SITA study reveals inefficiencies in air cargo supply chain

by Canadian Shipper

SITA, provider of integrated information and telecommunications solutions to the air transport industry, has sponsored a study, which was carried out by independent consultants with specialist skills in the world of logistics and distribution.

The study focused on the transport component of a generic supply chain and was presented to representatives of the cargo logistics industry, gathered at the Cargo Network Services (CNS)Partnership Conference in Miami, Florida this week.

Focusing on the flow of documents, information and goods from the shipper to consignee, the study found many fragmented processes and inefficiencies, due mainly to the involvement of multiple organisations with incompatible systems and processes.

The study revealed the following highlights: the average process cycle takes from eight to twelve days, while the goods are in actual movement for less than 5% to10% of the total cycle time. An average shipment generates at least forty documents/forms or copies or parts of documents/forms. Some 73% of the data recorded on all the documents can be viewed as a duplication of data initially recorded on three documents (shippers’ invoice, shippers’letter of instruction and the waybill), a piece of cargo can collect between one and five different carton labels, some 31% of all personnel employed in the movement of goods are employed in generating, checking or filing documentation, and approximately sixty processes were identified along the cycle.

“There has been a ot of talk about e-commerce, Internet and the New Economy. With this study in hand, we look beyond the hype to check the reality of supply chains. It is clear today that we have a series of ‘loose’ systems of operation, working within a narrow vertical focus – shipper, forwarder, carrier, handler, consignee and so forth – and not a chain of participants in a streamlined process. Global e-commerce cannot be achieved through technological attempts to string together the multiple and diverse processes and in-house computer systems which currently exist. A more aligned approach coupled with a shared information pipeline could radically improve the chain performance,” said Hugh Doyle, vice president, SITA Logistics Solutions, in a release.

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