Building an ecosystem to optimize and digitize the supply chain for sustainable mobility
Sustainability is hugely important to the logistics industry. Transport accounts for around 20% of global carbon dioxide emissions, while a report from the international organization Paris Process on Mobility and Climate (PPMC) says truck transports specifically account for one-quarter of global transport energy use.
What’s more, in Europe approximately a quarter of containers on the road are empty. These empty runs have high economic costs due to the wastage of fuel, time and labor, as well as increasing emissions through congestion. With the supply chain generating such vast quantities of waste and CO2 emissions, it’s incumbent on us as an industry to change before governments force us – or before customers demand it.
The key to unlocking a more sustainable model is to achieve complete visibility through the supply chain, including around emissions data. This data then needs to be shared between all stakeholders, so everyone can get a deeper look at the inefficiencies across their logistics networks and take steps to reduce the environmental impact.
However, doing so isn’t easy. So, how do we build an ecosystem that encourages digitization and real-time visibility (RTV) for a more sustainable industry? All it will take is three simple steps focused on the power of data.
Step 1 – Make supply chains visible to everyone
First, we must make sure all transport and emissions data can be gathered, shared and acted upon freely. This requires a level of openness and accessibility that doesn’t currently exist in the logistics industry – and has become more of a challenge as supply chain complexity has continued to increase.
Sixfold’s open visibility data (OVD) API is one initiative that lets carriers, shippers and logistics service providers (LSPs) share their RTV data across platforms and providers. This removes the issue of data being stuck in silos and enables all parties to share the data they want with who they want, in a safe and secure manner.
Enabling this flow of information between multiple stakeholders is the groundwork to creating a digitized ecosystem for greener and more sustainable logistics. It also maximizes the value of real-time visibility data by removing the data-sharing obstacles that have long hindered global supply chains.
Step 2 – Include emissions information as standard
Next, we need to make sure the data is gathered accurately and can effectively take emissions into account. This is vital to ensuring that supply chain businesses have access to the tangible insights needed to make smarter sustainability decisions.
Transporeon’s Carbon Visibility solution is an industry-first and ground-breaking approach to making this happen. It integrates and automates greenhouse gas emissions management across multiple modes of transport. By accurately monitoring the total emissions for carriers, shippers and LSPs, businesses can equip themselves with the right data to deliver the highest quality reports and in turn make better tactical and strategic decisions.
This means they can analyze specific operational elements (e.g. trucks or transport lanes) to immediately improve operations while creating the framework for a market that empowers companies to choose partners based on their emissions history. In addition, harmonized emission data facilitates horizontal collaboration between shippers and establishes more favorable market positioning.
Step 3 – Make the ecosystem attractive to join
The final – and often most difficult – step is to persuade organizations to join this ecosystem. Most approaches are very shipper centric, but we need to treat carriers as equal partners in change and give them the resources to undertake what used to be difficult digital transformation projects.
The key is to provide solutions that allow the low-cost entry into the transformation journey, while more importantly delivering tangible and actionable value to carriers.
For example, tools like Sixfold’s Fleet Monitor allow carriers to use the RTV data they generate to better manage their fleets in real-time. As a tool specifically designed for carriers and their dispatchers, it encourages carriers to join ecosystems that optimise the supply chain for sustainable mobility.
Ultimately, building an ecosystem for sustainable logistics isn’t easy. But there can be no arguing that empowering a greener supply chain is both extremely worthwhile and an immediate concern. According to the International Transport Forum, global transport activity will more than double by 2050 – with freight transport activity predicted to grow 2.6-fold and freight CO2 emissions predicted to grow by 22%.
Clearly, the onus is on the logistics industry to act before it’s too late. We believe that the triple-pronged approach of making data easily visible and shareable, accurately monitoring emissions and making it easier for shippers, carriers and LSPs to adopt greener strategies will be the best way to drive the future of sustainable supply chains.