Physical Internet Manifesto Globally transforming the way physical objects           are handled, moved, stored,          ...
Acknowledgements  The Physical Internet Manifesto has greatly benefited from           the contribution of esteemed collea...
Macroscopic Positioning                       CLAIM            The way physical objects aremoved, handled, stored, realize...
Supporting the claim                       CLAIM            The way Physical objects aremoved, handled, stored, realized, ...
Thirteen unsustainability symptomsLeading Us Toward Hitting the Wall Real Hard1.   We are shipping air and packaging2.   E...
We are shipping air and packaging                                  Unsustainability symptom 1Trucks and containers are oft...
Empty travel is the norm rather than the exception                                           Unsustainability symptom 2   ...
Truckers have become the modern cowboys                                   Unsustainability symptom 3                      ...
Products mostly sit idle, stored where unneeded,   yet so often unavailable fast where needed                             ...
Production and storage facilities are poorly used                                       Unsustainability symptom 5  Most b...
So many products are never sold, never used                 Unsustainability symptom 6    A significant portion of consume...
Products do not reach those who need them the most                                              Unsustainability symptom 7...
Products unnecessarily move,   crisscrossing the world   Unsustainability symptom 8                                       ...
Fast & reliable intermodal transport                     is still a dream or a joke                                       ...
Getting products in, through and out of cities                 is a nightmare                                       Unsust...
Networks are neither secure nor robust                                               Unsustainability symptom 11There is e...
Smart automation & technology are hard to justify                                      Unsustainability symptom 12      Ve...
Innovation is strangled                                              Unsustainability symptom 13                     Innov...
Thirteen unsustainability symptomsLeading Us Toward Hitting the Wall Real Hard1.   We are shipping air and packaging2.   E...
Mapping unsustainability symptomsto environmental, environmental and societal facets                                      ...
Readdressing the Goal                         GOAL          Enabling the global sustainabilityof the transport, handling, ...
Expliciting the Overall Goal                                             Economic goal                         Unlock high...
Restating the Overall Goal                           Enabling the global sustainability                      of bringing t...
The Inspiration for the Vision       June 2006: The Spark           •  A great front page one-liner               •  Inter...
The Digital Internet       Building Upon and Expanding Beyond        the Information Highway Metaphor             When the...
The Digital Internet                                    Building Upon and Expanding Beyond                                ...
The Essence of the Digital Internet                                                                                  The D...
Toward a Physical InternetDigital Internet as a Metaphor for the Physical World     Even though there are fundamental diff...
The Physical Internet                  An open global logistics system           leveraging interconnected supply networks...
Exposing 13 Key Features    of the Physical Internet Vision                    VISIONEvolving towards a worldwide Physical...
Thirteen Key Features       of the Physical Internet Vision1.  Encapsulate merchandises in world-standard     smart green ...
Digital Internet:           From information to packets  The Digital Internet does not transmit information,   it transmi...
Digital Internet:                  From information to packets  The Digital Internet is based on a protocol   structuring...
Physical Internet        1. Encapsulate merchandises inworld-standard smart green modular containers   π-containers are ke...
π-Containers:        Modularized and standardized worldwide     in terms of dimensions, functions and fixturesπ-containers...
π-Containers Easy to handle, store, transport, seal, snap, interlock, load,unload, construct, dismantle, panel, compose an...
Physical Internet2. Aim toward universal interconnectivity High-performance logistic centers, systems and movers          ...
Digital Internet:                                                  Hubs and Routers  Routing allows to insure Internet pe...
Physical Internet                   2. Universal Interconnectivity  The Physical Internet nodes are concurrently routing ...
Physical Internet3. Evolve from material to π-container     handling  storage systems   π-container handling and storage s...
Physical Internet3. Evolve from material to π-container     handling  storage systems  Reference: Montreuil, B., R.D. Mell...
Physical Internet    3. Evolve from material to π-container         handling  storage systems π-container handling and st...
Physical Internet   4. Exploit smart networked containers          embedding smart objects              Exploiting as best...
Physical Internet and the Internet of Things                                                                              ...
Physical Internet5. Evolve from point-to-point hub-and-spoke transport  to distributed multi-segment intermodal transport ...
Digital Internet Distributed multi-segment transmission                              In the Digital Internet, the packets...
Physical Internet5. Evolve from point-to-point hub-and-spoke transport to     distributed multi-segment intermodal transpo...
A typical cowboy haul from Québec to Los Angeles                                     One-way Distance travelled : 5030 km ...
Physical Internet5. Evolve from point-to-point hub-and-spoke transport to     distributed multi-segment intermodal transpo...
Multi-segment travel from Quebec to Los Angeles                                                                           ...
.$# -*#                                 !#                                                                                ...
!#$%     Road-Water π-Hub  designed for enablingdistributed multi-segment   intermodal transport  of π-containers through ...
Road-Rail Hub designed for enablingmulti-segment intermodal transport of π-containers           through the Physical Inter...
Physical Internet6. Embrace a unified multi-tier conceptual framework        Intra-Center Inter-Processor Network	        ...
Physical Internet6. Embrace a unified multi-tier conceptual framework         Intra-Facility Inter-Center Network	        ...
Physical Internet6. Embrace a unified multi-tier conceptual framework          Intra-Site Inter-Facility Network	         ...
Physical Internet6. Embrace a unified multi-tier conceptual frameworkIntra-CityInter-Site Network 	                       ...
Physical Internet6. Embrace a unified multi-tier conceptual frameworkIntra-State Inter-City  Network 	                    ...
Physical Internet6. Embrace a unified multi-tier conceptual framework                Physical Internet Manifesto          ...
Physical Internet7. Activate and exploit an Open Global Supply Web        An open web of product realization centers,     ...
Physical Internet7. Activate and exploit an Open Global Supply Web     As products and materials are moved and stored in ...
1	Factories:             	4	                                                                                              ...
From Private Supply Networks                            to Open Supply Webs         Insuring one-day delivery by each comp...
Physical Internet            8. Design products fitting containers                 with minimal space waste             Pr...
Physical Internet          8. Design products fitting containers               with minimal space waste  Product dimensio...
Physical Internet   9. Minimize Physical moves and storages      by digitally transmitting knowledgeand materializing prod...
Physical Internet      9. Minimize physical moves and storages         by digitally transmitting knowledge   and materiali...
Physical Internet   9. Minimize Physical moves and storages      by digitally transmitting knowledgeand materializing prod...
1	                                                                                                                        ...
Physical internet manifesto 1.8 2011 03-28 english bm
Physical internet manifesto 1.8 2011 03-28 english bm
Physical internet manifesto 1.8 2011 03-28 english bm
Physical internet manifesto 1.8 2011 03-28 english bm
Physical internet manifesto 1.8 2011 03-28 english bm
Physical internet manifesto 1.8 2011 03-28 english bm
Physical internet manifesto 1.8 2011 03-28 english bm
Physical internet manifesto 1.8 2011 03-28 english bm
Physical internet manifesto 1.8 2011 03-28 english bm
Physical internet manifesto 1.8 2011 03-28 english bm
Physical internet manifesto 1.8 2011 03-28 english bm
Physical internet manifesto 1.8 2011 03-28 english bm
Physical internet manifesto 1.8 2011 03-28 english bm
Physical internet manifesto 1.8 2011 03-28 english bm
Physical internet manifesto 1.8 2011 03-28 english bm
Physical internet manifesto 1.8 2011 03-28 english bm
Physical internet manifesto 1.8 2011 03-28 english bm
Physical internet manifesto 1.8 2011 03-28 english bm
Physical internet manifesto 1.8 2011 03-28 english bm
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Physical internet manifesto 1.8 2011 03-28 english bm

  1. 1. Physical Internet Manifesto Globally transforming the way physical objects are handled, moved, stored, realized, supplied and used π Benoit MontreuilCanada Research Chair in Enterprise Engineering CIRRELT, Interuniversity Research Centeron Enterprise Networks, Logistics & Transportation Université Laval, Québec, Canada Version 1.8: 2011-03-28 www.PhysicalInternetInitiative.org
  2. 2. Acknowledgements The Physical Internet Manifesto has greatly benefited from the contribution of esteemed colleaguesAmerica  CIRRELT Research Center: •  Teodor Crainic - UQAM •  Michel Gendreau - Université de Montréal •  Olivier Labarthe, Mustapha Lounès & Jacques Renaud - Université Laval  CICMHE, College-Industry Council for Material Handling Education: •  Russ Meller – University of Arkansas •  Kevin Gue & Jeff Smith – Auburn University •  Kimberley Ellis – Virginia Tech •  Leon McGinnis – Georgia Tech •  Mike Ogle – MHIAEurope •  Rémy Glardon – EPFL •  Éric Ballot, Frédéric Fontane – Mines ParisTech •  Rene De Koster – Erasmus University •  Detlef Spee – Fraunhofer Institute for Material Flow and Logistic Physical Internet Manifesto Benoit Montreuil Version 1.8, 2011-03-28, p. 2/83 www.PhysicalInternetInitiative.org
  3. 3. Macroscopic Positioning CLAIM The way physical objects aremoved, handled, stored, realized, supplied and used throughout the world is not sustainable economically, environmentally and socially GOAL Enabling the global sustainability of physical object movement, handling, storage, realization, supply and usage VISION Evolving towards a worldwide Physical Internet Physical Internet Manifesto Benoit Montreuil Version 1.8, 2011-03-28, p. 3/83 www.PhysicalInternetInitiative.org
  4. 4. Supporting the claim CLAIM The way Physical objects aremoved, handled, stored, realized, supplied and used throughout the world is not sustainable economically, environmentally and socially Physical Internet Manifesto Benoit Montreuil Version 1.8, 2011-03-28, p. 4/83 www.PhysicalInternetInitiative.org
  5. 5. Thirteen unsustainability symptomsLeading Us Toward Hitting the Wall Real Hard1.  We are shipping air and packaging2.  Empty travel is the norm rather than the exception3.  Truckers have become the modern cowboys4.  Products mostly sit idle, stored where unneeded, yet so often unavailable fast where needed5.  Production and storage facilities are poorly used6.  So many products are never sold, never used7.  Products do not reach those who need them the most8.  Products unnecessarily move, crisscrossing the world9.  Fast & reliable intermodal transport is still a dream or a joke10.  Getting products in and out of cities is a nightmare11.  Networks are neither secure nor robust12.  Smart automation & technology are hard to justify13.  Innovation is strangled Physical Internet Manifesto Benoit Montreuil Version 1.8, 2011-03-28, p. 5/83 www.PhysicalInternetInitiative.org
  6. 6. We are shipping air and packaging Unsustainability symptom 1Trucks and containers are often half empty at departure, with a large chunk of the non-emptiness being filled by packaging Overall, most goods travel by road. In the UK, 65% of all freight is moved by road, or about 160 billion tonne kilometres out of 240 billion tonne kilometres. In the USA, for example, there are 40,000 public carriers and 600,000 private fleets. With so many operators competition is likely to be more intense and pricing more flexible. [1] Transportation costs are the single largest contributor to total logistics costs, with trucking being the most significant subcomponent. Trucking costs account for roughly 50% of total logistics expenditures and 80% of the transportation component. Trucking revenues in 2005 increased by $74 billion over 2004, but carrier expenses rose faster than rates, eroding some of the gain. Fuel ranks as a top priority at trucking firms as substantially higher fuel prices have cut margins. The U.S. trucking industry consumes more than 650 million gallons of diesel per week, making it the second largest expense after labor. The trucking industry spent $87.7 billion for diesel in 2005, a big jump over the $65.9 billion spent in 2004. [2] References: 1]: “Transport in Logistics”, Chap. 12 in An Introduction to Supply Chain Management, Ed. By Donald Waters [Palgrave Macmillan] (2003) [2]: Wilson R. A., “Economic Impact of Logistics”, Chap. 2 in Logistics Engineering Handbook , 2008 Physical Internet Manifesto Benoit Montreuil Version 1.8, 2011-03-28, p. 6/83 www.PhysicalInternetInitiative.org
  7. 7. Empty travel is the norm rather than the exception Unsustainability symptom 2 Vehicles and containers often return empty, or travel extra routes to find return shipments Vehicles leaving loaded get emptier and emptier as their route unfolds from delivery point to delivery point Statistical evidence that around 30 per cent of truck-kilometres are run empty, illustrating huge inefficiency in road haulage and enormous potential for increasing back loading.In Britain, the proportion of truck-kilometres travelled empty felt from 33 per cent in 1980 to 27 per cent in 2004, yielding significant economic and environmental benefits. [1]Other things being equal, if the empty running percentage had remained at its 1980 level, road haulage costs in 2004 would have been £1.2 billion higher and an extra 1 million tonnes of carbon dioxide would have been emitted by trucks (McKinnon, 2005). Reference: [1]: McKinnon A., “Road transport optimization” Chap. 17 in Global Logistics New Directions in Supply Chain Management (2007), Ed. by Donald Water Physical Internet Manifesto Benoit Montreuil Version 1.8, 2011-03-28, p. 7/83 www.PhysicalInternetInitiative.org
  8. 8. Truckers have become the modern cowboys Unsustainability symptom 3 So many are nearly always on the road, so often away from home for long durations Their family life, their social life and their personal health are precarious The shift workers with the lowest mean hours of daily sleep are truck drivers, at 3.5 hours/24 hours Fatigue and sleep deprivation are important safety issues for long-haul truck drivers A National Transportation Safety Board study examined the effects of duty shifts and sleep patterns on drivers of heavy trucks involved in single-vehicle accidents and found that 62 of 107 accidents (58%) reported by drivers were deemed to be "fatigue-related“ [1] The American Trucking Association (ATA) has estimated that the driver shortage will grow to 111,000 by 2014 [2] References: [1]: “Consequences of Insomnia, Sleepiness, and Fatigue: Health and Social Consequences of Shift Work “, http://cme.medscape.com/viewarticle/513572_2 [2] : Wilson R.A. “Economic Impact of Logistics”, in Chap. 2 in Logistics Engineering Handbook, 2008 Physical Internet Manifesto Benoit Montreuil Version 1.8, 2011-03-28, p. 8/83 www.PhysicalInternetInitiative.org
  9. 9. Products mostly sit idle, stored where unneeded, yet so often unavailable fast where needed Unsustainability symptom 4 Manufacturers, distributors, retailers and users are all storing products, often in vast quantities through their networks of warehouses and distribution centers, yet service levels and response times to local users are constraining and unreliable Stocks are increasingly maintained at a higher level in response to longer and sometimes unpredictable delivery times, as well as changes in distribution patterns. In 2005, the average investment in all business inventories was $1.74 trillion, which surpassed 2004’s record high by $101 billion. Reference: Wilson R.A. “Economic Impact of Logistics”, in Chap. 2 in Logistics Engineering Handbook, 2008 Physical Internet Manifesto Benoit Montreuil Version 1.8, 2011-03-28, p. 9/83 www.PhysicalInternetInitiative.org
  10. 10. Production and storage facilities are poorly used Unsustainability symptom 5 Most businesses invest in storage and/or production facilities which are lowly used most of the times, or yet badly used, dealing with products which would better be dealt elsewhere, forcing a lot of unnecessary travel When the production function is considered to be a part of the supply chain, there is obviously much that can be done to improve environmental and social performance at this stage [1] The transport and storage of goods are at the centre of any logistics activity, and these are areas where a company should concentrate its efforts to reduce its environmental impacts [2] [1]: McIntyre K., “Delivering sustainability through supply chain management”, Chap.15 in Global Logistics New Directions in Supply Chain Management, (2007) [2]: Cooper J., Browne M. and Peters M., “European Logistics: Markets, management and strategy”, Blackwell, London (1991) Chopra & Meindl, “Facility Decisions and Distribution Network “, 2009_E4.5 Physical Internet Manifesto Benoit Montreuil Version 1.8, 2011-03-28, p. 10/83 www.PhysicalInternetInitiative.org
  11. 11. So many products are never sold, never used Unsustainability symptom 6 A significant portion of consumer products that are madenever reach the right market on time, ending up unsold and unused while there would have been required elsewhere Rusting new cars in disused airfields Physical Internet Manifesto Benoit Montreuil Version 1.8, 2011-03-28, p. 11/83 www.PhysicalInternetInitiative.org
  12. 12. Products do not reach those who need them the most Unsustainability symptom 7This is specially true in less developed countries and disaster-crisis zonesCountries most affected by high prices are those: which import large quantities of food,whose populations spend a large part of their income on food, where inflation is already high, where there is already food insecurity and which have large urban populations. References: “World Food Programme (WFP)”, http://www.wfp.org/node/7904 “Problems in developing logistics centres for ports in the Escap region”; Chap5, http://www.unescap.org/ttdw/Publications/TFS_pubs/pub_2194/pub_2194_ch5.pdf Physical Internet Manifesto Benoit Montreuil Version 1.8, 2011-03-28, p. 12/83 www.PhysicalInternetInitiative.org
  13. 13. Products unnecessarily move, crisscrossing the world Unsustainability symptom 8 Products commonly travel thousands of miles-kilometers which could have been avoided (1) by routing them smartly and/or (2) making or assembling them much nearer to their point of use Reference: “Virtual Warehousing”, Jeroen van den Berg Consulting, 2001 Physical Internet Manifesto Benoit Montreuil Version 1.8, 2011-03-28, p. 13/83 www.PhysicalInternetInitiative.org
  14. 14. Fast & reliable intermodal transport is still a dream or a joke Unsustainability symptom 9 Even though there are some great intermodal examples,in general synchronization is so poor, interfaces so badly designed, that intermodal routes are mostly time & cost inefficient and risky Reference: Crainic, T.G. and Kim, K.H., “Intermodal Transportation, Chap8 in Handbooks in Operations Research and Management Science”, C. Barnhart and G. Laporte (Eds.), 2007 Physical Internet Manifesto Benoit Montreuil Version 1.8, 2011-03-28, p. 14/83 www.PhysicalInternetInitiative.org
  15. 15. Getting products in, through and out of cities is a nightmare Unsustainability symptom 10 Most cities are not designed and equipped for easing freight transportation, handling and storage,making the feeding of businesses and users in cities a nightmare References: « Transport des marchandises en ville », www.transports-marchandises-en-ville.org “Problems in developing logistics centres for ports in the Escap region”, Chap5, http://www.unescap.org/ttdw/Publications/TFS_pubs/pub_2194/pub_2194_ch5.pdf Physical Internet Manifesto Benoit Montreuil Version 1.8, 2011-03-28, p. 15/83 www.PhysicalInternetInitiative.org
  16. 16. Networks are neither secure nor robust Unsustainability symptom 11There is extreme concentration of operations in a limited number of centralized production and distribution facilities, with travel along a narrow set of high-traffic routes This makes the logistic networks and supply chains of so many businesses, unsecure in face of robbery and terrorism acts, and not robust in face of natural disasters and demand crises References: Chopra & Meindl, “Facility Decisions and Distribution Network” - 2009_E4.5 “Terrorism - Supply Chain Effects”, http://www.weforum.org/pdf/CSI/Terrorism.pdf “The New Supply Chain Challenge - Risk Management in a Global Economy”, FM Global, 2006 , http://www.fmglobal.com/assets/pdf/P0667.pdf Peck H., “Supply chain vulnerability, risk and resilience”, Chap.15 in Global Logistics New Directions in Supply Chain Management, (2007) “Managing Supply Chain Risk”, Video produced by CFO Research Services, http://www.fmglobal.com/VideoPlayer.aspx?url=/assets/videos/CFO_SupplyChain.wm “Security, Risk Perception and Cost-Benefit Analysis”, Joint Transport Research Centre OCDE Summary & Conclusions – Discussion Paper #2009-6, March 2008 Physical Internet Manifesto Benoit Montreuil Version 1.8, 2011-03-28, p. 16/83 www.PhysicalInternetInitiative.org
  17. 17. Smart automation & technology are hard to justify Unsustainability symptom 12 Vehicles, handling systems and operational facilities have to deal with so many types of materials, shapes and unit loads, with each player independently and locally deciding on his piece of the puzzle This makes it very hard to justify smart connective technologies (e.g. RFID & GPS), systemic handling and transport automation, as well as smart collaborative piloting software References: Montreuil B., Facilities Location and Layout Design Chapter 9. in Logistics Engineering Handbook (2008) Hakimi D., Leclerc P-A., Montreuil B., Ruiz A., « Integrating RFID and Connective Technologies in Retail Stores », RFID in Operations and Supply Chain Management - Research and Applications, Erich Schmidt Verlag, 148-171, 2007.Spada Sal,“Material Handling Control System Software Extends Supply Chain Visibility “nov.15, 2001 http://www.arcweb.com/ARCReports2001/Material%20Handling%20Control%20System%20Software%20Extends%20Supply%20Chain%20Visibility.pdf Sunderesh S. H., Material Handling System – Chapter-11 in Logistics Engineering Handbook (2008) McKinnon A., Road transport optimization – Chap. 17 in Global Logistics New Directions in Supply Chain Management - eBook (2007) Fifth Edition, Edited by Donald Waters Decker C. et al.“Cost-Benefit Model for Smart Items in the Supply Chain” (2008) Myerson J.M. “RFID in the Supply Chain - A Guide to Selection and Implementation” - IT Consultant Philadelphia, Pennsylvania USA - Auerbach Publications 2007 Physical Internet Manifesto Benoit Montreuil Version 1.8, 2011-03-28, p. 17/83 www.PhysicalInternetInitiative.org
  18. 18. Innovation is strangled Unsustainability symptom 13 Innovation is bottlenecked, notably by lack of generic standards and protocols, transparency, modularity and systemic open infrastructure This makes breakthrough innovation so tough, justifying a focus on marginal epsilon innovationReferences: “RFID Tags: Advantages and Limitations”, http://www.tutorial-reports.com/wireless/rfid/walmart/tag-advantages.php “RFID hype is blurring limitations, study claims “, http://www.usingrfid.com/news/read.asp?lc=d59745mx97zf “RFID_Internet of Things in 2020 - Roadmap for the future”, Infso D.4Networked Enterprise & RFID Infso G.2Micro & Nanosystems, 2008 Physical Internet Manifesto Benoit Montreuil Version 1.8, 2011-03-28, p. 18/83 www.PhysicalInternetInitiative.org
  19. 19. Thirteen unsustainability symptomsLeading Us Toward Hitting the Wall Real Hard1.  We are shipping air and packaging2.  Empty travel is the norm rather than the exception3.  Truckers have become the modern cowboys4.  Products mostly sit idle, stored where unneeded, yet so often unavailable fast where needed5.  Production and storage facilities are poorly used6.  So many products are never sold, never used7.  Products do not reach those who need them the most8.  Products unnecessarily move, crisscrossing the world9.  Fast & reliable intermodal transport is still a dream or a joke10.  Getting products in and out of cities is a nightmare11.  Networks are neither secure nor robust12.  Smart automation & technology are hard to justify13.  Innovation is strangled Physical Internet Manifesto Benoit Montreuil Version 1.8, 2011-03-28, p. 19/83 www.PhysicalInternetInitiative.org
  20. 20. Mapping unsustainability symptomsto environmental, environmental and societal facets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hysical Internet Manifesto Benoit Montreuil Version 1.8, 2011-03-28, p. 20/83 www.PhysicalInternetInitiative.org
  21. 21. Readdressing the Goal GOAL Enabling the global sustainabilityof the transport, handling, storage, realization, supply and usage of physical objects across the world Physical Internet Manifesto Benoit Montreuil Version 1.8, 2011-03-28, p. 21/83 www.PhysicalInternetInitiative.org
  22. 22. Expliciting the Overall Goal Economic goal Unlock highly significant gains in global logistic, production, transportation and business productivity Environmental goal Reduce by an order of magnitude global energy consumption, pollution and greenhouse gas emission associated with logistic, production and transportation Societal goal Increase the quality of life of both the logistic, production and transportation workersand the overall population by making much more accessible across the world the objects and functionality they value References: Dablanc L., “Urban Goods Movement and Air Quality Policy and Regulation Issues in European Cities”, Journal of Environmental Law Advance Access, 2008 McIntyre K., “Delivering sustainability through supply chain management”, Chap.15 in Global Logistics New Directions in Supply Chain Management, 2007 Esty D. C. and Winston A.S. “Green to Gold “; 2006 Physical Internet Manifesto Benoit Montreuil Version 1.8, 2011-03-28, p. 22/83 www.PhysicalInternetInitiative.org
  23. 23. Restating the Overall Goal Enabling the global sustainability of bringing to users from around the world the physical objects they need and value, through a triple synergistic gain in terms of economy, environment and society“We are not environmentalist. “In a prosperous society,We are not Scientists you really have tow assets: But if we don’t do anything, people – their capacity and skills –we will be out of business.” and the ecosystem around them.Unilever supply chain manager Both need to be carefully tended.”the world’s largest purchasers of fish. Mats Lederhausen, executive’s veteran at McDonald’s. Reference: Sustainable Supply Chain Logistics Guide (SCL)- Business Tool (2009) http://www.metrovancouver.org/about/publications/Publications/sustainablesclguidefinal-june23.pdf Physical Internet Manifesto Benoit Montreuil Version 1.8, 2011-03-28, p. 23/83 www.PhysicalInternetInitiative.org
  24. 24. The Inspiration for the Vision June 2006: The Spark •  A great front page one-liner •  Interesting yet mainstream supply chain articles •  Nothing like what I perceived a Physical Internet should be •  I rapidly got passionate about the question What should or could be a full blown Physical Internet? •  What would be its key features? •  What capabilities would it offer that are not achievable today? •  Another question surfaced rapidly: Why would we need a Physical Internet? Physical Internet Manifesto Benoit Montreuil Version 1.8, 2011-03-28, p. 24/83 www.PhysicalInternetInitiative.org
  25. 25. The Digital Internet Building Upon and Expanding Beyond the Information Highway Metaphor When the digital world was looking for a way to conceptualize how it should transform itself, it relied on a physically inspired metaphor: Building the information highwayReferences “BCNETs Optical Regional Advanced Network Upgrade Completed”, http://www.bc.net/news_events_publications/newsletters/Dec_2007/ROADM_Completion.htm “What the Telecom Industry May Look Like in 10 Years”, http://kennethmarzin.wordpress.com/2008/01/24/what-the-telecom-industry-may-look-like-in-10-years/ Physical Internet Manifesto Benoit Montreuil Version 1.8, 2011-03-28, p. 25/83 www.PhysicalInternetInitiative.org
  26. 26. The Digital Internet Building Upon and Expanding Beyond the Information Highway Metaphor Well, they have achieved their goal and went farther, reshaping completely the way digital computing and communication are now performed They have invented the Internet, leading the way to the World-Wide Web They have enabled the building of an open distributed networked infrastructure that is currently revolutionizing so many facets of our societal and economic realityReferences: « Internet 2, le Web de demain », /http://www.futura-sciences.com/fr/doc/t/telecoms/d/Internet-2-le-web-de-demain_582/c3/221/p1 http://www.20minutes.fr/article/353755/Economie-Surendettement-Christine-Lagarde-ne-veut-pas-interdire-le-credit-revolving.php « rE-veille: réflexions sur l’aventure Internet », http://reveille.wordpress.com/ Physical Internet Manifesto Benoit Montreuil Version 1.8, 2011-03-28, p. 26/83 www.PhysicalInternetInitiative.org
  27. 27. The Essence of the Digital Internet The Digital Internet is about the interconnection between networks in a way transparent for the user, so allowing the transmission of formatted data packets in a standard way permitting them to transit through heterogeneous equipment respecting the TCP/IP protocolReferences: Kurose J., Ross K. and Wesley A. “Computer Networking: A Top Down Approach Featuring the Internet”, 3rd edition., July 2004. Parziale L., Britt D.T., Davis C., Forrester J., Liu W., Matthews C. and Rosselot N. “TCP-IP Tutorial and Technical Overview”, 2006. http://www.redbooks.ibm.com/redbooks/pdfs/gg243376.pdf “Interconnection of access networks, MANs and WANs “, http://images.google.ca/imgres?imgurl=http://www.exfo.com/ Physical Internet Manifesto Benoit Montreuil Version 1.8, 2011-03-28, p. 27/83 www.PhysicalInternetInitiative.org
  28. 28. Toward a Physical InternetDigital Internet as a Metaphor for the Physical World Even though there are fundamental differences between the physical world and the digital world, the Physical Internet initiative aims to exploit the Internet metaphor so as to propose a vision for a sustainable and progressively deployable breakthrough solution to global problems associated with the way we move, handle, store, realize, supply and use physical objects all around the world Physical Internet Manifesto Benoit Montreuil Version 1.8, 2011-03-28, p. 28/83 www.PhysicalInternetInitiative.org
  29. 29. The Physical Internet An open global logistics system leveraging interconnected supply networks through a standard set ofcollaborative protocols, modular containers and smart interfaces for increased efficiency and sustainability Working definition for the Physical Internet, jointly developed by Benoit Montreuil, Eric Ballot and Russ Meller, version as of 2011-03-23 Physical Internet Manifesto Benoit Montreuil Version 1.8, 2011-03-28, p. 29/83 www.PhysicalInternetInitiative.org
  30. 30. Exposing 13 Key Features of the Physical Internet Vision VISIONEvolving towards a worldwide Physical Internet Physical Internet Manifesto Benoit Montreuil Version 1.8, 2011-03-28, p. 30/83 www.PhysicalInternetInitiative.org
  31. 31. Thirteen Key Features of the Physical Internet Vision1.  Encapsulate merchandises in world-standard smart green modular containers2.  Aim toward universal interconnectivity3.  Evolve from material to container handling & storage systems4.  Exploit smart networked containers embedding smart objects5.  Evolve from point-to-point hub-and-spoke transport to distributed multi-segment intermodal transport6.  Embrace a unified multi-tier conceptual framework7.  Activate and exploit an open global supply web8.  Design products fitting containers with minimal space waste9.  Minimize Physical moves and storages by digitally transmitting knowledge and materializing products as locally as possible10.  Deploy capability certifications and open performance monitoring11.  Prioritize webbed reliability and resilience of networks12.  Stimulate business model innovation13.  Enable open infrastructural innovation Physical Internet Manifesto Benoit Montreuil Version 1.8, 2011-03-28, p. 31/83 www.PhysicalInternetInitiative.org
  32. 32. Digital Internet: From information to packets  The Digital Internet does not transmit information, it transmits packets embedding information  Information packets are designed for ease of use in Internet  The information within a packet is encapsulated and is not dealt with explicitly by Internet  The packet header contains all information required for identifying the packet and routing it correctly to destination  A packet is constructed for a specific transmission and it is dismantled once it has reached its destination Image: http://www.softlist.net/program/sniff_-_o_-_matic-image.html Physical Internet Manifesto Benoit Montreuil Version 1.8, 2011-03-28, p. 32/83 www.PhysicalInternetInitiative.org
  33. 33. Digital Internet: From information to packets  The Digital Internet is based on a protocol structuring data packets independently from equipment  In this way, data packets can be processed by different systems and through various networks •  Modems, copper wires, fiber optic wires, routers, etc. •  Local area networks, wide area networks, etc. •  Intranet, Extranet, Internet, Virtual Private Network, etc. References: Kurose J., Ross K. and Wesley A. “Computer Networking: A Top Down Approach Featuring the Internet”, 3rd edition., July 2004. Parziale L., Britt D.T., Davis C., Forrester J., Liu W., Matthews C. and Rosselot N. “TCP-IP Tutorial and Technical Overview”, 2006. http://www.redbooks.ibm.com/redbooks/pdfs/gg243376.pdf Physical Internet Manifesto Benoit Montreuil Version 1.8, 2011-03-28, p. 33/83 www.PhysicalInternetInitiative.org
  34. 34. Physical Internet 1. Encapsulate merchandises inworld-standard smart green modular containers π-containers are key elements enabling the interoperability necessary for the adequate functioning of the Physical Internet   Merchandise is unitized as content of a π-container and is not dealt with explicitly by the Physical Internet   From the cargo container sizes down to tiny sizes   Conceived to be easily flowed through various transport, handling and storage modes and means   Conceived to be easy to handle, store, transport, seal, snap, interlock, load, unload, construct, dismantle, panel, compose and decompose   Smart tag enabled, with sensors if necessary, to allow their proper identification, routing and maintaining   Environment friendly materials with minimal off-service footprint   Minimizing packaging materials requirements by enabling of the fixture-based protection and stabilization of their embedded products;   Various usage-adapted structural grades   Conditioning capabilities (e.g. temperature) as necessary   Sealable for security purposes Physical Internet Manifesto Benoit Montreuil Version 1.8, 2011-03-28, p. 34/83 www.PhysicalInternetInitiative.org
  35. 35. π-Containers: Modularized and standardized worldwide in terms of dimensions, functions and fixturesπ-containers Y X Z Illustrative modular dimensions 0,12 m 0,24 m 0,36 m 0,48 m 0,6 m 1,2 m 2,4 m 3,6 m 4,8 m 6 m 12 m B. Montreuil, B. Gilbert Physical Internet Manifesto Benoit Montreuil Version 1.8, 2011-03-28, p. 35/83 www.PhysicalInternetInitiative.org
  36. 36. π-Containers Easy to handle, store, transport, seal, snap, interlock, load,unload, construct, dismantle, panel, compose and decompose ,$%$()$*+ !#$%$()$*+ Physical Internet Manifesto Benoit Montreuil Version 1.8, 2011-03-28, p. 36/83 www.PhysicalInternetInitiative.org
  37. 37. Physical Internet2. Aim toward universal interconnectivity High-performance logistic centers, systems and movers exploiting world standard protocols, making it fast, cheap, easy and reliable to interconnect π-containers through modes and routes,with an overarching aim toward universal interconnectivityReferences: Crainic, T.G. and Kim, K.H., Intermodal Transportation, Chapt. 8, Transportation, Handbooks in Operations Research and Management Science, C. Barnhart and G. Laporte (Eds.), North-Holland,, 467–537, 2007 Goetschalckx M. “Distribution System Design”. Chap. 13 in Logistics Engineering Handbook, 2008 Physical Internet Manifesto Benoit Montreuil Version 1.8, 2011-03-28, p. 37/83 www.PhysicalInternetInitiative.org
  38. 38. Digital Internet: Hubs and Routers  Routing allows to insure Internet performance through a very efficient orientation of the packets towards the nodes of the network  Routing exploits the ease of storing transmitting information  A routers job is extremely simple: •  It moves packets to the next machine in the right direction as quickly as possible.  Because all routers do is move packets, they are able to process millions of packets a minute •  Each router maintains a routing table, a set of rules that tell the router which next machine to forward packets to, based on the final destination of a packet References: Zuckerman E. McLaughlin A., “Introduction to Internet Architecture and Institutions” : August, 2003 Perlman R, “Interconnections - Bridges, Routers, Switches, and Internetworking Protocols”; (2nd Edition) 1999 Physical Internet Manifesto Benoit Montreuil Version 1.8, 2011-03-28, p. 38/83 www.PhysicalInternetInitiative.org
  39. 39. Physical Internet 2. Universal Interconnectivity  The Physical Internet nodes are concurrently routing and accumulation sites within the networks, as well as gateways interfacing with the entities out of the Physical Internet  As currently conceived, the activities of sorting, storage and handling physical objects are brakes to interconnection •  Be it in train sorting yards or in crossdocking platforms  However there exist exceptions: •  Such as some of the recently implemented container ports  There is a need to generalize unloading, orientation, storage and loading operations, widely applying them to π-containers in a smart automated and/or human-assisted way  The objective is to make load breaking almost negligible temporally and economically   Intermodal less-than-truckload transport nearly at the same price, speed reliability as single-mode full truckload References: Crainic, T.G. and Kim, K.H., Intermodal Transportation, Chap. 8, Transportation, Handbooks in Operations Research and Management Science, C. Barnhart and G. Laporte (Eds.), North-Holland, 467–537, 2007 Chopra Meindl, Facility Decisions and Distribution Network - 2009_E4.5 Physical Internet Manifesto Benoit Montreuil Version 1.8, 2011-03-28, p. 39/83 www.PhysicalInternetInitiative.org
  40. 40. Physical Internet3. Evolve from material to π-container handling storage systems π-container handling and storage systems, with innovative technologies and processes exploiting the characteristics of π-containers to enable their fast, cheap, easy and reliable input, storage, composing, decomposing, monitoring, protection and output through smart, sustainable and seamless automation and human handling Physical Internet Manifesto Benoit Montreuil Version 1.8, 2011-03-28, p. 40/83 www.PhysicalInternetInitiative.org
  41. 41. Physical Internet3. Evolve from material to π-container handling storage systems Reference: Montreuil, B., R.D. Meller, E. Ballot (2010) Towards a physical internet: the impact on logistics facilities and material handling systems design and innovation, International Material Handling Research Colloquium (IMHRC 2010), Milwaukee, États-Unis, 2010/06/21-24 Physical Internet Manifesto Benoit Montreuil Version 1.8, 2011-03-28, p. 41/83 www.PhysicalInternetInitiative.org
  42. 42. Physical Internet 3. Evolve from material to π-container handling storage systems π-container handling and storage systems: •  Enable fast and reliable input and output performance •  Have seamless interfacing with vehicles and systems moving products in and out, as well as client software systems for tracking and interfacing with the containers •  Monitor and protect the integrity of π-containers •  Secure the containers to the desired level •  Provide an open live documentation of their specified performance and capabilities and of their demonstrated performance and capabilities, updated through ongoing operations  This applies in currently-labeled distribution centers, crossdocking centers, train stations, multimodal hubs, seaports, airports, and so on Physical Internet Manifesto Benoit Montreuil Version 1.8, 2011-03-28, p. 42/83 www.PhysicalInternetInitiative.org
  43. 43. Physical Internet 4. Exploit smart networked containers embedding smart objects Exploiting as best as possible the capabilities of smart π-containersconnected to the Digital Internet and the World Wide Web, and of their embedded smart objects, for improving performance as perceived by the clients and overall performance of the Physical Internet Physical Internet Manifesto Benoit Montreuil Version 1.8, 2011-03-28, p. 43/83 www.PhysicalInternetInitiative.org
  44. 44. Physical Internet and the Internet of Things   The Internet of Things is about enabling ubiquitous connection with physical objects equipped with smart connective technology, making the objects ever smarter and enabling distributed self- control of objects through networks •  It exploits technologies such as Internet, Web, RFID and GPS   The Physical Internet is to exploit as best as possible the Internet of Things to enable the ubiquitous connectivity of its π-containers and π-systemsImage: http://www.globetracker.biz/GlobeTracker/News.asp References: Johnson M. E., “Ubiquitous Communication: Tracking Technologies within the Supply Chain”, Chap.20 in Logistics Engineering Handbook, 2008 Scott D. M., “Electronic Connectivity and Soft ware” Chap.20 in Logistics Engineering Handbook, 2008 “Building a Smarter Container”, RFID Journal, http://www.rfidjournal.com/article/articleview/655/1/1/ Physical Internet Manifesto Benoit Montreuil Version 1.8, 2011-03-28, p. 44/83 www.PhysicalInternetInitiative.org
  45. 45. Physical Internet5. Evolve from point-to-point hub-and-spoke transport to distributed multi-segment intermodal transport Distributed multi-segment travel of π-containers through the Physical Internet, with distinct carriers and/or modes taking charge of inter-node segments, with transit nodes enabling synchronized transfer of π-containers and/or carriers between segments, and with web software platform enabling an open market of transport requesters and transport providers Physical Internet Manifesto Benoit Montreuil Version 1.8, 2011-03-28, p. 45/83 www.PhysicalInternetInitiative.org
  46. 46. Digital Internet Distributed multi-segment transmission   In the Digital Internet, the packets that constitute an overall transmission, such as an e-mail, do not travel directly from source node A to destination node B   The packets travel through a series of routers and cables (copper or optical), dynamically moved from origin to destination in as best a way as possible provided the routing algorithms and the congestion through the networks •  An email from Québec to Lausanne may go through tens of routers across the world, from New York to Beijing   Packets forming a message are not restricted to travel together •  Each may end up traveling its distinct route •  The overall message is reconstituted upon packet arrival at final destinationReferences: Zuckerman E. McLaughlin A., “Introduction to Internet Architecture and Institutions” : August, 2003 Kurose J., Ross K. and Wesley A. “Computer Networking: A Top Down Approach Featuring the Internet”, 3rd edition., July 2004. Physical Internet Manifesto Benoit Montreuil Version 1.8, 2011-03-28, p. 46/83 www.PhysicalInternetInitiative.org
  47. 47. Physical Internet5. Evolve from point-to-point hub-and-spoke transport to distributed multi-segment intermodal transport   Currently, if a trailer fully loaded with containers is requested to be transported from Québec to Los Angeles, there is high probability that: •  A driver and a truck will be assigned to the multi-day trip, •  The driver sleeping in his truck and driving to destination, •  Then moving to some as nearby as possible location to pick up a trailer returning toward as near as possible of Québec, to avoid empty travel References: Powell W. B. “Real-Time Dispatching for Truckload Motor Carriers“, Chapter 15 in Logistics Engineering Handbook, 2008 McKinnon A., “Road transport optimization “,Chap. 17 in Global Logistics New Directions in Supply Chain Management - eBook (2007) Fifth Ed. Edited by Donald Waters Physical Internet Manifesto Benoit Montreuil Version 1.8, 2011-03-28, p. 47/83 www.PhysicalInternetInitiative.org
  48. 48. A typical cowboy haul from Québec to Los Angeles One-way Distance travelled : 5030 km Drivers: 1, Trucks: 1, Trailer: 1 One-way driving time: 48 hours Return driving time: 48 hours One-way trip time: 120 hours Return trip time: 120+ hours Driving time for driver: 96 hours Trip time for driver: 240+ hours Physical Internet Manifesto Benoit Montreuil Version 1.8, 2011-03-28, p. 48/83 www.PhysicalInternetInitiative.org
  49. 49. Physical Internet5. Evolve from point-to-point hub-and-spoke transport to distributed multi-segment intermodal transport   In the Physical Internet, such a point-to-point experience would be exceptional. Most probably: •  A first driver and truck would be assigned to transport it to a transit point 3 to 6 hours away •  The trailer would be deposited to a slot in the transit point •  The first would then pick up another trailer required toward Québec •  Another driver and truck would rapidly afterward pick up the trailer and move it another segment forward, or yet the containers could be transferred to other trailers, trucks, trains, ships or planes as pertinent given the opportunities •  Repeating the process all the way to Los Angeles •  The shipper or its representative would have a priori arranged transportation on each segment and sojourn at each transit point, in his best interest in terms of price, timing and risk; or yet the routing decisions would be dynamic and/or distributed Reference: “Warehousing And Cross-Docking”, http://www.3pd.com/Services/JobSiteWarehousing.aspx Physical Internet Manifesto Benoit Montreuil Version 1.8, 2011-03-28, p. 49/83 www.PhysicalInternetInitiative.org
  50. 50. Multi-segment travel from Quebec to Los Angeles Québec 20 Montréal Alexandria 20-401 Bay, US border 81 90 Syracuse 90 Buffalo 71 Cleveland 70 Columbus 70 Indianapolis 44 St-Louis 44 Springfield Current Proposed 44 Tulsa Distance travelled one-way: 5030 km 5030 km Oklahoma City 40 Drivers: 1 17 40 Amarillo Trucks: 1 17 40 Albuquerque Trailer: 1 1 40 Flagstaff One-way driving time (h): 48 51+ 40 Needles Return driving time (h): 48+ 51+ Barstow Total time at transit points (h): 0 9 15-10 Total trailer trip time from Quebec to LA (h): 120 60+ Los Angeles Total trailer trip time from LA to Quebec (h): 120+ 60+ Total trailer round trip time (h): 240+ 120+ Average driving time per driver (h): 96+ 6 Average trip time per driver (h): 240+ 6,5 Physical Internet Manifesto Benoit Montreuil Version 1.8, 2011-03-28, p. 50/83 www.PhysicalInternetInitiative.org
  51. 51. .$# -*# !# -# !$# .*# -# !%# -(# !# .%# -+# !# -)# !(# -%# !)# !*# .(# -# !+# -$# !,# π-Transit sites allowing distributed !#$%()*+,- !#$%),,*+, multi-segment transport !#$.+/*%0+through the Physical Internet !#$1)2 Status of !-carriers currently in !-transit Incoming deposit Outgoing pickup estimation !-carrier !-bay !-vehicle Time !-vehicle Time (min, mode, max) C1 B2 V1 04:35 V14 (06:04, 06:05, 06:15) C2 B10 V3 05:15 V15 (06:05, 06:09, 06:12) C3 B7 V4 05:20 V13 (06:04, 06:07, 06:10) C4 B9 V6 05:35 V11 (06:02, 06:02, 06:02) C5 B3 V8 05:45 V12 (06:01, 06:01, 06:01) C6 B4 V9 05:48 V16 (06:10, 06:12, 06:18) C7 B6 V11 05:55 V19 (06:15, 06:20, 06:30) C8 B1 V12 05:58 V18 (06:10, 06:15, 06:20) C9 B10 V13 06:00 V25 (06:20, 06:30, 06:45) Reference: Montreuil, B., R.D. Meller, E. Ballot (2010) Towards a physical internet: the impact on logistics facilities and material handling systems design and innovation, International Material Handling Research Colloquium (IMHRC 2010), Milwaukee, États-Unis, 2010/06/21-24 Physical Internet Manifesto Benoit Montreuil Version 1.8, 2011-03-28, p. 51/83 www.PhysicalInternetInitiative.org
  52. 52. !#$% Road-Water π-Hub designed for enablingdistributed multi-segment intermodal transport of π-containers through the Physical Internet () Reference: Montreuil, B., R.D. Meller, E. Ballot (2010) Towards a physical internet: the impact on logistics facilities and material handling systems design and innovation, International Material Handling Research Colloquium (IMHRC 2010), Milwaukee, États-Unis, 2010/06/21-24 Physical Internet Manifesto Benoit Montreuil Version 1.8, 2011-03-28, p. 52/83 www.PhysicalInternetInitiative.org
  53. 53. Road-Rail Hub designed for enablingmulti-segment intermodal transport of π-containers through the Physical Internet Reference: B. Montreuil, E. Ballot, C. Montreuil et D. Hakimi (2010), OpenFret Project Report, InnoFret Program, France Physical Internet Manifesto Benoit Montreuil Version 1.8, 2011-03-28, p. 53/83 www.PhysicalInternetInitiative.org
  54. 54. Physical Internet6. Embrace a unified multi-tier conceptual framework Intra-Center Inter-Processor Network Physical Internet Manifesto Benoit Montreuil Version 1.8, 2011-03-28, p. 54/83 www.PhysicalInternetInitiative.org
  55. 55. Physical Internet6. Embrace a unified multi-tier conceptual framework Intra-Facility Inter-Center Network Physical Internet Manifesto Benoit Montreuil Version 1.8, 2011-03-28, p. 55/83 www.PhysicalInternetInitiative.org
  56. 56. Physical Internet6. Embrace a unified multi-tier conceptual framework Intra-Site Inter-Facility Network Physical Internet Manifesto Benoit Montreuil Version 1.8, 2011-03-28, p. 56/83 www.PhysicalInternetInitiative.org
  57. 57. Physical Internet6. Embrace a unified multi-tier conceptual frameworkIntra-CityInter-Site Network π-transits π-hubs Toward π-enabled! sustainable! city logistics! Physical Internet Manifesto Benoit Montreuil Version 1.8, 2011-03-28, p. 57/83 www.PhysicalInternetInitiative.org
  58. 58. Physical Internet6. Embrace a unified multi-tier conceptual frameworkIntra-State Inter-City Network π-transits π-hubs Québec, CanadaNorth eastern states, U.S.A. Physical Internet Manifesto Benoit Montreuil Version 1.8, 2011-03-28, p. 58/83 www.PhysicalInternetInitiative.org
  59. 59. Physical Internet6. Embrace a unified multi-tier conceptual framework Physical Internet Manifesto Benoit Montreuil Version 1.8, 2011-03-28, p. 59/83 www.PhysicalInternetInitiative.org
  60. 60. Physical Internet7. Activate and exploit an Open Global Supply Web An open web of product realization centers, distribution centers, warehouses, hubs and transit centers enabling producers, distributors and retailersto dynamically deploy their π-container-embedded products in multiple geographically dispersed centers, producing, moving and storing them for fast, efficient and reliable response delivery to distributed stochastic demand for their products, services and/or solutions Enabling Physical Equivalents of! Intranets, Virtual Private Networks,! Cloud Computing and Cloud Storage! References: Montreuil B., Labarthe, O., Hakimi, D., Larcher, A., Audet, M. Supply Web Mapper. Proceedings of Industrial Engineering and Systems Management, Conference, IESM, , Conference Montréal, Canada, May 13-15, 2009 Hakimi D., B. Montreuil, O. Labarthe, “Supply Web: Concept and Technology”, 7th Annual International Symposium on Supply Chain Management, Conference Toronto, Canada, October 28-30, 2009Montreuil, B., Hakimi, D. , B. Montreuil, O. Labarthe, ”Supply Web Agent-Based Simulation Platform” Proceedings of the 3rd International Conference on Information Systems, Logistics and Supply Chain Creating value through green supply chains, ILS 2010 – Casablanca (Morocco), April 14-16. Physical Internet Manifesto Benoit Montreuil Version 1.8, 2011-03-28, p. 60/83 www.PhysicalInternetInitiative.org
  61. 61. Physical Internet7. Activate and exploit an Open Global Supply Web   As products and materials are moved and stored in modular secured containers, it allows: •  Warehouses and DCs to accept handling and storing containers from a wide variety of clients, embedding an indeterminate and non-pertinent number of distinct products, as long as they respect their throughput, security, conditioning and dimensioning capability specifications •  Significant improvement in capacity utilization and facility profitability •  Significant reduction in asset requirements and significant improvement in logistic costs and delivery service performance References: “Virtual warehousing”, Jeroen van den Berg Consulting , 2001 Chopra Meindl, “Facility Decisions and Distribution Network “, 2009_E4.5 Physical Internet Manifesto Benoit Montreuil Version 1.8, 2011-03-28, p. 61/83 www.PhysicalInternetInitiative.org
  62. 62. 1 Factories: 4 3 Firm dedicated DCs: 16 Mean lead time: 1,75 Max lead time: 3 2 4 Independent Factory: 1 Factory: 1 Factory: 1 Factory: 1 private Firm dedicated DCs: 4 Firm dedicated DCs: 4 Firm dedicated DCs: 4 Firm dedicated DCs: 4 Mean lead time: 1,73 Mean lead time: 1,78 Mean lead time: 1,75 Mean lead time: 1,73 supply networks Max lead time: 3 Max lead time: 3 Max lead time: 3 Max lead time: 3 Shared supply web Shared supply webwith independently with jointly 1 1 implemented DCs 3 3 implemented DCs Factories: 4 Factories: 4 Firm dedicated DCs: 0 Firm dedicated DCs: 0 2 2 Group dedicated DCs: 16 Group dedicated DCs: 3 Mean lead time: 1,08 4 4 Mean lead time: 1,48 Max lead time: 3 Max lead time: 3 1 Factories: 4 3 Firm dedicated DCs: 0 Open supply web Group dedicated DCs: 0 with a high density of open DCs Open DCs used: 60+ Mean lead time: 0 available to many other clients 2 4 Max lead time: 0 * Lead times induced by transport from DC to client region Contrasting Independent Supply Networks, an Open Supply Web and a Global Open Supply Web in terms of number of distribution centers Manifesto Physical Internet and of DC-to-client lead time Benoit Montreuil Version 1.8, 2011-03-28, p. 62/83 www.PhysicalInternetInitiative.org
  63. 63. From Private Supply Networks to Open Supply Webs Insuring one-day delivery by each company in its served markets 47 facilities 30 facilities The private supply networks of 5 companies A shared supply networks among 5 companiesserving clients across Canada and the U.S.A. serving clients across Canada and the U.S.A. under a one-day delivery service policy, under a one-day delivery service policy, with 42 DC and 5 factories with 25 DC and 5 factories Reference: Montreuil and Sohrabi, From Private Supply Networks to Open Supply Webs, IERC 2010 Physical Internet Manifesto Benoit Montreuil Version 1.8, 2011-03-28, p. 63/83 www.PhysicalInternetInitiative.org
  64. 64. Physical Internet 8. Design products fitting containers with minimal space waste Products designed and engineeredto minimize the load they generate on the Physical Internet,with dimensions adapted to standard container dimensions, with maximal volumetric and functional density while containerized Reference: Seliger G., “Sustainability in Manufacturing - Recovery of Resources in Product and Material Cycles” (Ed. by Günther Seliger, Sringer Verlag, 2007 Physical Internet Manifesto Benoit Montreuil Version 1.8, 2011-03-28, p. 64/83 www.PhysicalInternetInitiative.org
  65. 65. Physical Internet 8. Design products fitting containers with minimal space waste  Product dimensions adapted to the standard container dimensions •  So that the packaged product fits in a small footprint container  In order to avoid moving and storing air, products should be designed and engineered so as to have maximal volumetric density while being in Physical Internet containers, extendable to their usage dimensions when necessary  Products should be designed so that only key components and modules have to travel extensively through the Physical Internet: •  Easy to be completed near point of use using locally available objects  Products having to move through the Physical Internet should be as functionally dense as possible when in the containers •  Functional density of an object can be expressed as the ratio of its useful functionality over the product of its weight and volume Physical Internet Manifesto Benoit Montreuil Version 1.8, 2011-03-28, p. 65/83 www.PhysicalInternetInitiative.org
  66. 66. Physical Internet 9. Minimize Physical moves and storages by digitally transmitting knowledgeand materializing products as locally as possible In general, it is much easier and much less expensive to move and store digital objects composed of information bitsrather than physical objects composed of matterReferences: Waters D., “Trends in the supply chain”, Chap. 1 in Global Logistics New Directions in Supply Chain Management , 2007) Fifth Ed., Ed. by Donald Waters Duncan R., “Internet traders can increase profitability by reshaping their supply chains” Chap. 19 in Global Logistics New Directions in Supply Chain Management , 2007 5th Ed. by D. Waters Physical Internet Manifesto Benoit Montreuil Version 1.8, 2011-03-28, p. 66/83 www.PhysicalInternetInitiative.org
  67. 67. Physical Internet 9. Minimize physical moves and storages by digitally transmitting knowledge and materializing products as locally as possible Exploiting extensively the knowledge-based dematerialization of products and their materialization in physical objects at point of use As it will gain maturity, the Physical Internet is expected to be connected to ever more open distributed flexible production centerscapable of locally realizing (make, assemble, finish) for clients a wide variety of products from digitally transmitted specifications, local physical objects and, if needed, critical physical objects brought in from faraway sources Physical Internet Manifesto Benoit Montreuil Version 1.8, 2011-03-28, p. 67/83 www.PhysicalInternetInitiative.org
  68. 68. Physical Internet 9. Minimize Physical moves and storages by digitally transmitting knowledgeand materializing products as locally as possibleThird-party production is to take an ever growing share of the overall production market, internal production ever more limited to highly sensitive core objects Product realization knowledge should be protected, and authenticity of the materialized products should be legally acknowledged Physical Internet Manifesto Benoit Montreuil Version 1.8, 2011-03-28, p. 68/83 www.PhysicalInternetInitiative.org
  69. 69. 1 3 Factories: 4 Firm dedicated DCs: 16 D2C max: 3 mean: 1,75 F2D max: 9 mean: 3,92 2 4 Independent Factory: 1 Factory: 1 Factory: 1 Factory: 1 private Firm dedicated DCs: 4 Firm dedicated DCs: 4 Firm dedicated DCs: 4 Firm dedicated DCs: 4 D2C max: 3 mean: 1,73 D2C max: 3 mean: 1,78 D2C max: 3 mean: 1,75 D2C max: 3 mean: 1,73supply networks F2D max: 8 mean: 4,11 F2D max: 7 mean: 3,00 F2D max: 7 mean: 3,69 F2D max: 9 mean: 4,88 Shared supply web Shared supply webwith independently with jointly 1 1 implemented DCs 3 3 implemented DCs Firm dedicated factories: 4 Firm dedicated factories: 4 Firm dedicated DCs: 0 Firm dedicated DCs: 0 2 2 Group shared DCs: 16 Group shared DCs: 3 D2C max: 3 mean: 1,08 4 4 D2C max: 3 mean: 1,48 F2D max: 9 mean: 4,36 F2D max: 10 mean: 4,39 Open supply web 1 Firm dedicated factories: 4 with a high density of open DCs Firm dedicated DCs: 0 3 Group shared DCs: 0 available to many other clients Open DCs used: 60+ 2 Inter-region transport induced lead times 4 D2C max: 0 mean: 0,00 F2D: Factory to DC lead time F2D max: 12 mean: 4,75 D2C: DC to client region lead time Contrasting Supply Networks, an Open Supply Web and a Global Open Supply Web Physical Internet Manifesto in terms of factory-to-DC lead times with no shared or open production centers Benoit Montreuil Version 1.8, 2011-03-28, p. 69/83 www.PhysicalInternetInitiative.org

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