Data is quickly becoming the most valuable asset a company has, but without the ability to exchange it and make money from it, it has limited value, cautioned Jean Verheyen, founder and chief executive officer of Nallian, a data sharing platform that helps companies within the same value chain to collaborate more effectively.

Verheyen was responding to a question by the session moderator, Glyn Hughes as to whether it was realistic for the air cargo sector, which has taken nearly four years to get to a 30 per cent penetration rate with the e-AWB, “to embrace something as unique as trusting your partners with your data and going into a community based sharing type situation?”

Verheyen noted that there is a significant need for companies to exchange information today, but many companies are afraid to do that because of information technology reasons, commercial or security reasons. But he added this is the unique selling point of Nallian, because the platform is tailored to provide only the data that is approved to be shared, with only the parties authorised to access it. “Th is is absolutely key, otherwise it won’t work,” he added.

“Data is becoming probably the most valuable asset a company has, but what are you with an asset that you cannot exchange. So you need a way to exchange the data and make money out of it, but you want to do it in a controlled way and that’s what we facilitate,” Verheyen said. He also believes that the market will drive companies to do this, in part because once the first few companies do it, they will then have a competitive advantage over the others, causing a cascading effect.

Tapping e-commerce

With data sharing a key component of collaboration in this day-and-age, how can freight forwarders and carriers move to tap the burgeoning growth of e-commerce, Hughes then asked.

One problem according to Emirates SkyCargo’s VP cargo commercial operations Ravishankar Mirle, is that the air cargo industry has always been focused on the business-to-business model and to tap e-commerce it would need to move to a business-to-consumer (B2C) model.

“But as an airline our core competency is delivering freight airport-to-airport. If we try to get into a B2C model and there is one guy ordering a pair of shoes in one part of the world and the pair of shoes has to come from Vietnam, or China through Alibaba or any of the e-commerce platforms it becomes extremely difficult for us to move the pair of shoes on the ground,” he points out.

He says that while the ultimate customer is the end consumer and that is the most important customer in the chain, “we have to be restrictive and respective of our core competencies.” For him it makes more sense to partner with a forwarder whose role would necessarily need to adapt, but for an airline it is extremely important for someone else to do the first and last mile delivery, he said Alec Koh, chairman of the Federation of Asia Pacifi c Aircargo Associations (FAPAA) notes that there is actually nothing new to freight forwarders doing door-to-door delivery but is pessimistic that the sector can handle the requirements of e-commerce. “We have done door-to-door some 30 years back, but that was one single shipment to one single place, not 30 different shipments of one kilogramme each to 30 different places,” he says.

“We don’t have that kind of manpower to do it,” he says, adding it just isn’t practical for forwarders to get in that kind of business. He went on to cite the example of the integrators, who when they first appeared on the scene had a limit on the weight per piece of about 70kg. “But they went further and further, on and on and if you look at them now with global air networks and extensive ground delivery capabilities, they’ve made their own industry. Can freight forwarders do that? I don’t think so,” Koh concluded.

For Hughes, part of the difficulty in changing to adapt to the evolving air cargo marketplace is the fact the industry is vertically structured. Th e airline’s customer is the forwarder, whose customer in turn, is the shipper or consignee. Airlines then rely on forwarders to communicate what it is that the shippers expect from the airlines, which creates a disconnect.

Th is vertical structuring also creates a procurement driven relationship rather than a quality and customer focus, he said, adding that this must be overcome for the industry to innovate as an industry “to secure our effective survival.”

For Roy Tan, managing director Indo-China for Crane Worldwide, the personal relationships still remain critical in the forwarding industry, but so too is the adoption of advanced IT systems to provide end-to-end visibility to clients.

In order to bring the industry forward, Hughes feels the very complex environment of air cargo needs to be demystified in part through greater leveraging of technology, something that hasn’t been done within the industry. He points to the new breed of disruptive network owners like Alibaba, Airbnb, Uber, etc.

Trust-based networks

Speaking from her perspective as VP product for online rate platform, Freightos, Ruthie Amaru said what makes all of these disruptive platforms successful is trust. “The key theme running through all them is ‘trust’, it’s a new way of creating a business relationship that works for everyone,” she said. It’s about creating a new way to do business in a trust-based network in which both parties benefit.

When she first joined Freightos, the first piece of advice given was not to ask freight forwarders for their rates. “Instead, I said can I bring you a new type of customer, a new type of business?

Are there rates you would be willing to publish for this type of business? I have an e-commerce vendor, a new type of consolidator who’s going to power eBay or Alibaba and they need you to put the following into this type of a cloud,” she said.

She added that it’s the same for the carriers, if you can show them it’s going to create more business then companies are more willing to open their information. “So the trust-based system where everyone feels safe bringing to the table what’s going to bring in more business, that’s what we’re trying to do.

We’re not trying to force anybody to do anything that’s not good for their own business because that’s not going to work,” she said.

Verheyen agrees saying, “you cannot force anyone, people will share their data when they are ready to do so and they feel it’s a new opportunity for them.”

He adds that the community approach is helpful because it lowers the barrier to entry and provides the necessary critical mass from which all participants can benefit.

Evolving forwarder role

A key question for Hughes however, is if the shipper is empowered, if there’s greater access to technology which puts more power in their hands, what will this mean for the forwarder?

Today the role of the forwarder is very much about navigating through the mire of regulatory necessity, he added.

But being a historically manual processes, if technology is leveraged to the point where that information can be hardcoded, because much of it is straightforward, how does that impact the evolution of the freight forwarders’ role going forward?

Koh was not optimistic that the processes could be fully turned into electronic processes, citing the difficulties already being experienced with e-freight. Tan was slightly more optimistic, citing the end-to-end visibility that his company already provides its customers.

“One of things that’s very important for all of us to acknowledge is that, it is complicated, but they are definitely solvable problems. Nothing here is too hard to solve, but let’s create some systems one piece at a time,” advised Amaru suggesting standardisation of carrier contracts might be a good place to start.

“E-commerce is also a great place to start looking – at just the needs – because what e-commerce needs, is for it to be really, really easy to get the information quickly. So that’s all you have to do is make it easy for your information to be consumed by the people you trust, quickly.

She also said the same applied to freight forwarders, because it is about people, about knowledge and about relationships. “But it’s also about exposing the fact that you have the knowledge and that you can provide the service very, very quickly,” she added.