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Smart Ports
Point of View
By Deloitte Port Services
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Smart Ports
Smart Ports || Contents
Contents
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Smart Ports | Contents
Contents
Introduction 3
Need for Smart Ports is driven by
industry challenges 6
From digital to smart 10
Challenges ahead 16
About the authors 18
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Smart Ports | Introduction
Introduction
Currently, a tidal wave of technological
innovation & integration is pushing industries
and businesses to transform themselves in an
effort to become more data, and insight-driven.
The port industry is no exception.
Being part of both larger transport projects remain isolated. At the equipment and requiring different
and logistics (T&L) supply chains moment, ports in Western Europe types of products and services
and in itself being a cluster of are leading the pack in these creates a complicated environment
companies and businesses active in attempts. Although the Smart Port with multiple stakeholders. In
the T&L sector, ports are in a and IoT initiatives are addition to heterogeneity of data, a
unique position to fully grasp the commendable, there is still a long fear of transparency also remains a
potential generated by these new way to go before we can truly speak major issue. Ports are typically
high tech developments. of fully integrated ports that fully comprised of a cluster of competing
capitalize on the potential of IoT companies.
Within the wider T&L sector, and insight driven applications, in
companies have begun other words true “Smart Ports”. Thus, they are often very hesitant
experimenting with a range of to share information with a central
connectivity and data-enabled Becoming a Smart Port means authority that has the ability to
technologies. In aggregate, these developing solutions to address the aggregate and distribute the data
technologies form the Internet of current and future challenges faced amongst the stakeholders involved.
Things (IoT), which represents a by seaports including spatial In addition the interaction with the
convergence between the physical constraints, pressure on surrounding environment, both
and digital worlds, ultimately using productivity, fiscal limitations, ecological and social, adds an extra
data as a source of value. These IoT safety and security risks and layer of complexity and opportunity
technologies are being applied in sustainability. Today’s technological to Smart Port development.
diverse settings, from last mile and business model innovations can
transport optimization to warehouse be a driving force behind the Smart
and transport management Port.
systems. These developments have
been accelerated by decentralized However, determining which
networks that rely on the rapid technologies, how to implement
availability and analysis of them and the way in which they can
information. support the overall digital strategy
of the port remains the main
Seaports are playing catch-up with challenge.
the large T&L players when it comes
to developing insight driven It stands to reason that ports are
solutions and IoT applications. The faced with a myriad of issues both
current landscape offers some initial technical and strategic. The diverse
attempts at enhancing value nature of a port, with a wide variety Transport management systems are
propositions through technologies of companies and ecosystems, currently the number one IoT
application in ports.
like automation but overall these operating different kinds of
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Smart Ports | Introduction
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Smart Ports | Introduction
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Smart Ports | Need for Smart Ports is driven by industry challenges
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Smart Ports | Need for Smart Ports is driven by industry challenges
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Smart Ports | Need for Smart Ports is driven by industry challenges
Port apps
The port of Amsterdam for example, has launched multiple apps. The I Am Port app offers real time information on
ships locations and itineraries in the port. In addition you can find information on arrivals and departures, size, draft
and berth of each ship in the port.
A second app, the Port Data app shows the historical market shares of the throughput of cargo of eleven ports in the
Le Havre – Hamburg range in order to promote the idea of data sharing. Finally a third app allows you to tour the port
in a VR environment and aims to increase local support for the seaport.
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Smart Ports | Need for Smart Ports is driven by industry challenges
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Smart Ports | From digital to smart
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Smart Ports | From digital to smart
Simply put, there are three Moving towards a true Smart Port, parties meet in order to create
generations in port development: one which uses the full potential of value. In a platform world, this
an IoT network and smart data often means that the availability of
1. The first generation port is a solutions means that a port must be supply on one side of the market
loading and unloading port (until able to identify and take advantage affects the volume of transactions
the 1960s) of new business models within the on the other side of the market. In
2. The second generation port is an larger ecosystem. The nature of the the context of a port, the platform
industrial port (until 1980s) business makes this challenging, business performs a sidestep from
3. The third generation port is a since it requires integration between the traditional supply and demand
logistics / supply chain port (post the supply and demand side from balance mentioned above, where
1980s) the T&L sector, assimilating not only the port is a landowner and service
logistics firms and suppliers and provider for both incoming and
Each generation comes with a new distributors but also their clients like outgoing logistics. A port platform
function and focus. In the third industrial producers. model would be represented by
generation traditional views held three parties:
that a ports function was less Ports have already positioned
service and regulator oriented and themselves in the supply chain as a 1. Supply: this side of the market
more landlord and facilitator (or place for supply and demand to includes inbound logistics
cluster manager) focused. What we meet. In other words, they companies, ship owners,
see today with the increased need represent a physical manifestation terminal operators, maritime
for digital integration is that a port of a platform business model. service providers, etc.
is increasing its focus as a service 2. Platform: this is represented by
provider, albeit not in physical While it is likely common to think in the platform itself. The Port
services like towage and crane traditional strategic terms – those Authority provides the physical /
operations but more by becoming a examples from Porter mentioned business platform for supply
data service provider. This means before, the strategic application of and demand to meet.
that phase three is actually followed this business model goes beyond 3. Demand: this side of the market
by phase four, a digitalization of these perspectives. Ports must includes outbound logistics
port activities where new services focus on the ecosystem they have companies, manufacturers both
either replace or augment created, a platform - where two inside and outside the port, and
traditional port services. distributors seeking to meet
materials and products further
down the value chain.
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Smart Ports | From digital to smart
A true Smart Port will need to take While some of the same parties may
advantage of its position in the remain involved on the supply and
supply chain to add value with the demand side of the market, they
improved use of the data generated now increasingly interact digitally.
by the embedded IoT infrastructure. Furthermore, this new digital
While the data in itself does not add environment creates opportunities
value, aggregating different data for new, non-traditional parties (e.g.
sources and setting the right technology companies, individual
business rules for analysis can turn developers, etc.) to create
it into real insight. At Deloitte, we applications and solutions for
refer to this as the Information stakeholders targeted at improving
Value Loop, which is further performance or enhancing the
explained on the next page. All of business model of port stakeholders
this data can be gathered in a or the port itself.
digital IoT platform. It is at this
point that the physical (business) We observe six distinct data driven
platform and digital (IoT) platform opportunity models based on the
begin to merge. level of cooperation and the type of
data used.
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Smart Ports | From digital to smart
For information to complete the loop and create value, it passes through the loop’s stages, each enabled by
specific technologies. An act is monitored by a sensor that creates information, that information passes through
a network so that it can be communicated, and standards—be they technical, legal, regulatory, or social—allow
that information to be aggregated across time and space.
Augmented intelligence is a generic term meant to capture all manner of analytical support, collectively used to
analyze information. The loop is completed via augmented behavior technologies that either enable automated
autonomous action or shape human decisions in a manner leading to improved action.
Getting information around the Value Loop allows an organization to create value; how much value is created is
a function of the value drivers, which capture the characteristics of the information that makes its way around
the value loop. The drivers of information value can be captured and sorted into the three categories:
magnitude, risk, and time.
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Smart Ports | From digital to smart
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Smart Ports | From digital to smart
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Smart Ports | Challenges ahead
Challenges ahead
Even though some ports today are starting to
come to terms with the importance and need for
digitalization and IoT, there is still a long road
ahead to get to relatively mature Smart
Port concepts.
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Smart Ports | Challenges ahead
First of all the real question remains The need for cooperation between
what the port wants to achieve by ports, in order to truly share data
becoming smart – in other words and insights is something that is
what is the strategic imperative. unexplored. This third challenge,
This strategic goal should go beyond driven by a certain form of
mere efficiency improvements and protectionism of the port authorities
focus on a holistic, long term on their own data is a major hurdle
strategy, where insights are distilled in the development of a true Smart
from smart applications enabling a Port strategy.
transition towards an insight driven
company. Finally the dichotomy between the
port authority and terminal operator
This challenge is amplified by the ads a level of complexity.
large variety that exists between Operational implementations cannot
ports for e.g. a pure bulk port be forced by the port authority on
versus a container port. Defining terminal level. This could create a
where the quick wins and long term port with a highly integrated
added value lie must be done in infrastructure network but with
cooperation with the respective lacking superstructure integration.
clients.
The role of the port authority within
A second challenge is the increased a Smart Port strategy includes
focus on cyber security. Companies development and facilitation for its
active in the ports industry, are users. The final level of integration
responsible not just for customer will be the result of the stakeholder
data (which is already extremely management and determination
valuable), but for physical goods. In shown by the port authority. The
addition many of the stored goods issues drivers and challenges above
can be regarded as strategic help port authorities to determine
stockpiles for the countries and where to play and find the right
regions increasing the need for a strategy to win. It is our strong
robust security system. Right now belief that becoming a Smart Port,
port security is limited to the global driven by smart technology like IoT
ISPS code, which focusses on is a fundamental part of every
physical threats. Port authority seaport game plan.
ecosystems must be aware that the
digital threat is just as important,
certainly if ports continue on their
path towards further digitalization.
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Smart Ports | About the authors
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© 2017 Deloitte The Netherlands