“Global Supply Chain security and effectiveness: SMART_CM standardisation proposal”

1. “Global Supply Chain security and effectiveness: SMART_CM standardisation proposal” Dr. Georgia Aifadopoulou SMART-CM coordinator Centre for Research and Technology Hellas Hellenic Institute of Transport

2. Content • ICT solutions for real time management & Security monitoring • The SMART_CM solutions for SC efficiency & increased security • Standardisation Recommendations of SMART_CM : CEN Workshop Agreement • Basic Structure of a Global Container Security Systems • Container Security Devices standardisation • The role of intermediate platforms • Standardised Messages for security processes • Impact of the project & Lessons learned

3. Background • A number of regulations in place to increase the global supply chain security • their implementation already has a negative impact on operational efficiency. • maintaining high security levels and managing these freight movements in an efficient way is a daunting task. • Supply chain security and operational efficiency, should go • hand in hand

4. Content • ICT solutions for real time management & Security monitoring • The SMART_CM solutions for SC efficiency increased security • Standardisation Recommendations of SMART_CM : CEN Workshop Agreement • Basic Structure of a Global Container Security Systems • Container Security Devices standardisation • The role of intermediate platforms • Standardised Messages for security processes • Impact of the project

5. Milestones in supply chain security & management Port of Loading Port of Discharge Point of Destination Point of Origin • Information Flow should match Physical flow • Common information is needed for supporting security and SC management processes Railway terminal Shipper Train Port Sea Port Sea Port Truck Retailer

6. ICT for real time management of intermodal chain • Information pipelines (RFID based systems + stakeholders information systems provide announcement of events along the chain) • On board container devices (hybrid GSM devises providing real time information, mainly invoked by security and cargo sensitive requirements) + middleware or single window platforms • Intelligent cargo (cargo as an “actor” in the chain communicating with the external world…) Key enabler : Creation of added value services.. Barriers for adoption • Information sharing is a problem also due to currently applied fragmented business models • Interoperability of systems an open issue • Who will pay for the technology?

7. Key problems limiting market penetration of ICT • High cost of technology implementation: The technology cost is high especially for the last two categories of solutions however it is expected to decrease with massive development. • No willingness for investment: The logistics actors are service providers which are invited to invest in ICT for improving their service; however the real economic benefit from the technology implementation lies at their customers (shippers) side. • Limited exploitation due to Information confidentiality/ fragmentation: In order to capitalize and exploit the full benefits of the real time monitoring of the chain operation, information has to be shared among the actors of the chain in order to create added value for each one of them in accordance to their needs. Since information is considered competitive advantage by the majority of the transport & logistics industry, it is resulting to fragmentations. • Lack of systems and solutions interoperability • Difficulty to shift from already adopted solutions

8. Content • ICT solutions for real time management & Security monitoring • The SMART_CM solutions for SC efficiency & increased security • Standardisation process within SMART_CM : CEN Workshop Agreement • Standardisation Recommendations • Basic Structure of a Global Container Security Systems • Container Security Devices standardisation • The role of intermediate platforms • Standardised Messages for security processes • Impact of the project

9. The SMART-CM Project • Focus • • Container security status provision • • Secure Trade Lanes Operation • • Supply chain management efficiency • • Container Security technology • Testbed • Two global container supply chain demonstrators • (container terminal operators, logistics services providers, customs • authorities, technology providers, research/consulting organisations)

10. The SMART CM solution (1/2)

11. The SMART-CM Solution (2/2) • A. ‘Interoperable Single Window Platform’: enabling all stakeholders involved to monitor container security status independently of the CSD technologies, no bias towards specific technology providers or towards customs or businesses, using the Movements Reference Number (MRN). • B. ‘Neutral information administering organization’: managing the neutral platform, guaranteeing data integrity along the whole process of security related container data gathering, providing information from platform to stakeholders. To be discussed: an EIA/SMART-CM platform for potential users. • C. ‘Industry Added Value creation’: the “burden” of the security regulations has been transformed to an added value for the transport industry, based on intelligent re-combining data incl. Estimated Time of Arrival (ETA) between a trusted environment – technology and neutral platform.

12. Basic SMART-CM Container Management Use Case —“To-Be State”

13. SMART-CM approach for overcoming ICT penetration barriers • Creation of trusted environment among actors of the chain and with Customs& Administrations. The support of information exchange among them is achieved by the development of a secured transactions platform. • Provision of customized added value services for each actor category for stimulating investment in technology by all • Standardized easy access to different information sources (on board devices/technology, information platforms, infrastructure sensors etc) • Fulfillment of cross sectors requirements. • Standardization of new or revised processesenabled by ICT

14. Content • ICT solutions for real time management & Security monitoring • The SMART_CM solutions for SC efficiency increased security • Standardisation Recommendations of SMART_CM : CEN Workshop Agreement • Basic Structure of a Global Container Security Systems • Container Security Devices standardisation • The role of intermediate platforms • Standardised Messages for security processes • Impact of the project

15. Standardization Recommendations by CEN WCA process (2/2) • CSDs Standardization for meeting industrial requirements for security • Standardisationof CSDs operational & technical characteristics • Message standardisation between CSDs platforms & neutral platform (s) • Middleware platform communication standard: adaptation of GS1 standard. • Proposal for a Basic Structure of a Global Container Security System • Large involvement of CSDs providers : 95% EU Industry, 75% of USA industry, key Chinese participants.

16. Basic Structure of a Global Container Security System • Components of a Global Container Security System (GCSS)was proposed....by CEN WSA SMART-CM_n0028 • Transportation Conveyance • Container Security Device (CSD) • Long-Range Communications Networks • CSD System Processing Centres • The Internet • “Neutral Platforms” as Security Monitoring Data Repositories

17. Basic Structure of a Global Container Security System • Key Components (1/2) • (a) Transportation Conveyance • There must be a transportation conveyance as the starting point in this process; it is typically a sea going container. However, all findings of the Project, and all conclusions of the CEN Workshops and CWA, are equally applicable to all other forms of surface transportation, including road, rail, or barge, and may in the future be applicable to air freight transportation. • (b) Container Security Device (CSD) • The Container Security Device serves four (4) functions: a GPS/GNSS receiver, a security status sensor, an environmental status data collector, and a communications device—both long-range and short-range communications. The SMART-CM Project determined performance objectives (KPIs) for the fulfilling of the security status reporting requirements. • ( c) Long-Range Communications Networks • Any communications network being used by CSDs is a public network of some type, in use by various subscribers to that particular service. Various systems use one or more of the cellular networks and/or the satellite communication networks available to subscribers.

18. Basic Structure of a Global Container Security System • Key Components (2/2) • (d) CSD System Processing Centres • Each type of CSD normally reports into a “home” system processing centre (or “back office”), which can then forward the report or components of the CSD report to various stakeholders, including “Security Monitoring Centres” such as the Project SMART-CM “Neutral Layer.” It is this “back office” system that is in fact sending the various messages to the “Security Monitoring Centre,” and not the CSD itself. • (e) The Internet • The various CSD Processing Centres use the Internet to send the CSD Reports to the “Neutral Platform.” In the future there may be value in the use of one or more secure private networks for the GCSS, but this is beyond the current scope of the CWA. • (f) Security Monitoring Data Repositories(s) • The Project SMART-CM “Neutral Layer” is one example of a Security Monitoring Data Repository; it happens to be based in Europe. Whether there is one global repository or a series of such repositories cannot be determined at this time. Issues around the centralized management of a Global System require Agreement amongst multiple global parties which are beyond the scope of this CWA

19. Model of a possible Global System Architecture for the Global Container Security System

20. Content • ICT solutions for real time management & Security monitoring • The SMART_CM solutions for SC efficiency increased security • Standardisation Recommendations of SMART_CM : CEN Workshop Agreement • Basic Structure of a Global Container Security Systems • Container Security Devices standardisation • The role of intermediate platforms • Standardised Messages for security processes • Impact of the project & Lessons Learned

21. …the project Impact …. …..a paradigm shift in global container chain efficiency & security: • Container security status provision : from post event to real time notification • Secured Trade Lanes Operation: • from AEO & inspection based model to technology enabled AEO & trusted parties based model • from regional security solutions to global solution • SC management efficiency: • from efficient actors to efficiently interrelated through information sharing community of actors (overall chain efficiency for the cargo owner). • From operations execution notification to operations pre-announcement • Container Security technology : • From technology for reregulation compliance to technology for cargo & chain visibility • From proprietary solutions with low market penetration to standardized Technology, offering global solutions & competing through excellence

22. Lessons learned (1/2) • Secured Trade Lanes Implementation : • Non EU Customs are seeking to trusted partied based models • Technology is accepted as a “partner” in security achievement in all continents. • A global solution for all modes of transport is imperative & should be achieved through customs agreement & International cooperation agreement . • SC management efficiency: • Real time information provision is feasible & highly appreciated • Sharing of business information only in trusted platforms • Container Security technology : • Technological improvements in accordance to the CEN WCA • Decrease of CSDs prices expected

23. Lessons learned (2/2) • Platforms role & interoperability : • Big investment by industry actors on IT platforms. • Only specialized platforms bringing added value are accepted • Real time information provision is a winning factor for acceptance • Interoperability achievement is a community agreement challenge and should be supported as such by open low cost technology • Global logistics is a complicated environment which can afford only Simple solutions • Ports Community Systems are recognized as trusted environments by the industrial actors and should constitute pillars for future VAS and customs compliance services .

24. THANK YOU gea@certh.gr www.smart-cm.eu