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   Vol. 23 No. 8
Thursday February 15, 2024

Kale Digitizes Global Air Cargo

Kale Digitizes
Amar More     If you were asked to speak on “Digitalisation for efficiency, customer delight and profitability”, other than having a field day on the advantages created by technology what would be your dream talk?
     Personally I would go straight to “customer delight”. This is the most imaginative and forward-looking approach I can think of, and the person who coined the expression is probably a genius. So this is what is happening to our good friend Amar More of Kale Logistics today February 15th. Amar is on a panel at AirCargo India addressing efficiency, customer delight and profitability. We took the opportunity to ask Amar a couple of questions off-line.
     In recent times we hear Amar More declared that “India is really creating a benchmark for the rest of the world in air cargo digitisation”. What Amar did not say, but we can do it without any fear of swanking, is that this is happening also as a consequence of the continuous activity of his company, Kale Logistics. The company has accompanied the process to modernise Indian airport logistics, this time working on its own mainland, besides myriad different initiatives in various countries, in particular in North America.
     Amar More declared recently in public that “the fact that each air cargo shipment is still accompanied by around 124 copies of paper, still staying on the ground for up to 85% of the total transportation time and even after 30+ years from the previous measurement taking the same amount of time to move internationally from one location to another (around 6 days); much more can be achieved using technology”, believing that “tremendous opportunities for the industry to improve in these areas by leveraging digitisation” exist.
     Kale Logistics is a first believer in digitalisation as a principal instrument of progress and development. I remember we held positive talks in FIATA with Kale Logistics many years ago during my term as DG, as Kale have always been strong supporters of our sector and logistics at large. In those times it was already clear that “inefficiencies lurk[ed] in connecting different stakeholders involved in the cargo business.”
AirCargoIndia Exclusive     The importance to focus on collaborative digital community systems around the airports will come to the fore and the enormous impact on the efficiency of air cargo movements will be explained in full detail in the mentioned panel talk. Yet this is no fait-accompli: all this has to be organised, adopted, implemented in conjunction with other stakeholder and policymakers. This shows the enormity of the task Kale Logistics is facing without dwindling. Many influential, organised and inspiring personalities have been working on this stage for years and many of these operators are well known to FT and, I expect, to Amar More.
     On the digitization of his own country, India, which is becoming more and more aware of the environment impact of human activities, Amar noted that “this digitisation will also help make the industry and the country move towards carbon neutrality. In our estimates, about 50,000 trees can be saved annually by eliminating unnecessary paperwork and about 25 bn tons of CO2 can be saved on an annual basis at country level through digitisation.”
     Reading the above, two questions came to mind; we then asked Amar More whether he would have time to send his comments despite his endless tasks in this season. He said “yes”. Hence, we have the opportunity to reflect on these issues with one of the principal actors of this digital transformation. It was an offer we could not refuse.
FT:   We come from a history of hopes for national and/or international cargo community platforms both in air freight and in ocean cargo. In the meantime, some remarkable examples have been created and we register Kale’s important contribution in this direction, but . . . There is no universal solution and we still cannot see last century’s dreams come to fruition across global supply chains.      Instead of dreaming, Kale has worked very hard in the last few years and managed to provide effective solutions in a growing number of countries. Is your recipe based on the adoption of common standards (which? e.g. IATA’s, WCO’s, UNCEFACT’s etc.) or a hybrid, more flexible approach? If this trend continues you will probably become, if you are not yet, the heavyweight of digitization in global airfreight; which areas are more difficult to cover in this process and what would be your suggestions to bridge the gap?
AM:   This is a great question. Connecting a community through digital becomes easier if the platforms support the common industry standards. If you want to make it simple for the stakeholders to connect with the other supply chain partners, then you have to minimise the changes they would need to do to their internal systems. Most systems in the industry support the UNCEFACT, WCO, IATA standards and our platform is perfectly capable of accepting as well as sending electronic data to different stakeholder systems. However, there are still a lot of areas where the proliferation of standards doesn’t exist (e.g. terminal charges payments information flowing from the handler’s systems into the forwarder’s system) and in those places we had to create simple APIs to facilitate data exchanges.
     We realised very early in our lifecycle that to be effective in community creation and adoption we need to simplify and simplify. That is the only recipe. So the stakeholders today can benefit from our approach by using simple APIs, industry standard EDI messages, simple excel sheet uploads, using portals if they prefer that method and finally innovations such as .pdf to EDI converters wherein the SME forwarders just send or upload simple .pdf files on our platform and using Optical Character Recognition (OCR) and Machine Learning (ML), we convert those into electronic data that can be processed through the platform.
     The connectivity between exporter/importer and forwarder is still an underserved area and we have that functionality in our platform to facilitate this important digitisation.

FT:   There is much talk, and there has been for a number of years, about greening our transport offer. On the ground we almost see the opposite. There is some remarkable opposition to legislative measures in this direction. In many areas of the world there is almost a feeling of resignation that nothing can be done. From your point of view, you stated in more than one occasion that digitisation can actually afford significant progress in providing services that are more compliant with sustainability. Considering your approach, would you be able to provide some examples where good business practice goes hand in hand with sustainability performance indicators?
AM:   The benefits pertaining to sustainability are enormous when it comes to digitisation and more specifically digitisation through the airport and port community systems. Just imagine the fact that today, in spite of individual stakeholder’s automation, we still have around 124 copies of paper (across 30 types of documents) getting generated in moving an international air freight system and an estimated 200+ copies of paper getting generated in moving an international ocean cargo shipment. Our study indicates that about 25% of the copies of paper may be required by law, but there is a tremendous potential to eliminate or drastically reduce the remaining 75% copies of paper and that is roughly 80 odd copies per shipment. With an airport or port single window infrastructure, where the data is shared digitally, the non-regulatory copies of paper can be replaced either with digital data or electronic dockets. If you take an airport with 1 Mn tons of cargo, then we are talking roughly about 1.4 Mn shipments annually. The potential to save the copies of paper is roughly 112 Mn copies of paper on an annual basis, which in turn could be equivalent to saving 11,200 trees on an annual basis. As grandiose as it may sound, if through digitisation we are able to achieve even a fraction of the above potential we would be contributing to the environment a great deal.
     Another example is an idling truck typically burns 0.6 gallons/hour, there are thousands of trucks plying to the airports and ports having a wait and dwell time, in some cases, in excess of 4-5 hours. The typical CO2 emissions are 10,000 grams/gallon. Now, if we can cut down a couple of hours from the overall processing time of trucks through digitisation and the community systems, you are talking about billions of grams of CO2 being saved on an annual basis per airport and port.
     These are common-sense, low hanging fruits of digitisation which can be reaped by creating digital cargo communities. Our pilot behind 300 trucks at the Atlanta airport showed we could save 9 Mn grams of CO2. We have developed a simple savings calculator that can tell an airport or port how much the community can save in terms of environmental and economic costs by deploying community level automation.
     Having had consideration for environmental improvements, Kale Logistics’s President told us more about his business objectives: “I would just like to state that building digital cargo communities around airports, ports is going to take the industry to a more efficient, secure and sustainable future. Not just that, but the global industry bodies like the United Nations CEFACT has also given a recommendation (recommendation 33) that talks about the path to trade facilitation through community systems; the International Maritime Organization has already taken a step by recommending the mandate of Maritime Single Window system. Even the International Civil Aviation Organization (ICAO) through the Annexure 9 on Facilitation recommends the implementation cargo community systems to create a trade facilitation infrastructure. The term community systems had been abused in the past with point to point EDI also being referred to as a community system. A true community system is nothing but a commercial airport or port single window system wherein the stakeholders get a digital infrastructure in terms of a single window to exchange data with the other stakeholders of the supply chain. The TIME IS NOW!”
     Listening to our friend Amar More we felt the same sense of expectation we had more than 25 years ago at an IATA meeting held in Vancouver. The air cargo world was opening to our incredulous eyes as a colossal heap of opportunities, all within reach. The only thing to do was agreeing on common standards for data exchange and the world of air logistics could become fully interconnected and, perhaps, automated. The other transport modes would follow suit and we thought the world of international trade was going to be changed for good before the end of the millennium. Soon everything would be available everywhere for everybody, those were our imaginings.
     Well, we have lived a curious experience in the last 25 years or more. Rather that pushing toward innovation and automation to expand the horizon of global trade, enhancing our life standards at the same speed, we have taken a big plunge into the inner human soul, magnified the stimuli of our inner selves and shrank the perspective of our dreams from the exploration of space to the magic of shopping without moving a step form our screens. Needless to say that nothing of what we had imagined as progress actually happened and what truly happened was making everything much easier and more complicated at the same time, too much of anything that has no value for Us at all. We went from “2001, a space odyssey” to the “Inception” and, with much resistance, we had to restrain our hopes.
     From other points of view, it is perhaps good that we did not manage to change the world and make it more interconnected through the standards of the past.      Ralph Waldo Emerson is credited to have coined this expression: “Life is a journey, not a destination.” Well, kudos to all those who, wittingly or unwittingly, managed make this journey almost eternal . . . Maybe Amar is the right captain to take us and air cargo logistics to its destination.
     Thank you, Amar More and Kale Logistics for taking this challenge without hesitation and proceeding in this fascinating journey, we'll keep our fingers crossed.
Marco Sorgetti/Tirthankar Ghosh

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