For air cargo carriers, there are many factors converging to introduce new challenges to their logistical planning and operations. Mastering the so-called ‘disruptors’ will require optimised strategies and processes, both of which gain a significant boost from leading-edge optimisation solutions.
Despite positive growth projections by leading airline industry groups, including the International Air Transport Association (IATA), air cargo carriers have hurdles to overcome.
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
- 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 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
- 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? Will Alibaba be far behind?
Blockchain: When a group of Japanese businesses operating in global trade announced their pilot programme 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.
Big Data: Big Data is also causing a stir within the air cargo industry. Carriers realise 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.
Artificial Intelligence (AI): 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 optimise processes such as load planning, route planning, workforce management, and customer service.
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 optimisation software, which is already helping air cargo carriers optimise their processes so that they can effectively address challenges, best leverage the new technologies like AI and position themselves for the changing marketplace.
Optimisation software helping carriers retain their competitive edge
There are advanced solutions that optimise 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.
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 (eg. dolly trains) in an optimised 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. Optimisation 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 (eg. availability, functional requirements, legal considerations), optimisation software helps carriers achieve optimal asset management and remain competitive.
Real benefits derived
Optimisation 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 optimised 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 utilisation. Prior to their application of GroundStar, the carriers’ loading and cargo transport supervisors were not always able to utilise 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 (ie. 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 software.