Over the past seven years a number of U.S. Business Schools undertook a variety of studies to answer questions relating to making investments in supply chain security and the use of technology to either minimise risk or to increase logistics efficiency.
The main question being asked: “Is there a financial return for those companies that invest in a higher level of logistics security through the use of technology?”
The studies suggested this was the case, especially when there is visibility of the cargo and its condition from beginning to end, as well as the implementation of a proper monitoring programme within an overall logistics plan.
Currently, according to the a recently published report on container scanning, the World Customs Organization claimed there were approximately 250 million containers currently handling global trade. Very few have visibility technology whereby the shippers or logistics partners can identify exactly where their containers are and if the cargo inside has been breached in anyway.
Tracking and tamper technology
There are a growing number of supply chain professionals, however, who view the use of tracking technology as a tool similar to the concepts of “lean manufacturing”, to lower cost when it was implemented around the globe in the 1990s.
If you improve supply chain efficiency by lowering inventory, reducing cycle and shipping time, reducing pilferage and loss, while increasing the efficiency of the customs clearance processes, your profits will increase. At the same time, the cost of adding “security logistics” visibility must be reasonable, as it now can be.
For security, almost all of these millions of containers use some level of tamper evident mechanical seal, whether barrier or indicative. As the WCO SAFE Framework Authorized Economic Operator, (AEO) programme expands globally, the ISO 17712 High Security (H) compliant seal is fast becoming the seal standard.
On a parallel basis, there are visibility solutions that are emerging which are also compliant to the ISO 17712 (H) standard and incorporate an electronic seal component intrinsic to a “real time” logistics model.
The use of electronic seals has not gained traction over the past seven years because the industry waited to determine what the direction the world’s governmental security agencies were going to take relative to electronic supply chain security, and then marry that direction with the proper technology.
Ultimately, the world’s governments provided no such direction and electronic seal technology development has reverted to its initial purpose; providing components that will enable shippers and logistics providers to attain significant “Return on Investment” through efficient movement and visibility of their cargo.