How sharing freight transport data across domains enables improved processes and risk management
The freight transport industry is continuously growing with an increase in volume of almost 25% in the EU over the last 20 years and a projected increase of 50% by 2050. Whilst growing in volume, the freight transport industry still relies heavily on paper-based trade documentation full of unstructured data. This means that an increasing amount of freight transport data is generated which still requires manual efforts before it can be used to create value. Freight transport data can already be made available in a structured and machine-readable form via the use of electronic trade documentation, but this is rarely used in practice. That is why the Data Sharing Coalition is supporting a Dutch case that explores how to enable the sharing of freight transport data in a controlled, structured, and machine-readable way across domains. This allows both organisations in the logistics domain and in other domains to directly use freight transport data shared with them to enable the creation of efficiencies in processes and to deliver new products and services.
Uncovering the full potential of freight transport information across domains
The process of moving goods within and across borders is accompanied by a large amount of information that needs to be communicated between the vast amount of parties involved in logistics chains. This freight transport data is used by parties in logistics chains to monitor the status of each respective shipment and to intervene in the event of issues. Communication of freight transport data currently heavily relies on paper-based trade documentation, which requires manual data entry of unstructured data and back-and-forth calls, emails, facsimiles, and physical delivery of documents; an administrative burden for organisations leading to inefficiencies and higher costs of trade.
The adoption of the use of electronic trade documentation is expected to increase in coming years. Recently passed European regulation on the use of electronic freight transport information (eFTI) makes the acceptance of electronic trade documentation mandatory for national public authorities (e.g. customs and inspection agencies) of European member states by the end of 2025. Together with an increasing need for contactless and paperless transport experienced by logistics organisations due to the COVID-19 pandemic, the use of electronic trade documentation and the structured data that this documentation contains is becoming increasingly more interesting for parties involved in international shipping processes.
Opening up freight transport data in a structured and machine-readable way is not only valuable for parties that are directly involved in shipping, but also for parties that arrange services beyond shipping. Logistics organisations have many interactions in their communication with organisations in other domains that arrange services related to their shipments. Access to structured and machine-readable freight transport data is highly beneficial for organisations in these other domains to enable improved risk management and processes, of which insurance provisioning is a very promising example.
The insurance market is currently experiencing shifting market dynamics towards the development of new business models due to digitalisation, and the use of new technologies and data analytics. A key aspect of this shift is an increase in the importance of data for insurers. Opening up freight transport data obtained through electronic trade documentation for insurers allows them to differentiate themselves via improved risk management and, over time, development of new data-driven services.
Sharing structured and machine-readable freight transport data with insurers under control of the entitled party: a data sharing use case of the Data Sharing Coalition
In the Data Sharing Coalition, iSHARE and Verbond van Verzekeraars collaborate in a use case together with other stakeholders in the logistics and insurance domains. In the use case, structured and machine-readable freight transport data is made available for the insurer covering the cargo whilst keeping data under control of the logistics organisation that is responsible for the cargo as the entitled party. iSHARE is a scheme that enables organisations in the logistics domain to share data in a uniform, simple, and controlled way, and Verbond van Verzekeraars is an industry association representing more than 95 percent of life and non-life insurers in the Netherlands. With this use case, a solid foundation will be built for the sharing of structured and machine-readable data across domains in a generic and controlled way, which enables many other use cases (e.g. sharing building data with mortgage providers, sharing asset data with financial institutions).
Opening up freight transport data for insurers in a structured and machine-readable way while retaining control of own data by the entitled party brings many benefits. Logistics organisations are assured via the iSHARE scheme that their sensitive freight transport data is shared in a controlled way and for a specific task and time frame with the insurer(s) that they have authorised as a trusted party. Freight transport data can be shared without the burden of manual efforts and requirements can be established for the electronic trade document and/or specific data fields to improve data quality and traceability. Insurers can use the structured and machine-readable data made available to them to develop new products and improve risk assessments, gather real-time data about proof of pick-up and delivery to obtain insights on operations and cargo, and develop risk profiles to evaluate risks and risk exposures linked with potential clients.
Data Sharing Coalition as a fruitful environment to define and realise opportunities for cross-domain data sharing
The Data Sharing Coalition creates a fruitful environment for organisations to collaborate in the definition and realisation of use cases. Knowledge and experiences of participants of the Data Sharing Coalition are collected and brought towards development to facilitate and improve the designs of use cases. Stakeholders in the use cases are brought together to explore opportunities of cross-domain data sharing with one another. Within these use cases, the Data Sharing Coalition guides its stakeholders towards a scalable use case design and swift realisation. Use cases are designed to facilitate a many-to-many reach, which enables organisations in both domains to share data with all other organisations in a generic way. By doing so, the data can be shared and re-used across domains and new value can be unlocked.
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