- Leah Barrier
Air Freight Innovation
When you think of innovation, you think of technology, creation, autonomy, digitization, blockchain, and the Internet of things (IoT). You think that this is the inevitable direction our world is headed, and in most cases, for good reason. Change, after all is guaranteed. We either keep up or fall by the wayside.
“If you don’t like change, you’re going to like irrelevance even less.” -Eric Shinseki
Automation is happening and will increase air freight transaction efficiency by nearly 75%. Why is it then, that the air freight industry is stumbling to remain sustainable in this digital world?
While the air cargo industry is increasing shipments exponentially (in residual response to technology; specifically, eCommerce sales), it still has issues to be addressed before this surge in air cargo shipments can be continued and properly handled. A few of the common road blocks for air freight innovation include:
Heavy reliance on the paper-based air waybills (AWB) instead of migrating to the electronic air waybills (e-AWB)
Market volatility makes it extremely difficult to predict accurate freight rates
Excessive external factor dependency (generally speaking)
The problem does not reside in the lack of innovative ideas, but rather the implementation of these ideas. In order for air freight to optimize to the fullest potential, cargo in general needs to debunk two myths according to Dr. Alexis von Hoensbroech, chief commercial officer for Lufthansa Cargo AG. Those myths are, “My data belongs to me” and “price transparency will kill my margins.” It seems evident that von Hoensbroech’s quote is in reference to blockchain technology and artificial intelligence software. Regardless of your views on the blockchain and supply chain merger, there will be roughly $5 billion directly invested in digital transformation over the next few years, allowing for money, markets, and early adopted investments to be the decision makers.
Drones are generating an impressive amount of buzz in air freight modernization. They could potentially take innovation and optimization to heightened levels of semi-automated services in the air cargo supply chain. Today they are being tested first by inspecting aircraft integrity and scanning for any structural damage to the air freight. Could the next step be replacing standard freighters altogether? If so, what are the implications? Human workers replaced by robots is arguably the biggest issue surrounding these particular drone conversations. It is difficult to predict what shift an autonomous supply chain will cause for the market and global economy but as more logistics and freight forwarding companies begin to implement these technologies into their day to day operations there will undoubtedly be a systematic change in the supply chain and the previous relationships that were needed.
On the other hand, innovation does not always implicate technology. Sometimes it means employing a trusted solution in a related industry. In this case, security. The one thing technology has failed to efficiently beat out is the nose of a dog. The U.S House of Representatives signed a legislation in March that will allow the air freight industry to outsource canines. This approval is meant to allow airline carriers the use of third party options as heightened security measures, especially with elevated air cargo demands. Canine security in air cargo is being seen as innovation with a little less risk, overhead, and trial runs involved. Overall, more cost effective and accurate.
Again, the air freight industry is not without innovative insurgencies and ideologies. The future of air exports and imports may very well be among us. The question remains; can the air freight industry integrate, adjust, and adapt to this fast-paced way of moving product?