Commentary: The data land grab

Companies in the shipping and logistics industry would be wise to view every technological product and pitch as an attempt to gather their data.    The most interesting aspect of the recently announced blockchain initiative between the A.P. Moller-Maersk Group and IBM isn’t the technology itself.
   While it’s hard to take two steps in any direction and not come across blockchain these days, there is still a comprehension deficit in the shipping industry about what the technology is and what it could enable. In other words, it’s very early days from an adoption perspective.
   What Maersk and IBM are trying to do is commendable, yet the more intriguing component of their plans is not what a blockchain would do for shipping, but what it asks of Maersk’s competitors.
   Maersk and IBM, in their announcement, were clear that the trade and freight transportation solution they are creating is meant to be a neutral platform for all parties in the industry. That means beneficial cargo owners (BCOs), exporters, freight forwarders, non-vessel-operating common carriers (NVOs), and even Maersk’s liner shipping rivals.
   The idea is a common platform to standardize data collection and submission from the myriad parties attached to an international ocean shipment would create immense process efficiencies for all. But that goal is based upon buy-in not just from a relatively conservative industry, but one that is chronically distrustful of competitors.
   Let me spell it out more clearly: are other ocean carriers going to trust that this is truly neutral? Further, are NVOs and BCOs that negotiate rates and service terms with Maersk going to trust a platform partly designed by Maersk?
   This all comes down to one simple root: data. Will other parties trust that their data is not being used in a way that inhibits them or helps a competitor? Perception counts for as much as reality here.
   You can expand this out wider across virtually any logistics software advancement over the past decade. Everybody is after data. Software providers, logistics companies, government agencies, carriers, consultants. Everybody.
   You should view every pitch from any service provider – whether they’re providing space on a vessel, advisory services, or a piece of software – as an attempt to get access to your data. That might seem like a sinister statement, but it’s not (necessarily). It’s the price of business efficiency these days.
   For the cost of granting a partner access to your data, you get that data back in a cleansed, analyzed and synthesized format. You might even get access to relevant, aggregate data beyond your business. But what’s important to understand is that providers might be seeking your data through an initiative that doesn’t even seem related to your data.
   Let’s take visibility, for instance. If a shipper signs up with a 3PL to provide track and trace messages, the sense is that data is being provided to the shipper. The provider is giving the shipper data it didn’t have before. But that provider, if it is so inclined, can take that data it’s collecting on the shipper’s behalf and ingest it in whatever way it likes. While it’s data the shipper might not have been collecting previously, it is data about the shipper.
   The same goes for a carrier working with a software company to provide status messages to its customers through a visibility portal. The software provider is likely ingesting that data and scrutinizing it for patterns (or at least it should be).
   What’s driving this relentless data land grab? The cost to store and process data has come way down. The technology to make sense of huge quantities of data has significantly matured. The interest in fields like coding and data science is exploding. All that’s missing from the equation is…the data itself.
   So software companies and service providers (the broad definition) are building tools to entice customers with innovative products, but the goal behind those products is to gather every piece of data they can get their hands on.
   So back to Maersk and IBM. This is a laudable effort to advance the understanding and adoption of blockchain in shipping and global trade. Literally hundreds of other companies (though few with the cache of Maersk and IBM) are doing likewise. And all have a desire to get access to data.
   Don’t let this stop you from investing in technology that helps you run your business better. But do it with eyes wide open. And make sure you’re profiting nicely from the data you’re surrendering.