Point of View

Digital transformation in logistics, is not just a passing fad or a hot topic among the professionals in the industry, it is a reality. However, there are still many questions and apprehensions surrounding the digital transformation of the air cargo industry. Why is this clearly necessary transformation coming so late? Why is it still taking so long to take effect? Is a digital transformation even necessary? What specific benefits are associated with undertaking a digital transformation journey? Ajith Pancily, Senior Product Manager - Special Initiatives, Cargo & Logistics Solutions at IBS Software, talks about digital transformation with respect to cargo airlines.

Why are certain businesses more inclined towards adopting new technology than their counterparts? What is IBS doing to minimize the risks and complexity of implementing a new cargo system?

Ajith: Digitization, as a process, deals with mission-critical systems that impact all areas of business. Getting all stakeholders on the same page about the benefits of a digital transformation takes time. Moreover, this transition needs to happen without interrupting day-to-day operations. Any issue during the deployment can clog up the entire operations of the business, which, especially in the case of airlines, can be incredibly costly.

From an IBS point of view, we have successfully gone live with 35+ airlines across different geographies and business models. With this experience, we can accurately predict, anticipate and resolve the issues that may arise while implementing a new cargo system like iCargo. 

What is the primary challenge in sharing of APIs for information and could they become a roadblock in the digital transformation journey?

Ajith: This is a widely talked topic, not limited to airlines. With APIs, many business functions are now exposed to anyone who wants to build these cases or solutions on top of it. This is something that is really a 'yes' or 'no' question for an airline. It entirely depends on what kind of business benefits they can expect by sharing information with their partners. When you have the capability to have real-time sharing of information (using APIs), you can also build automation and identify optimizations.

However, one significant roadblock is that this industry is still working on standards that have been set in the 80's and 90's. Often, these standards demand effort-intensive and time-consuming manual processes. One reason traditional processes still dominate is that within the industry, digitization is happening in isolated pockets. One business cannot implement a full-fledged change within the organization as they may have partners that communicate and operate using outdated technology. In addition, digitization is not limited to business processes.It can also mean other aspects, like performance metrics. Depending on the metrics you are tracking, you may need different types of APIs that allow you to measure success in the right manner. Since these are just emerging in the industry, there are no existing case studies that businesses can leverage, which makes this entire undertaking especially challenging.

What, do you think, air cargo carriers mostly consider, when they decide to digitize their air cargo systems?

Ajith: We are talking about air carriers or ground-handling agents, who are actually looking to transform the mission-critical parts of their business. From that point of view, this is not just an operational change for them. This is also a strategic change for them. Any cargo airline or a Ground-Handling Agent (GHA) has to consider the below aspects:

•   Whom are they going to partner with
   
  Airlines must identify a cargo solutions partner who is actually very conscious of emerging technology trends and the impact these technology trends or use cases can bring to the airfreight industry. In such a situation, airlines should look for a partner whose offerings remain relevant and future-proof.  
  
  
• How comprehensive is the air cargo management platform
  
  A cargo management system has to be comprehensive and well configurable, in case you need to bring about a change quickly because of some change in the business context. You also need a platform that integrates well with existing systems. It is only when a platform satisfies these needs; the benefits of digitization will become apparent. 
  
  
• What is the roadmap for the air cargo management platform
  
  Cargo carriers need to ensure that the cargo management platform meets their current and future demands brought about by internal needs or the dynamics of the industry. It is important that the business and the technology provider work hand-in-hand to achieve these. For instance, at IBS Software, we hold a very engaging User Forum every six months. We have face-to-face meetings with all our customers and we deliberate not only on industry-level topics, but also on actual functional features that the entire customer community wants in a particular model.
  

What are some of the innovations that IBS Software is rolling out in the airline cargo management space?

Ajith: If you look at the broad industry, almost all of the existing processes are aimed at managing general cargo shipments, which do not have special handling requirements. Over the last couple of years, we have seen tremendous dependency on shipments of medical supplies like PPE kits and vaccines. These are very high-risk shipments. Moreover, the transportation of special shipments does not just happen from one airport to another. When the same shipment goes to the destination airport, a third party handles it. The onus is on the cargo carrier to ensure that the integrity of the cargo remains intact throughout the journey. 

With applications like iPartner, we enable cargo carriers to extend all of their various SOPs, SLAs, and handling instructions for a specific cargo to their GHAs. iPartner also offers a feature that enables the use of internal web applications, or Android or iOS applications, that partners can use to feed information to the airlines.