www.kaleconsultants.com the growing role of information technology in air cargo peter o’sullivan...

www.kaleconsultants.com

The Growing Role of Information Technology in Air Cargo

Peter O’SullivanSenior Vice President, Cargo & Logistics

Kale Consultants Ltd


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Kale Consultants – who we are

Today’s air cargo industry

How IT in the industry has evolved

Where is the industry heading?

Where have we come from?

Industry pressure and technical innovation

A look at the role Information Technology (IT) plays in both supporting and enabling the air cargo industry

Introduction


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Indian based company, offering innovative and professional

solutions and services to the Travel & Transportation industry

3 development centers in India plus offices in New Jersey and

London

900+ professionals, 70+ customers, solutions in 30+ countries

ISO 9001:2000, BS 7799, SAS70, Amadeus certified, TIACA Trustee,

IATA Associate, NASSCOM member. BSE/NSE listed.

We provide:

Kale Consultants

REVENUE ACCOUNTING SOLUTIONS

TRAVEL SOLUTIONSCARGO SOLUTIONS MANAGED PROCESS SERVICES (BPO)

SOFTWARE DEVELOPMENT SERVICES


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Global air cargo industry represents 100bn rev ton-miles and $52bn in direct revenues in 2005Air cargo companies are investing around 2% of their revenues in IT - an estimated $1bn The main priorities in the industry as a whole appear to be:

Projects with proven pay back / cost savingsProcess simplificationSolutions that provide market advantageStrategic infrastructure upgrades (e.g. retirement of legacy systems)

While the percentage of investment in IT (as proportion of revenue is decreasing), the number of employees in air cargo IT is going up.

Snapshot of today’s air cargo industry*

* Information from recent reports, including from TIACA and Airline Business/Sita Survey

No doubt, IT investment is immense.

We need to understand what direction it is moving towards


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From early 1970s until mid to late 1990s, IT in the airline cargo industry was provided by few suppliers For example, in the airline business…

Cargo IT Industry – early days

IBM - FAST UNISYS - USAS

SITA hosted solution

Airline variants

Unisys hosted solution

Airline variants

Mainframe technologyVariants were created (usually by airline IT departments) and peripheral ‘bolt on’ systems addedHosted solutions were modified by the Hosted Service providers for common goodSystem to system interfaces were provided, usually through EDI (Cargo-IMP), and sometimes through third party communication enablers

Early systems focused on providing the operational basics. But change was soon on its way – fuelled by a combination of

Industry Pressures, and Technical Innovation


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Industry pressures have created new IT demands

• Passenger downturn• Rising operational costs• Business expansion

Internal Business Pressures

• Heightened Security measures• Governmental decisions, e.g. sell offs and mergers •Environmental pressures, e.g. excessive (and unnecessary) amounts of paper.

Geopolitical Demands

• Commodities 365 days a year• Delivery on demand• Raised performance demands

Heightened Customer Expectations

• Open Skies / deregulation • Market shifts• Express operators eating into traditional carrier territory• Low cost players• Alliances

Fundamental Industry Change

Industrypressures

The air cargo industry has been able to respond to these pressures thanks to rapid advances in technology


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Technical Innovation enables advantage

Technology is changing RAPIDLYIt creates new possibilities

It can bring advantage in a competitive market

The combination of industry demand and advancing technology has led to a new focus for IT solutions

Relational Databases Improved MIS, Data Mining

Componentisation Flexible and Modular Code

Internet / World Wide Web Portals, Browser, J2EE, .NET

XML / SMTP / Type X / FTP Multiple channels; peer-peer

Wireless Technology Hand Held Devices, RFID

Greater Scalability Hosted applications

CASE Tools Low cost development

High Bandwidth/Thin Client Centralised Computing

Greater awareness; Informed decisions; Better planning

Accommodate business change; Phased deployment

Integrated business; new access to market; entices custom

Cheaper communications, greater reach; simplification,

Faster operations; Greater accuracy; Mobile workforce;

Focus on core business; Service guarantees; Predicable costs

Earlier solutions; Rapid software upgrade; Smarter design

Easy deployment; Expansion of business; Low cost maintenance


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The changing nature of IT

Operational Systems

Decision Support Systems

Strategic & Tactical Systems

Bookings ReceptionScheduling

Manifest

Accounting

Tracking Paperwork

Load Control

Cost Mgt

Yield Control

Prioritisation

Market Mgt

Service Mgt

Allotments

Evolution

IT has moved upward. First towards “Decision Supporting Systems” and ultimately on to “Decision Making Systems”

Information Technology can do much more than support business – it can truly enable business and empower the executive

EDI BillingReconciliation Stock Control

ULD Control

Customs

Book / No Book

Fleet plan

Rev Mgt

W/H MgtCRM

Inventory Mgt


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The changing nature of IT

The Strategic and Tactical Systems need quality, integrated information to succeed

Information Technology can do much more than support business – it can truly enable business and empower the executive

Bookings ReceptionScheduling

Manifest

Accounting

Tracking Paperwork

Load Control

Cost Mgt

Yield Control

Prioritisation

Market Mgt

Service Mgt

Allotments

EDI BillingReconciliation Stock Control

ULD Control

Customs

Book / No Book

Fleet plan

Rev Mgt

W/H MgtInfo

rmat

ion Like any robust wall, the

foundations must be solid.

Higher IT services cannot be provided without a firm base

Inventory Mgt

CRM


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Who fills the IT market?

There are now many IT companies servicing the Airline Cargo Industry

Reservations and Operations System

ProvidersUnisys, Kale Consultants, IBS,

Champs, CargoSpot, SITA, etc

Cargo Revenue Accounting System

ProvidersKale Consultants, Mercator, CDM, SITA, Sabre, ACCA, etc

Revenue Management System Providers

Sabre, Pros, Manugistics, etc

Companies providing Hosted Service Systems

Unisys, Kale Consultants, SITA, Champs, etc

Cargo Portal Providers

GF-X, CPS, Ezycargo

Ground Operations Solution Providers

Kale Consultants, Magic, ABS2000, Lufthansa IS,

CargoSpot, etc

Connectivity Enablers

Traxon, Tradevan, BT, Descartes, etc

The list is growingGood news for the air cargo industry !

Claims Management Solution Providers

Sabre, Pros, Mercator, etc

Customs Interfaces:

Syntegra, MSSI, LH IS…

DG Solutions: Channel Solutions…Security Systems: Indian Technologies…Staff planning: Sabre, Qintic…ULD Management:SITA, Kale, Unitpool,

etc.

Other solution providers

Forwarder Solutions

Traxon, Cargowise, Tran-Soft, Fountainhead,

Freightdata, etc


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Where are we heading?

ACCELERATED LEGACY OVERHAULLegacy systems being replaced

PORTAL BASED SOLUTIONSUsers can sign up, connect, and use.

INTEGRATED SOLUTIONSLess ‘interfaced’ solutions

MOBILE COMPUTINGAccess anytime, anyplace with PDAs

CUSTOMER CENTRIC SOLUTIONSWeb solutions that allow customers to directly access informationMore information pushed out to more customersAggregation of customer information for sales people

PROFIT MANAGEMENT SOLUTIONSRevenue and Cost ManagementRevenue based decisions

B2B SOLUTIONSOpening up the freight market

STRATEGIC SOLUTIONSBased on high quality dataRevenue and Cost Management

HIGHLY CONFIGURABLE SOLUTIONSAllowing off the shelf solution that can be tailored

INCREASED EFFICIENCIESEarlier recognition of service failurese-freight


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Kale Consultants: enabler of air cargo growth

Business Strategy and IT Alignment

Kale helps forge / shape direction of the air cargo business by providing innovative solutions to industry

problems

Business/ IT Alignment

Kale ensured its IT activities and

investments are tightly aligned with business

priorities

IT Enablement

Kale ensures that ensures that potential business strategies and business opportunities take full

advantage of emerging technology capabilities

IT Management & Delivery

Kale’s IT resources are structured, positioned, sourced and managed for

efficient, effective and predictable delivery of high quality IT solutions

Business

IT

InformationTechnologyManageme

nt & Delivery

ENABLES

DRII

VES

ITAlignment

ITEnablemen

t

ITManageme

nt & Delivery

NAB


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Thank You

www.kaleconsultants.com the growing role of information technology in air cargo peter o’sullivan...

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