Cross industry collaborations – a new normal
The pandemic demonstrated the value of meaningful collaborative partnerships as common objectives emerged which united all parties within the supply chain and various industry associations. Building community and aligning air cargo stakeholders to a common vision is by no means an easy feat. It requires buy-in from within each organisation to transit from legacy processes and relationships, and time to build trust and deliver value. Nevertheless, the air cargo industry is beginning to see the benefits of community collaboration in this increasingly dynamic business environment.
After the Covid-19 pandemic struck, air cargo became more than ever a key part of civil aviation, as well as of the broader global supply chain. Following the announcement of a global pandemic by the World Health Organization (WHO) in March 2020, the International Civil Aviation Organization (ICAO) issued targeted recommendations and guidance for aviation authorities, including the importance of coordinating with all relevant stakeholders. Further, ICAO collaborated with stakeholders such as the Universal Postal Union to encourage states to ensure the financial stability of air and postal operators while also recognising the essential nature of their work.
Commenting on the partnership with International Air Transport Association (IATA), Fédération Internationale des Associations de Transitaires et Assimilés (FIATA), and The International Air Cargo Association (TIACA), ICAO’s air transport officer for air cargo, Cortney Robinson, says that the strengthened collaboration with these associations, as well as with various associations has played an important role in the sector’s pandemic response. “Today, common priorities have gained urgency yet some extend beyond it. Promoting the establishment of 7th freedom traffic rights for all-cargo operations - the most salient feature of ICAO Council Aviation Recovery Task Force (CART). In the current context, with the ongoing capacity shortages, efficiencies resulting from digitalisation have become a necessity for the transport of critical goods, including pharmaceutical deliveries. In addition, cross-border restrictions have resulted in a massive growth of ecommerce activities, which increasingly rely on safe, secure, efficient and resilient air cargo services; and finally ensuring the safe transport of Covid-19 vaccines and other medical goods.”
“In the current context, with the ongoing capacity shortages, efficiencies resulting from digitalisation have become a necessity for the transport of critical goods.”
Cortney Robinson, ICAO
Along the similar lines, Glyn Hughes, director general, TIACA states that TIACA, IATA, FIATA, Global Express Association (GEA), Pharma.aero, Cool Chain Association (CCA) and others worked together to produce new industry guidance regarding safe and secure vaccine transport, closed airspace, restrictive crew requirements and other trade impediments. “The success and outcomes-based approach employed by various supply chain partners saw shared expertise and facility planning for example as needed in some cases to overcome staffing challenges. We also saw innovative and collaborative methods for aircraft loading, particularly where in-cabin solutions were employed,” Hughes said.
Improved delivery timelines
Technology-backed collaborative efforts have helped enhance visibility and provide industry players with a big picture of the supply chain operations, thereby ensuring lesser room for errors.
Ashok Rajan, SVP and head cargo and logistics business, IBS Software, observes that collaboration with industry majors tops the list of its priority. “Building a host of platforms that allows stakeholders to engage with each other seamlessly, the airline - agent, airline - airline, airline – handler. We are also enabling these platforms to be able to connect non-IBS players as well. We are also working closely with industry bodies to frame standards for data exchange and increase the effectiveness of pilots so that the standards do not become the weakest link in the chain. We also work with our customers to do bespoke integration with some of their largest partners/customers.”
While in Southeast Asia, Changi Airport Group (CAG) together with the Civil Aviation Authority of Singapore established a local public-private partnership task force - Changi Ready Task Force, comprising of both local logistical companies and government agencies such as customs, border control and airport police, to ready our community to deliver the Covid-19 vaccines with Security, Transparency, Agility and Reliability quality (STAR) into Singapore and the region.
Lim Ching Kiat, managing director, air hub development, CAG, explains, “We formed the first and largest CEIV Pharma community in the Asia Pacific through the establishment of the [email protected] initiative, consisting of CEIV Pharma certified companies representing each node along the air cargo supply chain. More recently, CAG established the first CEIV Fresh certified community in Southeast Asia. These collaborative efforts are to enhance handling standards to assure global shippers.”
Meanwhile, the Hong Kong Air Cargo Industry Services (Hacis), a subsidiary of Hong Kong Air Cargo Terminals Ltd (Hactl), has road transport partners who provide some of the capacity for its Superlink China Direct RFS operation serving 9 depots on the Chinese mainland.
“TIACA, IATA, FIATA, and other partners worked collaboratively to highlight and overcome transport obstacles such as closed airspace and other trade impediments.”
Glyn Hughes, TIACA
Wilson Kwong, chief executive of Hactl, says, “For us, collaboration is more about working with our customers to understand their needs and their potential, and then to provide the necessary resources and skills. Carriers should view their handlers as professional facilitators, and instigate closer and more open dialogue with them. In our experience, good ideas and successful business development frequently result from adopting such a policy.”
Similarly, Hope Consortium, a UAE-based public-private partnership, formed to support the distribution of Covid-19 vaccines across the globe welcomed Bolloré Logistics as one of the partners in January.
Sanjay Goel, director and chief executive officer – South Asia, Bolloré Logistics India, notes, “For years, we have been building strong relationships with various stakeholders. During the pandemic, we were in a position to create solutions for our customers by securing transport plans through alternative options despite facing space issues, increased container shortages, uncertain demand, and unreliable shipping schedules. To address these new challenges we used passenger aircraft converted into cargo-carrying aircraft, offered solutions for charter flights and added our space allocation on specific trade lane routes.”
Like any other business, the Covid-19 pandemic has had its effect on the supply chain business as well. While it raised a few challenges, technology companies were quick to respond to these. Unlike other economic uncertainties, companies continued to invest in technology, realising the value of the digital supply chain to industries. In another way, the pandemic gave momentum to the adoption of digital channels and hence the value proposition of collaboration was not an option among the stakeholders.
“Collaboration will help democratise the logistics supply chain access. Moreover, this will bring about a digital revolution that will challenge the monopoly of the big boys who have the financial muscle to make large capital investments and therefore offer seamless supply chain experience by controlling all aspects of the chain. A digital wrapper instead could bring the same effect by combining smaller players and also lowering the entry barrier for new players. This is also going to call into question the value every player is bringing to the table and could slowly take off non-value-adding intermediaries,” mentions Rajan.
The supply chain disruptions experienced by businesses since last year has underscored the importance of supply chain agility and resilience. In 2020, Changi Airport introduced a community data-sharing platform – Changi Air Cargo Community System (ACCS), which is an open ecosystem of collaborative and community-based applications underpinned by an information-sharing platform that aggregates data from all parties involved in the cargo handling process. ACCS users included airlines, cargo handlers, freight forwarders, integrators and trucking companies who could all benefit from this platform and its use cases.
Kiat notes, “Among the first use cases is the truck dock slot booking application, which aims to even out cargo lodgement and collection at our cargo handler’s air freight terminals, thereby reducing waiting time, optimising resources and providing greater insights to airport landside activities. We plan to introduce other community-based applications soon to unlock further efficiency and productivity gains, as well as improve supply chain visibility.”
Further, Bolloré Logistics has created the B.Lab community to develop innovation initiatives from ideation to go-to-market phase with close involvement of its customers. The two centres opened in Paris and Singapore in 2019 to offer different collaborative workshops. In this ecosystem, third-party companies play an essential role as they consolidate the information from the different stakeholders. But it is also important to use dedicated tools like IoT sensors for sensitive flows or other solutions like the LINK platform that offers full visibility by integrating all the supply chain data to be shared with the stakeholders within the supply chain.
Goel states, “In addition, we are also rolling out CargoWise, an integrated single-platform Transportation Management System (TMS) designed by WiseTech Global that will be supplemented by Transport Order Management (TOM), developed in-house. This new software will be implemented across the entire Bolloré network and will help to simplify processes, increase responsiveness, eliminate paper, and operate more efficiently. Finally, to prevent supply chain disruption, we launched a new tool last year called Upwind that describes unforeseen internal or external events and their impact on the supply chain, thus allowing us to propose to our customers' continuity plans for their operations.”
“We plan to introduce other community-based applications soon to unlock further efficiency and productivity gains.”
Lim Ching Kiat, Changi Airport
Before the Covid-19 crisis, ICAO engaged in various programmes to foster collaboration through regular engagement with traditional aviation stakeholders, as well as with those in the broader supply chain. By linking the two sets of stakeholders, ICAO facilitated the necessary communication between member states, industry, UN agencies, and regional organisations. These relationships enabled various stakeholders to collaboratively advance their respective missions by enhancing their capabilities, yielding solutions and services that are more effective. The establishment of CART is an example of how the organisation mobilised efforts and built new partnerships to counter the fallout of the pandemic.
Robinson concludes, “Other examples include the collaboration between ICAO and the UN Economic Commission for Europe (UNECE) for the development of contactless, digitalisation solutions for trade and transport document exchange as part of the broader UN Covid-19 response. This collaboration came through the joint statement on the contribution of international trade and supply chains to a sustainable socioeconomic recovery in Covid-19 times signed by ICAO, UNECE and six other UN entities, last year.”
As the pandemic forced the aviation industry to grapple with shifting attitudes in air travel, reducing costs without hampering efficiency, innovation and skills during the pandemic, it forged its way forward through cross-sector collaborations to eliminate the coordination gaps and deliver a healthy model for the future.
Urgent shipments became the norm in doing business as PPE, medical aids and then vaccines increased in volumes. Hughes says, “With passenger aircraft deployed for cargo-only operations, with the regulatory environment changing daily, with differing quarantine and lockdown provisions being applied by various states, the entire air cargo ecosystem had to become adaptive and agile. This was best achieved through innovative and collaborative partnerships.”
Recently, CEVA Logistics delivered oxygen concentrators from the US to Indonesia via Singapore. As part of the broader Singapore Changi Airport community, CEVA is participating in the aid project organised by the Changi Airport Group. With many Southeast Asian and Pacific countries affected by the highly transmissible Delta variant, CEVA is using its global network to connect the right medical supplies. In total, 1,380 machines are being donated by the Changi Foundation together with more than 30 other airport partners, as well as individual airport employees.