Global supply chain visibility, automation and optimization depends on the quality of one commodity: data.
While individual freight forwarders and container lines have optimized their internal processes, none have developed a standard way of doing business across shipping stages.
Port operators, drayage carriers, warehousing companies and final mile delivery partners have their own visibility tools that require integration with carrier operating systems, but there is no standardized framework for interoperability.
In 2019, the non-profit Digital Container Shipping Association (DCSA) formed, bringing together global logistics companies Mediterranean Shipping Company, A.P. Moller – Maersk, CMA CGM, Hapag-Lloyd, Ocean Network Express, Evergreen Line, Yang Ming, HMM and ZIM to create a neutral authority for establishing data standards in international shipping.
In an interview with FreightWaves, chief marketing officer Ellen Sun explains why it takes a neutral party to create these standards, describes achievements and obstacles the DCSA has faced and expresses hope for higher adoption rates from global supply chain participants.
Questions and answers were edited for clarity and length.
“In 2018, [container lines] got together and said, ‘If we keep digitizing our own systems, and those systems are not connected, we cannot get as far as we need to in regards to optimization.’ There was really no option but for them to join together and try to standardize in a non-competitive way.
“They also knew this was not just going to be a [container line] exercise. They really needed to make sure that ports, terminals, freight forwarders and shippers would benefit from this initiative. If the standards didn’t get adopted on a broad scale, the investment of time and money would not make sense.
“They decided to make a nonprofit organization to make sure that everything the DCSA developed would be free for everyone to use.
“The reason we opened membership up to the carriers first is because it’s easier to get agreement on standardization from nine companies than a thousand companies. Then we take input from the industry as a whole on how those standards are working within the whole ecosystem.”
“The container lines realized that all [supply chain actors] are working towards real-time data because it’s what the consumers want. We’ve moved into a digital era and they need to catch up and start giving their customers the kind of service and access to data that everyone is used to having. How long were they going to wait to start meeting that standard?
“E-commerce is providing that end-to-end visibility. As those trends accelerated, the carriers got a lot of outside pressure to start moving the whole industry forward.”
“Sometimes we have people say, ‘If you standardize everyone’s operations, wouldn’t you stifle innovation?’. Actually it’s the opposite.
“You see this in banking standards. Banks aren’t competing based on if you call them and they can tell you how much money you have in your bank account. The innovation behind the mobile application that lets you see how much money you have is what they are competing on.
In order to create an innovative mobile application for any industry, you need a standardized way of communicating data through API integrations. We are not trying to standardize each company’s mobile application, just how they are communicating that data.
“Logistics solution providers and freight forwarders are trying to add these extra services for their customers, but since there is no common practice on how to communicate shipment data, they cannot easily offer greater value to their customers.”
“We are still pretty small and we want our members, solution providers and other industry stakeholders to freely be able to show whether or not they have adopted properly.
“If somebody needs help with implementation, that is something DCSA can do. If they are having issues implementing API standards, we have libraries of sample code that they can download. Anywhere you are in the process of implementing our standards, we have people to help you.
“Today, the Adopter Program is an honor system. That’s important to emphasize because we are not able to check everybody’s implementation. For now, the honor system gets companies at least trying to conform to our standard. Later we will verify compliance of different tools like track and trace.
“Think of the Adopter Program as a stopgap on the way to a longer process.”
Post time: Sep-08-2021