Air cargo accounts for approximately $111 billion in airline revenues, and the industry handles some $6 trillion worth of goods or roughly 35% of world trade. Though these are impressive figures, ‘could do better’ seems to be forever stamped across air cargo reports. Some of the software solutions being largely legacy-based might have limitations in adding modern functionalities.
In its 73rd AGM, IATA adopted a resolution to accelerate the modernization and transformation of the air cargo industry. The Trade Facilitation Agreement commits governments to make trade faster, cheaper and more efficient. It was concluded that air cargo processes are stuck in another century, and to ensure that air cargo is equipped to benefit from the anticipated $1 trillion increase in trade growth, airlines need a major revamp of industry processes. Air cargo is critical for serving markets that demand speed and reliability for the transport of goods. Managing shipments in an accelerated and competent manner is essential for global economic development and aviation profitability.
Airlines need to take active steps towards modernizing and digitizing the cargo handling process. After all, a perfectly good strategic business objective can be undermined by a myopic technology strategy. And there is practically no time to lose because customers already expect the efficiency of electronic documentation.
What are the challenges?
Many essential shipments, such as life-saving vaccines, standard parcels and even Formula 1, all rely on the air cargo industry to reach their desired destinations safely. Despite such high value, the industry is relatively slow in embracing digitization and faces multiple challenges including:
Prevalence of paperwork: Shipment information is exchanged within the complex supply chain using paper-based processes. This results in the lack of data standardization and integration, leading to poor data quality and mistakes. It also confines the visibility and expectancy of the shipment journey, making it vulnerable to unforeseen incidents.
Legacy systems are cost-ineffective: Application development and the maintenance of classic mainframe-based systems can be expensive.
Legacy systems work in silos: Many software solutions can be in need of a revamp, as they are mostly legacy based with a limited technology landscape to implement new functionalities. Cargo shipment is handled by an end-to-end cargo system that manages all touchpoints: the order, forecast, documentation (airway bill/letters of origin), warehousing, tracking, financials and accounting. It is difficult for even good software to manage every element efficiently, and different types of cargo can make the situation even worse.
Legacy systems have limited platform-level integration or data management competences. The new generation airline demands a truly connected ecosystem, which is possible with a transformed and scalable cargo system.
Being aware of these challenges, many organizations are now investing in modular cargo systems that can be scaled to manage complex requests.
Using technology to accelerate progress
The air cargo industry is gradually embracing a technology revolution that includes shifting from the substantial use of legacy mainframe systems to more tailored systems to improve their efficiency and transparency. The latest advances in technology enable air cargo systems to streamline operations, reduce costs and optimize efficiency. For instance, by leveraging e-freight technology, businesses can take the ‘paper’ out of air cargo and substitute it with digital data. The air cargo industry can also invest in designing a modular data platform to enable seamless data sharing globally.
Here is one such instance of an air transportation technology company that took active steps to modernize systems using technology.
Re-engineering a 40-year-old cargo system
A leading air transportation technology company partnered with Hexaware to re-engineer its flagship 40-year-old cargo system. The system was liked by most leading cargo airlines, but had limitations such as the inability to add modern features for improving the customer experience. So, the client was looking to modernize the legacy system.
A gradual integration
The client decided to move on to a next-generation system gradually and integrate it with the existing legacy system. By adopting this strategy, the client was progressing towards a digital transformation while continuing to operate the stable legacy systems. In partnership with the client, Hexaware created a roadmap to reengineer the cargo pricing module and integrate it with the current legacy stack. This was the first step towards the client’s re-engineering journey. All new business processes were developed on the next generation stack, effectively integrating with the legacy system. This eliminated some of the limitations imposed by the legacy architecture. The process involved data migration from the legacy platform to a next-generation system. Benefits included:
- Over 99% accuracy
- Roll out for all 14 airline customers within 2 years
Moving on to something big
These successful numbers boosted the client’s confidence and earned Hexaware the responsibility of re-engineering the client’s entire cargo software system on a next-generation technology stack. The project’s scope involved the end-to-end development of 11 modules with 350 system use cases built using 100-plus team members to release a commercially viable product in just two years.
How the team worked
Building the foundation: The team gained an understanding of the legacy system in its entirety by deep diving into manuals, code mining and application walkthrough. They created a well-defined technical framework to cover all reusable aspects of the project with the increased flexibility to support various custom processes.
Powering extreme automation: The team continually invested in automation. They automated the build and deployment process using a free and open-source automation server. They built an end-to-end regression suite by leveraging the selenium test framework.
Easy integration with other devices: The team made it possible for all the client’s business services to operate as web services. This means they can be incorporated with ease into other systems and devices such as mobile apps, third-party portals, scanners, flight operations systems, kiosks and data warehousing tools. It can also be integrated with external ancillary cargo applications as revenue management systems.
Enhancing the customer experience: This product is in line with IATA initiatives, including e-freight, and uses the latest IATA XML messaging standards. User-friendly features were incorporated. A hybrid mobile app was built on top of the cargo system to enable cargo agents to carry out warehouse operations seamlessly. Graphics were incorporated in areas such as inventory management to enhance the user interface. Other key improvements include:
- Zero downtime, even during monthly application upgrades
- Ability of customers to procure modules
- 75% reduction in effort to on-board new customers
The Hexaware team finished the work in the best possible manner with minimum complications and maintained the highest possible output standards. This was possible due to the team’s outstanding knowledge of running production systems in the cargo business environment and Hexaware’s 20-plus years of experience in handling the client’s operational environment.
To remain competitive and agile, air cargo carriers must leverage existing technology in the best possible manner. Embrace digitization to develop modern solutions that will drive efficiency in the air cargo ecosystem and deliver incremental value to end customers.
Read the compelling case study to discover how Hexaware can partner with you to accelerate your legacy modernization journey.