Print Email Facebook Twitter The air cargo supply chain at Schiphol, process improvement and collaboration Title The air cargo supply chain at Schiphol, process improvement and collaboration Author Pieters, S.R. Contributor Oey, M.A. (mentor) Verbraeck, A. (mentor) Van Duin, J.H.R. (mentor) Faculty Technology, Policy and Management Department Systems Engineering Date 2014-03-13 Abstract Schiphol, the main airport of the Netherlands, wants to be Europe’s preferred cargo airport. To reach this status, Schiphol has to offer a good infrastructure and high quality processes. Schiphol has no active role in these processes, but is dependent on third parties. Schiphol suffers from inefficiencies in the air cargo supply chain. A symptom for the inefficiencies in the chain is the queuing of trucks which was the trigger to start this research. The air cargo supply chain involves many parties: the shipper, the consignee, handlers, trucking companies, airlines and freight forwarders. Airports only have a facilitating role in supporting the air cargo supply chain. The research question for this research comes forth out of the aforementioned role and goals of Schiphol: How can Schiphol in its facilitating role enhance the quality of the air cargo supply chain at Schiphol? To identify the issues influencing the air cargo supply chain at Schiphol the chain has been analysed in two perspectives; the system perspective and the actor perspective. The system perspective involves the process steps in the chain. The actor perspective involves the roles and the relations of the actors in the chain. Following these analyses, scientific literature on information sharing and process management has been consulted. To find out how information sharing can be successful and how Schiphol should behave. System perspective The system perspective analysis resulted in several issues: Check-ins: the geography of the air cargo area at Schiphol causes several check-in gates to the terrains of the different handlers in 1 visit for trucks; A lot of documents are involved in the air cargo supply chain, which causes inaccuracy and superfluous process steps in the chain; Three points of queuing: the air cargo supply chain at Schiphol has three points of possible queuing; at the entrance of the terrains of the handlers, at the handlers office and before docking; The employees at an operational level have a big influence on the progress in the chain; Patterns: the air cargo supply chain is subject to weekly and daily patterns, that increases the queuing at several peak points in time; First Come – First Served; not always the best system for an efficient chain; Capriciousness of arrivals of both trucks and airplanes makes the processes unpredictable; The amount of pre-announcements is low and causing unexpectedness at several points in the chain, especially at handlers. To solve several of these issues the existing projects E-freight (international) and E-link (national) are developed and can reduce the amount of documents involved and interfere in the processes. With E-link the administration will be simplified and it will take some process steps and queues out of the chain, in this way the chain will be more effective. Although these are projects are promising, unfortunately the progress of the implementation of information sharing systems lacks behind. Furthermore, the implementation level of the ACN-card (check-in card for truck drivers) is so far not very high, because of the coupling with the E-link system this implementation level is very important. Actor perspective With 6 handlers with direct airside access, above 150 trucking companies and over 80 freight forwarders the actor perspective in the air cargo supply chain is characterised by the broad network of actors. A freight forwarder is the middleman in the transportation of the freight and determines the route of the cargo. The airline has contracts with the handlers and the trucking companies. The trucking companies and the involved handlers are not contractual related. This situation makes a good cooperation between the handlers and truckers more difficult. Issues resulted from the actor perspective analysis: Conservative character of the air cargo supply chain worldwide causes a lack of progress in innovation implementation; The education and motivation of employees at the operational level is low; The personal involvement during the air cargo handling is high, but not always rational; The actor analysis showed that there is a desire to work together, however, the cooperation is at a low level. This is caused by the commercial interest, the economic survival mode of the companies and the low level of willingness to invest in local systems by the handlers headquarters. Next to the actor relations and operational influence, the air cargo supply chain has suffered from the economic crisis of the past few years a lot. The lowering amount of transported cargo caused lower margins on the handling of freight. The revenues of most companies involved lowered and cost cuttings are the result. These cost cuttings influence the capacity at handlers and trucking companies and these lowering capacities result in efficiencies in the chain. Literature The literature research showed the advantages an information sharing system could have: Better planning by an increasing amount of pre-announcements; Personal behaviour can be steered; Lower amount of document involvement; Could be used for performance measurement in the total supply chain to improve the performance of the chain; Supports building of trustworthy relationships. Several issues should be kept in mind when developing information sharing between actors: Quality of the information is more important than faster sharing of information; Securing of information to keep the commercial values protected; For planning issues dynamic systems are necessary; Interoperability with IT-systems of several actors, otherwise influence at operational level makes acceptance hard; Easy to use at an operational level, clear protocols and routines are necessary for acceptance; To be able to implement an information sharing system into a chain a good relation is necessary and commitment to develop and implement the system. Synthesis The air cargo supply chain would be aided with the use of an information sharing system as E-link. A local system as E-link is hard to implement but has its advantages in better planning and the building of relations between involved actors. The most significant results in the processes of the air cargo supply chain at Schiphol can be found in: Reduction of document use in the chain; Reduction of truck turn time; Reduction of FTE’s at the handlers office; The progress in implementation lacks behind, however. The financial feasibility, even with a low percentage of efficiency savings of even 5,7% industry wide with a 100% implementation should be enough to convince the involved parties to invest. The economic influence is, however, very big and causes hard ways in the implementation of innovations in combination with the actor situation at Schiphol. In economic difficult times the demand for a powerful and reliable process manager is higher, Schiphol could fulfil that role. A shared value or goal should be created; Naming and framing of the problems and solutions; Creation of a sense of urgency; Incentive development; Protection of core values of companies; Schiphol should fit this role as a process manager well, because their interests in the air cargo supply chain at Schiphol is high and they have a reliable and powerful appearance, even when they are not directly involved in the air cargo supply chain. Conclusion & recommendations An information sharing system definitely has its advantages and would really help the air cargo supply chain at Schiphol to improve in quality and be able to attract more business. Further growth of air cargo volumes can be handled easily by this process improvement. The role for Schiphol is to be the process manager of innovations and implementations in the air cargo supply chain at Schiphol. Where Schiphol mainly should focus at in the complex system: Interoperability of the E-link system with systems at the several actors; Protection of core values of companies involved in implementation; Security and quality of information; Better naming and framing of E-link advantages; Transparency at both operational and managerial level, respectively clear protocols and insight in individual actor costs and benefits; Increase of ACN-card adoption. Because of the economic situation a good timing is necessary to find enough commitment for investment, it is realised that the economic situations has left its scars in the air cargo supply chain. Furthermore, the building of relationships is a long and hard process, but it is important for the success of innovation implementation in the air cargo supply chain at Schiphol. Further research should be focussed mainly at solving the unsolved issues with information sharing, like the multiple check-ins, the employee education and motivation and the increase of the ACN-card adoption. Subject air cargo supply chainSchiphol To reference this document use: http://resolver.tudelft.nl/uuid:d94921ec-5681-48fe-b83d-9b5ac11b0fab Embargo date 2014-03-28 Access restriction Campus only Part of collection Student theses Document type master thesis Rights (c) 2014 Pieters, S.R.