Cold Chain Management and Audits in 2018
Cold chain management in 2018 and beyond will be different. With major companies around the globe looking for better solutions, what can we expect from IoT in the cold chain?
Ensuring regulatory compliance in supply chain operations is an increasingly complex task. The Business Continuity Institute surveyed manufacturing businesses around the globe and found that 47% of firms cited increasing supply chain complexity as a current, major trend and growing cause for concern. While businesses can benefit from smart, connected solutions and IoT tools, many don’t know how to handle them.
Here are three new tools changing cold chain management and audits.
While each of these IoT tools are very different, they confront two huge problems in the cold chain.
- Human error
- Time wasted on automated tasks
How do you keep track of your products as they bounce from place to place? Cold chains require strict oversight and often have zero-tolerance for error. They require quantitative records and those records should be exact. Several things, however, can go wrong. In fact, several things often do go wrong, resulting in lost goods and resources.
WHO estimated that, in some countries, 50% of all vaccine doses go to waste and much of this can be attributed to failures in the supply chain. This is often the result of, among other issues, accidental freezing, breakage, theft, and loss.
Due to the highly sensitive nature of most cold chain products, third party logistics operators (3PLs) are expected to keep track of all relevant data. While shippers, managers, and other supply chain players must objectively trust one another, it can be difficult to clearly record each step in the chain. This is where the blockchain comes in. For years, the technology has been moving into the spotlight—particularly in banking where it’s already safeguarding sensitive processes. In short, blockchain systems allow everyone in the supply chain to record information on a shared and inalterable ledger. As the data cannot be changed, this means far more reliability and also transparency.
Blockchain erases the need to manually update records across multiple companies involved in an operation. For situations where involved parties don’t necessarily all have the same goals or a single group in charge, the distributed system allows each party to take part and benefit. All records can be updated instantly and considered highly reliable. The result: insight on where products aren’t being treated properly and how operators should move to fix it.
For proof that the blockchain is growing in the cold chain: look no further than Wal-Mart. It’s been nearly impossible to avoid stories of Wal-Mart’s demanding requirements for food delivery. Their desire to bring temperature-sensitive products directly to consumers at great scale is driving them to find new solutions. It seems even the business giant is curious about blockchain.
“I see a lot of potential to create what I call a digital and transparent food system,” said Wal-Mart food safety vice president Frank Yiannas.
CoinDesk went on to locate a further statement from the company:
“This is just the start of our blockchain exploration. We plan to continue to test the technology, by including more data attributes, for example. And we will continue to test how we can use it to improve food traceability and transparency by collaborating with others throughout the supply chain. This means farmers and suppliers and other retailers.”
Jean-Pierre Emond, Director of Cold Chain Research at Georgia Tech Research Institute, attributed 90% of errors in the cold chain to human error.
In many ways, it’s not surprising that technology is now doing work in the supply chain traditionally done by human hands. When properly set up, it’s very easy for digitalized and automated processes to run smoothly, erasing that nasty human error rate from the equation. For example, RFID has begun to take over in many places throughout industry, the supply chain, and healthcare. What these RFID tags offer is the ability to track movement and sensor data from beginning to end. Moreover, they make it easy to use sensor data in audit material. Of course, there are many ways to log temperature data.
For example, you need to track harvested products. They move through each stage of their prepping and shipping process: harvest, pre-cooling, packaging, transportation, cold storage, and store display. That’s a lot of steps. Perhaps the product sits outside the truck for an extra ten minutes due to a miscommunication. Maybe it waits another five out on a tarmac. As the goods pass between several hands and vehicles, maintaining control of the cold chain management system in place becomes nearly impossible. You attach Bluetooth tags with sensors to containers. Using Gateways, location and sensor data from these tags is regularly sent to the cloud and analyzed regularly. Should the goods spoil, managers can use historic data to see exactly where the hole in their supply chain is located. They can even set triggers to automatically alert staff when the goods are approaching a certain temperature.
As the stringency of regulatory compliance grows for pharmaceutical companies, so does the number of tracking and temperature data logging solutions. Countries around the world are upping their Good Distribution Practices (GDP) for pharmaceutical products in particular. By 2018, it’s likely that 7 of the world’s top 10 best-selling drugs will be biotechnology-derived large molecules. These require particular temperatures and highlight the growing importance of (and possible shortcomings within) the cold chain. Food and beverage, on the other hand, is also being hit by the introduction of regulations from acts like, for example, the 2011 Food Safety Modernization Act. This is why many businesses are now implementing active tracking solutions.
Bluetooth Low Energy (BLE) tags and beacons are replacing RFID tags in many industries largely due to their affordability. In supply chain and cold chain logistics, they’re helping operators track sensor data in real time. Instead of waiting until goods reach their final destination to determine whether they were properly prepared and cared for, BLE tags allow managers to clearly see the state of products as they move from the warehouse to the truck to their customer. Of course, in many situations, one overall temperature for a space isn’t enough. Many shippers require more granular, real-time data for different parts of a vehicle. The affordability of Bluetooth solutions will allow BLE tags to shine by being quickly deployed at a large scale for low cost.
RPA and AI
Data is great. It can also be overwhelming. Depending on how large your fleet is and how much land you cover, you may have a lot of data to sift through. Data is a bit of a “have your cake and eat it too” situation for cold chain operators. You want to gather as much data as possible and you want to find all the insight you can. Still, you don’t want to waste an exorbitant amount of resources doing so. Without an amount of automation present, some datasets just aren’t manageable. In fact, while finding the data for an audit may not be a burden in itself, conducting and presenting the audit in its entirety is. That’s why an increasing number of operators are looking to simple to use smarter platforms.
Robotics Process Automation (RPA) is about doing the dirty work for you. Audits often require taking data from several different places, in different formats, and putting them together. While RPA won’t quite do all the work for you, it can take care of a large chunk of the process. For those struggling to to manage growing order sizes and increasing customer expectations, AI makes the data portion much easier.
RPA and AI: While RPA effectively uses rule based processes to perform tasks—likely the same tasks over and over again, AI, on the other hand, is considered self-learning and can deal with unstructured or very large data.
Automating better 3PL relationships
Automating as much of the supply chain as possible will be crucial to dealing with its increasing complexity. In an interview with The Telegraph, Daniel Weston, chief operating officer for Europe at Adjuno shared this tip when it comes to auditing:
“Avoid a tick-box exercise. Instead, employ a collaborative approach with all parties within your supply chain, with clear corrective action plans and milestones that are mutually beneficial. To nurture this, provide your trading partners with simple ways to provide accurate evidence of audits, including real-time images and issue logs.”
The point is that automated processes are not only more reliable in terms of GDP but in terms of business relationships. Objective data leads to less doubt or hazy expectations. Blockchain-based tracking helps remove questions from the equation. Bluetooth temperature and environment logging will make confirming compliance to specific regulation infinitely easier. And, of course, using any kind of automation to generate audits saves time and resources.
Next steps for IoT in the cold chain management
The goal of technology in the cold chain isn’t just to make it cooler. It’s to make it more manageable and reliable. That 50% vaccine loss affects not only the shipping company and the manufacturer but the people who need them. Though auditing isn’t a notoriously exciting use case, it is necessary in order to keep on top of the field’s complexity and moving parts. While these technologies are still on the cutting-edge today, increased demand for cold chain management tools will mean more, unexpected technologies will soon enter the space. The result will be a cold chain experience almost unrecognizable from its earliest (and even current) forms.