physical internet manifesto eng version 1.11.1 2012-11-19

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Physical Internet Manifesto, version 1.11 Professor Benoit Montreuil, CIRRELT, Université Laval

Physical Internet Manifesto

Transforming the way physical objects are moved, stored, realized, supplied and used,

aiming towards greater efficiency and sustainability

Professor Benoit Montreuil

Canada Research Chair in Enterprise Engineering CIRRELT Interuniversity Research Center

on Enterprise Networks, Logistics and Transportation Laval University, Québec, Canada

Version 1.11.1: 2012-11-19

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Acknowledgements The Physical Internet Manifesto has greatly benefited from

the contributions of esteemed colleagues and doctoral students America CIRRELT Research Center:

• Teodor Crainic - UQAM • Michel Gendreau - Université de Montréal • Driss Hakimi, Mustapha Lounès, Jacques Renaud, Helia Sohrabi - Université Laval CICMHE, College-Industry Council for Material Handling Education:

• Russ Meller – CELDi, University of Arkansas • Kevin Gue & Jeff Smith – Auburn University • Kimberley Ellis –CELDi, Virginia Tech • Leon McGinnis – Georgia Tech • Mike Ogle – MHIA

Europe • Éric Ballot, Frédéric Fontane, Shenle Pan, Rochdi Sarraj – Mines ParisTech • Rémy Glardon – EPFL • Rene De Koster – Erasmus University • Olivier Labarthe – IUT Bordeaux Montesquieu • Detlef Spee – Fraunhofer Institute for Material Flow and Logistic

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Manifesto Outline

Global Logistics Sustainability Grand Challenge

Envisioning the Physical Internet

Enabling a Logistics Web

Toward Realizing the Vision

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Sample of companies contributing to the Physical Internet Initiative

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Logistics is the backbone sustaining our lifestyle At face value, logistics seems to be doing great!

Original slide concept by Professor Russ Meller, CELDi, U. of Arkansas

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Logistics is the backbone sustaining eBusiness At face value, logistics seems to be doing great!


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7

Container Logistics is the backbone

sustaining the

globalization of world trade

At face value, logistics

seems to be doing great!


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Logistics inefficiency and unsustainability claim

The way physical objects are moved, stored, realized, supplied and used

throughout the world is economically, environmentally and socially

inefficient and unsustainable

Yet we have to face a harsh fact

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ECONOMIC Logistics: 5-15% burden on GDP of most countries

worldwide logistics costs grow faster than world trade

ENVIRONMENT One of the heaviest greenhouse gas generators,

energy consumers, polluters and materials wasters Growing negative contribution

while nations’ goals aims for heavy reductions SOCIAL

Lack of fast, reliable and affordable accessibility and mobility of physical objects

for the vast majority of the world’s population Too often precarious logistic work conditions

Logistics inefficiency and unsustainability Why do we need to change ?

European Commission: A Roadmap for moving to a competitive low carbon economy in 2050, Office of the European Union, Brussels, 16p. (2011) Serveau, L.T. : Inventaire des émissions de polluants dans l’atmosphère en France. In: SECTEN, Citepa, Paris (2011) European Commission: EU energy and transport in figures. Statistical Pocketbook, (2009)

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Inefficiency and unsustainability symptoms Leading Us Toward Hitting the Wall Real Hard

1. We are shipping air and packaging 2. Empty travel is the norm rather than the exception 3. Truckers have become the modern cowboys 4. Products mostly sit idle, stored where unneeded, yet so often unavailable fast where

needed 5. Production and storage facilities are poorly used 6. So many products are never sold, never used 7. Products do not reach those who need them the most 8. Products unnecessarily move, crisscrossing the world 9. Fast & reliable multimodal transport is a dream 10. Getting products in and out of cities is a nightmare 11. Logistics networks & supply chains are neither secure nor robust 12. Smart automation & technology are hard to justify 13. Innovation is strangled

Montreuil B. (2011) Towards a Physical Internet: Meeting the Global Logistics Sustainability Grand Challenge, Logistics Research, currently available as online publication, 2011-02-12, http://www.springerlink.com/content/g362448hw8586774/fulltext.pdf

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Physical Internet Manifesto, version 1.11 Professor Benoit Montreuil, CIRRELT, Université Laval 11

1. We are shipping air and packaging • Trucks and containers are often half empty at departure, with a large chunk

of the non-emptiness being filled by packaging: 56,8% full when not empty; 42,6% average utilization

2. Empty travel is the norm rather than the exception • Vehicles & containers often return empty, or travel extra routes to find

return shipments (25% of travel), and loaded vehicles get emptier and emptier as their route unfolds from delivery point to delivery point

3. Truckers have become the modern cowboys • So many are always on the road, so often away from home for long durations

(very high turnover rate); Precarious family & social life, and personal health; in general, logistic operators and material handling personnel have similar precarious positions

4. Products mostly sit idle, stored where unneeded yet so often unavailable fast where needed

• 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

5. Poorly / badly used production and storage facilities • Most businesses invest in storage and/or production facilities that are lowly

used most of the times, or yet badly used, dealing with products which would better be dealt elsewhere, forcing unnecessary travel

Logistics inefficiency & unsustainability symptoms Leading Us Toward Hitting the Wall Real Hard

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6. So many products are never sold, never used • A significant portion of consumer products that are made never reach the right

market on time, ending up unsold and unused while there would have been required elsewhere; in the fresh food industry, products are wasted at an alarming rate: 12% in transit, 25% at retail

7. Products do not reach those who need them the most • This is specially true in less developed countries and disaster-crisis zones

8. Products unnecessarily move, crisscrossing the world • Products commonly travel thousands of miles-kilometers which could have been

avoided by making or assembling it much nearer to point of use

9. Fast & reliable multimodal transport is still a dream Even though there are great examples, in general synchronization is so poor,

interfaces so badly designed, that multimodal routes are most often time-and-cost inefficient and risky

10. Getting products in, through and out of cities is a nightmare Most cities are not designed and equipped for easing freight transportation,

handling & storage, making the feeding of businesses and citizens in cities a nightmare

Rusting new cars in disused airfield


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11. Logistics networks & supply chains are neither secure nor robust

• There is extreme concentration of operations in a limited number of centralized production and distribution facilities, with travel along a narrow set of high-traffic route

• 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

12. Smart automation & technology are hard to justify • 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 pie

• Hard to justify smart connective (e.g. RFID) technologies, systemic handling and transport automation, as well as smart collaborative piloting software

13. Innovation is strangled • Innovation is bottlenecked by lack of generic standards & protocols,

transparency, modularity and systemic open infrastructure. • This makes breakthrough innovation so tough, justifying a focus on marginal

epsilon innovation


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Mapping inefficiency & unsustainability symptoms to economical, environmental and societal facets

Econ

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1 We are shipping air and packaging

2 Empty travel is the norm rather than the exception

3 Truckers have become the modern cowboys

4 Products mostly sit idle, stored where unneeded, yet so often unavailable fast where needed

5 Production and storage facilities are poorly used

6 So many products are never sold, never used

7 Products do not reach those who need them the most

8 Products unnecessarily move, crisscrossing the world

9 Fast & reliable multimodal transport is a dream

10 Getting products in and out of cities is a nightmare

11 Logistics networks & supply chains are neither secure nor robust

12 Smart automation & technology are hard to justify

13 Innovation is strangled

Inefficiency and unsustainability symptoms

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Design a system to move, store, realize, supply and use physical objects throughout the world

in a manner that is economically, environmentally and socially

efficient and sustainable

The Global Logistics Sustainability Grand Challenge

Montreuil B. (2011) “Towards a Physical Internet: Meeting the Global Logistics Sustainability Grand Challenge,” Logistics Research, 3(2-3), 71-87, 2011.

The Global Logistics Sustainability Grand Challenge

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Eliciting the Overall Goal Toward Global Logistics Efficiency and Sustainability

Societal goal Sustainably and significantly increase the quality of life of the logistics workers and the world’s population by improving the timely accessibility and mobility of physical objects

Environmental goal Sustainably reduce by an order of magnitude the logistics-induced global greenhouse gas emission, energy consumption, pollution & materials waste

Economic goal Sustainably reduce by an order of magnitude the global economic burden of logistics while unlocking huge gains in business productivity

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The Digital Internet Exploiting the Information Highway Metaphor

When looking for a way to conceptualize how it should transform itself,

it relied on a physical transport and logistics metaphor: Building the information highway

Decades ago the information & communications technology community was stuck in a huge inefficient and unsustainable tangle

due to millions of unconnected computers

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Before: millions of unconnected computers – inefficient and unsustainable After: millions of interconnected servers and computers to form

the “Information Superhighway”

Key Enabler: transmission of formatted data packets through heterogeneous equipment respecting the TCP/IP protocol

Result: The Internet, the Web, the Mobile, the Apps,… An open and interconnected distributed network infrastructure

Forever transforming industry, economy, culture and society at large

Meeting the IT Grand Challenge Building Upon the Information Superhighway Metaphor

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The Physical Internet Initiative Using the Digital Internet as a Metaphor for the Physical World

Even though there are fundamental differences between the physical world and the information 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, store, realize, supply and use physical objects all around the world

Montreuil B. (2011) Towards a Physical Internet: Meeting the Global Logistics Sustainability Grand Challenge, Logistics Research, currently available as online publication, 2011-02-12, http://www.springerlink.com/content/g362448hw8586774/fulltext.pdf

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Exposing Key Features of the Physical Internet Vision

Evolving towards a worldwide Physical Internet

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The Physical Internet is an open global logistics system founded on physical, digital

and operational interconnectivity

through encapsulation, interfaces and protocols

The PI enables

an efficient, sustainable, adaptable and resilient

Logistics Web

The Physical Internet (PI, π)

Montreuil B., R.D. Meller & E. Ballot (2012). Physical Internet Foundations, In: Service Orientation in Holonic and Multi Agent Manufacturing and Robotics, edited by T. Borangiu et al., Springer.

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• Open market for goods transportation (eBay-style)

• Handles only “black box” modular containers

• Open and shared transportation and distribution networks

• Vast community of users • Supplier certification and

ratings-by-users to drive logistics performance

Simplified Mental Image of the Physical Internet

Seamless modular container consolidation in the Physical Internet B. Montreuil & C. Thivierge, 2011

Adapted from a contribution of Professor Russ Meller from CELDi, U. of Arkansas

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Positioning the Physical Internet

Original schematics from Benoit Montreuil, 2010, Physical Internet Manifesto, www.physicalinternetinitiative.org

World Wide Web (WWW) Digital Internet

Digital Information Packets

Open Logistics Web Physical Internet

Smart Physical Packets

Connecting Physical Objects through WWW

Internet of Things Smart Networked Objects

Smart Grid Energy

Internet

Energy Packets

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Universal Interconnectivity

High-performance logistic centers, movers and systems,

making it seamless, easy, fast, reliable and cheap

to interconnect physical objects through modes and routes,

with an overarching aim toward universal interconnectivity

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Encapsulation The Physical Internet does not deal directly with physical goods

It requires their

standardized encapsulation, such as data packets in

the Digital Internet

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Physical encapsulation

Physically encapsulate goods in π-containers

that are modular, ecofriendly, smart

and standardized worldwide

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Physical encapsulation of goods in π-containers Modular, ecofriendly, smart & standardized worldwide

• Merchandise is unitized as content of a π-container and is not dealt with explicitly by PI • Modular dimensions from cargo container sizes down to tiny sizes • Conceived to be easily flowed through various transport, handling & storage modes & means • Easy to handle, store, transport, snap, interlock, load, unload, construct and dismantle,

compose and decompose • Light, made of environment friendly materials, with minimal off-service footprint • Smart tag enabled, with sensors if necessary: proper identification, routing and maintaining • Various usage-adapted structural grades • Conditioning capabilities as necessary (e.g. temperature) • Sealable for security purposes

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Physical encapsulation of goods in π-containers World standard modular dimensions and fixtures

É. Ballot, B. Montreuil, R.D. Meller

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Illustrative potential modular

dimensions

Conceptual design illustrating the dimensional modularity of π-containers

The illustrated π-container design has a strictly conceptual and functional purpose: it has no prescriptive technical design and engineering intent

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Physically encapsulation of goods in π-containers Easy to compose into composite containers, then to decompose

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Conceptual design illustrating the composition functionality

of π-containers

The illustrated π-container design has a strictly conceptual and functional purpose: it has no prescriptive technical design and engineering intent

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Consumer Product Goods Company 494 products 268 shelf packages

258 case sizes

At the pallet level, there is a net savings of 10%!

At the case level, there is a net increase of 10% Using only of modular

dimensions (<15)

Here, no change in the shape of products. The number of products by case is allowed to vary by + or - 10%. Experiment limited to cases rather than π-containers to focus on modularity

The spatial impact of modular encapsulation

Meller, R. D., Lin, Y.-H., and Ellis, K. P., “The Impact of Standardized Metric Physical Internet Containers on the Shipping Volume of Manufacturers,” in Proceedings of the 14th IFAC Symposium on Information Control Problems in Manufacturing, Bucharest – Romania, (2012).

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• Maximal volumetric and functional density while being in Physical Internet containers, extendable to their usage dimensions when necessary

– Functional density of an object can be expressed as the ratio of its useful functionality over the product of its weight and volume

• Only key components and modules have to travel extensively – Easy to be completed near point of use

using locally available objects

Design products fitting containers with minimal space waste

Products designed and engineered to minimize the load and burden they generate on the Physical Internet,

with their dimensions adapted to standard container dimensions, with maximal volumetric and functional density while containerized

Source: guim.fr

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Digital encapsulation Exploiting as best as possible

the capabilities of smart π-containers connected to the Digital Internet

and the World Wide Web, and of their embedded smart objects,

for improving the performance as perceived by the clients

and the overall performance of the Physical Internet

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Physical Internet and the Internet of Things

Image: http://www.globetracker.biz/GlobeTracker/News.asp

The Internet of Things is about enabling ubiquitous connection with physical objects equipped with smart connective technology (RFID, GPS, sensors, Internet, etc.), making the objects ever smarter and enabling distributed self-control of objects through networks

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-systems

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Interfaces optimized for universal interconnectivity

Physical & digital interfaces exploiting the characteristics

of π-containers and standardized worldwide

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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, in Progress in Material Handling Research, Edited by K. Gue et al., Material Handling Industry of America, 23 p., 2010.

π-containers moving and storage means and 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

π-stores

π-movers A fork-less lift exploiting the snapping and interlocking functionalities of the π-container

A π-container equipped with wheels snapped through its standard modular interfaces

A highly flexible plug-and-play π-conveyor exploiting the standard modular dimensions and interfaces of the π-containers

In π-stores, modular π-containers can be stacked as in container port terminals

In π-stores, contemporary racking can be

used, however innovations in storage technologies

exploiting the functional characteristics

of modular π-containers are bound to be exploited

π-conveyors

Evolve from material to π-container transport, handling & storage means and systems

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Logistics centers designed for the Physical Internet

Reference: Meller, R.D., B. Montreuil, C. Thivierge & Z. Montreuil (2012), Functional Design of Physical Internet Facilities: A Road-Based Transit Center, in Progress in Material Handling Research: 2012, MHIA, Charlotte, NC, to appear (2012).

Transit Center facilitating the truck-to-truck transshipment

of trailers along relays networks

through the Physical Internet

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Roadway

Multimodal logistics centers designed for the Physical Internet,

enabling seamless, fast, cheap, safe, reliable, distributed, & multimodal

transport and deployment of π-containers

across the Physical Internet

Ocean, sea or river

Physical Internet Road-Rail Hub References • Montreuil, B., R.D. Meller, E. Ballot (2010)

Towards a physical internet: the impact on logistics facilities and material handling systems design and innovation, in Progress in Material Handling Research 2010, Edited by K. Gue et al., Material Handling Industry of America, 23 p.

• Ballot É., B. Montreuil & C. Thivierge (2012) Functional Design of Physical Internet Facilities: A Road-Rail Hub, in Progress in Material Handling Research 2012, Edited by B. Montreuil et al., Material Handling Industry of America, 34 p.

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Montreuil, B., R.D. Meller, C. Thivierge, C., and Z. Montreuil (2012), Functional Design of Physical Internet Facilities: A Unimodal Road-Based Crossdocking Hub,, in Progress in Material Handling Research: 2012, MHIA.

Enabling seamless, fast, cheap, safe, reliable, & distributed, multimodal transport and deployment of π-containers across the Physical Internet

Logistics centers designed for the Physical Internet

Road Hub of π-containers truck-to-truck crossdocking along a network of relays through the Physical Internet

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Physical Internet Protocols

Protocols optimized for universal interconnectivity

regulating the multi-layer services of the Physical Internet

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Standard Logistics Service Protocols

Open Logistics Interconnection Model

Standardized multi-layered

service architecture and protocols

Montreuil B., E. Ballot & F. Fontane (2012). An Open Logistics Interconnection Model for the Physical Internet, Proceedings of INCOM 2012 Symposium, Bucharest, Romania, 2012/05/23-25.

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Deploy capability certifications

Multi-level Physical Internet capability certification of containers, handling systems, vehicles,

information systems ports, distribution centers, roads, cities and regions, protocols and processes,

and so on

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Live open monitoring of really achieved performance of all π-certified actors and entities,

on key performance indices on critical facets such as speed, service level, reliability, safety and security

Such live performance tracking is openly available worldwide to enable fact-based decision making

and stimulate continuous improvement

Open information is to be provided in respect of confidentiality of specific transactions

Open Performance Monitoring

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A Global System

The Physical Internet is seamlessly applicable

everywhere, at any scale

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The Physical Internet: the same conceptual framework at any scale Intra-center Inter-processor Network Intra-Faciilty Inter-Center Network Intra-Site Inter-Facilities Network

Intra-City Inter-Site Network

Intra-Continental Inter-City, Inter-State/Province Network Inter-Continental Worldwide Network

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Aim for webbed reliability and resilience

The overall Physical Internet network of networks should warrant its own reliability

and that of the physical objects flowing through it

Network webbing and the multiplication of nodes should allow the Physical Internet to insure its own robustness

and resilience to unforeseen events

For example, if a node or a part of a network fails, the traffic should be easily reroutable,

as automatically as possible

Reference: Peck H., “Supply chain vulnerability, risk and resilience”, Chap. 14 in Global Logistics New Directions in Supply Chain Management, 2007

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Aim for webbed reliability and resilience

The Physical Internet’s actors, movers, routes, nodes and flowing containers should interact in synergy to guarantee:

– The integrity of physical objects encapsulated in π-containers – The physical and informational integrity

of π-containers, π-movers, π-routes and π-nodes – The informational integrity of π-actors

(humans, software agents) – The robustness of client-focused performance in delivering and

storing π-containers.

Reference: Peck H., “Supply chain vulnerability, risk and resilience”, Chap. 14 in Global Logistics New Directions in Supply Chain Management, 2007

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Enabling a Logistics Web

The purpose of the Physical Internet from a user perspective

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Logistics Web Set of openly interconnected

physical, digital, human, organizational and social

actors and networks aiming to serve

efficiently and sustainably the worldwide logistics needs

of people, organizations, territories and society

From a user perspective, the Physical Internet aims to enable an efficient, sustainable, adaptable and agile Logistics Web

Montreuil B., R.D. Meller & E. Ballot (2012). Physical Internet Foundations, In: Service Orientation in Holonic and Multi Agent Manufacturing and Robotics, edited by T. Borangiu et al., Springer.

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Transporting a trailer from Quebec to Los Angeles

Québec

Montréal Alexandria Bay, US border

Syracuse Buffalo

Cleveland Columbus

Indianapolis St-Louis

Springfield Tulsa

Oklahoma City Amarillo

Albuquerque Flagstaff

Needles Barstow

Los Angeles

20

20-401 81

90 90

71

70

70 44

44

44 40

40 40

40

40

15-10

Distance travelled one-way: 5030 km 5030 km Drivers: 1 17 Trucks: 1 17 Trailer: 1 1 One-way driving time (h): 48 51+ Return driving time (h): 48+ 51+ Total time at transit points (h): 0 9 Total trailer trip time from Quebec to LA (h): 120 60+ 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

Current P2P

Proposed Distributed

Enabling an open global mobility web From point-to-point or hub-and-spoke transport to distributed multimodal transport

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Enabling an open global mobility web From point-to-point or hub-and-spoke transport to distributed multimodal transport

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Illustrating Current Logistics Systems A small two-retailer two-manufacturer case

Adapted from: Hakimi D., B. Montreuil & E. Ballot (2012), Simulating a Physical Internet Enabled Logistics Web: the Case of Mass Distribution in France, ISERC 2012, 2012/-5/19-23

Current Conceptual Networks Current Spatial Flows

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The Impact of Exploiting a Mobility Web Here limited to unimodal road transport

Travelled distance: -27% Fuel Consumption: -19%

Average delivery time: +2% Maximum delivery time: -36%

Current Mobility Web

: Plant; :Retail store; :Private distribution center P# S# : Product flow : Road transport

: Plant; : Retail Store; : Open hub P# : Distribution center D#

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Current flows Physical Internet flows Physical Internet traffic

Ballot É., B. Montreuil, R. Glardon (2012), Simulation de l’Internet Physique: controbution à la mesure des enjeux et à sa définition, PREDIT Research Report, France, June 2012, 96 p.

Preliminary results using existing infrastructures, facilities, demand patterns and service levels Economical: From 4% to 26% overall cost saving

Environmental: About 3 times better in terms of greenhouse gas emissions, by combining road-to-rail modal transfer and more efficient road transport

Exploiting a Physical Internet Enabled Bimodal Mobility Web

for the Consumer Goods Industry in France Road and rail transport seamlessly integrated into the PI backbone network

Simulation based on product distribution flow to two top retailers in France, from their 100 top suppliers

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Montreuil and Sohrabi, From Private Supply Networks to Open Supply Webs, IERC 2010

Most companies design, run and optimize independently

their private distribution networks, investing in DCs

or engaging in long-term leases or contracts

There are 535 000 distribution centers in the U.S.A. only Most of them are used by a single company Most companies use often a single DC and generally less than 20 DCs Imagine the potential if each company could deploy its products through a open web including 535 000 open DCs in the USA

Activate and exploit an Open Global

Distribution Web

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Dynamically Deploying Stock Across the Distribution Web for Efficient, Fast & Agile Customer Response

Current private system Proposed open system

Adapted from: Hakimi D., B. Montreuil & E. Ballot (2012), Simulating a Physical Internet Enabled Logistics Web: the Case of Mass Distribution in France, ISERC 2012, 2012/-5/19-23

Client order

Physical flow : Plant : Retail store : Private distribution center : Open distribution center P# S# O#

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Travelled distance: -23% Fuel consumption: -29%

Average delivery time to store: -79% Maximum delivery time to store: -71%

Mobility Web Mobility Web + Distirbution Web

The Added Value of Exploiting a Distribution Web When Already Exploiting a Mobility Web

: Open distribution center : Plant; : Retail Store; : Open hub P#

: Distribution center : Plant; : Retail Store; : Open hub P#

D#

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The Impact of Exploiting a Logistics Web Integrating Mobility and Distribution Webs

[Average; Max] Delivery-Time-to-Store

Mobility Web

Mobility Web + Distribution Web

Private Logistics Networks

-82%; -74%

+16%; +15%

-79%; -71%

-19%; -27%

-29%; -23%

-42%; -44%

Fuel; Travel

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Minimize physical moves and storages by digitally transmitting knowledge

and materializing products as locally as possible through the open realization web

Exploiting extensively 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 centers capable 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

Open Global Realization Web

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M+A M OA

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Client M+A

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Integrated manufacturer + assembler

Manufacturer OA

OA Currently exploited open assembler

Currently unexploited open assembler

OM

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Currently exploited open manufacturer

Currently unexploited open manufacturer

Current realization network centered around an integrated

manufacturing & assembly plant

Alternative realization network exploiting realization web for outsourcing assembly

Alternative realization network exploiting realization web

for outsourcing manufacturing & assembly

Current snapshot

Current snapshot

Dynamically Outsourcing Product Realization to Certified Open Centers across the Realization Web

to Enable Efficient & Agile Near Point-of-Use Product Realization

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Open Supply Web

Source: Ballot E., O. Guodet & B. Montreuil (2011), Physical Internet enabled open hub network design for distributed networked operations, Proc. of SOHOMA 2011

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Distribution Web Mobility Web

Realization Web

Tier-0

Tier-1

Tier-2

Each supplier may for example sign a guaranteed X-time accessibility

contract with each client, keeping responsibility for

product delivery, deployment and realization

Client has minimal stock Supplier leverages its clients

for deployment pooling Each client has access to a global pool of π-certified suppliers and vice-versa

Exploiting a Supply Web

Supply Web

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A Supply Web with Myriads of π-Certified Suppliers, Open & Global Access, Standardized Contracts,

Open Monitoring and Supplier Ratings Multi-tiered, from raw materials to final products

Each exploiting the Mobility, Distribution & Realization webs

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From retail/rental networks feeding isolated clients

To interconnected users exploiting

an open Service Web

Getting access as needed to product functionality,

from product owners-users and rentals, buying products in

lesser percentage Supported by the other Logistics Web constituents

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π-Enabling Innovation

π-Enabled Innovation

Physical Internet induced innovation

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Montreuil, B., Meller, R.D., et al., “Designing Facilities for the Physical Internet,” Material Handling Industry of America, Charlotte, NC, 2010-2012.

Flex Conveyor from KIT/Gebhardt (Kai Furmans)

GridFlow from Auburn University (Kevin Gue)

Physical Internet Induced

Technological Innovation

π-Enabling technologies

π-Enabled technologies

http://www.youtube.com/watch?feature=player_detailpage&v=jsIDhMPalnE

http://www.youtube.com/watch?feature=player_embedded&v=6BFxHGluoNI

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Physical Internet induced business model innovation

Innovative business models for commercializing

Physical Internet enabled offers by various parties,

addressing stakeholder revenue, contracting, liability & insurance

What are to be the π-enabled equivalents of Amazon, eBay and Google?

How are the manufacturers, distributers, retailers,

transporters, logistics providers and solutions providers going to evolve so as to best exploit the Physical Internet?

π-Enabling business models

π-Enabled business models

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Physical Internet Induced Infrastructural Innovation

The Physical Internet homogeneity in terms of object encapsulation in π-containers

should allow a much better utilization of modes & means,

thus increasing the capacity of infrastructures by the exploitation of standardizations,

rationalizations and automations through currently unreachable innovations

π-Enabling infrastructures

π-Enabled infrastructures

http://www.ilookforwardto.com/2010/12/foodtubes-really-fast-food-delivered-in-a-physical-Internet-of-underground-pipes.html http://www.cargocap.com/content/what-is-cargocap

FoodTubes and CargoCap: Examples of currently contemplated infrastructural initiatives whose implementation viability can be upgraded through alignment with the Physical Internet

http://www.ilookforwardto.com/2010/12/foodtubes-really-fast-food-delivered-in-a-physical-Internet-of-underground-pipes.html

http://www.cargocap.com/content/what-is-cargocap

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Realizing the Vision

Evolving towards a worldwide Physical Internet

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The Physical Internet Global systemic sustainable vision

stimulating and aligning action around the world

Individual initiatives by businesses, industries and governments are necessary but are not sufficient

There is a need for a macroscopic, holistic, systemic vision offering

a unifying, challenging and stimulating framework

There is a need for an interlaced set of global and local initiatives

towards this vision, building on the shoulders of current assets and projects,

to help evolve from the current globally inefficient and unsustainable state

to a desired globally efficient and sustainable state

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Physical Internet Implementation Progressive Deployment, Cohabitation and Certification

The widespread development and deployment of the Physical Internet

will not be achieved overnight in a Big-Bang logic but rather in an ongoing logic

of cohabitation and of progressive deployment, propelled by the actors

integrating gradually the Physical Internet ways and finding ever more value in its usage and

exploitation

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A smooth transition starting with rethinking and retrofitting phases, then moving toward more transformative phases

The Physical Internet can constitute itself progressively through the multi-level certification of: – Protocols – Containers – Handling and storage technologies, distribution centers,

production centers, train stations, ports, multimodal hubs – Information systems (e.g. reservation, smart labels, portals) – Urban zones and regions, inter-country borders

Physical Internet Implementation Progressive Deployment, Cohabitation and Certification

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Conclusion The Physical Internet: An Instrument for Tackling

the Grand Logistics Sustainability Challenge

Exploiting the Internet metaphor for fostering a breakthrough logistics system

A commitment towards open universal interconnection of logistics services and resources

An integrated holistic tackle on making more efficient and sustainable

the way we move, store, realize, supply and use physical objects across the world

A highly scalable Coopetition approach

1/3

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The Physical Internet builds on the network effect, getting ever more effective as it gathers more users

It must gather critical mass, first exploiting existing infrastructures and means,

then gradually fostering innovation.

Even though it is to be ultimately global it will have to grow first in fertile domains,

to be collaboratively supported by key leaders from industry, government and academia.

2/3 Conclusion The Physical Internet : Not an Utopia, not a Big-Bang

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Conclusion The International Physical Internet Initiative:

An Open Innovation Endeavor

With this manifesto and its underlying research, a small step has been made towards meeting

the global logistics efficiency and sustainability grand challenge A lot more are needed to really shape this vision

and, much more important, to give it flesh through real initiatives and projects

so as to really influence in a positive way our collective future

This requires a lot of collaboration between academia, industry and governments

across localities, countries and continents Your help is welcome!

3/3

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Questions and comments are welcome, and especially collaborative project avenues

[email protected]

www.physicalinternetinitiative.org

Twitter: @physicinternet

physical internet manifesto eng version 1.11.1 2012-11-19

Documents

logistics research

universit lavalqubec

logistics web

container logistics

professor russ meller

way physical objectsare

mobility of physical

universit laval qubec