Executive Briefings

Now Is the Time to Fix Documentation Problems in Air Cargo, Northwest Executive Says

Radio frequency identification. State-of-the document imaging. Extensible markup language. All glitzy concepts, and all full of potential, as tools for automating the supply chain. But airlines and their freight-forwarder partners shouldn't wait around for cutting-edge technology, before they tackle the issue of paperless documentation. "Good old EDI [electronic data interchange]" will take us a long way," said Jim Friedel, president of Northwest Airlines Cargo. Speaking at the International Air Cargo Forum in Calgary, Canada, he urged carriers and forwarders to move now to automate the exchange of key documents. His call was timely enough. According to a Cargo 2000 audit conducted in September 2005, 76 percent of master airway bills (also known as the forwarders' waybill, or FWB) were incorrect. Moreover, a survey of three system providers found that 5 percent of FWBs, and 9 percent of house airway bills (FHLs), were rejected by airline systems. And those failures didn't even include messages that were rejected before reaching the airline, not sent at all, or accepted with missing or incorrect data, IATA said. Clearly, there's work to be done in the tradition-bound air cargo industry.

The solution, said Friedel, lies in IATA's Message Improvement Programme (MIP), an initiative to improve data quality on a worldwide basis. But participants don't need to take on all of the transactions involved in moving cargo by air. Just three EDI messages-the FWB, FHL and consolidated manifest (FUM)-make up 90 percent of relevant transactions. And initially, the MIP aims only at the FWB and FHL. But that's enough to make significant progress in the war on paper, Friedel said. He called on carriers to join the MIP "posse," and act now to speed up the transmission of data. In fact, the MIP effort is already well under way, with Northwest, KLM, United Airlines and Iberia Cargo on board, although it will take eight or nine carriers to achieve enough "critical mass" to convince forwarders to participate, Friedel said. He told carriers not to blame forwarders for the sorry state of data handling, however. "Freight forwarders will fix EDI if carriers ask them," he said.

Visit www.iata.org.

Radio frequency identification. State-of-the document imaging. Extensible markup language. All glitzy concepts, and all full of potential, as tools for automating the supply chain. But airlines and their freight-forwarder partners shouldn't wait around for cutting-edge technology, before they tackle the issue of paperless documentation. "Good old EDI [electronic data interchange]" will take us a long way," said Jim Friedel, president of Northwest Airlines Cargo. Speaking at the International Air Cargo Forum in Calgary, Canada, he urged carriers and forwarders to move now to automate the exchange of key documents. His call was timely enough. According to a Cargo 2000 audit conducted in September 2005, 76 percent of master airway bills (also known as the forwarders' waybill, or FWB) were incorrect. Moreover, a survey of three system providers found that 5 percent of FWBs, and 9 percent of house airway bills (FHLs), were rejected by airline systems. And those failures didn't even include messages that were rejected before reaching the airline, not sent at all, or accepted with missing or incorrect data, IATA said. Clearly, there's work to be done in the tradition-bound air cargo industry.

The solution, said Friedel, lies in IATA's Message Improvement Programme (MIP), an initiative to improve data quality on a worldwide basis. But participants don't need to take on all of the transactions involved in moving cargo by air. Just three EDI messages-the FWB, FHL and consolidated manifest (FUM)-make up 90 percent of relevant transactions. And initially, the MIP aims only at the FWB and FHL. But that's enough to make significant progress in the war on paper, Friedel said. He called on carriers to join the MIP "posse," and act now to speed up the transmission of data. In fact, the MIP effort is already well under way, with Northwest, KLM, United Airlines and Iberia Cargo on board, although it will take eight or nine carriers to achieve enough "critical mass" to convince forwarders to participate, Friedel said. He told carriers not to blame forwarders for the sorry state of data handling, however. "Freight forwarders will fix EDI if carriers ask them," he said.

Visit www.iata.org.