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2021
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DIGITALIZATION IN PORTS AND TERMINALS

Resolving issues are becoming increasingly challenging without any form of digital assistance.

A digital transformation builds a foundation that openly embraces new tech

Several tech trends expect to arise with more digital transformations taking place within the business and its operations. Take a look into the roles of IT teams and executives in the process of system architecture reform to allow for more AI, ML, automation, optimization, and standardization.

Renewed interest in the cloud

The business landscape has taken significant strides forward in embracing technology like the cloud, opening up limitless opportunities. Simultaneously, as digitalization becomes the norm, legacy systems have emerged as the preventative of innovation. Take a look into the strategies to handle these systems.

Products that boost environmentally friendly cargo container handling

Reducing the carbon footprint is a growing criterion when evaluating a new product. Understand the intricacies of how true cloud applications can derive outcomes better for the environment by taking a look into the difference between a lift-and-shift and a lift-and-refit migration approach.

DIGITAL TRANSFORMATION A NECESSARY STEPPINGSTONE TO ACHIEVE GREATER OPPORTUNITIES

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An IT manager or CIO developing a strategy fine-tuned to their terminal hold many responsibilities, especially in an environment fostering uncertainty. A digital transformation involves an array of tasks that align business goals with the company objectives against the proffered solution.

Many organizations accelerated their digital transformation within weeks or months instead of years as the reactive response to the global crisis. Achieving what would usually deem ‘impossible,’ most could move their existing operations onto a digital platform and perform their daily tasks. Existing processes already digitized and automated grant a faster digital transition, while businesses administering manual practices require a longer implementation timeframe.

The new business model works unbiased, defying difference in size, operations, and business nature. Despite the variants, most of these organizations share common fundamental goals prioritizing cost-optimization, environmental sustainability, and security. A solution that binds all these critical factors must establish a strong knowledge foundation. Understanding the latest technologies, then distinguishing beneficial tech from a fad is vital in the project feasibility and preparing for digital transformations.

The business landscape has taken major strides forward in embracing technology like the cloud, opening up limitless opportunities. At the same time, as digitalization becomes the norm, legacy systems have emerged as the preventative of innovation. Take a look into the strategies to handle these systems.

More application of Artificial Intelligence (AI) and Machine Learning (ML)

Particularly in this time and age where problems continually evolve, and the difficulty scale to resolve has risen, it is tricky to master these issues entirely on our own accord. Therefore, IT teams and CIOs or CTOs will increasingly embrace AI and ML technology to seek digital assistance, facilitating planning, calculating, and forecasting activities. When equipped with technological intelligence, complex tasks complete faster, reducing the work hours and mitigating errors, which drive both worker and operational efficacy. Therefore, IT infrastructures embedded with AI and ML technology can handle extraordinary tasks that may be challenging to complete when existing supplies, time, and equipment are limited.

Digitalizing business processes and operations builds a platform supporting AI and ML technology. The advantage of a readily digitalized IT infrastructure allows for integrating AI technology in small increments, leaving it up to you to fulfil the whole AI system scope when the business is ready. AI and ML technology appeal and its growing procurement mainly credit its resource optimization and better resource handling. We will witness widespread applications of AI and ML in the maritime and container handling industry.

Automating processes

Digitalization is the first step to accelerating business efficiency as it paves the way for innovative technologies to integrate and exercise their full potential power. On the contrary, most maritime businesses are manual, with paper as their primary source of storing, planning, and distributing information. It is almost impossible to maintain a competitive edge with an aversion to innovation in such a prevalent technological landscape. Just like AI and ML, digitalization will be more widespread as IT managers and executives look to execute their strategy with full automation in hindsight.

Digitalizing the organization constructs an IT system infrastructure ready for process automation which rids mundane and redundant tasks, freeing up time and labor for other higher significance tasks. Automating processes alleviates the number of tasks delegated to staff which also actively attributes operational optimization, decreasing the number of potential errors derived from manual planning. Manual handling of processes and operations can expose businesses to situations that make their systems vulnerable to security. With a population of heavy technological influence and more users connected to the internet, it fosters an environment for online dangers. As a result, it is crucial to digitalize information and automate processes to enforce better visibility and protection which readies the system to fend off any threats in all types of situations. Digitalization is the first step in entering a new business landscape. However, automation as the next step will ensure the foundation of operations and business that bring out the digital transformation’s full scope and power.

Resource and operational optimization

Digitalizing processes and operations allow users to determine the granular details necessary for achieving accuracy and precision in planning. It offers software users the power to access and utilize the information provided instantly at any given time, then calculates optimal results curated to the set parameters. As a result, the number of manual tasks typically spent sorting and filtering through information reduces. Hence, the overall workload decreases, which is naturally timesaving, leading to operational efficiency. Digitalization is essential to furthering business since it serves as the first steppingstone to any technological innovation. Without it, the IT solution will likely be incompatible with the current business structure, inflicting a negative downturn on resources and operations. Therefore, IT teams and executives responsible for port and terminal prospects must know the new software’s architecture and capabilities to distinguish the best-fit for compatibility and best to leverage full power.

In this global crisis, where resources run scarce, IT teams and executives may feel the pressure to develop a foolproof solution that values time and available resources while simultaneously delivering operationally and financially. Therefore, businesses that perform digitalization correctly will enable better time and resource management. These technological capabilities also seep into other business areas like environmental sustainability, whereby all factors contributing to wastage and fuel consumption alleviate to adhere to resource and operational optimization.

Standardization in ports and terminals

The lack of standardization prevalent in IT system infrastructures, processes, operations, and task execution makes it incredibly challenging to improve. Without a clear guideline of a common standard of practice established, most products and innovative technology released in the market will not entirely, if not, at all, be able to integrate seamlessly or efficiently. Due to the manifold of different ways terminals operate equipment and resources, not only are the business objectives unique to each port, but software providers cannot develop a product that can be a standard fit for all. The array of different business objectives will incur high fees to accommodate system customization. Consequently, any new projects adopted will resist cost optimization, defeating the purpose of transforming business for the better.

The global supply chain fell vulnerable to the former year’s crisis, highlighting the grave issues that require reforming. Defining standards facilitates a smooth digital transformation such that all stakeholders in the port and terminal industry have an equal opportunity for business continuity. These goals reflect the growing community’s mission, the Terminal Industry Committee 4.0 (TIC4.0), a joint venture by terminal operators, equipment providers, software providers, and all relevant stakeholders worldwide. Their initiatives strive to promote, define, and adopt a shared industry standard for the Cargo Handling Industry to allow technological advances like digitization. Therefore, a digital transformation will have higher chances of achieving cost and operational optimization when all can practice and institute a common set of standards within their operations and processes.  

Conclusion

A thorough analysis of the product’s technical architecture will reveal its actual capabilities and what it can offer. From there, the IT manager or executive needs to ask questions – will this product drive cost-optimization? Will this facilitate operational and worker efficacy? Will this sustain a secure and safe environment? What current operations or processes require standardization? This criterion will shape a well-formed response, deciding the potential of a product or strategic approach. However, digitalization is the agreed fundamental foundation to integrate other technologies.

RENEWED INTEREST IN THE CLOUD

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The massive surge of cloud applications to enable remote work in the past year has highlighted the advantages of operating truly in the cloud. A renewed and arguably more profound interest in the cloud rests within its unparalleled agility and scalability, allowing organizations to respond effectively to changing circumstances. Consequently, businesses deprived of cloud capabilities operating on legacy systems prevented an online remote working environment, inherently falling behind their competitors. Businesses become proportionally dependent on legacy systems with time and will encounter complex issues as their architecture and design make them incompatible with new technologies.

A system’s age is not an accurate indicator, but the business system’s inability to pivot and meet its demands are tell-tale signs of a legacy system. Due to its rigid software architecture combined with its technology and design, not only is it challenging to scale infrastructure, maintain, support, improve, or integrate with new systems, but it is incredibly resource intensive. This outcome resonates with the survey conducted by Logicalis, concluding that CIOs dedicate 40-60% of their time to managing legacy IT instead of focusing on strategic activities. Continuing this path may cause more detriment in the future as it limits innovation and can cost the company’s position amongst other competitors.

The common trend to counteract legacy systems or evade such sudden change entails CIOs investing their budgets in infrastructure-as-a-service (IaaS). This type of lift-and-shift approach is widespread, with companies employing virtual machines and hardware via IaaS to run the legacy systems. However, this alternative is costly and performance hindering, practically defeating the purpose of going cloud as using virtual machines via an IaaS service model does not develop the full spectrum of cloud-native advantages. This extra step is unnecessary and requires substantial processing power to connect to the same system on a virtual computer, adding another layer that can instigate delayed startups and longer load times. If organizations persist with this method, Gartner proposes that by 2024, nearly all legacy applications powered on an IaaS will require optimization to be more cost-efficient.

Cloud computing, renowned for its flexibility, reliability, and security, has been a significant driver of supply chain continuity. Instead of IaaS, a Software-as-a-service (SaaS) platform can pose a better fit for ports and terminals for planning and control activities from virtually anywhere, allowing operators to continue to service their customers. A SaaS frees terminal operators and executives from worrying about high CAPEX spent maintaining the entire IT system infrastructure. All technical resource management responsibility is relayed to the TOS provider, alleviating the monthly budget exhausted on the hardware, software licensing fees, data facility maintenance, and the hefty electricity to power and cool these servers. This way, terminal operators can experience full cloud-native advantages while focusing on other higher priority tasks and keep their expenses considerably low.

Migrating an entire system to the cloud without reconfiguring or retrofitting the system architecture will strip TOS operators from achieving the cloud benefits. Perhaps IaaS will prove feasible as a short-term strategy, but a true SaaS will demonstrate long-term results and harness opportunities that secure the competitive edge needed.

PRODUCTS THAT BOOST ENVIRONMENTALLY FRIENDLY CARGO CONTAINER HANDLING

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Typically, an on-premise deployment will absorb immense power to run its data facilities and, most of the time, will not use the hardware in its full capacity. On the other hand, software users of cloud TOS providers operate in a shared environment (i.e., multitenancy), leveraging power from just enough IT resources to accommodate their existing data volume, no more no less. Maximizing the use of IT resources through scalability and on-the-fly upgrades ensure no wastage in computing or energy.

Cloud Computing is a technology that has been introduced into the Container Handling Industry and is a technology that can be argued as environmentally friendly. Cloud computing reduces the number of data centers worldwide, reducing the impact on the environment. A cloud application using a cloud service provider is more energy-efficient than using the traditional on-premise data center, mainly because there is a reduction of IT infrastructure used and data centers built that produce emissions into the environment. Since cloud computing is based on the concept of service sharing, it maximizes the use of resources and the advanced technologies at these cloud data centers are energy efficient, as they use less energy for lighting and cooling.

Also, some cloud computing data centers are now shifting towards renewable energy to power their centers, this reduces their carbon footprint. Using a Cloud TOS provides better IT operational efficiency than smaller on-premise deployments due to large-scale dynamic provisioning and multitenancy, which allows for more efficient use of IT resources. Cloud computing, in general, saves more energy and reduces carbon emissions compared to on-premise data centers. Cloud computing is also environmentally sustainable due to its power of dematerialization, as it replaces physical high-carbon products with virtual elements to help reduce energy use and carbon footprint.

Harry Nguyen, CEO and Founder of RBS

Software hosted on the cloud is reflective of a lift-and-shift solution that involves minimal changes to the hardware or software infrastructure. As a result, migrating to the cloud requires purchasing storage, hardware, and networking requirements of an anti-green solution that consumes substantial amounts of energy, attributing to high OPEX and deepening the carbon footprint in the environment. Alternatively, the environmentally sustainable approach adopts a lift-and-refit approach since it lessens the interaction between end-users and back-end data centers. A lift-and-refit migration involves reconfiguring existing TOS architecture to inherit a true cloud nature so it can wholly subsist as a SaaS, which does not require purchasing hardware. Stray from the lift-and-shift migration as it requires no changes. It is crucial to understand that the cloud offers a greener and more efficient strategy for exercising daily terminal operation.

Low-cost, environmentally friendly technology and equipment were not readily available in the market in the earlier stages. However, technology has advanced incredulously, developing products that are more economical while lessening the carbon footprint. As more terminals realize they have a corporate responsibility to the environment just as much as driving profit, we can anticipate matrimony between driving wealth and adopting greener strategies in the forthcoming future. There is a rise in terminal operators integrating environmentally sustainable equipment, cloud technology, and instituting carbon-neutral practices that reduce negative impacts on the environment. As a more reliable and beneficial alternative, we can soon expect the environment as one of the most critical factors in evaluating and decision-making.

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