6 Ways to Optimize Your Intermodal Supply Chain
How companies can use technology to improve port and transportation visibility within their intermodal supply chains while also making these critical components more cost-efficient and effective.
Handling about 25 million containers each year, intermodal has long been thought of as a reliable and cost-efficient way to move freight. Intermodal shipping comprises multiple modes of freight—such as ocean to rail and/or truck—to transport goods from shipper to consignee.
The process generally starts with a shipping container being moved by a truck to a rail or container ship, and then back to a truck for last-mile fulfillment.
In 2020, intermodal shippers have been facing new challenges with some port traffic being reduced, import volumes waning, and goods taking an extra five days (on average) to reach their destinations, according to Sea-Intelligence Maritime Analysis’ last count.
That’s what happened at the Port of Los Angeles, where import volumes were down by 12% and overall cargo volume had been reduced by 15.5% as of August.
Blank sailings (cargo shipments that have been canceled by the carrier), a backlog of empty containers, and the rush to secure space on outbound vessels have all impacted the intermodal landscape in 2020.
What’s Your Plan-B?
With a large portion of domestic commerce moving through U.S ports and facilities, many companies are reevaluating their footprints and planning for the future. And while COVID-19-related challenges were both unexpected and unwelcome, it’s a catalyst for companies to examine ways to re-architect their business models, improve their supply chain operations, and reduce costs across their footprints.
Here’s the problem: Traditionally, businesses have relied on historical data to predict supply and demand. COVID-19 turned this strategy on end, and now the same companies need a “Plan-B.” With all modes feeling the impact of the global pandemic, companies that lacked supply chain visibility pre-COVID-19 are now looking for ways to optimize their networks to:
- Gain access and real-time visibility to critical information and data
- Accommodate customer demand quickly
- Navigate extreme supply chain disruptions
- Address cost concerns
- Improve their revenue targets
- Establish contingency plans for the “next” disruption
6 Ways to Optimize Your Intermodal Supply Chain
Here are six ways companies can improve intermodal visibility and optimize this critical link in their end-to-end supply chains:
Tap into the power of massive IoT
The Internet of Things (IoT) has matured significantly over the last few years, and today’s intermodal users can leverage IoT sensors and networks like Narrowband IoT and LTE-M to make critical infrastructure intelligent.
By connecting everything in the supply chain—both inside and outside of its four walls—IoT enables sensor-based real-time tracking. For example, it can be used to obtain the location and status of thousands of containers, trailers, trucks in route, and even pallets or packages as they move through the supply chain.
This visibility provides critical information for managing potential supply chain disruptions, helps drive efficiency, and reduce transportation costs.
Deploy high-quality surveillance
This will help organizations gain insights at port entrances, where they can track trucks and trailers in real-time. High-quality surveillance also provides the data that companies need to be able to optimize their intermodal operations (i.e., it allows them to see which assets are on the ground, analyze what’s onsite in the yard, and even enhance worker safety).
By leveraging high-resolution cameras and advanced computer vision with analytics, companies can unlock a suite of new opportunities while also improving overall efficiencies.
Use AI to adapt to real-time shifts in supply and demand
Companies should focus on “push” versus “pull” strategies when assessing supply and demand. For example, they can use artificial intelligence (AI) to track real-time demand and develop AI predictive models, versus relying on traditional supply and demand models to tell them what they should order and/or have in stock.
With AI, demand predictions are more accurate and companies can more readily adapt to micro-demand trends.
Fully adopt a mobile-first approach
IoT, AI, and video surveillance are technologies that provide increased visibility throughout a supply chain. But if that data and information aren’t available to employees and managers on-the frontlines throughout the supply chain it is useless. Therefore, companies must deploy the necessary networks and access, cloud-based workforce and back-office software applications, and high-performing mobile devices.
With a mobile-first approach, you are putting access to the data and intelligence at the edge, in the hands of the critical frontline workers and decision-makers at the points of intersection. This is key to fully leveraging these technologies to enhance visibility and optimizing their intermodal supply chain networks.
Plan for 5G for communication
5G is a quantum leap for networks and it’s drastically changing the way devices are communicating with the network. Connecting billions of devices, 5G consists of three pillars — faster connections, greater capacity and lower latency or less delays in response. Faster connections is network speed performance that is 10 times faster at peak performance than today’s 4G networks. This enable faster data access, downloading and streaming of video content in particular. The second pillar of more capacity on 5G supports the many, many “billions” of IoT devices connecting to the network and often communicating without human intervention. And the third pillar, lower latency or less delay in response means the 5G network can support applications that need immediate, real-time response that is required in self-driving trucks, safer rail transport and mass transit or medical imaging.
Practice good compliance
We’re likely to see new COVID-19-related and climate change workplace compliance and regulation standards coming soon. We’ve seen how a virus can disable the entire supply chain, which is why sanitization and virus mitigation processes are a must. Along with that, companies must prioritize security and situational awareness, both in the physical and the cyber sense to avoid other extreme business disruptions.
Sustainability and modernizing infrastructure for efficiency are becoming increasingly popular as more companies and ports are pledging to become carbon neutral, while others are regulating sulfur emissions (in compliance with the IMO2020 regulations).
What’s Next for Intermodal Supply Chains
COVID-19’s impacts on the global supply chain are far-reaching and continue to affect nearly all aspects of these critical networks. Right now, companies are preparing for what might come—another global pandemic or global business disruption; shielding themselves against further impacts from the COVID-19 pandemic; and future-proofing their supply chains to absorb any additional impacts.
By implementing some or all of the technology and strategies outlined in this article, intermodal users can prepare for the future and be braced for any disruption. Panasonic TOUGHBOOK mobile solutions and it’s ecosystem of industry-leading partners can help you to manage and reduce costs, increase productivity and play a role in transforming your organization’s transportation and supply chain operations. Contact us at TOUGHBOOK@us.panasonic.com if you would to learn more.