question of the month
Cost-cutting is a terminology used a lot in the air freight business, but does this attitude to tightening the purse strings lead to service quality being reduced?
OLIVER EVANS
Chief cargo officer, SwissWorldCargo
“Cost-cuttingmay be a tired old buzzword, but the practice is as inherent and unavoidable as in any other industry.We have to think of cutting as an art, the delicate art of surgery, and not as an act of butchery. “Cost-cutting has all too
often been used as a threat, supposedly to combat complacency, and as a gut reaction by clueless managers in the face of any economic storm looming on the horizon. This has caused fear and distrust, and has been the trigger for a decline in motivation, customer service and quality, ultimately destroying the enterprise. “Cost-cutting should
AKSHAY SHRIVASTAVA
Senior vice president and global head of business solutions and service delivery, IBS Software Services
“Our industry as a whole still falls far short of acceptable standards of reliability and customer expectations.”
instead be understood as amartial art, a discipline born of long, indeed continuous, practice, and masterful control of themind and the hand guiding the knife. “Themind should be ceaselessly questioning every
established process, using all internal and external inputs, facts and figures as a guide. The hand should be delicately probing every step along a process to establishwhat is truly essential. “The fact is that our industry as awhole still falls far
short of acceptable standards of reliability and customer expectations. This is due to the huge complexity and diversity of our processes, systems and practices, coupledwith the inertia of our institutions. “We have a longway to go, and the first step is to
recognise that service qualitywill only be enhanced by the smart application of themartial art of cost- cutting.”
“We do not recommend reduction of service quality as ameans of cost-cutting, for airlines or for anyone in the services sector. Cost- cutting can instead be achieved bymaking business processesmore efficient and cost-effective, throughmethods such as increased automation in all aspects of the business and keeping the unit cost of IT to aminimum,while reducingwastage and redundancy at every step of the operational processes. “As a solution provider,
we believe there are several enablers that can help carriers, such as systems that allowthe customer to do asmany business transactions as possible himself, using technology such as the Internet. “We also use integrated IT systems that facilitate
“Cost-cutting can be achieved bymaking business processesmore efficient and cost-effective.”
one-time data capture across the shipment life-cycle; these not only avoid redundancy of effort, and thereby reduce cost of operation, they also increase the accuracy and reliability of data. “The adoption of e-Freight standards and processes
that eliminate the need for repeated and redundant data capture, aswell asmaking use of a SaaS (Software as a Service)mode of operations for IT systems, are othersways that can significantly reduce overheads. “We also believe that airlines should focus on
expanding their portfolio of services by innovating and introducing newproducts that provide a better class of service, or support needs in specialised areas such as pharmaceuticals. “This can help ensure a higher top line, thus
reducing the need for carriers to consider reduction of service quality as ameans of cost-cutting.”
3 AIR LOGISTICSCHINA 6
Page 1 |
Page 2 |
Page 3 |
Page 4 |
Page 5 |
Page 6 |
Page 7 |
Page 8 |
Page 9 |
Page 10 |
Page 11 |
Page 12 |
Page 13 |
Page 14 |
Page 15 |
Page 16 |
Page 17 |
Page 18 |
Page 19 |
Page 20 |
Page 21 |
Page 22 |
Page 23 |
Page 24 |
Page 25 |
Page 26 |
Page 27 |
Page 28 |
Page 29 |
Page 30 |
Page 31 |
Page 32 |
Page 33 |
Page 34 |
Page 35 |
Page 36 |
Page 37 |
Page 38 |
Page 39 |
Page 40 |
Page 41 |
Page 42 |
Page 43 |
Page 44 |
Page 45 |
Page 46 |
Page 47 |
Page 48 |
Page 49 |
Page 50 |
Page 51 |
Page 52