Software in logistics and transportation

Michael Henke,

Guest commentary: Mastering software!

In these times of digital transformation, the following applies more than ever: pure transportation or other traditional logistics services are no longer enough. If you can't also do software, you don't have a bright future ahead of you.

Prof. Dr. Michael Henke is Institute Director at Fraunhofer IML and holds the Chair of Corporate Logistics in the Faculty of Mechanical Engineering at TU Dortmund University. © Fraunhofer IML

In the digital age, software is inextricably linked to all economic phenomena, especially logistics - why? Because it enjoys a phenomenal advantage: All the basic principles of logistics can be completely mapped with the help of algorithms. That's why we at Fraunhofer IML have long been convinced that logistics will be one of the first fields in which artificial intelligence (AI) will become established. There are already individual examples in practice where AI-supported applications are being used, such as in route planning or to implement machine learning processes in the field of production logistics. At the moment, these are still isolated solutions.

What is therefore needed is a platform on which AI can be established on a broad basis by combining logistics and IT. This is the only way the economy can benefit. We are building this platform in the form of the "Silicon Economy" - i.e. the complete virtualization of value creation processes. The IT basis of this Silicon Economy is formed by combining the Internet of Things (IoT), blockchain and logistics. To this end, we are currently developing three "middlemen" - so-called brokers: an IoT broker that collects data in the Internet of Things; a blockchain broker that can be used to trade and book data; and a logistics broker that will orchestrate and optimize logistics processes on this basis.

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We are working on this as part of the future logistics program being pursued by the Ministry of Transport. In doing so, we are laying the foundations for linking logistics and IT, software and hardware, which we will use to develop new business models with our partners from the field. We are thus making our contribution to the future data economy by combining the data and refining it using AI and big data algorithms. The aim is to make the solutions accessible so that everyone can benefit from them - especially SMEs.

A second major initiative is Blockchain Europe - the project to establish the European Blockchain Institute in North Rhine-Westphalia. This initiative, funded by the state of NRW, is inextricably linked to the realization of a Silicon Economy. In this project, we are focusing on the blockchain broker as the IT core, which plays a central role in connecting IoT and AI for logistics. At the same time, the flow of materials and information is linked to the financial flow and comprehensive supply chain management becomes a reality.

We are developing both software and hardware solutions for the blockchain broker, which will gradually become generally accessible. In the future, the open source development of logistics solutions will be just as important as the software for logistics in order to jointly build a logistics platform that will be able to compete internationally with the major players from the USA and China. We invite everyone in the community to work with us on this major vision, which we call Silicon Economy - Supply Chain Eco Systems. Our open source approach makes this possible, because open source means that everyone can and should participate!

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