AGEING technophobe managers of small and medium-sized freight forwarding businesses are still using pencils, paper and fax machines.
These analogue dinosaurs need to be jettisoned for younger talent before ‘mom and pop shop’ forwarders can truly embrace digitisation, warns Arnaud Lambert (below, right) chief executive (CEO) of global software company CHAMP Cargosystems.
“The main issue [halting their digital transformation] is most of the ‘mom and pop shops’ do not have people at the helm who are younger than 40,” Lambert controversially tells Thelma Etim.
“The success of these types of businesses is based on their [personal] relationships – the management knowing the people point-to-point etc. They still exist and they will never disappear.” But it is not the way forward.
“Digitisation is changing the game and it will be pretty hard for somebody to really embrace it unless he/she has made the conscious choice to attract [and encourage] young talent. I don’t think this [situation] is specific to air cargo, but I believe once the small businesses embrace it, digitisation will move [much] faster,” he adds.also
Three years ago CHAMP launched a software product specifically targeting the smaller forwarding community so that they would not need to invest in large and expensive IT infrastructures.
The product is already especially popular in the United States and, surprisingly, in parts of Africa. “We have seen between 35 and 40 per cent growth every year because our solution brings these business communities into the digital age – they are [suddenly] part of the ecosystem. These freight forwarders also play an important role in their local communities,” he notes.
“Interestingly, the biggest adoption of our product is in the USA. Of course, the US is also the biggest market. However, you would expect America to be really advanced in technology – but no, there are many people there [still] using a pencil, a piece of paper and a fax,” Lambert observes.
Whilst some air cargo bosses complain that it is the cost of digitising their processes that is the major hindrance, the CHAMP CEO insists that, in reality, to affect immense changes within a company’s deep-rooted culture requires addressing its mentality and reviewing the expectations of a large internal historical IT department using a very old system. These are the real barriers to the widespread digitisation of the airfreight industry.
The good news is that the cost of digitisation is now “much more affordable” than before, especially for small companies. “In the past, you had to invest a lot – but now everything is subscription-based,” he notes.
“However, I am more concerned about the big historical players because, for them, the cost of evolution and managing the transformation is huge, not only from a technical angle but also from a mindset point of view.
“It is not just about putting something on paper in a digital format, it is about re-inventing the entire process and reaping the benefits of the digital world,” Lambert concludes.
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