The use of data and technology in cargo risk management
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A presentation by Prof Alwyn Hoffman (School for Electrical, Electronic & Computer Engineering: NWU - Potchefstroom Campus), at the Transport Forum SIG: "Security Value Chain on Road and Rail" on 3 March 2016 hosted by University of Johannesburg. The theme of the presentation was: "The Use of Technology in Cargo Risk Management". More like this on www.transportworldafrica.co.za
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The use of data and technology in cargo risk management
- 1. The Use of Technology in Cargo Risk Management Prof Alwyn Hoffman Northwest University Alwyn.Hoffman@nwu.ac.za 082 851 6537 1q
- 2. Overview • DTI funded projects at NWU • Liaison with industry stakeholders • Different approaches to cargo risk management • Secure marking of products • Using electronic seals and vehicle tracking systems • Using the Internet and data analytics • Using trade corridor management systems • Finding an optimal mix of solutions • Piloting of proposed new solutions • Where to from here? 2
- 3. DTI funded projects at NWU • Northwest University (NWU) is involved in a number of research projects that explore possibilities to improve the management of freight and the end-to-end management of trade corridors by using new technologies • One focus area is the improvement of overload control and cross-border operations by automatically analyzing data sets available from traffic cameras and customs systems in order to facilitate a Green Lanes concept for compliant operators • Another area of focus is to reduce the risk of freight in transit from the perspective of the cargo owner by making freight movements visible and traceable using available data • The long term goal is to create a practically proven blue-print that will encompass both efficiency and security requirements using a common technology platform 3
- 4. Liaison with industry stakeholders • Studies are being conducted in cooperation with SARS, SADC Transit Task Team and SAAFF for regional trade corridors • Systems were implemented at Durban harbor in cooperation with TPT to demonstrate automated verification of electronic seals used on containerized cargo • Vehicle GPS tracking data is being collected for some of the major transport operators to study deviations from plan that contribute towards productivity losses and risk • In cooperation with Sanral and provincial DoTs data is being collected from existing traffic camera and WIM scale systems to detect compliance of vehicles with overload control measures and deviations from trip plans • An agreement has been reached with SAAFF (freight forwarders) to centrally collect data for all cross-border operations to identify the reasons for delays 4
- 5. Different approaches to cargo risk management • Using high integrity product markings (e.g. Microdots or Digital Signatures) • Using physical security (armed escorts) to prevent losses • Using 24/7 tracking of vehicles combined with electronic seals to provide early warning of risk incidents • Using end-to-end spot checking of cargo (based on traffic cameras and RFID readers) plus control over hand-over transactions to track transfer of culpability • Using Call Centres and the Internet to systematically record data on cargo security events, combined with Data Analytics to detects patterns • Using a combination of all of the above 5
- 6. The challenge is to find a common solution that will address the needs for 6 Insurance Compliance, Cargo Protection and Global Logistics Visibility
- 7. Key Requirements for High Integrity Supply Chains • Reassurance to End-users DESIGN AND ENGINEERING DISTRIBUTION CENTERSSUPPLIERS MANUFACTURING PLANTS CUSTOMERS END USERS PULL PULL PULL PULL PULL • Product and Source Authenticity • Product Traceability • Operator Liability
- 8. Tier 1: Enabling Branded Cargo Protection with Secure Product Markings • Traditional techniques to protect branded products suffer from serious weaknesses: • Holograms and security inks are easily cloned • Serial numbers can be copied and need online verification • The Electronic Banking industry solved the problem of cloned identities by using Digital Signatures • Branded products can be protected in the same way by writing a unique Digital Signature into each product identifier • Revenue authorities can use the same authentic markings to verify item level tax compliance
- 9. New ISO Standard for Secure Item Marking • Previous DTI THRIP project at NWU led to the development of a new standard SANS1368, in cooperation with the SABS and local industry, for the authentic marking of physical items based on 2D barcodes or RFID • This standard utilizes ISO standard encryption techniques and describes the process to be followed to mark items like manufactured products or documents in such a way that the source of origin can be securely determined in offline mode • The improved version ISO/IEC WD 20248: Information technology — Automatic identification and data capture techniques — Data structures — Digital signature meta structure has been accepted by the relevant ISO committee (USA, UK, China, France, etc.) 9
- 10. Tier 2: Solving the Logistics Problem: Cargo Item Tracking Based on Passive RFID Cargo items are marked using both barcoding and low cost RFID labels Back-end system is updated to reflect current status of cargo items to improve logistics management and to reconcile stock figures Movements of items are tracked using either installed or handheld RFID readers
- 11. Tier 3: Using trails of custody enabled by passive electronic cargo seals to ensure end- to-end secure supply chains Passive RFID e-seal using on containers and trucks to allow verification of cargo security status At each point of hand-over or delivery the identity of the truck and status of the cargo are automatically detected In fully automated mode the identity of the truck, driver and container and status of e-seal is detected without human intervention and cargo flow can be controlled automatically Information about each cargo event is dispatched to central system Details of sealing and dispatch transactions are securely recorded The status of the e-seal is verified manually Controller Reader Boom
- 12. Tier 4: End-to-end monitoring of cargo movements using existing GPS tracking and camera systems Certified transport operator submits declaration to SAIA of internal cargo sealing, weight control, authorization of dispatch and route plan SAIA system identifies traffic cameras and WIM scales along route where vehicle should be spotted If vehicle was not seen, if it did not use the WIM scale lane or if the weight changed significantly an alarm is recorded and a supervisor is notified Information about cargo movements for entire fleets is accumulated and a behavioral track record is created to be used in SAIA risk assessments Details of sealing, weighing and dispatch transactions are securely recorded on centralized SAIA system SAIA system use GPS tracking data from certified operator to determine when vehicle should be spotted by traffic camera and WIM scale
- 13. Tier 5: Using 24/7 tracking of vehicles combined with active electronic seals to provide early warning of risk incidents 13 demonstrate
- 14. Tier 6: Using Call Centres, the Internet and Data Analytics Information on cargo security incident is communicated to Call Centre Internet searches are performed to detect potentially related commercial activities – sale of stolen cargo Cargo loss data is systematically recorded in a database representing the entire industry Authorities are informed about suspicious cases
- 15. The Objective: End-To-End Audit Trails to Track Transfer of Culpability Step # 1: Container trail of custody initiated by cargo owner Unique tag ID E-Seal serial # Cargo Owner ID Encrypted Auth Code Step # 2: Container trail of custody appended by Shipper Unique tag ID E-Seal serial # Cargo Owner ID Encrypted Auth Code Shipper IDStep # 3: Container trail of custody appended at Customs Unique tag ID E-Seal serial # Cargo Owner ID Customs ID Shipper ID Encrypted Auth Code Step # 4: Container trail of custody appended by Transporter Unique tag ID E-Seal serial # Cargo Owner ID Customs ID Shipper ID Transporter ID Encrypted Auth Code Step # 5: Verification by Inspectors Step # 6: Verification by Recipient
- 16. Key Technologies • Digital Signatures verified offline: – Detects data tampering – Detects the legal source of markings – Detects the original document • Web Services – Enables Cloud and Mobile services • Smart Phones with camera & GPS – Personalised ownership • QR Barcodes as read by all smart phones • RFID – Radio Frequency Identification – Cheap standard USB and Blue Tooth readers interface with smart phones CID VCS Signer
- 17. Digital Signature Real Electronic Digital Identity Signer Digital Signatures is a de facto International encryption Standard used widely by Banks and Web Services to create integrity and privacy in online services. Digital Signatures have been legalised by many countries to be prima facia evidence. iDocTrust invented a Digital Signature [DigSig] small enough to fit into QR Barcodes and RFID Tags creating a method to offline verify the integrity of physical documents. • The DigSig allows the verification of the document legal source and integrity. • The DigSig in a barcode allows offline data tamper detection. • The DigSig in a RFID Tag allows the offline detection of the original document.
- 18. Goods Marking SCM Shipment Tracking System Supply Chain Management System Goods Receive -Items -Boxes Inventory Control -Items -Boxes Shipments -Compile -Dispatch Shipments -Compile -Dispatch Goods Authentication -Source -Channel Anti- theftTransfer Transfer SCTS Data Vault Fraud Agent System Retailer SystemManufacturer System Trusted Third Party Certification Authority Overview of Typical Supply Chain Trust Service System SCTS System
- 19. Goods Marking Goods Receive -Items -Boxes Inventory Control -Items -Boxes Shipments -Compile -Dispatch Shipments -Compile -Dispatch Goods Authentication -Source -Channel Anti- theftTransfer Transfer SCTS Data Vault Fraud Agent System Retailer SystemManufacturer System Trusted Third Party Certification AuthorityStep 1 SC Principal provide Fraud Agent wih business rules for flow of products Supply Chain Trust Service System Operation: Step 1 Supply Chain Management System
- 20. SCTS Data Vault Goods Marking Shipments -Compile -Dispatch Manufacturer System Step 2 Implement iDocTrust authentication technique: – generate labels containing digital certificates with secure reference to authorised issuer –Store copy of Digital Signature in SCTS Data Vault Digital Certificates Digital Evidence TTP CA Supply Chain Trust Service System Operation: Step 2 CID VCS Signer
- 21. Goods Marking Goods Receive -Items -Boxes Inventory Control -Items -Boxes Shipments -Compile -Dispatch Shipments -Compile -Dispatch Goods Authentication -Source -Channel Anti- theftTransfer Transfer SCTS Data Vault Fraud Agent System Retailer SystemManufacturer System Step 3 Mark items at manufacturer with labels that contains DigSig Authentication Information TTP CA Supply Chain Trust Service System Operation: Step 3 Supply Chain Management System
- 22. Goods Marking Goods Receive -Items -Boxes Inventory Control -Items -Boxes Shipments -Compile -Dispatch Shipments -Compile -Dispatch Goods Authentication -Source -Channel Anti- theftTransfer Transfer SCTS Data Vault Fraud Agent System Retailer SystemManufacturer System Trusted Third Party Certification Authority Step 4 •Capture transaction information when transferring products from Manufacturer to Distributor •Transaction information includes: -Goods IDs -Human operator biometrics -Time -Place Supply Chain Trust Service System Operation: Step 4 Supply Chain Management System
- 23. Goods Marking Goods Receive -Items -Boxes Inventory Control -Items -Boxes Shipments -Compile -Dispatch Shipments -Compile -Dispatch Goods Authentication -Source -Channel Anti- theftTransfer Transfer SCTS Data Vault Fraud Agent System Retailer SystemManufacturer System Trusted Third Party Certification Authority Step 5 Authentic Transaction information is sent automatically to SCM and Fraud Agent system and to SCTS Data Vault Digital Evidence Supply Chain Trust Service System Operation: Step 5 Supply Chain Management System
- 24. Goods Receive -Items -Boxes Inventory Control -Items -Boxes Shipments -Compile -Dispatch SCTS Data Vault Fraud Agent System Trusted Third Party Certification Authority Step 6 During Inventory Control the authenticity of items is verified offline using DigSig information on labels Supply Chain Trust Service System Operation: Step 6 Supply Chain Management System
- 25. Goods Receive -Items -Boxes Inventory Control -Items -Boxes Shipments -Compile -Dispatch SCTS Data Vault Fraud Agent System Trusted Third Party Certification Authority Step 7 If discrepancy is detected fraud detection systems are automatically informed Supply Chain Trust Service System Operation: Step 7 Supply Chain Management System
- 26. Goods Marking Goods Receive -Items -Boxes Inventory Control -Items -Boxes Shipments -Compile -Dispatch Shipments -Compile -Dispatch Goods Authentication -Source -Channel Anti- theftTransfer Transfer SCTS Data Vault Fraud Agent System Retailer SystemManufacturer System Trusted Third Party Certification Authority Step 8 •Capture transaction information when transferring products from Distributor to Retailer •Transaction information includes: -Goods IDs -Human operator biometrics -Time -Place Supply Chain Trust Service System Operation: Step 8 Supply Chain Management System
- 27. Goods Marking Goods Receive -Items -Boxes Inventory Control -Items -Boxes Shipments -Compile -Dispatch Shipments -Compile -Dispatch Goods Authentication -Source -Channel Anti- theftTransfer Transfer SCTS Data Vault Fraud Agent System Retailer SystemManufacturer System Trusted Third Party Certification Authority Step 9 Authentic Transaction information is sent automatically to Distributor and Fraud Agent system and to SCTS Data Vault Digital Evidence Supply Chain Trust Service System Operation: Step 9 Supply Chain Management System
- 28. SCTS Data Vault Fraud Agent System Trusted Third Party Certification Authority Step 10 During Inventory Control at Retailer the authenticity of items is verified offline using DigSig information on labels Supply Chain Trust Service System Operation: Step 10 Goods Authentication -Source -Channel Anti- theft Retailer System
- 29. Goods Receive -Items -Boxes Inventory Control -Items -Boxes Shipments -Compile -Dispatch SCTS Data Vault Fraud Agent System Trusted Third Party Certification Authority Step 11 If discrepancy is detected SCTS, Retailer, Distributor and Fraud Agent systems are automatically informed Supply Chain Trust Service System Operation: Step 11 Supply Chain Management System Goods Authentication -Source -Channel Anti- theft Retailer System
- 30. Goods Marking Goods Receive -Items -Boxes Inventory Control -Items -Boxes Shipments -Compile -Dispatch Shipments -Compile -Dispatch Goods Authentication -Source -Channel Anti- theftTransfer Transfer SCTS Data Vault Fraud Agent System Retailer SystemManufacturer System Trusted Third Party Certification Authority Step 12 Fraud Agent applies SC Principal business rules to track&trace and discrepancy information to generate list of exceptions Supply Chain Trust Service System Operation: Step 12 Supply Chain Management System
- 31. Goods Marking Goods Receive -Items -Boxes Inventory Control -Items -Boxes Shipments -Compile -Dispatch Shipments -Compile -Dispatch Goods Authentication -Source -Channel Anti- theftTransfer Transfer SCTS Data Vault Fraud Agent System Retailer SystemManufacturer System Trusted Third Party Certification Authority Step 13 If fraudulent activities are suspected the Fraud Agent request a disclosure from the SCTS Data Vault to compile Evidence Trail Request Disclosure Supply Chain Trust Service System Operation: Step 13 Supply Chain Management System
- 32. Goods Marking Goods Receive -Items -Boxes Inventory Control -Items -Boxes Shipments -Compile -Dispatch Shipments -Compile -Dispatch Goods Authentication -Source -Channel Anti- theftTransfer Transfer SCTS Data Vault Fraud Agent System Retailer SystemManufacturer System Trusted Third Party Certification Authority Step 14 Fraud Agent provides SC Principal with a forensic report (including complete Evidence Trail) and take appropriate action on behalf of the SC Principal Supply Chain Trust Service System Operation: Step 14 Forensic Report Actions against Fraudulent Parties Actions against Fraudulent Parties Supply Chain Management System
- 33. SCTS Business Model 2. Evidence Recording Click fee Fraud Agent Data Vault 1. Digital Certification Click fee 4. Anomaly Detection Subscription fee 3. Disclosure Request Service fee
- 34. SCTS Disclosure & Contracting Brand Owner Principal Logistics Service Provider Manufacturer Distributor Court Service Contract Inspection Agreement Service Level Agreement Fraud Agent Court Order for Disclosure Trace Elements of Anomaly Disclosure Recorded Trail of Evidence Service Level Agreement
- 35. Where to from here? • Satellite Tracking Technology used to be an effective tool in fighting vehicle and cargo theft but is impacted by jamming • Electronic sealing and traffic camera systems can add further data to reduce cargo risks • Secure product markings is however the best long term cure against large scale cargo theft and illegal trade • The possibility exist to link cargo risk management systems to future Green Lanes systems to provide further benefits to cargo owners by streamlining Trade Corridors • NWU is conducting pilot projects with DTI and industry organizations to create blue-prints for new logistics performance and risk management solutions • The transport and cargo insurance industry is invited to lend its support through active participation of its members 35