Blockchain’s Potential Role in Transportation Management Transcription
Hello everyone, and welcome to Talking Logistics, where we have conversations with thought leaders and newsmakers in the supply chain logistics industry. It is my great pleasure to welcome back to the program JP Wiggins, co-founder and vice president of logistics at 3G TMS. Today, we are going to talk about blockchain and its potential role in transportation management. Blockchain is one of the most talked-about technologies in the industry today, yet it remains one of the least understood, with many questions and uncertainties surrounding it.
Does blockchain have a role to play in transportation management? What are the biggest hurdles and challenges that the industry needs to overcome to make blockchain in transportation a reality? And how could it potentially improve the status quo? These are some of the questions we’ll address in today’s episode. It’s great to have JP back to share his insights and perspective on this topic. JP, welcome to the program.
JP: Thanks! Glad to be back. It’s always a pleasure.
Host: JP, as I mentioned, over the past few years, there’s been a lot of hype and discussion about blockchain’s potential role in supply chain management. From your perspective, where are we today in the hype cycle? Is the perception and understanding of blockchain changing, especially in transportation?
JP: I think we’ve moved from the hype cycle to a phase of healthy skepticism, which is where ideas start to be fine-tuned, and real progress is made. During the hype cycle, we heard some pretty wild ideas about what blockchain could do. People were setting up pilot programs that didn’t make sense—they were trying to use blockchain for things that could have been accomplished through a simple email exchange. Now, we’re in a different world. What we’ve discussed and written about is just one idea of how blockchain could potentially be useful, because I think it’s important to realize that blockchain is a technology in search of a problem. It was built around Bitcoin and secure transactions, but now we’re trying to see where else the technology might have practical applications, including in transportation.
Host: I agree. There’s been a shift away from the idea that blockchain is going to cure all problems, and now people are approaching it with more seriousness. They’re starting to peel back the layers and try to understand it more. So let’s do that—how can blockchain improve transportation management? What are some of the problems it might help solve, or benefits it might provide to shippers and logistics service providers?
JP: One example I like to use is our work as a Tier 1 TMS. In today’s digital economy, what you do electronically with freight can sometimes be more important than the physical operations. We did a study and found that on average, our clients have about 35 digital touches per shipment, from the time the order is created until it’s delivered. In some cases, this number can even skyrocket to over 100 touches. This includes updates from vendors, warehouses, tracking companies, and status notifications, to name a few.
One of the biggest gaps right now is with mom-and-pop carriers and brokerage carriers, which make up a large portion of the North American freight market. There are over half a million carriers, most with fewer than six trucks. This is where blockchain could help. For other modes of transportation, there are many ways to track freight, but for brokerage carriers, it’s still a bit of a black hole. Blockchain could improve visibility in this area.
Host: That’s a really interesting statistic—up to 100 digital touchpoints for a single shipment. It’s also believable, considering the various steps involved in the lifecycle of a shipment. You mentioned small carriers and owner-operators, who play a big role in the transportation industry today. Do you see any interplay between the Electronic Logging Device (ELD) mandate, blockchain, and TMS as areas of opportunity?
JP: Definitely. The ELD mandate has helped improve visibility for larger contract carriers, and there are great third-party tracking solutions that connect to ELDs or APIs to track freight. This is especially prevalent in the food industry, where visibility is critical. However, for brokerage carriers and mom-and-pop operations, tracking is still an issue. Many of these carriers don’t have IT departments or sophisticated systems, so getting real-time tracking information is difficult. Blockchain could help solve this by providing a network for shared information in a secure format.
Host: Blockchain isn’t a silver bullet solution, and it doesn’t operate in a vacuum. What other technologies or capabilities are necessary to fully realize these opportunities? From a shipper or 3PL standpoint, I assume a TMS is a key part of the equation.
JP: Absolutely. Shippers and 3PLs rely on TMS to handle everything from tendering and tracking to managing exceptions and proof of delivery. A Tier 1 TMS, like ours, automates many of these processes, so you don’t need human intervention unless there’s a significant exception. But we need more integration across the board—whether it’s connecting ELDs, smartphones, or load boards—to make all this data easily accessible. Blockchain could be part of the solution by enabling that seamless exchange of information.
Host: What do you see as the biggest challenges the industry needs to overcome to make blockchain in transportation a reality?
JP: The biggest challenge is achieving critical mass. There are over half a million carriers, and we need to get them all on the same network. This could potentially be an initiative led by a government agency or through collaboration among several companies. There are already smaller apps gaining traction with drivers, but we need to consolidate those efforts and create a unified system. Once we build that critical mass, we can start to realize the full potential of blockchain in transportation.
Host: I agree. And with that, JP, we’re running out of time, so I want to ask you one final question. What advice would you give to shippers and logistics service providers regarding blockchain? What actions should they take today to keep pace with developments in the months and years ahead?
JP: I think the pressure to solve the visibility issue, especially in brokerage, is only going to grow. It’s similar to the way e-commerce and tracking requirements hit the industry like a tsunami a few years ago. This is going to get solved in the next 24 months, and companies should be preparing for it now. As a TMS provider, we love data—it helps us build automated workflows and scale operations without manual intervention. Solving this visibility issue will be a game-changer for brokers and the entire industry.
Host: Well, JP, thank you for your insights today. It’s clear that blockchain has the potential to make a big impact, and it will be interesting to see how things unfold in the coming years.
JP: Thanks for having me. I enjoyed the conversation.
Host: Thank you to everyone who joined us. If you’re watching this episode on demand, either at the 3G TMS website or on Talking Logistics, and have a question or comment for JP, feel free to post it there. I’m sure he’ll be happy to respond. Thank you again for joining us, and we look forward to seeing you in a future episode of Talking Logistics. Have a great day!
