Shipchain for Dummies Part 1 — Introduce Trust in Logistics
Have you ever wondered why it was possible to track your Uber Eat delivery man’s location in real-time but much more difficult to achieve with your last order from Amazon? Or worse, did the parcel get lost and no one seems to know why, and neither be willing to take responsibility for it?
Are you a Supply Chain professional who ever wondered why the logistics industry still relies on pen and paper for most of its documentation? Would you benefit from knowing when that crucial raw material delivery is due to arrive at your factory to efficiently plan when to resume production?
Are you a logistics provider who needs to ensure that drivers take the most efficient routes? Or a food quality engineer who must be able to track the provenance of the goods and guaranteeing conditions the goods are exposed to along the way?
Some of those needs have already been met but management of this data, along complex supply chains, confined into private databases of the different companies involved during goods’ transportation, and subject to manual errors or voluntary alterations, has not.
ShipChain intends to address this problem by combining the power of public (read decentralized and open) blockchain and Internet of Things technologies in their Track and Trace platform.
Regardless of whether you are familiar with these terms, this article has the goal of explaining how ShipChain is doing this.
Case study
Firstly, we will use a concrete example: imagine you own a small fleet of refrigerated trucks and often transport ice creams across the USA for various global producers. Competition is fierce, and our operations have to comply with ever-changing state and federal regulations (e.g. Electronic Logging Devices aboard trucks, capturing multiple parameters like speed, driving time, etc.). At the same time, you have to meet the ever-growing customers’ expectations. They want fast, reliable and predictable deliveries. Furthermore, they desire proof that products are taken care of appropriately (e.g. temperature, pallet stability, etc.).
How would Shipchain and Keeptruckin products help us address these challenges?
In short:
By ensuring that necessary data is captured and stored securely without having to trust anything or anyone.
Sounds counter-intuitive? Alright, to explain this, we ought to split the rest of the article in 2 sections, each covering different technologies:
1) How to capture the data — (Electronic Logging Devices — ELD and Internet of Things — IoT)
2) How to store the data — (Blockchain)
How to capture the data
Electronic Logging Devices
Plugged directly to the truck and using mobile apps, information like the speed of the truck, driving time, hard breaks is recorded without having to rely on manual entries that are prone to errors or voluntary false recordings.
Internet of Things
Leaving theoretical definitions to the Wikipedia page, one of the most concrete examples out there comes from Hanhaa and their ParceLive tracker. With the size of a thick letter, this device (that can be attached to the pallets in the trucks, for example) would record and broadcast on the mobile network in real-time: GPS location, temperature, or time of significant shocks (ever wondered what happened when opening a truck and all pallets are titled?) without the need for human intervention.
In summary, thanks to ELD and IoT technologies, we know have access to all the data that we need to respond to new regulations and our customers’ requirements. Over time, costs of these devices keep coming down, enabling a virtuous circle of adoption and benefits of scale. And half of the Trust we talked about earlier comes from the fact that this data was captured automatically without the need for human intervention. However, there is a problem… that’s not enough! What if the data was altered after the recording? If stored on a database, anyone with write access to the database could change it, so how is that a valid proof? This is where blockchain comes into play: to store the data and prevent its tampering.
How to store the data
Public (decentralized) blockchain
There are books and articles titled “blockchain for dummies”, and we would encourage the reader to look at some later. However, a short explanation is given here. A blockchain is a record (sometimes called a ledger) of transactions (grouped in blocks), and these transactions can contain various kinds of information (e.g. GPS location and temperature at a specific time of a parcel). The data is impossible to alter because the program that runs the blockchain does not rely on one central authority to validate the authenticity and integrity of the data.
A database or an Excel spreadsheet would be able to record that data in a similar way, except that the owner of the file can open the file, edit it and save it. The underlying idea and power of a blockchain are that no one can alter the information stored on a blockchain because the consensus behind data validation is so decentralized that no one can yield the power that would be necessary to interfere with it.
Finishing thoughts
In the Part 2 article, we will elaborate further on how the blockchain(s) powering ShipChain work(s). However, we hope that Part 1 helped you to understand and visualize where TRUST would come from and ultimately kick-off an overdue transformation of the Logistics industry.
In other words, TRUST in logistics would originate from the automatic recording of data into an immutable ledger.
Disclaimer: This article’s writer is not affiliated in anyway with ShipChain Inc. He is just a blockchain and logistics enthusiast who owns SHIP tokens.
https://en.wikipedia.org/wiki/Electronic_logging_device
https://en.wikipedia.org/wiki/Internet_of_things
https://tech.co/fleet-management/best-eld-devices
