The airfreight industry has been surging towards digitalisation in the post-pandemic environment. Over the past 30 years, the logistics industry has steadily increased its investments in digital technologies. However, for a considerable period, digitalisation was perceived as an option rather than a necessity.
This transformation has primarily been driven by two key factors. First, the experience of disruptions such as the Suez Canal blockage revealed the importance of transparency, visibility, and flexibility. While the logistics industry demonstrated remarkable flexibility during these challenges, including the pandemic, it also exposed some limitations.
READ: Collapsible ULD combats global imbalances
Secondly, the growing demand from customers for enhanced digital capabilities became apparent amid an ongoing generational shift. The previous mindset, where digitalisation was viewed merely as a cost factor, is evolving with a new wave of leaders who have grown up with digital technologies and recognise the vast potential they present.
“You can see that, even through a downturn, investments in digital innovation have continued unabated,” Martin Schulze, CEO of BlueBox Systems, said. “More and more people are getting to realise there’s a huge potential with technology, a must do if they are to compete nowadays.”
Airfreight industry: Bringing tech expertise
Over the past 25 years, the Bluebox Systems’ parent company BusinessCode has been deeply immersed in the logistics industry, contributing to the digitalisation efforts of companies like DHL Express. Their focus has been on implementing data-driven approaches, emphasising the importance of comprehending not only the technical and data aspects but also the broader context.
READ: Airfreight industry’s sustainable stance
This wealth of experience has been seamlessly integrated into the current company. Acknowledging the intricacies of logistics and the multitude of factors at play, Bluebox Systems understands that adopting a siloed approach—solely concentrating on IT or isolated processes—will inevitably fall short in this complex industry. The success of IT and digitalisation projects in logistics lies in bridging the gap between the technical intricacies and the overarching business objectives.
“The IT landscape is changing,” Schulze stated. “We always encourage our customers and support them with their work, showing the opportunities and what role technology might have in the future.”
Enhanced visibility
The emphasis on visibility became a significant trend during the pandemic, acting as a wake-up call for both industry professionals and customers. The shock of realising the lack of transparency in tracking shipments and the uncertainty of their arrival locations resonated profoundly as disruptions spread throughout the sector.
Although the supply chain has returned to normality, the lasting impact of this revelation persists. There is a collective understanding that maintaining such opacity is no longer acceptable, and transparency is now a non-negotiable requirement. The question is no longer whether customers want or need visibility; it’s about how to implement it effectively.
“I think the shock is still there. That understanding that we need transparency is still there, especially as supply chains are still subject to new disruptions, like the current one in the Red Sea,” Schulze explained. “I think you see a shift that freight forwarders see themselves more in charge of providing this visibility, ramping up their own capabilities.”
“We don’t have to discuss it with the customer anymore, it’s really one of the ‘must have’ items on the agenda.”
Transparency drives sustainability
Bluebox Systems is clear about the role of visibility in the sustainability discussion. Firstly, in numerous countries, there is a growing legal obligation to report the CO2 emissions of transportation chains. Compliance with these regulations underscores the importance of transparency.
However, the more significant aspect lies in the proactive management of carbon emissions. The ultimate goal is not merely reporting but actively reducing emissions. Achieving this requires data to precisely identify areas for improvement.
“It’s so important for customers to have this data. They can choose an airline with a more modern fleet that has a drastic impact on cutting carbon emissions. Whether it’s the number of engines or the flight plan, shippers and forwarders have options and visibility to shape their decisions,” he explained.
“You need the transparency to know where there are gaps, what’s successful and which areas to target to achieve carbon emission goals.”
Regional disparity
The difference in the adoption of new technologies is not as pronounced as one might have anticipated in the past. Currently, tech companies are engaged in discussions with customers across the globe, from Latin America to Africa to Asia and everywhere in between.
Surprisingly, even in less developed regions, there is a growing interest in discussions around CO2 emissions and calculations, with some considering the adoption of digital freight forwarding – a trend that might not be immediately expected.
“There is no one region that I would say is really lagging behind or where it is really not eager to adopt technology. In fact, the regions you would expect to be a bit behind are more eager than ever to leapfrog their way into a digital future, as they can more afford to embrace innovative ideas,” Schulze highlighted.
Further development
While there is a wider embrace nowadays, the logistics industry currently finds itself with work to do. It lags behind in digitalisation compared to other sectors like banking or insurance, having had no pressing need to bridge this gap until recently.
Amidst the excitement of adopting advanced technologies, the real potential for transformative change lies in operational improvements through data utilisation. Beyond the buzz surrounding technologies like artificial intelligence, the integration of IT systems and services among industry partners emerges as a crucial and, albeit less glamorous, focus.
Customers, regardless of the numerous partners involved in the supply chain, are seeking a unified and smooth experience. Therefore, the next significant leap for the industry lies in breaking down the barriers between companies and their IT systems. The goal is to create a standardised approach where partners can work seamlessly together, eliminating the need for complex actions.
“How can we work together in a standardised way and avoid sitting in silos and building complex workarounds?” Schulze pondered. “There’s definitely a lot of room for improvements but the industry is looking at an interesting time.”
