A little over a year ago, the Department of Homeland Security unveiled a $300 million port security plan that expanded the Container Security Initiative (CSI) – a program designed to identify, target and search high-risk cargo. Phase II of the CSI extended protection beyond the initial 20 major ports (which account for 68 percent of all cargo entering the United States) to increase the rate of protected cargo to 80 percent.
Clearly, the federal government’s continued emphasis on homeland security highlights the need for increased diligence on all fronts, including the nation’s ports. In February of this year, President Bush responded to this need in his Fiscal 2005 budget proposal, which called for $1.9 billion for port security efforts.
Cargo security – no easy featThe transit of goods from factory to destinations across international borders is presently fraught with security holes. At the core of the current port security problem is a lack of real-time supply chain visibility. Often, no mechanism exists to track and manage cargo from port-to-port, and those that do exist are neither all-encompassing nor cost efficient. As the government enacts regulations and the private sector develops new technologies for port security, the amount of data (i.e. location, source, contents, security, etc.) corresponding to specific pieces of cargo moving in and out of this country will grow exponentially. If port officials monitor and track this data properly, they can leverage the information to predict and prevent acts of terror.
National security necessitates the development of a comprehensive security infrastructure that allows parties involved in cargo movement – including the companies originally providing goods, shipping and freight companies, governments/ports receiving shipments and the end recipient of the freight – to share vital supply chain information. Recently, a public/private pilot program used new technologies and processes to design an efficient and cost-effective supply chain security system for cargo transportation between ports.
In response to the need for improved port security, the Asia-Pacific Economic Cooperation (APEC) launched the Secure Trade in the APEC Region (STAR) program in 2002. The first STAR initiative, known as the STAR Bangkok/Laem Chabang Efficient and Secure Trade (STAR/BEST), was a pilot project launched in late 2003 to demonstrate a trans-Pacific supply chain security system.
STAR/BEST developed a secure shipping line between Laem Chabang, Thailand and Seattle that created an end-to-end secure supply chain system designed by Oracle Corp., Savi Technology, and the ports of Seattle and Laem Chabang. Laem Chabang is Thailand’s main international port, shipping more than 3 million containers annually. Each year, the ports of Laem Chabang and Seattle transport approximately 20,000 containers across their trade lane alone.
Securing the supply chainWithin the STAR/BEST pilot, the Port of Laem Chabang served as the origin point, with that of Seattle serving as the destination. Laem Chabang port employees packed containers, secured them with radio frequency identification (RFID) sensor e-seals and loaded them on ships. Port officials were able to track the containers throughout their route – from ports in Taiwan and South Korea, and on to the Port of Seattle – by utilizing a real-time, Web-enabled software application with RFID capabilities from Savi and database technology from Oracle. In addition to its ability to track the location of cargo throughout the shipping line, the system included an electronic seal mechanism that would activate an alarm if a piece of cargo was opened en route.
Once they arrived at the Port of Seattle, the containers were discharged from the ships and their electronic seals checked. There, operators with handheld computers verified the containers’ contents and origin. Upon verification, receivers used handheld computers to unlock the seals and remove the container contents.
The STAR/BEST program also included a capacity building component designed to help employees of small-to-medium-sized shipping organizations, as well as involved government agencies, learn regulations and best practices in order to facilitate trade in the context of a secure environment. This training program, built on Oracle’s iLearning application, provided instructions for complying with new and existing U.S. customs requirements, such as the 24-hour manifest rule of the Computer Security Initiative. By understanding the presiding regulations before entering ports, freight handlers could work more efficiently, saving themselves much time and frustration.
When comparing the cost of the STAR/BEST program to the benefits achieved, an independent third party concluded that the ports of Laem Chabang and Seattle saved $220 per container by using these technologies and processes.
Managing new innovations, tracking new dataAs the parties involved in worldwide container trade continue to adopt RFID technology, new challenges will emerge as increasingly large volumes of supply chain data – order entry, manufacturing, maintenance, receiving and inventory – flood systems.
By using Oracle 10g Database, the parties involved with the STAR/BEST program were able to track, store and manipulate RFID data in real-time, without compromising security, high availability or performance. When applied beyond the pilot project stage, this capability should allow port officials to identify hidden patterns in order fulfillment, uncover new cost reduction opportunities, and reduce business and security risks.
As the government and private sector continue to expand port security efforts, they can use the lessons learned during the STAR/BEST pilot to design new cost-effective programs for securing the global trade process. STAR/BEST exemplifies the progress made through use of new technologies, like RFID, and collaboration between private and public organizations. No one group can achieve port security alone. By working together, industry and government can develop more efficient and secure trade lines – improving business efficiencies while building a powerful tool in the war against terror.