The path to visibility in container shipping
Cargo owners worldwide face similar problems with respect to their container transportation services. Multi-modal transport chains often appear as “black boxes”, and containers are lost from view until they arrive at certain points in the supply chain. These problems are compounded by inaccurate estimated time of arrival (ETA) data, especially when ETAs change and cargo owners are not proactively notified.
The lack of interoperability between different IT solutions has created huge “blind spots” along the end-to-end container journey that no proprietary solution is likely to resolve. This puts cargo owners at a competitive disadvantage. Without visibility into where inventory is at any given time, cargo owners cannot effectively meet market demand and are ill-equipped to manage disruption or unforeseen changes.
Achieving end-to-end, real-time visibility into multi-modal supply chains requires a unified, futureproof approach to the exchange of data. Digital standards such as those developed by Digital Container Shipping Association (DCSA) and its carrier partners are designed to align data definitions and drive interoperability of technology solutions. This will enable supply chain participants to exchange data in a unified way over disparate systems.
EDI has been the dominant method for exchanging messages between container shipping stakeholders for decades. It was designed to eliminate much of the human error that occurs with manual, paper-based processes, and it does so quite effectively. But like many 40-year-old technologies, EDI has some drawbacks in terms of keeping up with modern customer demands for visibility.
The limitations of EDI stem from the fact that it is designed for one-way communication of one type of message from one machine to another. Each EDI connection has to be integrated into the back-end systems of the sending and receiving machines. A cargo owner needs multiple EDI connections with each carrier they work with to communicate all the messages involved in, for example, a booking request. And if any of the data in any of the messages changes on either end, or a new type of data is needed, the EDI connection has to be reconfigured, or a new one has to be created.
As a result, the maintenance of EDI is extremely labor-intensive and expensive due to the number of 1:1 EDI connections required to connect multiple parties. But even if you have the money to spend, it’s becoming increasingly difficult to find people who can do the job. Technology is moving forward, and technologists are trained on modern technologies. EDI is a dead end for companies that need to innovate while maintaining a sustainable workforce.
APIs—real-time interactions, lower costs
The application programming interface (API) is the modern standard for interoperable digital communications. It is a set of programming instructions and data exchange standards that allow different web-based systems to communicate with each other in real time. APIs can handle billions of interactions every day. With new technologies like smart container tracking devices, real-time data exchange volumes will grow exponentially, necessitating a shift to API technology.
The value of API technology is well recognized in business, and it has been a linchpin for digital transformation in many digitally advanced industries, such as banking and ecommerce. Think about when you use your credit card to purchase something online. The data needed to complete the transaction is exchanged and validated instantly over the web using APIs. Many standards organisations are embracing APIs as a way of improving information sharing and interoperability. For example, UN/CEFACT has launched efforts to ensure proliferation of web APIs to support international trade and transport processes.
The 2-way, real-time data exchange enabled by APIs is what’s needed to increase visibility into container shipping processes and events. Think about the benefits for exception handling in particular. With EDI, shippers have to wait for carriers to notify them about agreed-upon events. But with APIs, shippers can query the carrier’s system or subscribe to automatically receive status updates for any relevant event. If there are delays or other types of exceptions, shippers can learn about them as they happen and work to resolve them immediately.
DCSA digital standards – driving real-time visibility in container shipping
The purpose of DCSA is to establish digital standards that will enable the interoperability of technology solutions across the end-to-end supply chain. This will provide a foundation for industry-wide digitalisation along the lines of what you see in banking, telco and the airlines. By working towards the widespread adoption of standards, DCSA’s aim is to advance the industry significantly in terms of visibility and real-time responsiveness.
With 9 of the top 10 carriers as members, DCSA is in a unique position to work with a broad range of industry stakeholders, including regulatory bodies and other standards organizations, to drive alignment at every connection point using APIs. This will create an ecosystem of interoperability across the global supply chain that will enable shippers to connect in real-time not only with carriers, but with freight forwarders, terminals, ports, regulators, banks, customs officials, etc. And all of these connections will have far fewer technology integration points and require much less maintenance than an EDI-based system would.
To date, DCSA has published standards for some of the most urgent and impactful aspects of the container shipping industry including Track & Trace, Internet of Things (IoT) and soon, electronic bill of lading (eBL) (as the first step towards eDocumentation). While these standards would move the industry closer to interoperability even if implemented in EDI, DCSA publishes open API definitions and design principles to expedite the shift to API-arbitrated communication. Widespread adoption of API-based digital standards will enable shippers and other industry stakeholders to receive the real-time data they need to make better business decisions all along the container journey.