Regulations and Technology – Why STEM Is More Important Than Ever In Supply Chain Management

First let me apologize, it has been a hot second since I’ve updated.  It’s not that I’m forgetful, life has been very busy at the end of the semester.  But now the semester is behind me and I’m on break for a blink before summer sessions starts.

But lack of presence on here doesn’t mean a lack of interest in the world of logistics; and it’s been a very interesting few weeks.  From China’s imports and exports slowing down to Uber, Google, and Ford lobby for autonomous equality in the passenger transport industry; it is a time of molding and shaping in the realm of logistics and supply chain.  And it is ever-present that Science, Technology, Engineering and Mathematics will be having a prominent center spot in the shape our logistics takes.

As times change, so do demands, and so do expectations.  Some of these expectations are welcome and exciting; but with it comes further responsibilities as the government seeks to ensure everything is acceptable.

There’s four big regulations taking place over the course of 2016 that are really taking place to encourage technological advances, and if you have an eye for such technology, this market is ripe for the picking.

Automated Commercial Environment (ACE), amendments to Safety of Life at Sea (SOLAS),Customs Relation Bill  (CRB), changes in the Authorized Economic Operator Program  (AEO), and EU Anti-fraud Agency (OLAF… yes, like the snowman who likes warm hugs) are four regulations rolling out this year that will impact shippers this year, and not just in the United States – but globally.  These are global regulations, they are going to affect the market as a whole. But three are specific to the realm of STEM development becoming cohesive with global shipping: ACE, SOLAS and OLAF.

ACE
ACE will be a staggered roll out and will be replacing the current Automated Commercial System (ACS).  This is to establish one portal for the information of imported goods to flow from businesses to the U.S. Customs and Border Protections (CBP).  The goal of ACE is to help the industry better facilitate trade – it boils down to moving products quicker in the commercial stream with better data and less paperwork. This means a better utilization of the International Trade Data System.  This will affect all forms of transportation, with March 16th being the first official date for the National Highway Transportation Safety Administration to begin adhering to it and all other modes following suit by October of 2016.  Federal agencies such as the Centers for Disease Control and Fish and Wildlife Service should be providing functionality for companies via ACE. By December 31st of 2016 all agencies and functionalities should  be completely integrated into ACE.
What do all these deadlines mean for shippers? It means that if they do not file with ACE when it comes to their cargo process it will not pass customs.  

This is a huge opportunity for tech savvy companies (3PL’s, 4PL’s, brokers, etc.) to step up and have integrated systems that make filing with ACE not only do-able, but seamless, as well as having customs-certified software, and that all data is not only obtained but accurate.  This is a huge shift in the import/export realm and those holding SAP certifications should watch how ACE affects the industry. If you’re a techy and you’re data driven, this could be your time to shine in processing data efficiently and even helping build software for companies to make them customs compliant.

 

SOLAS
This amendment to the SOLAS Convention will become effective on July 1st – and the new protocol of this amendment is to ensure that containers (only those being carried via water) have a verified weight that shippers are responsible for providing. This is in response to a number of ship related accidents being caused because improper weights were given. Inaccurate weights can also lead to big delays because if a port isn’t equipped with proper equipment, goods can sit there until the proper equipment can be obtained or it is unloaded without the proper weight being known and that can cause containers that are being stacked to collapse in on themselves.

There’s still some kinks in this to be played out – many shippers are lamenting this regulation citing that they don’t when to have this information and who do they give it to – which I’m sure will be worked out.  But I’ve seen it in almost every realm of transport: some companies will fudge weights or classifications to get a cheaper rate.  This will eliminate that with the threat of heavy fines (hopefully at least, improper weights is a huge safety issue)

Why is this important for STEM based careers?
Owning your own weight systems can be very expensive, especially with the upfront costs.  But technology and engineering are already out there making acceptable solutions.  Cost efficient solutions.

For example, LASSTEC’s Contaienr Weight System or Banbury’s LoadSense Technology.  All of this beautiful engineering meeting a very basic need that affects our world market.  They’ve seen a problem: Containers having to be weighed accurately and have gone above and beyond merely weighing it.

These are components built into the crane that not only weighs the container, the live data is then sent to the shippers database, stored, totaled, analyzed – in real-time via a wireless network.  Technology and engineering are badly needed in the logistics field – it’s not just people shipping products, it’s a changing force that impacts our economy.

OLAF (the kind that doesn’t like warm hugs)

This will be effective starting September 1, 2016 and it means shippers will have to file with OLAF about the status of a container – when it is loaded onto a ship, when it moves to a terminal gate, etc.  The goal is to establish a centralized database that contains information on container movements of goods entering, leaving and transiting the EU.  This is to cut back on fraudulent movement of cigarette smuggling and counterfeit goods.  This is on the basis of accountability to shippers – now with this information being transmitted to OLAF, if a container is alerted for having illicit goods, the owner of it should be easily identifiable.  And since shippers should already have such data, this should be easy.

But, since it hasn’t been needed before now, there could be a slight chance that shippers don’t have accurate records or haven’t been keeping full records.  STEM development comes in to build software for companies to help keep this data readily available and processed in real-time.  This could also lead to the possibility of integrated RFID technology becoming more of the norm for container shipping and allowing customers and shippers to pin point where their goods are when it’s on the water – something that isn’t as readily available as their other modal counterparts.

 

Let this be a slight nudge that while we need individuals that can work in the high stress of supply chaing with quick and critical thinking – our best support system comes from those building the company from within with STEM.  They are responsible for our software and the technology that we gladly use and are thankful for because it makes our jobs more efficient.

To learn more about STEM support and where your current county falls in devloping students for STEM fields click here.

 

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