CaaS – Corridor as a Service – is a new concept for multimodal logistics, which originates from PPP (public, private, partnership) and intelligent transport systems (ITS) collaboration projects in Finland and internationally. CaaS has enabled interaction between the different parties.
Based on the outcomes of border crossing collaboration projects the Finnish coalition started to develop CaaS concept, which combines ITS systems to intelligent logistics, in order to intensify logistics. The CaaS concept provides digital and effective model to reform current logistics system and services. As the concept is centered on new technologies and solutions, it also offers the opportunity to be at the forefront of exploiting new technologies.
Supply chain currently
Consignor or consignee purchases logistics services from logistics service provider (LSP) or providers based on B2B agreement. Order consist of demand to transport something from A to B. Based on this order, cargo owner provides related information and documents for LSP, which then picks cargo from point A and does necessary documents.
While transport is on process, information is moving together with cargo in documents that haulier is carrying. Cargo owner might get information about process from check points, but usually transparency is weak. At some point cargo is delivered and cargo owner gets information that transport is completed, how it is done and how accurate information is, is usually unclear. For cargo owner this means that they do not have access or opportunity to control their cargo. Usually this kind of operation model also means that transport is planned based on LSP premises.
Supply chain with CaaS
Consignor or consignee purchases logistics services from logistics service provider (LSP) or providers based on B2B agreement or B2N (business to network). Order consist of demand to transport something from A to B. Cargo owner provides LSP access to cargo data base, from where LSP can collect necessary information and forward that to necessary stakeholders. In this operation model data and information is not moving together with cargo, vice versa data and information is available all time.
While transport is on process, cargo owner has access to transport process information via cloud service. Actor gets information from the infrastructure that now your cargo is moving in this vehicle and this vehicle is now crossing this point. In addition to this comes traditional check point information from LSP. Owner has good transparency for transport and actor knows when and how transport is done. For cargo owner this means that they can control and manage their shipments during transport. This also means that owner has good visibility about transport process so they can use that information to plan upcoming transports.
The CaaS concept aims at eliminating human errors and opacity in logistics, with reliable data sharing, digital solutions and ecosystem approach. This all happens in core transport corridors and nodes, which binds corridors to international transport network. The role of nodes, i.e hubs, is vital for CaaS, since those are usually places where data and information is transferred between stakeholders.
International trade is one of the main interests of the concept, since border crossing is one well know bottleneck of logistics. However, with reliable data sharing and process information from the very beginning of the supply chain, border crossing can be developed and it can be even competitive advantage for countries and their transport corridors.One fundament of the CaaS concept is supply chain visibility, which means that shipments and cargo must be visible for those who has permission and need to have to access this information. With only check point status information this is not possible and thus CaaS approach integrates freight data base information to intelligent infrastructure, i.e traffic flow information for example.
Companies in general are in the core of CaaS since, the development of Corridor as a Service has started on a business-driven basis. For service-creating businesses, CaaS provides an opportunity for new business development and, in the future, a place to develop and streamline your current business and related freight transport.
For consignee and consignors CaaS provides new ways to organize and manage logistics, and hence cut logistics costs. The CaaS concept enables API based solution for reliable data sharing and aims for effective logistics, where logistics demand is connected to logistics supply over the company boundaries, if allowed. Data and information will also be shared with supply chain stakeholders based on cargo (data) owner permissions. While transportation in on process all necessary stakeholders have access to process information, which enables consignee and consignor to handle and manage their transportations.
For logistics service providers CaaS provides new digital tools to develop current services. CaaS also enables digital business environment, where document driven operation models can be changed to data based approach. With digital solutions, human errors can be eliminated. In addition, the information does not need to be fed into the systems several times, which again resources.
For authorities and public sector CaaS aims to boosts the target of creating international connections and hubs for new logistics services and the enhancement of freight logistics. The CaaS concept also wants to spread the word that logistic sector has a huge potential to drive employment and innovations. It will improve trade between west and the east, by saving time and improving transparency of freight. At the same time, it will respond to the emission reductions to save fuel in order to improve the load factor of transport through intelligent technology.