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Tracking technology

Just to be clear: there is no “one and perfect” tracking technology for achieving supply chain visibility. Because… there are MANY options!

IoT devices, satellite and radio systems, analytics, Control Towers – and that isn’t even half of them. Which are used for what? You will learn about it in this chapter. And one more thing.

22%

22% of retailers and manufacturers have other focuses than trying to find new disruptive technologies (source), which means that tracking technology can be your competitive advantage.

Supply chain visibility trends

According to the 5th edition of Logistics Trend Radar by DHL, there are fourteen(!) different supply chain visbility trends that influence the T&L industry. Next-Generation Wireless is an exemplary singular technology with hundreds of applications.

Trend radar by DHL for logistics industry

If you felt a little dizzy, take into consideration that DHL is only one of many different information sources. For example, Gartner identifies nine(!) technology-driven trends for 2021.

nine strategic technology trends for 2021 by Gartner
McKinsey Trend Radar

Ironically, McKinsey Global Institute reports that 85% of respondents struggled with insufficient digital technologies in the supply chain. Of course, it’s worth to follow reports of all the mentioned institutions, but let’s be honest – a plurality of information sources do not always help… The possibilities are overloaded by tech solutions, and anyone could feel lost or frustrated with them.

Communication protocols

Tracking technology determines tracking possibilities. To track global or international shipments, you need technology with medium to a global range or dense evenly disposed infrastructure.

To track and trace for shorter distances, you need short-range communication protocols. Below you will find a classification that will clean up that mess a bit.

  • Wireless
    • Short-range (BT, Wi-Fi (LAN), RFID, NFC)
    • Medium-range (cellular (2G, 3G, 4G/LTE, 5G))
    • Long-range (LPWAN (NB-IoT, LoRaWan, Sigfox)
    • Global -satellite comms
  • Wired

Basically, we distinguish wireless and wired communiation protocols. A structure of wired technologies allows for short-range communiaction only. With wireless technologies you can track your shipments even globally.

Barcodes

Barcodes are a visual representation of data, readable only by optical scanners/readers. There are different types of codes, that can store different pieces of data (numeric data, alphanumeric data etc.). Basic division is between 1D (one dimension) and 2D (two dimension) codes.

  • 1D – Lineal barcodes (e.g., Code-128, Code-11, Flattermarken) – group of codes used in logistics and industry for serial numbers, product IDs, etc.
  • 2D codes (QR-Code, DataMatrix, PDF417, Aztec) – store any kind of data, especially for banking and payments, logistics, mobile tagging, business cards, events, Wi-Fi access etc.

When compared to 1D codes, 2D codes may hold much more data, are no less easy-to-use, cost-effective and have error correction and data restoring ability. Here are some examples of optical codes and how they are used.

Barcodes examples

Barcodes differ by the amount of data they can hold. Also, depending on the symbology, size and resolution of the barcode, you will use a High Density (HD) reader or a Long-Range reader.

Code type Use cases Code type examples
Postal bar codes (1D codes) Postal service providers optimize mail delivery with this kind of codes Australian Post Standard CustomerKIX (TNT Post Netherlands)Royal Mail
GS1-DataBar (1D codes or mixed) With GS1-DataBar trade items are identified; also used for a retail point of sale (POS) applications GS1-DataBarGS1-128 Composite Symbology
EAN and UPC bar-codes (1D codes or mixed) Used for product identification EAN-8EAN-13UPC-A
Healthcare codes (1D and 2D) Healthcare and pharmaceutical applications use these codes HIBC LIC 128HIBC PAS 39Pharmacode One-Track
ISBN, ISSN and ISMN barcodes Used to identify books, periodicals and media ISBN 13ISMNISSN

If you want to use any sort of barcode in logistics for identification, the barcode label must be within the line of sight of the reader and directed towards it to work. Otherwise, detection and identification are not possible. It is quite cheap and easy to print a sticker with a barcode and put it on an object or a box.

But to be able to identify and register the object effectively, you need either a carefully designed and set up supply chain infrastructure (e.g., packing or sorting lines), or you need employees and other actors within the supply chain to perform the barcode scans manually.

RFID

Radio-frequency identification technology uses electromagnetic fields to automatically identify and track tags attached to objects. The speed and accuracy of deliveries, completion of goods into a consignment, managing their flows, package implementation and control of returnable packages are very often performed with the use of RFID labels and tags.

RFID is perfect for warehouses and short distance communication (up to 100 m) as experienced in retail shops or hospitals.

It helps to create organised systems that store information about inventory, assets and people location. To build an RFID system you need three things:

  • RFID tags (also called chips or transponders),
  • RFID readers,
  • a software to receive, store, process, and send data.

For the RFID system to work, you need at least 1 reader and at least 1 tag.

RFID tags types

A tag can hold up to 608 bites (96 bites in standard EPC memory and additional 512 bites in User Memory). Due to the way data is saved the tags can be divided into 3 categories:

  • RO (Read-Only) tags,
  • WORM (Write Once Read Many) tags
  • and RW (Rewritable) tags.

You can also divide RFID tags by power source:

  • Active tags – have their own built-in battery and offer higher data logging rates and longer transmission ranges between them and a reading device.
  • Passive tags – do not have their own power source and acquire the energy from radio waves transmitted by the reading device.
  • Semi-active tags – are a combination of passive and active tags. They have their own power source in a form of a battery, but this only serves to power the chip, not to emit radio waves. Their sensitivity is much greater than that of the passive tags, and their battery life is longer than that of active tags.

Active RFID

Both passive and active RFID tags don’t have to be in the line of sight to scan them. In addition, one reader can collect information from multiple tags at the same time. The reading range depends on the RFID type and waves frequency. Generally, it’s up to 15 meters for systems of passive tags and up to 150 metres for active tags.

Passive RFID

For the passive tags the frequencies work as follows:

  • LF (Low Frequency) standard uses the range of 30 to 300 kHz and can read data from 10 cm (e.g., access card)
  • HF (High Frequency) standard uses the range of 3 to 30 MHz (according to ISO 13,56 MHz) frequency and can read data from 1,5 m (e.g., keyring)
  • UHF (Ultra High Frequency) generally ranges from 300 MHz to 3 GHz, but in systems and devices, the frequency is between 860 and 960 MHz. This standard can read data up to 15 meters (e.g., marker on metal)

What is important, standard passive RFID-based identification and tracking system gives you less accurate information. It informs you only whether the tag is in its range. However, there are some passive RFID systems that can tell you location in a 3D space which has an accuracy of up to 10 meters.

Bluetooth

Bluetooth is a wireless technology standard for exchanging data. Fixed and mobile devices can communicate with Bluetooth technology over short distances — generally up to 100m. However, newer versions of this communication protocol reach up to 1000m outdoors.

Bluetooth devices consume very little energy and can create a mesh network. They pass information from the device to the device without the immediate proximity of the gateways. Furthermore, with Bluetooth 5 standard, devices can infer the relative angle and distance of one another, so their location can be determined accurately.

BLE beacons

Although Bluetooth standards are regularly developed and updated, the technology is still mostly useful for short-range communication, usually within one specific site or across well-controlled environments because it requires quite high investment in the gateway infrastructure.

RFID vs Bluetooth

The introduction of RFID was supposed to set new standards in logistics, but some aspects of the technology created limitations. As the recent report by DHL sums it up:

RFID tags, though inexpensive, were not cost-competitive to simple printed labels. A lack of global standards across reading infrastructure and tags, as well as a swarm of heterogeneous proprietary systems, made global deployments complicated and expensive. Also, multiple stakeholders had to be involved to ensure availability of uniform, consistent infrastructure across complex and inherently fragmented supply chains (source).

But the technology is regaining professionals’ interest, especially for applications in the well-controlled environments. Although Bluetooth standards are regularly developed and updated, the technology is still mostly useful for short-range communication, usually within one specific site or across well-controlled environments because it requires quite high investment in the gateway infrastructure.

IoT in supply chain

IoT is short for Internet of Things and refers to a communication standard. IoT devices are a group of devices that can store, transmit and process data using all kinds of cellular technology or satellite communication in real-time.

IoT-based sensor networks consist of IoT devices equipped with sensors to track and trace location, temperature, tilt, shocks etc. and communicate with the proper software. At Skyrise.tech we run Independent tests of 5 location tracing devices about which you can read on the blog. They are commonly used in the transport of goods, but also in further links of the chain (fisheries, crop fields, mines etc.) to track raw materials. They support the supply chain visibility to the greatest extent but have some limitations.

Sea and air transport are such examples, because the cellular connection to transmit data in real-time is rarely or not at all available throughout the whole route. However, IoT devices are still very usable as they can log environmental data when not connected to a network and then restore the communication when they are back in cellular range.

IoT use cases in logistics:

  • Tracking and tracing the location of shipments, fleet and assets
  • Monitoring and tracing environmental conditions during shipping and production
  • Monitoring the state of assets and predicting when they need maintenance

Data loggers vs IoT devices

There are two basic types of tracking devices that distinguish the operation time: data loggers and IoT devices.

Simple data loggers, known and used in the industry for many decades now, collect data on the inner disc during the packing, storage and shipment, but the data can be transferred and processed further only on certain checkpoints or after the whole shipping process is over. This means that simple data loggers don’t work in real-time, and data can only be analysed retrospectively.

IoT devices with sensors work differently. They are connected to your software via the Internet to track location and/or environment of the shipment in a real-time. This means that you do not have to have the device in your hands to read data. IoT devices create faster, more reliable networks with which you can monitor what is happening in real-time with your shipment and/or what happened during the delivery.

How IoT works?

Tracking devices armed in the geolocation system (which can be based on i.e., GPS, GSM triangulation, WPS (Wi-Fi Positioning System) record the exact position of a tracked object on land, in the air or on the water at specific time intervals. Collected data can be stored within the device or transferred to a location in a database centre, cloud or an Internet-enabled computer. Also, more advanced IoT devices communicate with the central system on an ongoing basis and in response to certain pre-defined events, so the system can alert the user monitoring shipment about problems if necessary.

They make measurements at specific intervals and send them in real-time.

But what does it mean? The intervals short enough to call the whole procedure as real-time tracking, vary from implementation to implementation. For tracking of some assets e.g., empty containers, it might be enough to get information on their location once a day, but on the other hand, when you are moving a batch of temperature sensitive vaccines, you might want to know if the temperature has changed every 10 minutes, to react right away and prevent waste if any undesirable tendency appears.

Benefits of IoT

Numerous advantages are coming out of real-time location and conditions tracking. A business will not only acquire data but can also use them to:

  • calculate or even predict the time needed to reach certain destinations (and compare & optimise the routes),
  • get notified about potential problems as soon as they occur and take actions fast to prevent the delays,
  • inform the recipient of the shipment in advance about delays and measures taken,
  • prevent theft,
  • diagnose or predict harmful conditions during transportation and prevent damage that may result from them,
  • compare and evaluate logistics partners,
  • calculate the losses due to the delay in delivery,
  • understand better the problems that have occurred to better plan the processes
  • and much more.

Such automation brings savings by preventing your cargo from theft attempts or inconvenient environment. Instead of manual reporting, you get a piece of digital information transmitted live to your logistics systems. In addition, with such devices, you can track the location of your shipments in a real-time and be independent from information from 3PL systems, which is usually not showing precise location but some checkpoints, that might be even outdated (some 3PLs do not even provide an option to get shipment information).

Limitations of IoT tracking devices

At this time, you probably ask yourself – why don’t we all already use these IoT devices for tracking? Well – there are several reasons for that.

First – each IoT tracking device is quite costly. Simpler one-use trackers that are useful on routes that take maximum a couple of days cost at least several USD per unit. And more durable or multiuse trackers can cost up to several hundred USD each, and may require regular maintenance, charging and organising the process of reverse logistics.

Also, even a good tracker does not guarantee real-time data transfer everywhere – coverage and availability of communication infrastructure is a challenge not only at sea, but even in many rural areas in countries with generally a well-developed infrastructure.

Finally – sometimes it is simply pointless to invest in IoT. If you know that the vessel with your container has 3 days delay in the middle of Indian Ocean, you can usually just acknowledge it and do nothing more about it. In this case using special trackers is just an unnecessary expense. Especially that, in this case, you could use other, 3rd party data, to learn about it.

1. Tracking on sea

Containers transported on ships and equipped with intelligent tracking devices are still not that popular. Location on the world map is pretty difficult to obtain directly from the trackers, because of the limited cellular signal coverage on sea.

Furthermore, the temperature inside of a container, humidity, shock, noise and the presence of lots of large metal objects around the trackers influence the devices’ operation and distort the signal. In this case tracking the vessel’s position on sea by using data from the official AIS satellite systems makes definitely more sense. And the devices in the containers are more useful for gathering data on your load conditions, which can be retrieved after the container is unloaded on the shore. The devices mounted in containers are also still useful for tracking the assets’ location and utilisation on land, including checking if they were loaded on a vessel and unloaded in the port of your choice, and nowhere else.

2. Tracking in air

Using IoT devices for tracking air-shipments can also be challenging. Based on signal coverage during the flight, the obtained data on location or shipment conditions can be sent with a significant delay, if at all. But in this case the biggest challenge is compliance with airlines guidelines. Because IoT tracking units contain batteries, the devices might not be allowed on board. And an airline may require that they are turned off or placed in airplane mode during the flight. It varies from airline to airline, so you should check it before you decide to use an IoT tracking device.

As with the case with the vessels on the sea, during the flight you can track your shipments by tracking the planes’ location in dedicated systems.

3. Battery life

Another challenge is battery life. Different devices have different battery types that can discharge during the process of transportation. Based on the battery capacity and frequency of gathering and sending data, the devices can operate from several hours to several years. Remember that before you pick the right device and settings for your shipment.

We compared popular IoT tracking devices from Kizy Tracking, Cellocator, TrustedGlobal, Logmore and LightBug to see which is the best. Here you can read the blog post about their physical parameters and here you can download the report Independent tests of location tracking devices.

Achieving supply chain visibility with IoT

According to the Bluetooth Special Interest Group, 48 billion devices will have internet access by 2021. The majority of those devices will no longer be computers or smartphones but automobiles, machines, personal possessions, and appliances that communicate with each other, usually wirelessly. That number represents a ten-fold increase in connected devices over today’s levels

The logistics industry is constantly evolving thanks to technology. Internet of Things has made its way into containers, trucks, production lines and shipments for good. IoT devices continually transmit million bytes of data to control product and delivery statuses and improve visibility in supply chains.

Important!
We should distinguish IoT from IIoT – Industrial Internet of Things.

The aim of IIoT is to monitor the supply chain, while increasing the effectiveness of manufacturing or management system. IIoT devices have more sensitive sensors, including more location-aware technologies while IoT is most common for consumer usage. The quality of analytical processes taking place inside IoT platforms also differs. Due to the amount of data generated, IIoT will be associated with Big Data, cloud computing, Machine Learning and Artificial Intelligence. For the sake of simplicity, we will use the term IoT.

How logistics achieve visibility with IoT?

Attached to machines, trucks, containers, and packages, the IoT devices help obtain unprecedented insights into logistics operations and help spot and solve many problems within the whole supply chain.

Supply chain visibility gained new possibilities with IoT. Internet of Things in logistics makes it possible to:

  • monitor the physical location of goods and assets (jump to: IoT challenges),
  • monitor the environment in which the goods are transported or stored,
  • manage traffic,
  • alarm when the fleet or production equipment requires attention (maintenance, violations),
  • help to optimise processes, e.g., shipping goods.

How is this done?

OneSensors collect relevant data (e.g., recognise the location, diagnose movement/no movement, measure the temperature inside the refrigerated vans).

TwoThe devices send data (usually wirelessly, via 3G, LTE, 5G, …) to the IoT cloud platform.

ThreeThe platform processes and integrates data obtained from many IoT devices. It can additionally integrate it with data from different systems.

FourThe data is analysed and displayed upon the user’s request in the application.

FiveThe data is spread across the network of other IoT devices to increase the visibility of information in the supply chain.

IoT platforms are responsible for collecting, processing, securing and integrating data from various sources.

In order to show actionable information in real-time (upon the user’s request), the platform may also automatically analyse the data.

Improve your supply chain visibility with IoT

Despite challenges of visibility in specific cases, there are many areas where IoT covers informational needs. Emerging logistics business models and ideas are the motor for technology changes – and vice versa. Tracking and tracing the shipments and cargo is the fundamental feature, but there are plenty more use cases.

Food and temperature control

A trucker with 200 kg of ice cream in the cold room truck enters the city centre. Unfortunately, on the last mile to his destination point there is a problem with a road which is under construction. The driver needs to find another way to get to the shop or else the temperature-sensitive cargo will melt away.

  • IoT sensors monitor in real-time what is the temperature in the cold room and send alerts when there are no optimal conditions for ice cream

Medicaments and vehicle accidents

The ordered batch of drugs is transported to the hospital. On the way, however, the driver had to brake harshly and finally hit the railings by the road.

  • During the transit, a vehicle’s location was monitored with GPS, thus you know the exact place of an accident. Sensors attached to drug packages note if there is any open and exposed to light. Thanks to RFID tags it is easy to distinguish those packages.

Drugs and inventory control

For some patients taking their drugs regularly is essential. A medical centre that does not have an optimal drug inventory level puts patients at health risk.

  • The warehouses in hospitals are easier to maintain with IoT. Based on the business rules orders for manufacturing drugs can by planned ahead and placed without time hazard.

Data tracking

There are at least three other options if you want to gather useful data and get better visibility of your shipments (not necessarily your assets). These are:

  • RPA (Robotic Process Automation) systems such as UiPath or SmartRPA
  • Logistics partners’ APIs (Application Programming Interface)
  • Custom integrations with logistics partners systems

These data sources can give you insights into the status of your shipment and milestones it has reached, as well as help you check e.g. if the flights or ferry connections that you are using operate according to schedules.

RPA (Robotic Process Automation)

You can use RPA to automatically retrieve data on the status of your cargo from specific companies’ websites and platforms aggregating data and update them e.g., in an Excel file or a TMS or SCM system.

This is done by setting a scenario of actions that should be undertaken by a bot in an RPA system – after you have done this, the robot checks your shipments one by one very fast, and you or your colleagues don’t have to waste your time on tedious manual work.

API and EDI

The first method used for sending information about cargo electronically was EDI (Electronic Data Interchange), created in the ’60sand still used by many companies. But nowadays, API (Application Programming Interface) becomes the new standard in the T&L industry. API makes it possible to share information openly and instantly between parties – usually by using cloud system computing. An example could be the information exchange on cargo status between your systems and systems used by your carriers, couriers and other 3PL companies. Unfortunately, not all systems have APIs, and even if they have it, they vary in quality and ease of use.

Custom integrations

Custom integrations may be done based on EDI and API. But they can be quite demanding if your logistics vendors’ systems do not have such interfaces.

In some cases, specialised Integration Platforms as a Service might be used as intermediaries in data integration – they can be treated as translators of data between different systems existing on the market. Many software companies offer system integrations, but a successful integration requires experience and knowledge about data flows, the software used and the industry. Therefore, it is highly beneficial to use this type of services from companies experienced with the transport & logistics industry.

End-to-end supply chain visibility

What is worth stressing – the real, end-to-end supply chain visibility, and especially predictive analytics based on it, is possible usually only thanks to using multiple sources of data.

For example, information from third-party systems on the movement of vessels on seas, or planes in the air is great to cover blind spots left by data from the physical trackers (especially IoT trackers). And physical trackers are good to cover blind spots left by the data from systems of logistics companies – some of the smaller logistics companies do not even have the systems to share such basic information as “delivered” status, not mentioning reaching any milestones on the way, or a route between the milestones.

Analytics

Your company’s performance may improve as a result of implementing data analysis tools.

In many cases it also needs an operator – a person responsible for drawing accurate conclusions from the data set and – equally important – the context of data embedding. But on the other hand, many parts of data analytics can be automated, either with some workflow automation, artificial intelligence (AI) and machine learning (ML).

Descriptive analysis

Descriptive analysis technologies enable you to create and view a dataset. For example, data visualisation tools (graphs, maps, dashboards, area charts, bar charts, heat maps, timelines …) help you to present one set of data.

The other example will be BI (Business Intelligence) / Data integration / ETL (Extract, Transform, Load) tools which are many sources of information combined into comfortable dashboards and reports with many data sets. When implementing technologies for descriptive analysis, you ought to build context around the collected information. Think about what information will help you answer the most important questions for your business and how this information will affect your company.

Descriptive analytics helps you answer questions such as:

OneWhat is the level of …?

TwoWhat has been/ was the level of ….?

ThreeWhat happens or happened? How many times?

FourHow different events and measures correlate?

FiveWhat are the observed trends?

Predictive analysis

In turn – predictive analytics help answer questions that are built around future events:

  • What will happen and when?
  • What is the probability of the occurrence of X?
  • What is the prognosis for Y?

Predictive analytics technologies allow you to create alerts before an unexpected but impactful event happens. For example, predictive machine learning (ML) / artificial intelligence (AI) algorithms can detect patterns of machinery component failures and learn from these patterns. During the learning process, they create a database with lots of relevant data. When the database is big enough and algorithms smart enough, they will notify personnel so that machinery maintenance can be comfortably planned ahead.

Also, when tracking the movement of cargo, ML algorithms may predict how small delays in the beginning can translate into the final estimated time of arrival (ETA) based on the data about previous logistics operations and some extra data from external systems e.g., on the weather conditions or traffic.

Blockchain

The concept behind blockchain can be described as a distributed ledger that can record transactions between parties in a secure and permanent way. It was introduced in 2009 to record and verify operations on a new currency – bitcoin.

The technology is young and developing, although some industries such as financial or healthcare have already started to benefit from blockchain technology. For the logistics industry, especially for supply chain transparency, blockchain may become a powerful solution.

Blockchain potential for supply chain transparency

  • Reducing bureaucracy and paperwork – the proof of purchase, permits, certificates can be stored in a tamper-evident digital format.
  • Reducing frictions in shipment statuses – information from blockchain is in real-time.
  • Enabling data transparency – each block of information has its own code which can’t be forged. Every violation is easy to recognise and trace.
  • Automating commercial processes in logistics with smart contracts

Blockchain challenges

  • Industry adoption – technology is not mature yet, the industry has problems to adopt and use blockchain to its advantage.
  • No standards and governance.
  • No legal standards.
However, we believe that companies that want to be more transparent can utilise blockchain alternatives, such as event sourcing.
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