Doc Or Die

A recent article in the Wall Street Journal (4 January 2007) titled "Global Shippers Play Catch-Up in Information Age" reminded me of Shakespeare's "Merchant of Venice." Antonio is a successful merchant who wants to help his friend Bassanio impress the beautiful and wealthy Portia. Antonio laments that "thou know'st that all my fortunes are at sea" (Act 1, Scene 1, Line 115) and so he borrows money from Shylock to give to Bassanio, but Shylock' terms are a little extreme – if he's not repaid, he will literally take "a pound of flesh" from Antonio.

Antonio's problem, of course, is that even though "he hath an argosy bound to Tropolis, another to the Indies…a third at Mexico, a fourth for England"(Act I, Scene 2, Line 94) he doesn’t know when he borrows the money from Shylock that all his ships have already been lost at sea.

The WSJ article reports that competitive pressures, "just in time" inventory management, and other mandates for efficiency in global supply chains have forced shipping lines to invest heavily in IT and systems for feeding a continuous stream of information about the location and condition of goods to their customers. These tight supply chains can also be brittle, and problems can propagate far from their origin. A ship's late arrival into one port can cause it to miss the high tide, causing another 12-hour delay that affects later deliveries. This might mean that containers of parts needed at a factory two or three ports down the line won't arrive "just in time" and the assembly line shuts down. But with a couple of days notice, the factory can jiggle production to prevent this from happening.

I mentioned some of this tracking technology in a previous posting about "The Box," but this WSJ story added the new twist that customers can now send messages that respond to the alerts coming from ship containers. For example, the color and ripeness of bananas -- which are green and hard when they are loaded on ships -- depends critically on their storage temperature in transit. The banana buyers can remotely adjust the container temperature if necessary to accommodate changes in the delivery schedule.

Poor Antonio -- if his ships had the new IT and systems that are described in the WSJ story, he would have known that he couldn’t repay Shylock and wouldn’t have entered into such a dreadful contract. Of course, we've all made bets and bad choices that better information would have made seem as foolish when we considered them as they did in hindsight.

-Bob Glushko

# posted by Bob Glushko @ 10:16 AM