Maersk recently announced that it has selected Microsoft’s Azure as its preferred cloud partner. Azure will serve as the platform for all the divisions under the A.P. Moller – Maersk Transport & Logistics banner. The cloud platform is intended to enable the company to pursue its goal of digital transformation and advance its strategy “of becoming the global integrator of container logistics.”
Maersk already ranks as “the largest transport and logistics company in the world,” according to Microsoft’s press release on the partnership between the two businesses. The company’s number of ships exceeds a thousand, and the Maersk Line transports over 17 million containers each year. That’s a lot to track to stay on top of what is going as anticipated and what calls for intervention.
Global transport is subject to all kinds of delays, ranging from the readiness of the product to the weather to terminal lineups. All those can interfere with the flow of global supply chains. That’s why access to information about the shipments when they’re happening are essential for planning and stepping in when necessary.
Ibrahim Gokcen, chief digital officer, Maersk, in the Microsoft release, explained that there are two underlying motivations for the partnership adoption. One is to work off a single, “common platform shared by all our transport and logistics businesses,” he said. The other is to develop “a marketplace of apps and digital products that improve operations and drive better business decisions.”
As detailed in Maersk’s details on the partnership, the unified platform would make “it easier to create and link insights related to operations and commercial activities.” It also would be more economical and expedite scaling the solutions throughout the business units.
The data that comes in includes report of Maersk’s fleet performance and yearly container repairs that add up to almost four million. Tacking all that effectively gives the company invaluable insight for better planning, as well as information their customers want to know.
“With Azure, products that are beneficial to one business can be quickly adapted for the others, because all data that can be shared from the businesses is now available in the same place,” Jan Voetmann, head of analytics engagement, explained.
As a case in point, he suggested the possibility of coming up with “an algorithm that uses crane data to predict the optimal time for maintenance to be done in order to avoid breaking down.” That determination could then serve as a standard to determine when such maintenance should be applied to other things, “say, containers or vessel engines.” Once the pattern is proven, “we can just grab the other data set in Azure.”
The idea of using cloud is to harness those data insights both for those within Maersk and for its customers. As Gokcen observed, “Eventually Maersk’s vessels and containers and other assets will be generating terabytes of data on operations and activities in real time, and machines and people will be talking to each other, learning things about our operations and our customers that we can’t even imagine now — and they’ll be available as products, for download.”
In fact, customers will be able to obtain the apps developed specifically for the purpose of gaining a view of what is happening in the supply chain at the Maersk app store. Then they would just have to glance at their phones to know what’s happening with their shipment and so capitalize on Azure’s IoT’s capabilities.
In an interview with Fortune, Judson Althoff, executive vice president of Microsoft's worldwide commercial business organization, pointed out the advantage of connecting cargo for tracking: “A tracking system that follows them, from when they are loaded through the last mile of delivery, means customers can visualize the flow of goods.” For one thing, that could show what happened to account for a shipment of “100,000 Barbie dolls” losing 20% of them to arrive with only 80,000, which he say is “the industry average.”
Likely, they were lost for a variety of reason, whether through accident or deliberate theft. Without tracking the customer would be completely in the dark about which particular factors are involved in the loss cargo. So having a view of what happened when would empower the customer to plan for better loss control the next round.
With the cloud data collection and the ease of access provided by apps, all involved will have a more complete picture and be able to make more informed decisions for their business.