inventory checks by using drones’ cameras to take inventory images, for instance, is here.”
Digital Supply Chain Twin
A digital supply chain twin is a digital representation of the relationships between all physical entities of end-to-end supply chain processes — products, customers, markets, distribution centres/warehouses, plants, finance, attributes and weather. They are linked to their real-world counterparts and are used to understand the state of the thing or system in order to optimise operations and respond efficiently to changes.
“Digital supply chain twins are inevitable as the digital world and physical world continue to merge,” said Mr Titze.
Immersive experiences such as augmented reality (AR), virtual reality (VR) and conversational systems are changing the way people interact with the digital world. “In supply chain, organisations might use AR along with quick response (QR) codes and mobile technology to speed up equipment changeovers in factories,” said Mr Titze. “Immersive user experiences will enable digital business opportunities that have not yet been fully realised within global supply chains.”
Blockchain in Supply Chain
Although supply-chain-related blockchain initiatives are nascent, blockchain has potential to fulfil long-standing challenges presented across complex global supply chains. Current capabilities offered by blockchain solutions for supply chain include traceability, automation, and security.
“Organisations might use blockchain to track global shipments with tamper-evident labels, allowing a reduction in the time needed to send paperwork back and forth with port authorities and improved counterfeit identification,” said Mr Titze.
“The 2019 Top Supply Chain Technology Trends You Can’t Ignore,” from Gartner provides an outlook into other emerging trends that might disrupt supply chain operations in the upcoming years, such as 5G and edge computing.
Drakes deli team member and AFLW player Ebony Marinoff.
Australia’s largest 100% family-owned meat processor, Thomas Foods International, and largest independent grocery retailer, Drakes Supermarket have signed on as members of the blockchain-based food ecosystem IBM Food Trust. The successful pilot can trace the entire lifecycle of a food product, from region to plate, and update the record in real time. The two South Australian organisations are the first in Australia to pilot IBM Food Trust using the IBM Blockchain Platform, reducing traceability times from three days to three seconds.
The pilot involved tracing the origin of a piece of steak back to one of four individual farms. IBM Food Trust uses blockchain technology to enable participating retailers, suppliers and growers to collaborate based on a shared view of food ecosystem data to enable greater traceability, transparency and efficiency. This is important as it provides increased data granularity, which is an enabler for several use cases. Firstly, in the event of fast, surgical recalls, customers can quickly identify the amount of product at risk with minimised false positives. Secondly, product differentiation, which allows retailers to prove the provenance and history of an individual cut of meat.
Thomas Foods International (TFI) and Drakes Supermarket have been testing IBM Food Trust for the past three months to deliver improvements in day-to-day operational efficiencies. By removing data silos within the organisations and enabling a high level of data granularity, the pilot has enabled data to be shared across organisations. TFI and Drakes are able to upload data into a shared platform and the lifecycle of the products being traced has been mapped across the organisations, allowing a product to be tracked as it moves through the supply chain.
IBM Food Trust members contribute data to the network
Participants such as TFI can upload their data and share with other organisations within their ecosystem. Organisations within the same supply chain can leverage the information of the partners to establish a single, shared version of truth.
Simon Tamke from Thomas Foods International said: “By maintaining the individual data relating to each product instead of moving to data about grouped products, we are achieving a greater understanding of how each food item is moving through the supply chain. This added level of transparency and verifiability will reinforce customers’ and consumers’ confidence in the provenance of our product and is made possible by blockchain technology.
“We are pleased with the steady progress of our blockchain collaboration with IBM, while we continue to receive very positive feedback from the industry and customers,” he added.
Head of Blockchain at IBM Australia and New Zealand Rupert Colchester said: “We see blockchain as a potentially game-changing technology for food traceability. Drakes and Thomas Foods have demonstrated how different players in a single supply chain can securely share data and key events, bridging organisational boundaries for the good of both consumers and the benefit of their own business processes. We expect to see more of this collaboration in the coming year, with groups of partners working together for the benefit of the entire food industry.
“Transparency and traceability are the key to many industries now, and none more so than in the critical issues of food safety and provenance.”
Tim Catwright from Drakes Supermarket said: “The greater level of granularity since adopting IBM Food Trust has enabled the traceability of a food package across the supply chain, reducing the time required to identify the origin of a product from days to just seconds.”
An electronic Bill of Lading pilot has reduced the time to transfer shipment documents from seven days to one second, enabling 28 tonnes of fresh mandarin oranges, a symbol of prosperity, to arrive early for Lunar New Year
Pacific International Lines (“PIL”) has used an electronic Bill of Lading (e-BL) built on the IBM Blockchain Platform in a successful real-time pilot tracking shipment of mandarin oranges from China for the Lunar New Year celebrations.
With the use of IBM Blockchain powered e-BL, the trial has produced a significant reduction in the administrative process of transferring the title deed from five to seven days to just one second.
This is significant because the Bill of Lading is one of the most crucial documents used in international trade, typically issued by a shipping carrier to document the title or ownership of goods. It also functions as a receipt of goods and a contract of the shipment.
Combining e-BL with blockchain technology promises to help companies reduce their document processing times to almost zero, with an instantaneous digital transfer of the bill of lading for their cargo. Document handling is automated, and goods delivered more quickly and efficiently. Hupco Pte Ltd (“Hupco”), a major importer in Singapore of mandarin oranges for the upcoming Lunar New Year, took part in the e-BL trial as the consignee of 3,000 cartons of mandarin oranges (approximately 108,000 mandarin oranges).
Chairman and CEO of Hupco (Mr) Tay Khiam Back said: “We are delighted with the outcome of the trial. By using the e-BL, we have seen how the entire shipment process can be simplified and made more transparent with considerable cost savings.
“Our customers can expect their orders in a more timely manner, and, importantly, with freshness assured.”
As a symbol of prosperity, mandarin oranges are a common – and welcome – sight during the Lunar New Year in Asia, with people exchanging them as greeting gifts and eating them during the festive celebrations. Companies shipping perishable items like these mandarin oranges require faster document processing and expedited cargo clearing for delivery. This shortens the overall shipping time – reducing potential risks for retailers and providing fresher options to consumers.
For this trial, the consignee (Hupco) benefited from collecting their goods faster with the immediate receipt of the electronic Bill of Lading.
They also benefited from:
- Lower operating costs such as electricity costs (charging for refrigerated cargo containers at the port while waiting for collection), storage costs (at port) and cost savings from enhanced equipment utilisation.
- Stronger provenance and real-time visibility of documents that is both traceable and tamper-proof.
- Greater security by helping prevent document fraud, which comprises 40% of all maritime fraud.
The live trial follows the e-BL Proof of Concept which was announced in October 2018.* PIL and IBM collaborated to digitize the lifecycle of negotiable and non-negotiable Bills of Lading on top of distributed ledger technology. The live trial is an important milestone because it validates how the system works in real-time conditions.
Executive director of PIL Lisa Teo said: “We are pleased with the steady progress of our blockchain collaboration with IBM. To-date, we have received very positive feedback from the industry and authorities, and we are enthused by the possibilities of how our blockchain developments can transform and inject a much-needed boost in efficiency and innovation into the industry.”
CEO and chairman of IBM Asia Pacific Harriet Green said: “A blockchain-based trade network will be a game-changer, and we have a great opportunity here with our partner PIL to revolutionise the documentation processes in a way that benefits the entire industry. Powered by blockchain, the e-BL developed by the IBM Research Singapore will be critical in helping to establish an extensible ecosystem for trade, thus expectedly enhancing trade efficiency and building trusted trade relationships among the industry players.”
The e-BL platform gives various ecosystem players the convenience to manage a Bill of Lading digitally with accuracy and speed, including banks. A similar trial from Singapore to Brunei has taken place for negotiable e-BL with key stakeholders participating including Bank of China Limited Singapore Branch (BOC). The negotiable e-BL network establishes an extensible ecosystem which facilitates trade transactions and settlements, as the process of issuing Letter of Credit and Guarantee is enhanced.
L-R: Marcus Sweeney, chief information officer, NTI; Charles Turner-Morris, director, BeefLedger; Tony Clark, chief executive officer, NTI; and Warwick Powell, chairman, BeefLedger.
Specialist transport insurer NTI is taking part in a blockchain trial, with the aim of boosting food safety, improving animal welfare and monitoring export security for Australian beef.
BeefLedger, an Australian integrated provenance, blockchain security and payments platform will deploy a pilot initiative that tracks the paddock-to-plate journey of premium Australian beef, abroad.
NTI CEO Tony Clark said the reasons for backing the trial are varied, but in a snapshot, it is supporting Australian businesses.
“We’re excited by the prospects this presents across several streams of Australian industry: agriculture, animal welfare, transport and logistics,” said Mr. Clark.
“While it’s early stages, we’re optimistic of the outcomes and learning, and what it potentially means for Australian suppliers, exporters and consumers.”
The pilot run will see premium live cattle transported from South Australia’s Limestone Coast to the processing facility at Casino in New South Wales and frozen for shipping to Shanghai, for consumption.
BeefLedger chairman Warwick Powell said the rise in wealth across Asia, particularly China, sees a steady growth in demand for imported beef and increased risk of counterfeiting and poor safety standards.
“Research shows us that ethical standards and concerns for animal welfare, along with authenticity and proof of product origin, are amongst the top priorities for Chinese consumers. It’s also what’s driving consumer interest in Australian products,” said Mr Powell.
BeefLedger is a platform developer and technology integrator, which is rolling out a blockchain technology, packaging innovations and Internet of Things digital systems to improve product credentials and supply chain performance. The platform deploys a diverse range of technologies to create a multi-layered system that delivers enhanced product security and credentialing.
The Australian beef supply chain is integral to the Australian economy, with some 45,000 cattle producers across the country contributing to Australia’s position as the third largest beef exporter in the world.
Managing a supply chain has never been simple and in an era of evolving trade barriers and global economic uncertainty, it’s more complex than ever. While new technologies such as blockchain and automation continue to up-end old ways, Australian organisations that rely on legacy systems to coordinate their internal and external supplier networks will struggle to keep pace.
Here are four things to keep in mind as you review your supply chain for the 2019 financial year and beyond.
- Agile planning
Supply chains are rarely static. These days they’re under constant pressure to evolve and adapt, for a multitude of reasons. They include regulatory changes, such as new emissions standards, digital disruption and the emergence of competitors offering better value products and services.
“Optimising the supply chain is important for organisations of all stripes, but in one sector it’s critical.”
Effective, connected planning and the ability to adapt quickly can mean the difference between thriving and struggling. ‘Siloed’ sections of the supply chain are more likely to lead to the latter outcome. Unfortunately, that’s just the model legacy solutions tend to promulgate. By contrast, cloud-based software allows a bird’s eye view of operations, from supplier status to customer demand. Australian organisations which embrace it will be better placed to anticipate bottlenecks and breakdowns in their supply chain before they become problems, rather than scrambling to remediate after the fact.
- Making planning an enterprise-wide affair
Joined-up planning can’t occur across the enterprise if business units – IT, sales, finance, operations – continue to do their own thing. Collaboration is crucial to success in an era where supply chain networks are no longer linear but, rather, more akin to sprawling spiderwebs. It’s tricky to achieve without the right tools. Putting them in the hands of decision makers and frontline staff, rather than in the IT department where they’ve typically found their home, makes it possible for companies to adapt their supply chain planning models quickly and simply.
- Embracing blockchain
It’s the high-tech development that’s shot to prominence in recent years – but when it comes to blockchain, interest and adoption are two different things. Expect that to change in 2019 and beyond as larger organisations progressively implement aspects of the technology within their supply chains. Smaller players that fail to follow suit may struggle to keep up.
- Retail alert
Optimising the supply chain is important for organisations of all stripes, but in one sector it’s critical. For retailers with an omni-channel model, featuring both bricks and mortar outlets and an online presence, having a supply chain that can service both efficiently is imperative. There are significant differences between supplying one or several stores and supplying thousands or millions of individual customers. For organisations attempting to make a go of these two very different business models simultaneously, tools that provide a holistic view of inventory aren’t nice to have – they’re essential. Without them, it’s impossible to enact the sort of connected planning that allows market opportunities to be identified as they arise and peaks and troughs in activity managed well.
Transform and grow
Supply chains are going through a period of unprecedented transformation, in Australia and abroad. Organisations that aren’t alive to the possibilities that connecting the planning process can offer – and alert to the dangers of not doing so – may struggle to stay competitive in 2019 and beyond.
Patrick Elliott is the vice president, ANZ, for Anaplan. For more information call +61 2 8310 6342 or visit www.anaplan.com.
A worldwide analysis of leading organisations implementing blockchain demonstrates the technology’s potential to transform supply chains across the globe.
A new report by the Capgemini Research Institute has revealed that blockchain could become ubiquitous by 2025, entering mainstream business and underpinning supply chains worldwide. Through investment and partnerships, the distributed ledger technology will dominate manufacturing as well as consumer products and retail industries, ushering in a new era of transparency and trust.
The report, Does blockchain hold the key to a new age of supply chain transparency and trust?, provides a comprehensive overview into the businesses and geographies that are ramping up their blockchain readiness, and predicts that blockchain will enter mainstream use in supply chains by 2025. Currently just 3% of organisations that are deploying blockchain do so at scale and 10% have a pilot in place, with 87% of respondents reporting to be in the early stages of experimentation with blockchain.
The UK (22%) and France (17%) currently lead the way with at-scale and pilot implementation of blockchain in Europe, while the USA (18%) is a front-runner in terms of funding blockchain initiatives. These ‘pacesetters’ are optimistic that blockchain will deliver on its potential, with over 60% believing that blockchain is already transforming the way they collaborate with their partners.
The study also found that cost saving (89%), enhanced traceability (81%) and enhanced transparency (79%) are the top three drivers behind current investments in blockchain. Furthermore, blockchain enables information to be delivered securely, faster and more transparently. The technology can be applied to critical supply chain functions, from tracking production to monitoring food chains and ensuring regulatory compliance. Enthused by the results they are seeing, the pacesetters identified in the study are set to grow their blockchain investment by 30% in the next three years.
On the downside
Despite the optimism surrounding blockchain deployments, concerns remain around establishing a clear return-on-investment, and interoperability between partners in a supply chain. The majority (92%) of pacesetters point to establishing ROI as the greatest challenge to adoption and 80% cite interoperability with legacy systems as a major operational challenge. Additionally, 82% point to the security of transactions as inhibiting partner adoption of their blockchain applications, undermining blockchain’s status as a secure technology.
Chief technology officer for financial services at Capgemini Sudhir Pai said: “There are some really exciting use cases in the marketplace that are showing the benefits of blockchain for improving the supply chain, but blockchain is not a silver bullet for an organisation’s supply chain challenges. Blockchain’s ROI has not yet been quantified, and business models and processes will need to be redesigned for its adoption. Effective partnerships are needed across the supply chain to build an ecosystem-based blockchain strategy, integrated with broader technology deployments, to ensure that it can realise its potential.”
In a previous report conducted earlier this year with Swinburne University of Technology in Australia, Capgemini found that experimentation in blockchain will peak in 2020 as organisations explore proofs of concept and branch out from Fintechs. According to the report, blockchain transformation will mature in 2025 as organisations undertake enterprise transformation and integration, establishing policies for privacy and data management.
Deputy Vice Chancellor (Research and Development) of Swinburne University of Technology Professor Aleks Subic said: “Organisations trust blockchain technology to solve key issues and create new business opportunities, and it lends credibility to the digital ecosystem across the supply chain. We believe that blockchain technology will play an integral role in the digital transformation of supply chain channels for a wide range of industries in the near future.”
Despite the barriers facing blockchain today, organisations are trying to drive wider adoption now while the technology is in its early stage. One example is the Mobility Open Blockchain Initiative (MOBI), a consortium comprised of a group of auto and tech companies focused on getting carmakers to assign digital identities to vehicles so that cars and systems can transact with each other.
Current industry use cases
Capgemini Research Institute’s report identified 24 use cases for blockchain, ranging from trading carbon credits, to managing supplier contracts and preventing counterfeit products. Capgemini applied these use cases to retail, manufacturing and consumer products, finding that blockchain can be and is being used for tracing the production, provenance and inventory of contracts, products and services. The report highlights that consumer product organisations are notably focused on tracing and identifying products, with Nestlé, Unilever and Tyson Foods implementing blockchain trials. Retailers are focused on digital marketplaces and preventing counterfeits, with the likes of Starbucks investing in blockchain trials. More critically, blockchain can safeguard food supplies, tracing food from farm to fork, to head off contamination or product recalls.
A copy of the report can be downloaded here.
A new blockchain tool developed by a researcher at the University of Waterloo, Canada, and a collaborator at Airbus in Germany could make procurement of goods and services safer and more impartial.
The tool called Strain, a blockchain auction protocol that allows for safer and more secure bidding on contracts with companies, makes the online auction more difficult to hack or manipulate than conventional methods.
“The goal is to have something that is traceable, cannot be tampered with in any way, and is confidential except for absolutely necessary information that needs to be revealed,” said Florian Kerschbaum, a computer science professor and director of the Cybersecurity and Privacy Institute at the University of Waterloo. “While blockchain can provide a strong audit trail, it is slow and generally shares too much information.”
The researchers understood that the protocol needed to be fast and secure at the same time. Currently, blockchain message exchange can take up to an hour to correctly settle for consistency and to handle competing lines.
Protocols are not tuned for blockchain in auction situations, in general. In contrast, the new auction protocol Strain requires only four blocks: a commitment of a bid, a computation of the winner, a verification, and finally an opening of the winning bid.
Strain protects the confidentiality of the bid against malicious parties using zero-knowledge proofs. This means that it reveals only that the computation is complete, but not the inputs or computational steps. It even offers an extension that would allow a vendor to participate in two auctions without revealing that they are the same bidder.
Ukraine is an example of a country that is using blockchain technology to hold auctions in a way that addresses concerns of nepotism and corruption.
Moving forward, Kerschbaum and his collaborator Erik-Oliver Blass at Airbus, would first like to further the performance and security of the protocol. They would also like to see if they can extend this to an open group of vendors as it has only been tested with a closed group.
The paper, Strain: A Secure Auction for Blockchains, appeared in the proceedings of the 23rd European Symposium on Research in Computer Security.