The Promise of the Physical Internet

By Mary Lou Jay for MHI Solutions

Professor Benoit Montreuil looks at today’s logistics systems and sees inefficiencies and unsustainable practices.

–Trucks and shipping containers frequently travel empty or only half full.
–Products sit in warehouses that are poorly utilized, far from the end customers, resulting in unsold or unused merchandise.
–There is no fast and reliable multi-modal transportation.
–System-wide automation is not economically feasible because of the wide variety of items shipped and the number of players operating independently.
–Breakthrough innovations are difficult to achieve because there are no generic standards and protocols that apply throughout the distribution chain.

But Montreuil, a faculty member in the Department of Operations and Business Decisions at Laval University in Québec, has a solution. He envisions a Physical Internet (PI) that will transform the way physical objects are moved, stored, realized, supplied and used. The goal is greater efficiency and sustainability.

Montreuil based the concept of the PI upon the digital internet and the way that data moves through that network in packets of information. Following TCP/IP protocols, these information packets encapsulate all of the routing information required to get them to the right destination, always moving along the most efficient available pathway. The Physical Internet would encapsulate products in standard-sized containers, using digital technology and improved relay networks to get goods transported to where they are needed in the most efficient and most economical way possible.

Montreuil defines the PI as an open, global logistics system founded on physical, digital and operational interconnectivity through encapsulation, interfaces and protocols.

“It is logistics in the broad scope, encompassing transportation, storage, value added services and the structure and design of production facilities,” Montreuil said. “It’s a global system designed for the entire world.”

Open and transparent transportation and storage systems would replace the proprietary systems used today. “This means, for example, that you could store your goods in any existing distribution center warehouse in the world, as long as you fit their specific requirements,” Montreuil said. Goods would be transported by various carriers in a way that is analogous to people using a mass transit system; they don’t reserve a place on the subway, but simply take the one that will get them to their destination at the right time.

The PI would be physically interconnected at every level—containers, trucks, railroads and ships, transportation hubs and storage facilities. RFID labeling on shipping containers would provide digital interconnections for automated routing and distribution. Operational interconnection could be achieved through the use of standardized protocols throughout the world; a trucker arriving at an unfamiliar transportation hub would know how to proceed because the protocols for handling the freight would be the same everywhere.

The Physical Internet would rely on encapsulation of products, with standard-sized, modular and eco-friendly containers replacing the wide variety and sizes of containers that are used today. “Material handling should evolve from handling materials to handling modular containers,” said Montreuil. There would be three levels of containers, sized so that smaller fit together inside the larger. The large transport containers would be similar to those used on ships today. Handling containers would replace boxes, cardboard cases, and pallets. Packaging containers would hold products that are specifically designed to fit inside of them.

In a PI network, regional hubs would handle shipments from many different sources. As the RFID-encoded containers reach these relay hubs, they would be broken down and reconfigured into new containers bound for the same destination. The system would eliminate the need for long-distance trucking; instead of carrying a cargo load of goods across the country, truckers would bring their loads to these hubs and drop them off for someone else to transport to another hub. The truckers would then return home with a load destined for their local area.

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