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Physical Internet

Pr. Eric Ballot

SIL — Barcelona, June 11th, 2015

workshop on e-Freight “Secure information based collaboration”

Venue day 1: SIL International Logistics & Material Handling Exhibition, Recinto de Montjuic - Plaza España, Fira de Barcelona, Barcelona, Spain

Day 1: Thursday 11th June 2015

Time Cluster Workshop – Opening sessions

09:30 10:00 Registration and reception

10:00 11:00 Welcome speeches - Ramón García, CITET

- Marcel Huschebeck, PTV

11:00 11:40 Key note speeches:

Physical Internet

From CO2 to CO3:

making supply chain collaboration sustainable

Eric Ballot, MINES ParisTech

Frans Cruijsen, Argusi

Cluster Workshop – First session moderated by Dolores Herrero, ITENE

11:40 11:50 Introductions to BESTFACT cluster on e-Freight Roland Frindik, MARLO, cluster leader

11:50 12:50 How to get a successful shopping experience

Processes in mobility. The collaborative last mile

ICT and Electric Vehicles for Last Mile

Enrique Sánchez-Prieto, CRAMBO

Raico Luis, FIELDEAS

Arturo Pérez de Lucia, AEDIVE

12:50 14:20 Lunch

14:20 15:20 Palletways – Technology POD and PASS

Building Blocks Logistics

B2MOS – The Business to Motorways of the Sea

Jose Miguel Garcia, Palletways Iberia

Pieter van den Bold, Innovatrain

Adriana Diaz Alonso,

Escola Europea de Short Sea Shipping

15:20 15:40 Coffee and Tea Break

15:40 16.20 FREIGHT 4ALL Project - Italy-Spain Demonstrator

LogiCon: Improving service quality by involving small

transport operators in the electronic information exchange

Sean Deehan, Fundación Valenciaport

David Quesada, ENIDE

16:20 17:00 Panel Diskussion moderated by Dolores Herrero, ITENE

17:00 end of 1. day of the e-Freight workshop

17:00 19:00 possibility to visit the SIL Exhibition

20:30 Common dinner at Ca la Nuri Restaurant, Barcelona (directions below)

Agenda

2

• Efficiency and trends

• The Physical Internet concept

• Stakes and perspectives

E. Ballot June 11th 2015

Source: Centre for sustainable

transportation Canada

3

• Trends…

• Flow exponential growth

(even if they will not reach the sky)

• Shipments fragmentation

• Shipment median weight divided by 4,5

from 160 kg in 1988 to 30 kg in 2004 Source IFSTTAR 2013

• A no cost illusion for the consumers

• Expectations: better services and economic support to growth


Efficiency, trends and innovations

Efficiency, trends and innovations

How to take advantage of economy of scale when each shipment is going smaller?

How to mitigate the environmental effects? Decoupling / economic activity?

How to cope with the demand without new physical infrastructure?

4

• Huge dominance of freight road transport

• Fill rate and empty trip ratio difficult to improve

• Challenging goals


An incredible performance but with contradictions

Challenges and the Physical Internet concept

A call for new logistics

solutions

Truck overall efficiency (Food UK)

McKinnon, A., Y. Ge, and D. Leuchars, Analysis of

Transport Efficiency in the UK Food Supply Chain, L.R.

Centre and S.o.M.a. Languages, Editors. 2003:

Edinburgh. p. 38.

EU CO2

emissions targets

Challenges and the Physical Internet concept

5

Exemple de la superposition de deux réseaux

Definition


The Physical Internet is a hyperconnected

global logistics system enabling

seamless asset sharing and flow consolidation.

The Physical Internet is founded on

universal physical, digital, operational, business and legal interconnectivity

achieved through

standard open protocols, encapsulation, interfaces, certification,

performance assessment and monitoring.

B. Montreuil, R. D. Meller & E. Ballot, June 9th, 2015

www.physicalinternetinitiative.org

http://www.physicalinternetinitiative.org

Physical trend A generalization of containerization: small and modular boxes, pallets footprint free

6

Montreuil, B., Meller, R. D. and Ballot, E. (2010). Towards a Physical Internet : the impact on logistics facilities and

material handling systems design and innovation. In: AL.,

K. G. E. (ed.) Progress in Material Handling Research.

Material Handling Industry of America


Expected physical impact

7

Cost evolution Source The

Box, HAROPA & JB Hunt

The benefit of handling standard: the twist lock example


8 E. Ballot June 11th 2015

Information could be more independent of logistics operators

Information management trend

• Information captured and exploited mainly locally in silos

• Structured information communication across organizations thanks to the Internet of

Things and new norms

Information management expected impact

9

Information flow

Be part of the Internet of Things


• All logistics assets could be

connected soon… thanks to the IoT

• We need

• communications technologies

• Standard to structure the data

• Workflows and applications

Logistics networks trend

10

Actual supply networks design


+

=

Two dedicated supply chains:

overlapping each other

DC of retail chain 1


Plant of manufacturer 1

WH of manufacturer 1





Another supplier with 3

factories distributes via

2 warehouses to 10

regional distribution

centers of two

customers

A supplier with 3

factories distributes

via a central

warehouse 10


centers of two

customers

Expected impact on networks

11

Interconnected networks


+

=DC of retail chain 1








Another supplier with 3

factories distributes via

2 warehouses to 10


centers of two

customers

A supplier with 3

factories distributes

via a central

warehouse 10


centers of two

customers

An interconnected

network

Stakes and perspectives

12

“What if” we transfer shipments from supply networks to a “basic” version of the Physical Internet?

• Actual supply networks

Physical Internet Network

• A network of 47 hubs with hundreds

of transportation services


Stakes and perspectives

13

Cost reduction from -12% to -36% without changing inventory management

A simulation of a FMCG supply network in France

M€


An innovation platform

14

• Not a single warehouse… spread containers!

• 50 hubs in France with storage accessible to all

• And yet less inventory and transportation

• No shortage on the Internet!

• So many products stored and yet so often unavailable…

• A physical internet access provider for all

• It groups my deliveries, my shipments and knows me!

• A bonus when I announce my car journey

• I becomes a carrier of… goods containers!

• Invent your app!


Towards a consistent and standardized framework

15

Many dimensions to coordinate


• Logistics ecosystem components integration pitfalls

• The ITRS example

How to make Moore’s law?

An example of collaboration in the

semiconductor sector

Lack of physical interconnectivity

Heterogeneous pallet without

modular dimension

5

scaling. Technical progress was of course a key ingredient of this industry ability, but it

was not the only one: another key factor was the high degree of confidence, shared by the

industry players, that achieving Moore’s law was possible AND would bring the

expected benefits.

Fig. 1: The virtuous circle of the semiconductor industry

The ITRS is based on this industry-wide shared confidence of both the technical

feasibility and the economic validity of this virtuous cycle, as it is clearly stated in the

introduction to the ITRS executive summary: “a basic premise of the Roadmap has been that continued scaling of electronics would further reduce the cost per function […] and promote market growth for integrated circuits”.

Of course the ITRS is not the only mechanism that has been at work to achieve that

virtuous cycle. Nevertheless, it has had a strong prescriptive effect: not a single PhD

thesis in the field is written without positioning its research vs. the ITRS acknowledged

“roadblocks”. Likewise, funding agencies are also referring to the roadmap. The ITRS

has therefore been able to provide research guidance for the many actors of the

semiconductor ecosystem (semiconductor companies, equipment and material providers,

public and private research laboratories and institutes, and funding agencies), thereby

significantly contributing to technology exploration and at the same time increase resource efficiency in the very fast technological development of the industry. It should

also be stressed that the ITRS helped to synchronize the technology development and the

timely availability of manufacturing equipments and methods.

The literature on innovation management supports this view of the key role of a

global roadmapping process for the industry innovation capabilities. This literature

stresses that the success of an individual company depends critically on the “collective health of the organizations that influence the creation and delivery” of the firm

Better Performance/Cost

Transistor Scaling

Investment

Market Growth

European perspective: ALICE ETP

16

• The goal

• Efficiency gain by a factor 2 or 3!

• A more resilient network

• A better use of infrastructure

and means

• A call for innovation

• Obstacles

• Not urgent

• Too many standards

• New business models

• A lot of investments

Create a framework for a more consistent approach of logistics issues

E. Ballot June 2nd 2015

How to know more about it?

17

Recently published

• Research papers

• (E)-Books

– In English

• YouTube movies


Next time…

18

Efficacité global des camions

(Food UK)

A research center in China… Pr. George Q. Huang, end 2014

E. Ballot June 2nd 2015

19

Thank you

Québec, 2012-11-28, 76/76

Physical Internet Manifesto, version 1.11.1 Professor Benoit Montreuil, CIRRELT, Université Laval

Questions and comments are welcome,

and especially collaborative project avenues

[email protected]

www.physicalinternetinitiative.org

Twitter: @physicinternet

Pr. Eric Ballot

Mines ParisTech

60, boulevard Saint-Michel

75006 Paris – France

Tel: +33 1 40 51 90 97

Email: [email protected]


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