Optimization Software Helping Air Cargo Carriers Address Challenges, Improve Performance, and Maximize Growth Opportunities

April 21st, 2019 Michael Reinkober Leave a comment

For air cargo carriers, there are many factors converging to introduce new challenges to their logistical planning and operations. Changing customer expectations, new partnership definitions, and emerging competitors are all conspiring and requiring air cargo carriers to adapt to these new market dynamics. Mastering the so-called “disruptors” will require optimized strategies and processes both of which gain a significant boost from leading-edge optimization solutions. Understanding the disruptors and how best to address them will be the key for today’s air cargo carriers’ continued growth and ability to successfully compete.

Challenges and Performance Improvement Goals

There is no question that despite positive growth projections by leading airline industry groups, including the International Air Transport Association (IATA), air cargo carriers have hurdles to overcome. IATA’s prediction of a rise in cargo in 2018 came true with 62.5 million tons of cargo carried in 2018, a 4.5% increase over figures in 2017 leading to an 8.6% increase in cargo revenues at $59.2 billion. This growth boosts confidence, but air cargo carriers are not celebrating just yet. Still, air cargo carriers are not celebrating just yet. They realize that to achieve growth and profitability, they need to improve their value proposition by optimizing their processes and overall performance. This will require they get ahead of new challenges, while embracing new tools that facilitate better performance.

Among the key challenges air cargo carriers must address are:

-Those relating to the delivery of different cargo in accordance with the Service Level Agreement (SLA) for each cargo product, and recording time-stamps required for the audit trail;

-Optimal management of staff and equipment resources on the apron and in the cargo warehouse; and

-Maintaining optimum situational awareness and management by exception even in the most complex and confusing situations.

In addition to helping address these challenges, air cargo carriers also need solutions that will help them improve their performance of various tasks such as:

-Transporting of cargo between the aircraft and cargo center, as well as transports between different locations within the cargo center;

-On-time dolly availability at aircraft stands and holding areas;

-Preparation of dolly and trailer trains at aircraft and at outbound docks;

-Cargo build-up and breakdown in the warehouse;

-Loading/unloading of aircraft; and

-Loading/unloading of road feeder services.

The Disruptors

Competitors

When Amazon announced plans to launch its own delivery service, more than one carrier took note and stock of the implications. While its plans are to start accumulating a fleet of branded trucks, what is to say that the Amazon logo won’t soon appear on its own fleet of air cargo carriers? And, will Alibaba be far behind?

Blockchain

When a group of Japanese businesses operating in global trade announced their pilot program to evaluate the application of blockchain technology to streamline and improve cross-border trade operations, there was interest by air transporters as well as those in other modes of transportation. This group is not alone in exploring ways to leverage this digital database that uses linked blocks secured by cryptography to improve transactions and logistics. UPS, for one, has expressed interest in utilizing blockchain technology in its operations.

Big Data

Big Data is also causing a stir within the air cargo industry. Carriers realize that by harnessing the power of real time data, along with more flexible management of workforce and other resources, they can increase their overall efficiency. This is particularly true when it comes to better determining the number of planes needed for cargo transport during specific periods; efficiently scaling up or down accordingly.

Artificial Intelligence (AI)

Like Big Data, Artificial Intelligence (AI) is also getting a closer look by air cargo carriers. While some don’t expect AI to immediately impact the industry, there is a generally accepted viewpoint that it will ultimately help the carriers better forecast their facilities’ needs, improve cargo tracking, enhance revenue management, and optimize processes such as load planning, route planning, workforce management, and customer service. Among the top five air cargo carriers, at least two, FedEx and UPS, are known to be researching the implementation of AI. Consolidation services are also being looked upon by air cargo carriers as a way to mitigate challenges faced by organizations with lean supply chains and/or those that need to provide a Just in Time (JIT) service even for the smaller quantities.

All of these “disruptors” have changed customer expectations; the operative words here are faster, more flexible, more transparent, and lower prices. These expectations lead us to optimization software. It is already helping air cargo carriers optimize their processes so that they can effectively address challenges, best leverage the new technologies like AI and position themselves for the changing marketplace.

Optimization Software Helping Carriers Retain Their Competitive Edge

Regardless of the challenges, air cargo carriers still have a distinct advantage over other modes of transport; specifically, they are faster and more reliable. Cargo IQ data indicates that air cargo shipments, on average, take 140 hours to go from shipper to the consignee. The reliability of air cargo carriers is another notable differentiator. That is, however, not to say that air cargo carriers don’t benefit from improved processes. Optimization software is intended to take their operations to a whole new level and enable them to retain their competitive edge.

There are advanced solutions that optimize a wide range of carrier processes, from ground handling and airport operations to turnaround management and aircraft maintenance. These solutions have demonstrated a direct impact on the carriers’ productivity, costs of operation, performance levels, communications, and resource management. They enable an air cargo carrier to achieve best practices and process transparency which help them perform with the consistent speed and reliability they tout over other modes of transportation. Let us look at how some of the challenges faced by air cargo carriers are being effectively addressed by applying optimization software.

A key operational challenge faced by air cargo carriers is that different cargo products have different Service Level Agreement (SLA) limits relating to when the cargo must be delivered to the aircraft. This requires carriers to establish and allocate the necessary resources (e.g., dolly trains) in an optimized manner and in adherence to the SLA. There also is another requirement for time-stamps to be recorded as proof and for subsequent auditing purposes. Optimization software addresses this challenge by automatically taking SLA limits into consideration when allocating tasks to resources. Additionally, each action is connected to a time-stamp so that a detailed recording of activities performed can be guaranteed.

Air cargo carriers are further challenged by today’s highly competitive industry and the demand for optimal management of staff and equipment. By applying state-of-the-art algorithms to automatically allocate tasks to staff and equipment in accordance with various parameters (e.g., availability, functional requirements, legal considerations, etc.), optimization software helps carriers achieve optimal asset management and remain competitive.

Given the many operational complexities and typical infrastructure limitations air cargo carriers must contend with, maintaining sharp situational awareness, even under the most stressful and/or chaotic conditions, is vital. Built-in optimizers in today’s most advanced software solutions alleviate much of the confusion enabling staff to fully focus on critical tasks, thereby facilitating management-by-exception.

Real Benefits Derived

Optimization software is delivering real benefits to carriers. INFORM’s GroundStar optimization software suite has made a significant difference on behalf of various cargo customers. For example, by applying the software to allocate and manage its employees, one customer is now able to turn around 350,000 express freight shipments, on average, per night. Having to cater to an estimated 65 cargo flights per night within a short window of just four hours, situational awareness and pro-active decision-making is crucial. The GroundStar solution elevates situational awareness to the highest level to facilitate optimum decision-making. On a typical day, approximately 250 loading staff and drivers are allocated in parallel for efficient workforce management. During the peak holiday season, the strength of the implemented solution is especially evident as more than 500,000 parcels must be efficiently handled per night.

INFORM’s GroundStar also is helping air cargo carriers meet the demands posed by the 5% annual increase in the number of express shipments. It is enabling these carriers to effectively manage expansion by supporting them with advanced automation and optimized and focused decision-making which, in turn, is helping them increase productivity without adding staff.

Another example of how INFORM software is benefiting its cargo customers relates to their estimated 20% increase in dolly train utilization. Prior to their application of GroundStar, the carriers’ loading and cargo transport supervisors were not always able to utilize the full capacity of a tug and its dollies to meet SLAs and other timelines. After the implementation of GroundStar, the information regarding a tug’s status (i.e., whether a tug driver has enough time to wait for another unit load device (ULD) to be collected or to leave the stand with only three ULDs instead of four) is a strategic decision automatically handled by the INFORM software.

The Way Forward

The future for air cargo carriers and their continued process optimization will include further leverage of data – small and Big Data – to extract new insights and empower all staff levels from management to technicians. In turn, air cargo carriers will be able to gain even greater clarity to support their optimum decisions on matters ranging from dynamic disruption management and efficient aircraft turnaround, to aircraft maintenance, workforce management, and supply chain management.

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Livingston International to Participate in TradeLens Pilot

April 3rd, 2019 Haylle Sok Leave a comment

Global trade management and freight forwarding provider, Livingston Blockchain, confirmed this week its position as the first customs broker to implement the TradeLens pilot for brokerage automation. The blockchain-enabled digital shipping solution aims to provide solutions for trade roadblocks such as delayed transit times, risk factors, and fraud.

“The most important aspect of the platform is the ecosystem – building trust to enable collaboration with one another through a model that benefits everyone. Livingston’s participation in this initiative allows us to analyze the impact of blockchain on the logistics process by bringing in the role of customs administration, which involves the submission, examination and storage of reams of data on a daily basis,” said Peter Patterson, IBM Canada -Blockchain Leader.

Developed by A.P. Moller – Maersk and IBM, the initiative aims to create an efficient and secure trade environment. Livingston’s participation in the TradeLens pilot will consist of sensitive information on shipments while streamlining internal operations – all without added risks.

“We have always prided ourselves on being a forward-thinking customs broker and trade-services provider,” said Craig Conway, Chief Technology Officer, Livingston International. “We are excited to work with Maersk, IBM, CBSA and other members of the TradeLens ecosystem on an initiative we believe will serve our industry well and provide transparency and security in the global movement of goods.”

“As a leader in customs brokerage services, Livingston is now positioned to pioneer the use of blockchain technology and shape its impact to shippers around the world,” said Mike White, CEO of Maersk Global Trade Digitization and head of TradeLens.

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Velocity 2019 MercuryGate User Conference

April 3rd, 2019 Haylle Sok Leave a comment

Billed as “the premier industry event for transportation and logistics professionals,” the conference includes the world’s leading shippers, logistics providers, industry experts and, of course, MercuryGate software experts.

The three-day conference will feature keynote speakers Adrian Gonzalez, president of Adelante SCM, and American Blockchain Council’s co-founder and executive director, Jack Shaw. The conference will take place at the Cosmopolitan in Las Vegas with topics of discussion focusing on blockchain, parcel shipping, TMS best practices, high velocity multimodal frieght, and much more.

This year’s event will kick-off the morning of May 5 with a full day of activities including an exciting escape room experience at Escapology, a Pink Jeep tour, and a supercar driving experience at the Las Vegas Motor Speedway. The day will conclude with an official Welcome Reception at the Madame Tussauds of Las Vegas.

Don’t miss out on this informative, fun, and unforgettable conference May 5-7 and RSVP your spot today.

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Enhanced Security Solutions Provided with Paramount Advanced Technology & Hexagon Partnership

March 20th, 2019 Haylle Sok Leave a comment

Smart transportation, displacement monitoring, mining security and infrastructure monitoring are just a few of the improvements for enhanced African rural safety following the newest partnership between Paramount Advanced Technologies and Hexagon’s Geospatial and Safety & Infrastructure divisions. Paramount Advanced Technologies serves as a subsidiary of the African-based global defence and aerospace company Paramount Group.

“Paramount Advanced Technologies’ cutting edge research and development (R&D) and systems integration expertise which has delivered solutions effectively across the African continent, coupled with the technological innovation and overarching support that Hexagon brings from decades of system deployments globally makes for an impactful partnership to the betterment of the continent’s infrastructure and security capabilities, an alliance which we are privileged to announce,” stated Paramount Advanced Technologies CEO Ralph Mills.

Additional benefits from the partnership include facilities and inventory management, public records management, command and control and tactical emergency services. Paramount’s Integrated and Smart Systems (ISS) provides an innovative approach to providing proactive solutions for rural safety initiatives with a foundation built on the strongest industry partnerships.

“We live in exciting times, where the era of the Fourth Industrial Revolution upon us is driven by disruptive technologies such as IoT, augmented reality, blockchain, drones and robotics, amongst others. Technological changes are rapid while the availability of unstructured data is prolific,” Mills added. “The challenge before us is to make sense of that data, leveraging real-time information and intelligence to solve real-world problems, ensuring that organizations are best aligned to harness the advantages of this era by being digitally enabled, so as to avoid the risk of being left behind.”

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4 TRAITS SUCCESSFUL LEADERS MUST EMBRACE AS SUPPLY CHAINS CHANGE

March 13th, 2019 Greg MacNeill Leave a comment

The current state of international trade has only added to the chaotic and unpredictable nature of supply chains. This is the reality for many industries, and leaders who hope to stay competitive must adapt—quickly.

In healthcare, for instance, institutional buyers purchase steel products such as bedpans, trays and carts. These buyers traditionally get steel goods from suppliers in China at significantly reduced prices—thanks to high purchase volumes—compared with the steel products bought by smaller organizations or sourced from North American manufacturers. New tariffs on Chinese goods, however, have shaken things up and prompted buyers to re-evaluate their strategies.

Automation and other game-changing technologies are also shaping modern supply chain management. While technological innovations were once limited to tasks like negotiating better shipping rates, savvy supply chain leaders must now consider technology’s long-term implications and how those innovations can have profound effects on their operations.

Confronting Change Effectively

Global supply chain managers have several tools at their disposal for streamlining operations. But tools are useless without someone to use them, and leaders must be agile and innovative enough to integrate these methods into their supply chains.

Consider blockchain, which IBM is using to increase food chain and supply chain transparency. The company recently unveiled IBM Food Trust, a blockchain-based network that allows food supply companies to share data free of charge.

Evolving supply chain expectations necessitate new levels of transparency, and blockchain is one of many burgeoning technologies that leaders will need to leverage to respond effectively to society’s shifting needs. Another such avenue of change is enhanced data and analytics. In fact, 50 percent of supply chain organizations surveyed by Digitalist Magazine ranked data and analytics above the Internet of Things and artificial intelligence as the primary source of change in the industry.

With increased worldwide uncertainty, global supply chain managers must take steps to build systems that can be responsive to change. This worldview goes beyond just having the latest technology; it means maintaining a vision for how an organization can be future-proof.

The Qualities of Effective Supply Chain Leaders

Prudent application of business principles to the supply chain can yield positive results, yet many companies still use outdated management models instead of embracing lean management strategies. Successful innovators among supply chain leaders will instead evolve by embodying these four traits:

Technological fluency: In one GEODIS study, 70 percent of supply chain professionals described their operations as “very” or “extremely” complex. Supply chains are more complex than ever before, which means leaders must focus on improving their domestic supply chain practices.

Gaining a clearer understanding of IT and its benefits is one way to create clarity. Although supply chains essentially are all about people, those people are using technology to get the job done. For that reason, companies should stay up-to-date on the industry’s product options around IT and automation and should understand how best to leverage them.

Short- and long-term focus on the bottom line: A nuanced understanding of technology should be complemented by a clearer idea of a business’ cost to serve. Whether they are running operations or overseeing buying practices (or even automation upgrades), leaders must ask themselves how every decision will affect their bottom line.

That question should not solely focus on earnings in six months or a year. Leaders should look beyond that window to position their supply chains for shifts that could come five or 10 years down the line. In such a rapidly changing environment, a proactive approach will ensure their companies are ready to pivot when it matters most.

Willingness to delegate: Leaders should not assume they have to shoulder their missions alone. Working closely with a team is the most effective way to get the critical insights necessary to make a difference. The ability to direct, manage, influence and inspire the right people can help leaders build teams that will be responsive to modern supply chain challenges.

Because technology is so integral to supply chains, put together a team in which each member has a specific area of expertise. This team should include people who are investigating blockchain, attending AI conferences, or finding ways to integrate new technology within the company culture. Team members should embrace new technologies and go out of their way to spread this enthusiasm throughout the organization.

Experience managing projects, negotiating, and collaborating: Successful leaders should have project management acumen and the skills to negotiate for resources and budgets—including a high degree of personal organization and a pre-emptive approach to managing risks. Leaders must be willing (and able) to negotiate internally and externally for resources or an expanded budget.

Along these lines, leaders also should be willing to cooperate with partners for data. Considering data is the fuel that powers so many advances in supply chains, this collaboration should be a win-win scenario for all parties. Leaders who embrace supply chain management advances—technological or operational—will be positioned to prosper despite any transformations the market might undergo.

These tips can help leaders take care of their supply chains, but they must start now. As the industry and the world surrounding it become increasingly fluid, anticipating these shifts early can keep your supply chain relevant and optimal for years to come.

Greg MacNeill is the senior vice president of Worldwide Sales at TECSYS, an enterprise supply chain platform and solution provider. Possessing a wealth of knowledge in the areas of supply chain best practice, enterprise logistics software and supply chain technology, MacNeill uses his decades of experience to craft pragmatic solutions to complex supply chain challenges that enable—and empower—his customers.

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IF DAYS COUNT, HOW ABOUT HOURS? 2019 BANKING INDUSTRY OUTLOOK

January 29th, 2019 Peter Frerichs Leave a comment

Last year got off to an energetic start. It’s been a year now and how memories can fade, but economic growth worldwide was intensifying in January, advancing at a steady clip, and then … clunk. China, Japan, the Eurozone economies and the United Kingdom all began to weaken. The U.S. kept it moving but despite its acceleration, world markets continued to contract and pundits are now predicting a slowdown from 3.2 percent growth in 2018 to 3.0 percent in 2019.

With that said, however, the global banking system finds itself in one of its best positions in more than a decade. While recovery from the financial crisis has not been consistent across regions, total assets (per The Banker’s Top 1,000 World Banks Ranking for 2018) ascended to $124 trillion and return on assets (ROE) posted an impressive 0.90 percent. Banks in the U.S. have returned to health much more quickly thanks to forceful policy interventions and prudent regulatory measures. Total U.S. bank assets coming into 2019 hover in the $17.5 trillion range and efficiency ratios are posting new highs.

Within the larger transportation, logistics and supply chain management arena, banks and their ancillary collaborators play a critical role in financing a complex system of moving parts and players. Innovation is critical and for 2019 the banking outlook will be defined in large part by further technological developments and closer collaboration between actors.

Blockchain

We’ve been hearing about blockchain for a while now, but 2019 is poised to be a breakthrough moment for blockchain in the banking sector, with a notable focus on supply-chain management. Close to every major company worldwide runs enterprise resource planning (ERP) and supply chain management software. Yet, there are still some antiquated, human elements mixed in which make it difficult for firms to take full advantage of the technology. Global supply chains are giant ecosystems, with hundreds if not thousands or tens of thousands of moving parts, all trying to work together from a financial perspective to either achieve financing, transfer funds or get paid. Efficiency is at an all-time high, which means delivery times have been shortened and are putting pressure on middlemen (banks) to process funding for all transactional entities.

Blockchain has the potential to accelerate payment processing time and reduce transaction costs. According to an Accenture survey, “nine in 10 executives said their bank is currently exploring the use of blockchain.” Instead of relying on a central intermediary that would need to be negotiated with, managed and shared around the world, blockchains synchronize transactions and data across a shared network where everything is transparent and open to those on the network.

This last point is critical, however, as blockchain and distributed ledgers are only as valuable as the shared network they sit upon. Expect more integrated collaboration across countries with not only banks but financial technology companies (FinTechs) to arrive at a backbone in 2019 with which to underpin the system.

FinTech Collaboration

Mentioned earlier, FinTechs have exploded due to the ever-increasing integration of trade across borders. In earlier times, certain FinTechs concentrated their collaboration with individual banks, but 2019 is opening the door to a wider, broader banking ecosystem where FinTechs are developing and bringing to the table innovative technology—such as robotics, artificial intelligence and machine learning—to the collective table.

FinTechs make sense for banks as banks desire one thing: the best ROE they can achieve. In 2016, EY reported the largest 200 global banks reported average ROE of 7.1 percent. To get to 12 percent, for example, those same banks would need to increase revenues by roughly 15 percent and reduce their costs by just under 14 percent. FinTechs help banks streamline, drive down costs and enhance customer service. This is going to be front and center in 2019 and for years to come.

At the moment, approximately 12 percent of European supply chain finance programs are managed via FinTech platforms. The statistic in North America is not much different and while this figure perhaps will not double by the end of the year, the cooperation between FinTechs and banks will become much more pronounced.

Artificial Intelligence

Lastly, AI. Hardly confined to the financial sector, AI is revolutionizing how nearly every sector of the economy works. From virtual assistants such as Amazon’s Alexa to chatbots, at an individual level Accenture reports that 37 percent of U.S. consumers by the end of last year will have owned a digital voice assistance device. This has been spilling over into banking in a multitude of ways.

Customer service automation, especially vital across countries, languages and within supply chains, is resolving client issues at a fraction of the price as opposed to a real person. Autonomous predicted that AI could result in $450 billion in financial sector savings by 2030. In a similar vein, machine learning is integrating and analyzing data from multiple databases to arrive at a more holistic, 360-degree view of the customer or firm, which results in highly personalized products and services uniquely tailored per group. Behavioral data, credit and savings products and goals of the organization or person (personal goals) are shared and analyzed accordingly.

While not commonly associated with AI, fraud prevention and overall security will also be big issues for the banking sector moving into 2019. In this regard, AI is proving to be of excellent assistance with its unique ability to run through hoards of data and identify patterns that would otherwise elude the human eye. McAfee notes that cybercrime costs the world economy approximately $600 billion. AI can detect fraud in real time, providing banking and FinTech entities, as well as their customers and ancillary suppliers, information on the spot that could be disastrous if not managed correctly. With AI alone, Mastercard reduced “false declines” for its customers by 80 percent.

This year will likely see more radical banking changes as compared to 2018. As the world economy continues to work through some bumps and bruises, expect the banking outlook to be rosier.

Archives, Global Trade Daily, Software

Blockchain Changes the Pace for Agricultural Supply Chain

January 20th, 2019 Haylle Sok Leave a comment

Farmers and buyers are now provided streamlined visibility for their deals through the new blockchain platform, Grain Discovery. As a result of the start-up technology, the first global corn trade transaction was successfully processed for Prince Edward County farmers Larry Reynolds and Lloyd Crowe following the discovery of vomitoxin beyond the threshold for corn and leading to rejection of two loads. The two were in need of a quick and reliable solution to locate a new buyer and process the transaction. Grain Discovery did just that.

“By using Grain Discovery, we were not only able to avoid hours of searching for a new buyer, but found one just down the road, at a better price than the original deal, and were paid instantly,” said Mr. Reynolds. “If blockchain technology means a few extra dollars in my pocket and a few hours less trucking, then that’s a win.”

The goal for Grain Discovery is to create a revolutionary approach to agricultural supply chain through the use of blockchain technology while providing increased visibility, control, and simplicity for farmers and buyers.

“Farming technology in the agricultural industry is incredibly advanced,” explained Rory O’Sullivan, CEO of Grain Discovery. “However, the way grain is bought and sold hasn’t changed much since our grandparents were farming! In the age of Amazon and eBay, we reckoned the industry deserves better.”

“We are participating in a number of other pilot projects this year, including tracing soybeans from seeds in Canada to the export market in Japan and coffee from Columbia to your local café,” said Mr. O’Sullivan. “This transaction was the vital first step towards realizing our goals.”

Source: EIN Presswire

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Blockchain Company Highlights Circular Economy

December 27th, 2018 Haylle Sok Leave a comment

A Netherlands-based blockchain startup company is changing the course of data sharing, certification access, as well as product and material oversight. Circularise offers a communication system that companies can use for “virtually endless range of product value chains” according to a release from the company.

In early December, the company put the circular economy in the spotlight, showing the overall benefits it provides to the industry. The concept focuses on reusing resources and maximizing the value of all products and materials. The end result is the elimination of waste.

Through the communication technology provided by the company, stakeholders are enabled to share information about parts, materials, etc. while maintaining ownership of their data and determining who gets access to it.

“Providing a system where all stakeholders can be held accountable for their actions, audit results can be published and shared, and information can be exchanged in a flexible way, is key,” explained Pietro Pasotti of Circularise.

The company revealed successful pilot programs with an Italian recycling plant as well as Netherlands-based furniture manufacturer and plans to expand its reach in 2019 in the fashion/textile and beverage industries through additional project initiatives. Circularise has also had successful partnerships with over 18 organizations.

About Circularise:

Since 2017 Circularise is working with multiple partners in the framework of H2020 C-SERVEES project backed by the European Union. Together these parties are developing a solution that aims to boost a resource-efficient circular economy in the electrical and electronic (E&E) sector through the potential synergies of two major revolutions of our time: the circular economy and the Industry 4.0.