The Green Corridor – Optimal Tech for Green Logistics – Making Emissions Visible
When I was advised that this month’s LogiSYM Magazine would have some focus on digitization, I immediately thought about the absence of greenhouse gas (GHG) emissions data in our everyday life. Accounting systems and other operational management systems simply don’t bother to measure waste and in particular, GHG emissions. Because tech investment in most large companies is made over years and years, the ability to accommodate for emissions data is usually something that has to be done outside of the usual management system data.
Raw materials, parts and services are currently all running through supply chains and manufacturing processes and emitting GHGs. Digitization of processes should include this emissions data going forward. The old adage “If you can measure it, you can manage it” has definitely proven itself time and time again. That said, information needs to be timely and it needs to be accurate. IT solutions for supply chains need to bring that micro level information on waste (including GHG emissions) into the hands of managers.
EFFICIENCY IS NO SMALL MATTER – DNV, an international society that conducts research on decarbonization, recently released its energy transition outlook for 2021. The outlook predicts that in the next 30 years, the global economy will likely grow by 111%, but energy demand will likely peak in 2035. In other words, the growth of making products does not increase in direct relation to the energy needed to make them. That is because it is expected that industries will be constantly improving on how to make more products using less energy. Indeed, human ingenuity has been able to do this time and time again.
The efficiency gains predicted though are not necessarily a given. It takes committed upper management to invest in the tools that can measure what is happening so that this greater efficiency can be realized. When it takes less energy to produce more, it creates proportionately less emissions. The ability to do any of this generally means having the tools – and that takes data. If you can provide a manager with data, then they can work on solutions.
Digitizing logistics technology is innovating fast. Companies that are investing in technology now have some avenues to get the GHG emissions data. One can have technology for the macro level (plotting our forecasting for sales) as well as the micro level (monitoring fuel economy in a truck).
I recently toured the Advanced Remanufacturing and Technology Centre (ARTC) in Singapore. This center was funded by both private and public sectors to advance R&D in manufacturing technologies – especially those involved with “remanufacturing” or essentially repairing something instead of scrapping it (itself a very green thing to do). Vivien Cheong, Regional Business Development Manager of Arcstone, (arcstone.co) led me past the neat gadgetry on display and under development in the lab testing areas to where her company sits on the 4th floor.
Arcstone sells digital systems to optimize manufacturing. The different stages of manufacturing are broken down into the steps taken in the factory in what they call their “workflow builder” module. For the factory itself, there is some neat calculating going on which takes the raw materials, the water, and the energy used. Using this information, carbon emissions is calculated for each step. In addition, processing times are recorded at each station so that overall production is monitored and managed.
In many factories the “raw materials” will be parts or subcomponents provided by suppliers. These suppliers do not have to provide carbon emissions data. Instead, the supplier simply provides workflow module type data to Arcstone, which crunches the numbers to offer a view of emissions throughout the entire supply chain and production chain.
In this way, operation and production data from various dashboards (tier 3 and 4 suppliers included) are connected to a main “control center” that monitors the entire supply chain. Important here is the inclusion of carbon emissions data. The dashboards from suppliers as well as what energy and materials are used in the factory are tabulating the amount of emissions in each location.
Arcstone provides several ways for the data of suppliers to be passed. It can be done via EDI, API or via a web portal. Such real-time data and visibility functions allow for supplier comparisons as well as overall emission source contributor identifications, which can be focused on for improvement. As the carbon emissions are directly calculated from the system, there is no need to badger suppliers for that specific data especially if they don’t know or have the information themselves. What the supplier does need to provide is production and utilization data, which they should be monitoring already for themselves.
DISTRIBUTION AND BEYOND – I also met with Anders Nordahl, COO of Mixmove/Orkestra, recently to share a cold beverage. After spending years at large MNC 3PLs, he wanted to get behind some tech that would innovate the industry. Mixmove provided that for him.
Anders is someone who thrives on data, so it makes sense that he would have been attracted to Mixmove’s solutions. He’s an avid cyclist who bikes at least 200 kilometers a week and he relies on a lot of data to help him maximize his routine: he measures his peddle power, which leg is working harder, his heart rate (the most important), and much more so he can improve his performance day by day. Believe me, it’s impressive!
Mixmove currently brings benefits to businesses dealing with warehousing fulfillment and transportation and includes 3M and DHL Supply Chain as customers, who primarily want to gain efficiencies in loading and moving shipments so that truck utilization is maximized and overall truck miles are reduced.
The technology incorporates AI features that optimize loading for shippers and 3PLs alike. Mixmove is cloud-based and provides visibility on the parcel level. Crucially, the system will calculate the carbon emissions spewed out with every transportation move. The mileage (using real-time optimal routing logic) is combined with the shipment’s physical details and the delivery truck type to calculate the CO2 emitted.
Data silos put up by different companies, systems, and even departments are often a main reason for overall inefficiency. That inefficiency means needless tons of CO2 are emitted. Anders has shown from his work with large accounts that by using the AI technology of Mixmove and collecting data from these different silos in an agnostic cloud-based system, great fuel savings and therefore CO2 emission cuts can be achieved. In one case the fuel and emissions per kilogram shipped was actually halved for a customer!
Siemens and other digital system vendors are also adding emission visibility features to their products. Businesses of all sizes have more and more options to report and capture their GHG emissions and more importantly have the tools to drill down and reduce those emissions. So when you are moving forward with new digital solutions to increase efficiency, do consider incorporating solutions that provide GHG emissions data. Our planet and our future generations would thank you for it!
Tim at ARTC Singapore