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Beyond e-AWB, it's time for air cargo to embrace digital technology

THE air freight sector must now take the plunge into full supply chain digital technology well beyond adopting the electronic air waybills (e-AWB) that consumes attention today, says an e-commerce expert.

That's the opinion Markus Flacke, managing director of Luxembourg's CHAMP Cargosystems, who said his reason for attending the recent e-AWB workshop of the International Air Transport Association (IATA) e-AWB workshop in Atlanta was to make that point.

"We already see a lot of electronic data exchange happening in this industry," he said. "We need to think about the digitisation of this industry," he said, reported London's Air Cargo News.

"The e-AWB is only the first step into connectivity. Once you have established this connectivity a lot of items and discussions may become a lot easier.

"We can link the information flow of the air cargo supply chain from a shipper all the way through to the consignee."

Mr Flacke joined CHAMP in 2014 and previously worked for Lufthansa Cargo. He said that since joining CHAMP, he has noticed a tremendous uptick in data volumes being pushed through its systems.

He said the logistics and air cargo industries would "reap the benefits" of digitisation and there would be rapid adoption of digital systems over the next five years because of the benefits it can bring.

"We have a lot of conversations in the background about how can we connect better, how can we collaborate and share data, how can we make this data inter-change better," he said.

Mr Flacke pointed out that the US was in the process of introducing ACE (Automated Commercial Environment) that will require the transmission of shipment data ahead of loading, requiring connection with US government systems.

And while the US is leading the way, other countries are expected to develop similar regimes.

The development of e-commerce is another reason for companies to improve the sophistication of their systems and processes.

"E-commerce is a big opportunity for everyone in this industry, for everyone from the carrier to forwarder. But for that you need to be able to link your IT system with someone else's IT system," he said.

"If you don't have that, it will be very difficult to participate in e-commerce shipments being transported by regular air cargo carriers and not necessarily put into regular cargo consolidation," he said.

"The business intelligence that can be generated out of the digital data exchange is also becoming very interesting. Data analysis can be used to improve business processes and cargo flows," said Mr Flacke.

"Our ultimate goal is to provide our customers with an analysis of their data that will help them to improve their business.

"When you think about the wealth of data that is generated by the air cargo supply chain, it is easy to imagine how it can help every supply chain participant to improve their business.

"For example; understanding the booking behaviour of clients, shortening pre-booking cycles and supporting the potential for e-commerce," said Mr Flacke.

But companies must change their attitude towards IT if they were to capitalise on its development.

"We are the beginning of what I would describe as a digital battle and to be successful in a digital battle you need to understand and make IT core of all your activities.

"It is important that these companies engage in digital transformation and really champion IT in their whole thinking, they need to rethink processes and really need to start not only ask 'how do I take my air waybill into the digital world?' but how do I make my whole workflow more digital?"