Monday, 22 May 2017

Chain of Custody: The source of control in global supply chains? – IoT Beyond the Buzz

Chain of custody is a term often thrown around as a buzzword. In combination with the latest technology hypes like IoT, the chain of custody is magnified to address everything from supply chain security to regulatory compliance.

What is chain of custody? How and why is it relevant for supply chains?

You may find multiple definitions of a chain of custody by governments, associations, agencies, logistics service providers, shippers. All of them take a slightly different viewpoint on the topic.

The simplest way to define the chain of custody in the context of supply chains could be to name it as a certification mechanism that enables goods to come with a digital passport that serves as a verifiable transcript of the product’s life-cycle and journey. The chain of custody certification offers the ability for public and private entities to chronologically document (physically or electronically) the ingredients, components and final products, their condition from production to destination as well as along the distribution lines recording any disruption in the product’s environment that could negatively influence the products quality or performance. This documentation should be precise enough to also be validated by a court.

the chain of custody in the context of supply chains can be defined as a certification mechanism that enables goods to come with a digital passport that serves as a verifiable transcript of the product’s life-cycle and journey.
The logistics industry is slowly being transformed to the point when the utilization of the electronic data environment will become the norm in the industry and the additional technological advancements in IoT technology will enable the integration of complete cargo supply. Such new potential opportunities of data gathering and processing will produce valid documentation along the supply chain for the chain of custody.

Use of the latest technology

Two types of major factors have influenced the development and penetration of technology in global supply chains in general but also specifically with respect to chain of custody and security. Moore’s law is the observation stating that the number of transistors in a dense integrated circuit doubles approximately every two years – meaning latest technology becomes cheaper, smaller and faster and therefore more usable for supply chains. Second, initiated by 9/11 billions of US$ grants have been given to companies to develop new technologies for making international supply chains more secure. This led to major development activities as the initial risk of starting the business was covered by the grants. However, not all technologies are or will be accepted. The European Union and the World Customs Organization, for example, have rejected the Safe Port Act of 2006 with the impossible requirement of 100% scanning of all containers. Also from a business case point of view, there is not a given justification for any kind of new technology, or IoT solution respectively.

Human Factor: Be confident but don’t trust!

No technology, not even IoT, can prevent or eliminate human failures in the system. Even if the economic and technical feasibility is given for chain of custody solutions, there is still the human factor which should not be neglected naively. The problem is, that most of supply chain and security managers are so busy just keeping dots connected that they tend to forget to consider that every dot and connection represents a source for a new risk itself.

An end-to-end chain of custody system is built on involving and trusting several human beings at various touchpoints. Imagine you have a product tagged with a false-approve IoT technology at the point of production or assembly. The loading into a container of such tagged products is monitored and acknowledged by an authorized loading manager via IoT technology. From that moment on, the container is monitored with IoT technology during its whole journey. Every movement, every change in condition is carefully analyzed and reported. At the point of destination, an authorized trustee is confirming the receipt of the products via IoT technology and hands over to the receiver of the products.

Who guarantees that the product is tagged with the right information? Who can make sure, the loaded shoes are shoes and not weapons? While monitoring cargo in-transit, who guarantees, that the right person receives the needed notifications and takes appropriate actions? What if the thief colludes with the security manager of the company and triggered alerts are simply ignored? What if the authorized trustee at the receiving side is corrupt and confirms the receipt even though cargo has not arrived completely?

The success formula: Latest technology supported by well-defined processes strengthened by powerful structure

Developing a comprehensive chain of custody requires more than just technology and processes. It is obvious that the latest technology development can and will lead to major improvements in general, with respect to chain of custody and other supply chain optimizations. But the best technology is useless if it is not supported by a lean, well-defined process, which is at the end strengthened by a powerful structure around it. The chain of custody requires expert guidance to make the use of IoT successful.
Even the best technology is useless if it is not supported by a lean, well defined process, which is at the end strengthened by a powerful structure around it. The chain of custody requires expert guidance to make the use of IoT successful.
The evidence collector must be a neutral party closely working with its sponsor but with no inherent interest in the monitoring results. Only such a structure will allow to some degree a chain of custody as defined at the beginning of this article.


Obviously, the ability to chronologically and electronically monitor and document cargo in-transit will lift the complete supply chain into the visible electronic data environment.

Thanks to supply chain visibility companies are now enabled to optimize processes and create efficiencies. For example: The increased transparency along the physical supply chain enables organizations to improve financial supply chain operations and reduce inventory levels & working capital. Or, by monitoring shipments while in transit & knowing transportation conditions organizations can better verify the quality of incoming components.

To conclude: IoT can be a great enabler of a paradigm shift in supply chain management and it brings processes that were designed centuries ago in the days of sailing ships to the 21st century. At the same time the chain of custody, well set-up with processes and supporting structures, could be the trigger to start using the latest technology and realize additional benefits by leveraging business intelligence behind collected data.

This article originally appeared on the website of Arviem. To read more about cargo tracking and monitoring visit the company blog.

Wednesday, 9 November 2016

IoT enabled Supply Chain Visibility: The Holy Grail of Supply Chain Managers

Written by: Stefan Reidy

End-to-end supply chain visibility empowers supply chain and logistics managers to make educated decisions. It helps companies to decrease the impact of disruptions on the supply chain by providing actionable data. Supply chain leaders recognize the importance of visibility as it streamlines operations, reduces business risk, increases efficiencies and enables better decision making and forecasting based on insights offered by real-time data. KPMG’s study reveals that the industry is expected to see a rapid growth of investment into technologies such as IoT to monitor, manage and improve the supply chain operations. When considering the fact that the key beneficiaries of visibility solutions are multiple business functions such as logistics, supply chain, finance, quality management and security the results of the study are not surprising.

Source: Global Manufacturing Outlook: Low visibility, high supply chain risk (KPMG, 2016)

The IoT technology: The enabler of Supply Chain Visibility 

While the need for better supply chain visibility has been around for as long as there have been supply chains, the technological innovation that could serve as the enabler of this supply chain evolution was missing. Thankfully, by the ever increasing availability of IoT technologies, supply chain visibility can already be achieved today.  
IoT is on the rise towards restructuring the entire process by which supply chains operate. The power of IoT lies in intelligently connecting people, processes, data and things via devices and sensors creating a networked ecosystem of things continuously measuring, collecting and exchanging ‘live’ data. Supply chains benefit from live data as it provides unprecedented visibility into every process and transaction within the supply chain.
IoT enabled supply chain analytics dashboards provide opportunities for supply chain leaders to have better access to real-time data and transform today’s outdated supply chain structures and create the supply chains of the future that are hyperconnected, innovative, transparent and intelligent.

Real-time cargo tracking and monitoring improves in-transit visibility 

Today the true visibility into the movement of goods is still minimal and mostly done via processes heavily dependent on phone calls and email communication. The traditional supply chain visibility concept is milestone-based, resulting in logistics blind spots for the shippers. Data about the status of assets is only recorded when goods reach certain checkpoints. In-between the checkpoints companies lack the visibility to know where their inventory is located, whether carriers are providing the right service levels, and where the bottlenecks and inefficiencies are in the supply chain.    
With the help of real-time cargo tracking and monitoring, companies can replace milestone based track and trace solutions and benefit from automated end-to-end in-transit visibility from the point of manufacture to the point of delivery. Real-time cargo tracking and monitoring offers capabilities that set exporters and importers apart from their competition. It connects intermodal shipping containers, cargo, vessels and trailers with enterprise IT systems via the use of sensors, GPS, mobile networks and a cloud based platform. The sensors capture and transmit signals and data to provide a closer picture of the condition, geographical location and environment of goods in transit. By having the possibility to access this data at any time from anywhere, supply chain leaders are empowered to take corrective actions and make fast and smart decisions when it comes to the unplanned, distracting events and delays in the supply chain. 
Monitoring the condition and the environment of shipments in real time allows clients to verify the whole journey of a product; predict, correct, and even prevent problems thanks to faster response time. Clients know whether their cargo has been tampered with, whether it has experienced any significant shocks or temperature fluctuations that might have negatively affected the quality of the product.
Fully transparent supply chains allow companies to sense and respond to disruptions in the supply chains with extreme precision. Thanks to the constant flow of data and insights provided by real-time cargo monitoring, companies are able to uncover the unknown, by revealing supply chain related issues. In-transit visibility creates vast opportunities for supply chain optimization. It reveals insights that enable logistics and supply chain professionals to optimize shipping routes by defining safe and optimal routes, to evaluate carrier performance levels against benchmarks, to analyze logistics carbon footprint, to improve security of cargo and to reduce business risk.

This article originally appeared on the website of Arviem. To read more about cargo tracking and monitoring visit the company blog. 
Do you know where is your cargo and what is happening to it at this very moment? If not, get in touch with us to arrange an unbinding, free consultation to explore the possibilities of your business to increase supply chain visibility.
Stefan Reidy is a leader, a proud father, a supply chain enthusiast and a visionary aiming to build the ‘Google of Trade’. He is the CEO of the Swiss arviem AG, helping manufacturers, exporters and importers to make the invisible visible and the unknown known by enabling transparent global trade via real-time cargo monitoring services. Arviem's service provides clients with flexibility in managing their supply chains. While avoiding the costs of developing their own solution or the need to invest in devices, hardware, software and staff, clients improve their trade management and supply chain operations.

Tuesday, 27 September 2016

Fighting for Enhanced Supply Chain Security

By Stefan Reidy 

Cargo theft has been around for centuries; unfortunately, though the crime has evolved together with transportation methods. Bandits on horseback have been replaced by gangsters that are organized in international crime syndicates.

Cargo theft is a global problem affecting manufacturers, logistics providers as well as customers. It is a complex problem influenced by factors ranging from local laws to the global economy.

Jim Yarbrough, Global Intelligence Program Manager at the supply chain specialist BSI commented: "Companies have always faced a wide range of challenges to their supply chain, but [the] latest figures indicate how severe the impact of violent theft can be.

"These events are creating extreme levels of risk for organizations, both directly affecting the bottom line and disrupting the supply chain in ways which, if not tackled, could do serious harm to a company's hard-earned reputation."

BSI has recently published the latest Global Supply Chain Security and Business Continuity Risk Index, that highlights the current supply chain security and business continuity threats faced by organizations worldwide.

2015 BSI SCREEN Global Intelligence - Supply Chain Threats, Risks, and Trends

Stowaway Risk Increases in Southeastern Europe as Migrant Crisis Continues to Threaten Regional Business Continuity

The integrity of the transported goods can be negatively affected by the stowaway attempts which have been significantly increasing because of the migrant crisis. Migrants hiding inside of containers on trucks or railways increase security risks, negatively affect the timely movement of cross-border freight which results in increased shipping costs.

Continued Terrorism Threats Are Targeted Towards more and more industries in Europe and Globally

In 2015, 319 supply chain terrorism attacks were recorded by BSI. As the report states these attacks were reported in 33 countries that is 38% more than in previous years. Taking to consideration that the number of terrorists attacks on food, beverage and agriculture shipments has more than tripled while the number of attacks on pharma, metals, industrial and manufacturing cargo doubled since 2013, we can conclude that measures need to be taken to stop this deteriorating trend. 

Arviem AG ( Solves the Challenges of Obtaining Visible, Secure and Intelligent Trade

Without proper security to address these threats, the global economy is more at risk now than ever before. In order to increase the security of global trade,  Arviem has just announced its partnership with Powers International based in the US. The partnership will be working towards optimizing and strengthening supply chain security together with organizations such as the Interpol, Customs Cooperation Council and Nestle. 

Arviem’s market leading real-time cargo monitoring technology along with its American partner’s chain of custody solution will enable global cargo to come with a ‘digital passport’ that will serve as a verifiable transcript of the shipment’s journey. Arviem has the solution to keep the cargo visible by remotely tracking, monitoring and securing valuable shipments. 

This article originally appeared on the website of Arviem. To read more about cargo tracking and monitoring visit the company blog.