E Freight Case Study Cathay Pacific

CASE STUDY
The benefits of
100% e-AWB and e-freight
implementation for airlines
The Case of Cathay Pacific
e-freight
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INTERNATIONAL AIR TRANSPORT ASSOCIATION 2012
TABLE OF CONTENTS
1. Acknowledgments ....................................................................................................................................... 3
2. Executive Summary ..................................................................................................................................... 4
3. Introduction .................................................................................................................................................. 6
3.1. Objectives ............................................................................................................................................ 6
3.2. The electronic Air Waybill (e-AWB) and e-freight ................................................................................ 6
3.2.1.
e-freight ......................................................................................................................................... 6
3.2.2.
Electronic Air waybill (e-AWB) ...................................................................................................... 7
4. Cathay Pacific first IATA member to be 100% e-AWB .......................................................................... 7
5. Main constraints and issues in a paper environment .............................................................................. 8
5.1. Introduction .......................................................................................................................................... 8
5.2. Export process prior to e-freight adoption ........................................................................................... 8
5.2.1.
Delivery of the freight at the airport cargo terminal ...................................................................... 8
5.2.2.
Perform incoming checks on received documents ....................................................................... 9
5.2.3.
Sort the received documents ........................................................................................................ 9
5.2.4.
Perform outgoing checks and deliver to the aircraft ................................................................... 10
5.3. Import process prior to e-freight adoption .......................................................................................... 10
5.3.1.
Unload the cargo & documentation and dispatch ....................................................................... 10
5.3.2.
Retrieve goods and documents for consignee delivery.............................................................. 10
5.4. Summary - main constraints & issues and impacts ........................................................................... 11
5.4.1.
Export Process ........................................................................................................................... 11
5.4.2.
Import Process............................................................................................................................ 12
5.4.3.
Accounting Process .................................................................................................................... 12
5.4.4.
Data archiving ............................................................................................................................. 13
6. The benefits of e-AWB and e-freight........................................................................................................ 14
6.1. The new operational export processes in place for e-AWB and e-freight ......................................... 14
6.1.1.
Delivery of the freight at the airport cargo terminal .................................................................... 14
6.1.2.
Perform incoming checks on received electronic documents .................................................... 14
6.1.3.
Sort the received documents ...................................................................................................... 16
6.1.4.
Perform outgoing checks and deliver to the aircraft ................................................................... 16
6.2. The new operational import processes in place for e-AWB and e-freight ......................................... 16
6.2.1.
Repatriate and dispatch documents ........................................................................................... 16
6.2.2.
Retrieve documents for consignee ............................................................................................. 16
6.3. The challenges of the transition towards 100% e-freight................................................................... 16
6.3.1.
Introduction ................................................................................................................................. 16
6.3.2.
The impacts of the non e-freight countries and stakeholders on the e-freight leaders .............. 17
6.3.3.
e-freight shipments after Cathay Pacific cutover 100% e-AWB in Hong Kong .......................... 18
6.4. Main savings identified along the processes ..................................................................................... 19
6.4.1.
The approach used to calculate the benefits and costs ............................................................. 19
6.4.2.
Caption ....................................................................................................................................... 19
6.4.3.
Export process ............................................................................................................................ 20
6.4.4.
Import process ............................................................................................................................ 21
6.4.5.
Accounting process .................................................................................................................... 21
6.4.6.
Data archiving ............................................................................................................................. 22
6.4.7.
Productivity gains........................................................................................................................ 22
6.5. Main benefits ...................................................................................................................................... 23
6.6. Main costs to consider ....................................................................................................................... 24
7. The Cathay Pacific next steps .................................................................................................................. 25
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1. Acknowledgments
IATA would like to thank Cathay Pacific and especially Jackson Chan (Cargo Services Manager efreight), for his fully dedicated support to the realization of this case study and for sharing with IATA his
deep knowledge and his precious experience on how he managed successfully the e-freight project for
Cathay Pacific as well as for providing key data, which was crucial to calculate the savings and build this
detailed report.
IATA would also like to thank Nick Rhodes, Director Cargo - Cathay Pacific, for having supported the
cooperation.
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2. Executive Summary
The objective of this document is to analyze and share the benefits of e-freight for airlines based on a
case study realized with Cathay Pacific, which has implemented e-freight and was the first airline to achieve
100% electronic Air Waybill (e-AWB) in its Hong Kong home base.
The graphic below highlights for three implementation scenarios the productivity gains, i.e. the level of
manpower that can be saved or re-allocated to other tasks.
Scenario 1 forms the base scenario with the implementation of 100% e-AWB and e-House Manifest.
Scenarios 2 and 3 include the benefits from scenario 1, and in addition the removal of the accompanying
pouches of documents transported with the freight. These two scenarios correspond to implementation of
the full scope of e-freight, not just e-AWB.
Productivity gains (in %) obtained in e-freight environment

SCENARIO
SCENARIO 11
SCENARIO
SCENARIO 22
SCENARIO
SCENARIO 33
100%
100%e-AWB
e-AWB
++100%
100%e-House
e-House
Manifest
Manifest
100%
100%e-AWB
e-AWB
++100%
100%e-House
e-House
Manifest
Manifest
++50%
50%without
withoutpouch
pouch
100%
100%e-AWB
e-AWB
++100%
100%e-House
e-House
Manifest
Manifest
++100%
100%without
withoutpouch
pouch
Export
Export process
process
27%
38%
52%
Import
Import process
process
-2%*
19%
53%
Accounting
Accounting process
process
12%
12%
12%
Archiving
Archiving process
process
50%
50%
50%
TOTAL
TOTAL
Productivity
Productivity gains
gains
19%
30%
48%
*Due to additional effort spent for some destinations where two copies of AWB are still required (printed) by the
consignee and consignee/freight forwarder to be signed for confirmation of pick up the cargo.
This analysis shows that e-freight can generate significant productivity gains:
Nearly 20% of total productivity gains are reached with 100% e-AWB + 100% e-House Manifest.
This has already been achieved by Cathay Pacific in Hong Kong.
30% of total productivity gains are obtained with 100% e-AWB + 100% e-House Manifest and
50% of shipments without pouch.
Up to nearly 50% of total productivity gains can be obtained with 100% e-AWB + 100% e-House
Manifest and 100% of shipments without pouch.
The last two scenarios correspond to full e-freight implementation (i.e. removal of air waybill and of
accompanying documents normally traveling in document pouch).
.
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Beyond the productivity gains, the case study shows that e-freight brings additional benefits such as:
reduced costs from less paper and printer use,
improved customer service,
increased quality of information,
increased level of security,
faster respond to regulator bodies,
etc. (see chapter 6.5 Main benefits for all details).
To achieve these benefits, the right conditions must be met, and in the case of Cathay Pacific they included:
an investment in business process re-engineering and information system from Cathay Pacific
and their partners
a favorable environment with the local market and the support of government (customs).
The 100% e-AWB triggers acceleration in overall e-freight penetration and validates the strategy of e-AWB
as the first step towards full e-freight. The figure shows that after e-AWB cutover in HKG, the number of
e-Freight shipments grew in a much faster manner.
Year 2010, from 200 to 300 e-freight shipments (Cathay Pacific)
Year 2011, from 300 to 3600 e-freight shipments (Cathay Pacific)
Year 2011, from 600 to 6400 e-freight shipments (HKG)
Cathay Pacific and Hong Kong e-freight shipment trend 2010-2011
Cathay Pacific cutover 100% e-AWB

in HKG on January 2011
This document does not translate these productivity gains into dollar value, as this depends on each airline
cost structure. However, a separate template has been created, that allows each airline to calculate their
own productivity gains from such implementation. This template can also be used by ground handlers as a
process model approach has been defined.
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3. Introduction
3.1. Objectives
This document is part of a series of case studies on the benefits of implementing e-freight business
processes in the air cargo supply chain.
The objectives of this document are to:
Share the benefits of e-freight for the airlines based on a case study of one IATA airline member,
Cathay Pacific, which has implemented a 100% electronic Air Waybill solution in its Hong Kong
home base and has implemented e-freight procedures throughout its network
Present the processes that have been put in place:
for e-freight
for managing the e-freight rollout, which includes the dual existing transition period of paper
and paperless environments towards 100% e-freight
Identify the costs to consider for implementing an e-freight solution and for running the operational
activities.
3.2. The electronic Air Waybill (e-AWB) and e-freight

3.2.1. e-freight
e-freight is the process of transporting air cargo shipments with digital (electronic) exchange of data and
documentation, in lieu of paper documentation (for Air Waybills, manifests, invoices, packing lists, etc.).
Today, the air cargo industry still largely relies on paper-based processes to support the movement of
freight. The average shipment generates more than 30 documents that are used and/or handled by the
various parties involved: shippers, freight forwarders, ground handling agents, airlines, customs brokers,
customs and other government authorities.
These paper-based processes are not cost-effective, nor do they serve the key requirements of air cargo:
security and speed.
In December 2004, the Board of Governors mandated IATA to lead an industry-wide project whose aim is to
take paper out of the air supply chain, and create the conditions to replace the existing processes with new
ones where the industry and governments rely on the electronic exchange of information between the
parties to facilitate the movement of freight. The long-term vision for the industry is to eliminate the need to
produce and transport all paper for all stakeholders paperless e-freight.
Although the vision is paperless, the current mandate is paper free. Achieving the vision will require
sweeping changes in regulatory and legal environments. The Board decided that paper free is a more
realistic approach and will deliver the majority of business benefits for industry stakeholders. e-freight is
paper free, i.e., a paper free process whereby the airfreight supply chain does not transport the paper, but
there may be a requirement by exception to produce a copy of this paper from an electronic structured
format message or a scanned document.
The documents that may be required to be produced by exception are the documents in the project scope
that support the cargo or goods release/clearance by customs authorities.
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3.2.2. Electronic Air waybill (e-AWB)

Air waybill is a document made out by or on behalf of the shipper which specifies the contract between the
shipper and carrier(s) for carriage of goods and which is identified by the airline prefix issuing the document.
The paper Air Waybill is a critical air cargo document that constitutes the contract of carriage between the
shipper (direct shipper or freight forwarder acting on behalf of the shipper) and the carrier (airline).
The e-AWB is the term IATA uses to describe the interchange of electronic data (EDI) messages,
in lieu of a paper Air Waybill, to conclude the contract of carriage.
The new Electronic Air Waybill recommended practice (e-AWB RP1670) removes the requirement
for a paper Air Waybill, significantly simplifying the air freight supply chain process.
With the e-AWB, there is no longer a need to print, handle or archive the paper AWB
4. Cathay Pacific first IATA member to be 100% e-AWB

Cathay Pacific Airways (CX) and Dragonair (KA) have implemented 100% electronic Air waybill (e-AWB)
st
between forwarder and airline for all export shipments in Hong Kong (HKG) since January 1 , 2011. The
cutover not only made CX/KA the first in adopting full implementation of e-AWB and also proved to the
industry it is doable. It marks an important milestone in the air freight industry.
e-AWB has been proved to be the first effective step to increase e-freight penetration where HKG has
increased 10 times the e-freight shipments in 2011 compared with January 2011 against December 2011.
Airlines can implement 100% e-AWB and forwarders can drive 100% e-freight in parallel, moving towards
the IATA vision of being paper free by end of 2015.
Cathay Pacific Airways success is by working closely with two excellent IATA working groups since
2007: the IATA e-freight Central Action Group (e-CAG) and the IATA e-AWB Advisory Group. The
groups combine with IATA leaders, major airlines and global forwarders expertise. We define project
scope, standards, procedures and workable approach to move forward. The e-freight and e-AWB
projects require the whole air freight industry members working together to make it happen by end of
2015.
Jackson Chan, Cargo Services Manager e-freight, Cathay Pacific.
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5. Main constraints and issues in a paper environment

5.1. Introduction
The handling of freight in a paper based environment involves the below processes. The case study focuses
on the processes involved in document handling.
Export
process
Receive
freight at the
airport
Import
process
Repatriate
documents &
dispatch them
Retrieve
documents
for consignee
Accounting
process
Collate all air

waybills for
billing
Perform
analysis &
checks
Archive
documents
Destroy
documents
Archive
process
Perform
incoming
checks
Sort
documents
Perform
outgoing
checks
Deliver
to the
aircraft
Invoice
& manage
discrepancies
Sequencing of some activities along the supply chain might differ from one country to another, from one
airline to another. In this section we will describe the main processes and activities performed in Hong Kong.
While the cargo paper environment process described in the next section is still in place for many airlines in
Hong Kong, Cathay Pacific has moved to 100% electronic Air Waybill.
5.2. Export process prior to e-freight adoption

5.2.1. Delivery of the freight at the airport cargo terminal
In Hong Kong, the cargo is delivered first, prior to the freight documentation. The Ground Handler acts as a
neutral party and weighs the goods on behalf of both the freight forwarders and the airlines. This specific
approach eliminates subjects of disagreements between the involved parties.
When the cargo has been delivered to the airport warehouse by the freight forwarder and unloaded, a
warehouse agent counts the number of pieces, checks the total weight and measures the freight
dimensions. The agent keys in data in the warehouse application. After acceptance, the agent produces and
prints the Reception Check List (RCL) document in four copies, keeps a copy and delivers the three others
to the truck driver who returns to the freight forwarder warehouse. At this stage, data is available in both
ground handler Web solution and airline cargo systems, and both freight forwarder and Cathay Pacific can
access to the information.
On the freight forwarder side, as soon as the RCL document has been produced data is used to finalize and
produce the Air Waybill, the House Air Waybill and the House Manifest. The pouch is built and delivered
together with the Air Waybill and House Manifest to the airline Export office counter.
Because the weighing of the freight is done by the ground handler as a neutral party, it however obliges the
freight forwarder must come twice: a first time to deliver cargo at the warehouse and a second time to give
the updated documents to the airline at the Export airline front desk.
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5.2.2. Perform incoming checks on received documents

The documents are brought to the airline by car. As the freight
forwarder car driver arrives at the airline Export desk, he may be
served immediately or may queue up to an hour, depending on the
number of other drivers who arrived earlier. Due to the manual
handling of documents the service offered to the freight
forwarders is therefore not always optimal.
When it is his turn, the driver gives the documents to the airline
Export front desk agent who carries out checks. This activity can take
some time, depending on the number of documents to check.
If the documents are accepted the Export front desk agent gives the
Original 3 of the Air Waybill for Shipper to the driver.
At that stage, due to potential human error there is a risk of overlooking hidden dangerous goods or
special handling requirements for the shipment. Indeed, the Export employee may miss a document out
of the pile of papers to check, which may translates to aircraft safety issue and hazards for handling agents.
5.2.3. Sort the received documents

The Export front desk agent gives a copy of the Air Waybill and the
House Manifest to the Data Processing Unit (DPU) where a team
keys in data into the Cathay Pacific cargo application and into the
warehouse system the relevant data from the received
documentation.
The manual data capture is time consuming with a risk of
mistakes, such as incorrect shipper or consignee address or
mismatch data between paper and data, which can cause customs
issue: data is used for Customs clearance and customs can delay
the cargo delivery or upload.
In parallel, the front desk agent brings the rest of the documents
delivered by the driver to the Export Flight Handling Unit area
(EFHU) and stores them in the dedicated pigeon hole, sorted by
destination.
At the Export Flight Handling Unit (EFHU) agents prepare the Flight
Manifest based on booking lists and Air Waybill documents retrieved
from the pigeon holes.
Agents group all documents by flight and bring them to another agent
for last checks (see picture in the next section).
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5.2.4. Perform outgoing checks and deliver to the aircraft

Agents check documents against Flight Manifest. When validated,
the agent puts all documents in the flight bag (flight pouch).
Agents will deliver the pouch, Air Waybills, House Manifests and
any other required documents directly to the aircraft. The physical
cargo and the documentation are at this point reunited. This task is
time consuming and the flight bag can sometimes be heavy.
5.3. Import process prior to e-freight adoption

5.3.1. Unload the cargo & documentation and dispatch
Cargo is unloaded from the inbound aircraft, and paper documents
are repatriated to the airline import warehouse and left on a large
dedicated table (see picture) where all flight bags are open.
Documents for HKG terminating shipments are split from the transit
shipments and delivered to the Import front desk where freight
forwarder drivers will come and retrieve them.
The documents are temporarily stored in pigeon holes (on left side
of the next picture below). This activity is time consuming.
5.3.2. Retrieve goods and documents for consignee delivery

Freight forwarder drivers must pick up the documentation,
sometimes queuing as shown on the picture.
The queue can be by far longer, especially before the week-ends.
The airline agent completes the Shipment Release Form, the driver
signs it and retrieves his documents. The driver goes to the
warehouse, takes his goods, signs the Proof of Delivery (POD)
ready to return to freight forwarder warehouse, and the airport
warehouse agent keeps a copy.
The detailed existing process is:

The freight forwarder driver comes and signs for the AWB as Delivery Receipt
The Cathay Pacific agent returns the Original 2 of AWB For Consignee to the driver
The Cathay Pacific agent will print out the Warehouse Shipment Release Form and driver will use
them for picking the physical cargo from the warehouse
The freight forwarder driver will sign on the Warehouse Shipment Release Form and will get one
copy while the warehouse will keep remaining copies.
If any discrepancy or damage for the cargo is found, the driver can go back to Cathay Pacific counter to
report damages and to amend the Delivery Receipt if necessary.
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5.4. Summary - main constraints & issues and impacts

The constraints and issues described in the previous section are summarized in the tables below.
5.4.1. Export Process

Processes
Main
Main activities
activities
Constraints
Constraints &
& issues
issues
Impacts
Impacts
Receive the
freight at the
airport
Freight
Freight forwarder
forwarder driver
driver delivers
delivers
cargo
cargo to
to the
the warehouse
warehouse
Warehouse
Warehouse agent
agent checks
checks received
received
cargo
cargo (weight,
(weight, number
number of
of pieces,
pieces,
etc.)
etc.) and
and gives
gives aa receipt
receipt to
to the
the driver
driver
Driver
Driver goes
goes back
back to
to the
the freight
freight
forwarder
forwarder house
house and
and delivers
delivers the
the
receipt
receipt
Freight
Freight forwarder
forwarder driver
driver prepares
prepares the
the
documentation
documentation
AA driver
driver comes
comes back
back to
to the
the airport
airport
warehouse
warehouse to
to deliver
deliver the
the documents
documents
Driver
Driver has
has to
to come
come twice
twice
for
for one
one freight
freight delivery
delivery
Driver
Driver has
has sometimes
sometimes to
to
queue
queue at
at peak
peak time
time
periods
periods for
for 30
30 minutes
minutes to
to
one
one hour
hour
When
When documents
documents
presented
presented after
after flight
flight cutcutoff
off time
time itit prevents
prevents the
the
load
load of
of the
the freight
freight
This
This process
process isis
performed
performed manually
manually
Freight
Freight
Forwarder
Forwarder
reduced
reduced
efficiency
efficiency
Airline
Airline reduced
reduced
efficiency
efficiency
Degradation
Degradation of
of
service
service
Reduced
Reduced shipper
shipper
satisfaction
satisfaction
The
The acceptance
acceptance agent
agent collects
collects the
the
documents,
documents, performs
performs aa quality
quality check
check
and
and gives
gives the
the shipper
shipper copy
copy of
of the
the
Master
Master Air
Air waybill
waybill to
to the
the driver
driver
May
May overlook
overlook some
some
hidden
hidden dangerous
dangerous goods
goods
May
May overlook
overlook special
special
handling
handling requirements
requirements
for
for the
the shipment
shipment
Potential
Potential aircraft
aircraft
safety
safety issue
issue
Potential
Potential healthy
healthy
issue
issue for
for
handling
handling agents
agents
AA copy
copy of
of the
the Master
Master Air
Air waybill
waybill and
and
the
the House
House Manifest
Manifest are
are delivered
delivered to
to
aa team
team in
in charge
charge of
of loading
loading data
data in
in
systems
systems
The
The dedicated
dedicated team
team keys
keys in
in data
data in
in
systems
systems from
from the
the Master
Master Air
Air waybill
waybill
and
and House
House Manifest
Manifest
The
The rest
rest of
of the
the documents
documents are
are put
put
into
into aa pigeon
pigeon hole
hole by
by destination
destination at
at
the
the Export
Export Flight
Flight Handling
Handling Unit
Unit
Prepare
Prepare flight
flight manifest
manifest based
based on
on
booking
booking list
list and
and air
air waybill
waybill
documents
documents
An
An agent
agent groups
groups all
all documents
documents for
for
the
the flight,
flight, brings
brings them
them to
to another
another
agent
agent for
for checks
checks
Manual
Manual tasks
tasks that
that remain
remain
time
time consuming
consuming
Risk
Risk of
of wrong
wrong data
data
capture
capture
Risk
Risk of
of incorrect
incorrect address
address
data
data capture
capture due
due to
to
shorten
shorten consignee
consignee and
and
shipper
shipper addresses
addresses into
into
35
35 characters
characters
Reduced
Reduced
efficiency
efficiency
Potential
Potential
incorrect
incorrect billing
billing
to
to the
the forwarder
forwarder
increasing
increasing
appeal
appeal cases
cases for
for
billing
billing
amendment
amendment
Customs
Customs hold
hold
cargo
cargo and
and delay
delay
delivery
delivery to
to
consignee
consignee
Perform
outgoing
checks
Check
Check documents
documents against
against flight
flight
manifest
manifest
Confirm
Confirm when
when ok
ok
Put
Put all
all documents
documents in
in the
the flight
flight bag
bag
(flight
(flight pouch)
pouch)
Manual
Manual tasks
tasks that
that remain
remain
time
time consuming
consuming
Reduced
Reduced
efficiency
efficiency
Deliver to the
aircraft
Take
Take the
the flight
flight bag
bag and
and deliver
deliver itit to
to
the
the aircraft
aircraft
Manual
Manual task
task that
that remains
remains
time
time consuming
consuming
Task
Task outsourced
outsourced to
to ramp
ramp
operator
operator involving
involving
additional
additional cost
cost
Reduced
Reduced
efficiency
efficiency
Additional
Additional costs
costs
Perform
incoming
checks
Sort
documents
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5.4.2. Import Process

Processes
Repatriate
documents
and dispatch
them
Retrieve
documents
for
consignee
Main
Main activities
activities
Constraints
Constraints
Impacts
Impacts
Freight
Freight paper
paper documents
documents are
are
repatriated
repatriated to
to the
the airline
airline import
import
warehouse
warehouse
Local
Local arrival
arrival flight
flight bags
bags are
are split
split from
from
the
the transit
transit ones
ones and
and delivered
delivered to
to the
the
Import
Import front
front desk
desk
The
The documents
documents are
are temporarily
temporarily
stored
stored in
in pigeon
pigeon holes
holes
There
There isis aa dual
dual process
process
of
of cargo
cargo and
and document
document
repatriation
repatriation performed
performed by
by
two
two different
different resources
resources
There
There isis aa manual
manual
research
research of
of local
local
documents
documents with
with final
final
delivery
delivery to
to the
the front
front office
office
Reduced
Reduced
efficiency
efficiency
Freight
Freight Forwarder
Forwarder driver
driver comes
comes to
to
pick
pick up
up their
their documentation
documentation
The
The airline
airline agent
agent completes
completes the
the
Shipment
Shipment Release
Release Form,
Form, the
the driver
driver
signs
signs itit and
and retrieve
retrieve his
his documents.
documents.
The
The driver
driver signs
signs the
the air
air waybill
waybill
Delivery
Delivery Receipt
Receipt and
and Shipment
Shipment
Release
Release Form
Form
The
The driver
driver goes
goes to
to the
the warehouse
warehouse to
to
take
take his
his goods
goods
Freight
Freight forwarder
forwarder driver
driver
needs
needs to
to come
come first
first to
to the
the
import
import front
front office
office before
before
retrieving
retrieving their
their goods
goods at
at
warehouse
warehouse
Drivers
Drivers may
may queue
queue at
at
front
front office
office at
at busy
busy times
times
An
An inefficient
inefficient
two-step
two-step level
level
process
process retrieval
retrieval
AA need
need for
for the
the
airline
airline to
to provide
provide
resources
resources
Constraints
Constraints &
& issues
issues
Impacts
Impacts
5.4.3. Accounting Process

Processes
Main
Main activities
activities
Collect all air

waybills for
billing
For
For each
each flight
flight retrieve
retrieve all
all physical
physical
air
air waybills
waybills
Identify
Identify missing
missing documents
documents
Deliver
Deliver air
air waybills
waybills to
to the
the accounting
accounting
department
department
In
In physical
physical paper
paper
handling
handling environment
environment
some
some documents
documents may
may
be
be lost
lost
Workload
Workload
increase
increase
Perform
analysis &
checks
Process
Process all
all air
air waybills
waybills per
per customer
customer
Key
Key in
in data
data in
in cargo
cargo application
application
Perform
Perform checks
checks on
on data
data and
and charges
charges
No
No specific
specific constraint
constraint
None
None
Manage
Manage discrepancies
discrepancies due
due to
to loss
loss
of
of documents
documents
Invoice
Invoice to
to customers
customers
Missing
Missing documents
documents
Workload
Workload
increase
increase
Customer
Customer
relationship
relationship
Invoice
& manage
discrepancies
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5.4.4. Data archiving

Regarding local regulations, the cargo documents must be archived for 7 years in Hong Kong. Each Air
Waybill and House Manifest are thus collected and stored until their destruction.
Main
Main activities
activities
Processes
Archive the
documents
Destroy the
documents
Collate
Collate the
the air
air waybills
waybills and
and house
house
manifests
manifests
Bring
Bring them
them to
to storage
storage area
area
Store
Store on
on the
the shelf
shelf
Plan
Plan the
the retrieval
retrieval of
of dossiers
dossiers
Retrieve
Retrieve the
the dossiers
dossiers
Destroy
Destroy the
the dossiers
dossiers
Recycle
Recycle the
the paper
paper
Constraints
Constraints
The
The documentation
documentation
needs
needs to
to be
be archived
archived for
for
77 years
years
The
The process
process brings
brings no
no
added
added value
value
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Impacts
Impacts
Workload
Workload
increase
increase
Cost
Cost for
for storage
storage
Workload
Workload
increase
increase
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6. The benefits of e-AWB and e-freight

The changes in the export and import processes in e-freight and e-AWB environment are described below.
6.1. The new operational export processes in place for e-AWB and e-freight
6.1.1. Delivery of the freight at the airport cargo terminal
This sub-process remains the same. The freight forwarder driver delivers the freight at the airline warehouse
where the number of delivered pieces, the overall weight and dimensions are taken and information is
captured in the ground handler application solution. The Freight Forwarder can access the data either from
their own system or the airline system. The truck driver returns to his warehouse with the Reception Check
List document. As soon as the data is in the system the Export operator can finalize the Air Waybill, the
House Air Waybills and the House Manifest.
Note: as noted above, the delivery (and acceptance) of the freight still involves a paper process with the
RCL. This could be eliminated as a further step but is not yet considered paperless in this case study.
6.1.2. Perform incoming checks on received electronic documents

A flexible approach in place
Freight Forwarders have to key in their air waybill and house manifest data in their system and send their
data using direct host-to-host connection to Cathay Pacific. If forwarders do not have yet this capability they
can use the application called Ezycargo system. So far in Hong Kong, about 1/3 of the freight forwarders
uses Ezycargo to send the FWB / FHL messages.
An efficient application solution in place
One of the Airline Export employees checks the quality of the
messages received electronically. The application with interface has
been developed to display data on the screen, and specific
functionalities to perform automated checks have also been
designed and implemented to facilitate the human checks, save
time and gain in efficiency and control. This includes among others
the crosscheck of number of pieces, weight from physical goods
against FWB and FHL data, as well as the check of station, country
and postal codes. If anything is detected as incorrect by the system,
it will be highlighted by a red cross in the application, on the screen.
If the verification is not positive, the agent rejects the acceptance and specifies the reasons to simplify the
investigations for the freight forwarder in charge of completing the file correctly.
Compared to the paper environment, the application is capable of assessing the risk of dangerous goods
being present. The export employee will then clarify with the freight forwarder to make sure it is not
dangerous goods or not requirements for special handling.
When ready, the freight forwarder submits again the electronic documents. On the left side of the picture the
screen shows the e-freight application, and on the second screen it shows the airline cargo system and the
local warehouse system from left to right.
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The quality control takes more time than before for verifying data as well as for specifying the
reason of rejection to the freight forwarder due to the following reasons:
In AWB paper Export staff can see all information faster compared to e-AWB
So far, experience tells paper AWB has less errors than electronic data when first started in each
location, which may be due to IT mapping and inappropriate data input to satisfy system
requirement such as only put . In the address field and CargoImp FWB limitation such as 35
characters in key address has an impact on time processing too. A Cargo-IMP change request is
under adoption by the Cargo Services Conference to allow for two address lines increasing the size
to 70 characters.
System auto checking and highlight of potential errors require staff to clarify with forwarders and
reduce errors such as hidden Dangerous Goods.
Remark: Export staff may take a learning curve to do faster. With learning curve, in HKG the e-AWB
rejection rate was 70% in January 2011 and has been significantly reduced to 30% by the end of December
2011. This will continue to reduce.
If the e-Documents are correct the agent proceeds to the acceptance and with one click button verifies
automatically whether the Air Waybill and the House Manifest have still to be printed in case the destination
country is not yet e-freight capable.
The Cathay Pacific Export office reduced to the minimum!
After Cathay Pacific cut over 100% e-AWB, there is no need to
receive paper Air Waybill and House Manifest from all freight
forwarders.
When the destination country is e-freight, there is no need to
collect the pouch from e-freight freight forwarders, which means
there is no need for the freight forwarder to physically come once
again to the airport and bring the pouch (except if special
documents need to be transported, such as certificate of origin,
etc.).
Closed desks
Last
desk
The need for resources is also adapted to the new situation and limited to the minimum, as shown on the
picture: the full large left part is now closed and only one counter remains open to handle the forwarder
pouches for non e-freight shipments as well as special documents to carry, and the walk-in customers (no
pre-booking, no interactions done until the customers turn up at the acceptance desk).
If the Freight Forwarders have a single process for this
activity, unfortunately Cathay Pacific has to manage two
processes in parallel to respond to routes such as Warsaw
routes, which means that:
The electronic Air Waybills and House Manifests
documents need to be printed for Warsaw routes, which
is now done directly by an airline agent and not by the
freight forwarders anymore. When paper AWB is printed
this is not considered as e-AWB as the contract of
carriage is on paper.
The freight forwarder has still to come to deliver the
pouch with the House Air Waybills, the Invoice and
Packing List and any other document.
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6.1.3. Sort the received documents

The process is drastically simplified as most of the tasks have been automated in the e-freight
environment. The Flight Manifest preparation remains the core activity of this process and most of the other
tasks are eliminated, as presented in chapter 6.4.3.
6.1.4. Perform outgoing checks and deliver to the aircraft

There is no need to go and retrieve documents at the aircraft anymore, for e-freight upstream stations
and flights without special documents to carry, translated in productivity gains.
However, when the upstream station is non e-freight or when some special documents have to be carried
on, there is still a need to collect the flight bag (Air Waybills, House Manifests and pouches), and the old
process remains unchanged. This will still remain the case for several years to come.
6.2. The new operational import processes in place for e-AWB and e-freight
6.2.1. Repatriate and dispatch documents
With digitized information:
There is no pouch and no document to retrieve. The task is eliminated, except when special
documents have been carried, and then the flight bag needs to be brought back to the airline import
office.
There is also no need to open the flight bag, separate the documents for local goods from the
documents for goods in transit (except when special documents have been carried). The process is
simplified.
There will be an interim period. When not 100% e-freight, there are still documents to be sorted and to be
dispatched to the consignee like Certificate of Origin, License, Permit, or CITES Certificate etc. Local
customs or government authorities are still requesting original copy.
6.2.2. Retrieve documents for consignee

For the non e-freight destination the airline import office is required to handle the Air Waybill and the House
Manifest as well as the pouch and dispatch them to the consignee (via the freight forwarder).
For the e-freight destination, like Hong Kong, the airline import office may still require to handle the pouch
(when exists) and dispatch it to the consignee via the freight forwarder. Currently Cathay Pacific prints out
the Air Waybill and the warehouse shipment release form for the consignee signature for proof of delivery:
Cathay Pacific still print two AWB laser A4 copies, one for consignee copy and the other one for forwarder to
sign it as Delivery Receipt. In the near future, only the warehouse shipment release form should be printed
for the proof of delivery.
6.3. The challenges of the transition towards 100% e-freight

6.3.1. Introduction
For e-freight to be feasible between an origin and destination, both parties should be to the same treaty
(MP4 or MC 99). There may be exceptions to this general rule that would apply to those locations that have
not signed Warsaw 29 but have national legislation that supports e-document trading.
The MP4 and MC 99 countries support electronic data information exchange and paperless. The Warsaw
countries require a specific procedure to prepare the paper Air Waybill and must be on board the cargo flight
at origin.
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6.3.2. The impacts of the non e-freight countries and stakeholders on the e-freight leaders
While Cathay Pacific became the first airline to be 100% e-AWB, many airlines, freight forwarders and
countries are not yet e-freight. Cathay Pacific would get the full benefits of paper free on e-freight trade
lanes.
Offering 100% e-AWB is already improving the customer service and airline performance significantly as
described previously. If we also look at the savings obtained by an airline that is e-AWB and e-freight it leads
to an advantage by being even more efficient and less costly for the airline. Even with this situation the direct
savings are more important than costs making the case more than robust enough to move to e-freight. Of
course, with more e-freight trade lanes the payback will be faster.
6.3.2.1. Dual processes to set up and manage: printing Air Waybill!
While the overall business case remains very positive on both the bottom line and the operational
conditions, there is consequently a necessity to manage several dual processes to cover both e-freight and
non e-freight destinations. There is no real added complexity but the situation leads to additional workload
with non added-value and some additional costs.
For instance, a task that should have disappeared in a full e-freight environment and that was performed by
the freight forwarders in now assigned to the airline, a position choice directly taken by the airline:
In the e-freight environment, the freight forwarder does not need to print the Air Waybill and the
House Manifest anymore, the task is performed electronically
In a non e-freight environment at destination, the airline receives the AWB data and House Manifest
electronically from the freight forwarder and needs to print the two documents as there is a pouch
delivered by the freight forwarder to handle.
Cathay Pacific has decided to perform this task in order to simplify the process for the freight forwarders and
make them ready on both information technology and procedures to proceed for the 100% e-freight rollout
with their own documents such as House Air Waybill, invoice, packing list.
In order to calculate the additional workload, or lets say to reduce the total elimination of that activity each
airline should calculate the destination routes impacted by not being yet e-freight and by the number of times
there is a need to carry special documents on e-freight routes. Note that on some routes paper AWB is
printed at destination.
6.3.2.2. Dual processes to set up and manage: the arrival of the pouch
This has been described in chapter 6.1.2 and the additional work to perform is now explained. Before the eAWB and e-freight, the airline export counter agent received at the same time the pouch with the Air Waybill
and House Manifest documents.
Today, this is not true anymore as the Air Waybill and House Manifest are sent electronically by the freight
forwarders, which leads to an additional activity for the airline, but also for the freight forwarder who needs to
bring the pouch. Indeed, the airline agent has to verify whether and when the pouch has been delivered.
Remark: This constraint happens only in Hong Kong location (airline home market) where freight forwarders
tendered their cargo first and weigh the cargo. When this is done freight forwarders go back to their office to
prepare the Air Waybill with actual piece and weight information. For Cathay Pacific office, there is no
perfect timing to staple the AWB and the pouch together due to large volume of shipments out of HKG.
At other locations, airline can receive at the same time both the physical cargo and forwarder pouch and
thus can check the electronic Air Waybill and print it out and staple all documents together before export.
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A specific procedure has been put in place: Cathay Pacific has produced on purpose a label delivered to the
freight forwarders in charge of specifying on that label (attached to the pouch) information on the e-AWB
number, destination, flight number, and consignee name. The airline is then in charge of matching both the
pouch with the printed Air Waybills and House Manifests documents.
The Export office agent time stamps a specific label that contains key information (e-AWB number,
destination, flight number, consignee name) and the freight forwarder leaves the office with a copy of the
label as a proof of delivery for the pouch.
6.3.2.3. Data quality check
The building logic of the e-freight application consists of performing basic data quality checks such as
correct pieces, weight among Air Waybill, House Manifest and physical goods. It also highlights suspect
dangerous goods and special cargo based on keyword searching. The export staff cannot simply ignore this
without checking with the forwarder for additional information.
This task is thus more time consuming than before using paper mode. On the other hand it ensures a better
quality and service to the freight forwarders and customs.
The additional work on the airline side is also shared with the freight forwarders that need to provide more
information. The freight forwarders are still in the learning curve and it is expected to have less additional
checks in the future with freight forwarders completing correctly the documentation.
6.3.3. e-freight shipments after Cathay Pacific cutover 100% e-AWB in Hong Kong
The figure shows that after e-AWB cutover in HKG, the number of e-Freight shipments grew in a much
faster manner.
Year 2010, from 200 to 300 e-Freight shipments (Cathay Pacific)
Year 2011, from 300 to 3600 e-Freight shipments (Cathay Pacific)
Year 2011, from 600 to 6400 e-Freight shipments (HKG)
Cathay Pacific and Hong Kong e-freight shipment trend 2010-2011
Cathay Pacific cutover 100% e-AWB

in HKG on January 2011
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6.4. Main savings identified along the processes

6.4.1. The approach used to calculate the benefits and costs
Together with the support of IATA, a process performance approach including visits in the field has been
undertaken in order to analyse and compare all sequential activities in paper and paperless environments as
well as the use of key metrics for measuring the benefits.
Cathay Pacific have a standard measurement for each major Import and Export activity based on previous
statistics or by chronometer measurement. Cathay Pacific created a benefit worksheet in 2009 when
requesting the e-AWB and e-Freight projects funding. The benefit worksheet has been reviewed in early
2012 after one year 100% e-AWB cutover in Hong Kong with additional knowledge and experience.
Three scenarios have been defined and analyzed to identify the benefits respectively.
Scenario 1: e-AWB scenario
The e-AWB scenario focuses on being 100% e-AWB and e-House Manifest only as implemented already in
HKG by Cathay Pacific. By the end of 2014 IATA targets to reach 100% for the e-AWB as well as for the eHouse Manifest.
Scenario 2: e-AWB + 50% without pouch shipments scenario
This scenario is based on the scenario 1 + implementation of e-freight for 50% of the shipments by the end
of 2015. As of April 2012 Cathay pacific has 8% e-freight penetration in HKG.
Scenario 3: e-AWB + 100% without pouch shipments scenario
This scenario is equivalent to scenario 1 with a 100% e-freight environment. The principle of being 100% efreight means a true paperless transportation for all shipments, whether general cargo or special cargo (no
document pouch), with still walk-in customers to serve.
6.4.2. Caption
In paper environment we have defined the required workload to perform a task and its frequency. The
more + there are, the heavier the workload and task repetition. The aim of this approach is to highlight the
main savings without communicating on Cathay Pacific figures for confidentiality purpose. It also shows
where the improvements are along the processes for any other carrier.
Task that remains
Task to perform in both paper environment and in e-freight environment
Minor change
Task slightly improved (5%)
Partly eliminated
Task partly eliminated, usually around 50%
Eliminated
Task eliminated
Eliminated*
Task eliminated except when special documents to handle
More effort
Task requiring more effort (dual or new task, etc.) compared to paper environment
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6.4.3. Export process

Paper environment
Task description
Retrieve and check the documents
Perform
incoming
checks for
acceptance
Deliver to the
aircraft
Inform
customs
100% e-AWB + eHouse Manifest

+ 100% pouch
less shipments
+++
Partly Eliminated
Partly Eliminated
Eliminated
Performs a quality check on electronic FWB

and FHL data (no missing data and special
documents)
+++
More effort
More effort
More effort
Detaches the shipper copy of the Master Air

waybill and gives it to the driver. Detaches
the airline copy for filing and one copy for
airline finance office for billing.
+++
Eliminated
Eliminated
Eliminated
Detaches another copy of the Master Air

Waybill and one copy of House Manifest for
customs report process
+++
Partly Eliminated
Partly Eliminated
Eliminated
After acceptance, receive correction advise

from the freight forwarder for data
amendment (Charge Correction Advice
CCA)
+++
Partly Eliminated
Partly Eliminated
Partly Eliminated
+++
Eliminated
Eliminated
Eliminated
+++
+++
Partly Eliminated
Partly Eliminated
Partly Eliminated
Update the air waybill record in the

warehouse systems (Inform the warehouse
to provide the ok to start physical cargo buildup or flight manifest work)
+++
Eliminated
Eliminated
Eliminated
Sort rest of received documents
+++
Partly Eliminated
Eliminated*
Retrieve documents for preparing flight

manifest
+++
Eliminated
Eliminated
++
++
Partly Eliminated
Eliminated*
Check documents against flight manifest

(HKG)
+++
Dual process
Dual process
Eliminated
Check documents against flight manifest

(oversea stations)
+++
Partly Eliminated
Partly Eliminated
Eliminated
Put all documents in the flight bag (flight

pouch)
++
+++
Partly Eliminated
Partly Eliminated
Eliminated
Container build up instruction based on

booking list and received air waybills
Group all documents for the flight, to be
ready for checks
Perform
outgoing
checks
100% e-AWB +
e-House
Manifest + 50%
pouch less
shipments
+++
Deliver the Master Air waybill and the House

Manifest to the team in charge of loading
data
Key in data in systems from the Master Air
waybill and House Manifest into airline cargo
system
Sort
documents
Workload Frequency
100% e-AWB +
e-House
Manifest
Take the flight bag and deliver it to the

aircraft
After take off, update information to report to
customs in some countries (US, Canada,
Europe, etc.)
Eliminated
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6.4.4. Import process

Paper environment
Workload
Frequency
Retrieve flight bag from aircraft and bring it

back to the office
+++
Split the local arrival flight bags from the

transit ones and deliver them to the Import
front desk
+++
Print AWB laser copies for consignee copy

and sign for delivery note for proof of
delivery.
Sort and store temporarily the documents in

pigeon holes
Deliver to the Freight Forwarders the

documents they come to pick up
Task description
Receive the
freight at the
airport
Perform
document
delivery
process
Archive the
documents
100% e-AWB +
e-House
Manifest
100% e-AWB +
e-House
Manifest + 50%
pouch less
shipments

+ 100% pouch
less shipments
Partly Eliminated
Partly Eliminated
Eliminated
New task
New task
Partly Eliminated
Eliminated*
++
Partly Eliminated
Eliminated*
Complete the Shipment Release Form, and

get freight forwarder signature
++
++
Copy of the air waybill.
Eliminated
Eliminated
New task
Eliminated
Remark: the new task to perform in e-freight environment is due to additional effort spent at destinations
where still two copies of AWB are required (i.e. to be printed) by the consignee and consignee/freight
forwarder to be signed for confirmation of pick up the cargo.
6.4.5. Accounting process

Paper environment
Task description
Collect all air

waybills for
billing
Perform
analysis &
checks
Invoice &
manage
discrepancies
For each flight retrieve all physical air

waybills
Identify missing air waybill documents
Workload Frequency
100% e-AWB +
e-House
Manifest
100% e-AWB +
e-House
Manifest + 50%
pouch less
shipments

+ 100% pouch
less shipments
Eliminated
Eliminated
Eliminated
Minor change
Minor change
Minor change
Deliver air waybills to the accounting

department
Eliminated
Eliminated
Eliminated
Process all air waybills per customer
++
Key in data or data amendment in cargo

revenue accounting application
++
++
Partly Eliminated
Partly Eliminated
Partly Eliminated
Perform checks on data and charges
++
Manage discrepancies due to loss of

documents
+++
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6.4.6. Data archiving

Paper environment
Workload Frequency
Task description
Archive the
air waybills
and house
manifests
Destroy the
archived
documents
100% e-AWB +
e-House
Manifest
100% e-AWB +
e-House
Manifest + 50%
pouch less
shipments

+ 100% pouch
less shipments
Eliminated
Eliminated
Eliminated
Collate the documents, label them and store

them
++
Organise the collect of documents
(+)
Eliminated
Eliminated
Eliminated
Retrieve the documents
(+)
Minor change
Minor change
Minor change
Destroy the documents
(+)
Eliminated
Eliminated
Eliminated
Recycle the documents
(+)
Eliminated
Eliminated
Eliminated
6.4.7. Productivity gains

The graphic below highlights for three e-freight implementation scenarios the obtained productivity gains,
i.e. the level of manpower that can be saved or re-allocated to other tasks.
Improvements have been calculated for the three scenarios and are given in percentage of productivity
gains per process and as overall.
Productivity gains (in %) obtained in e-freight environment

Workload
Workload
weight
weight
per
per
process
process
SCENARIO
SCENARIO 11
SCENARIO
SCENARIO 22
SCENARIO
SCENARIO 33
100%
100%e-AWB
e-AWB
++100%
100%e-House
e-House
Manifest
Manifest
100%
100%e-AWB
e-AWB
++100%
100%e-House
e-House
Manifest
Manifest
++50%
50%without
without
pouch
pouch
100%
100%e-AWB
e-AWB
++100%
100%e-House
e-House
Manifest
Manifest
++100%
100%without
without
pouch
pouch
Export
Export process
process
27%
38%
52%
++++++
Import
Import process
process
-2%*
19%
53%
++++
Accounting
Accounting process
process
12%
12%
12%
++
Archiving
Archiving process
process
50%
50%
50%
TOTAL
TOTAL
Productivity
Productivity gains
gains
19%
30%
48%
*Due to additional effort spent for some destinations where two copies of AWB are still required (printed) by the
consignee and consignee/freight forwarder to be signed for confirmation of pick up the cargo.
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6.5. Main benefits

The benefits are numerous and can be presented as follows:
Increase
Increase
productivity
productivity
Eliminate
Eliminatemany
manyoperational
operationaltasks
tasks
Eliminate
double
Eliminate doublekeyboarding
keyboardingand
andreduce
reducenumber
numberofofmanual
manualerrors
errors
Eliminate
risk
of
losing
documents
Eliminate risk of losing documents
Access
Accessinformation
informationininreal
realtime
timeand
andtreat
treatshipments
shipmentsfaster
faster
Reduce
Reducestorage
storagecosts
costsby
byeliminating
eliminatingpaper
paperdocuments
documentsand
andfree
freeup
up
valuable
office
space
valuable office space
Eliminate
Eliminatecosts
costsofofpaper
paperpurchase,
purchase,paper
paperdestruction
destructionand
andrecycling
recyclinginin
e-freight
environment
e-freight environment
Reduce
Reduceoutsourcing
outsourcingcost
costatatout
outstations
stationsby
byeliminating
eliminatingpaper
paperhandling
handling
Reduce
Reduce
costs
costs
Improve
Improve
customer
customer
service
service
Provide
Providean
animproved
improved&&efficient
efficientservice
servicetotothe
thefreight
freightforwarders
forwardersby
by
simplifying
their
paper
handling
work
and
reducing
their
simplifying their paper handling work and reducing theirdowntimes
downtimes
Pro-actively
Pro-activelyalert
alertfreight
freightforwarder
forwarderon
ondocument
documentissues
issuestotolet
letthem
themadjust
adjust
quickly
and
ensure
loading
of
cargo
as
scheduled
quickly and ensure loading of cargo as scheduled
Better
Bettervisibility
visibilityfor
forfreight
freightforwarder
forwarderand
andstakeholders
stakeholdersby
byenhanced
enhancedcargo
cargo
track
&
trace
solution
track & trace solution
Eliminate
Eliminatethe
themanagement
managementofofdiscrepancies
discrepanciesdue
duetotomissing
missingdocuments
documents
Increase
Increase
level
level
of
security
of security
Secure
Securethe
theaccess
accessofofdangerous
dangerousgoods
goodsinformation
informationand
andspecial
specialhandling
handling
requirements
for
the
shipment
requirements for the shipment
Become
Becomeflexible
flexibleenough
enoughtotobe
becompliant
compliantwith
withregulations
regulationsneeds
needsby
by
responding
properly
and
in
a
fast
manner
to
customs
demands
responding properly and in a fast manner to customs demands
Respond
Respondfaster
faster
to
toregulator
regulator
bodies
bodies
Reduce
Reducecycle
cycletime
time
Perform
pre-clearance
Perform pre-clearancetotothe
thecustoms
customs
Submit
data
with
better
quality
Submit data with better qualitytotocustoms
customs
Contribute
Contributetotothe
theadvanced
advancedreporting
reportingrequirements
requirementsby
byproviding
providingdata
datainin
advance
and
be
compliant
with
Governmental
and
security
regulators
advance and be compliant with Governmental and security regulators
Increase
Increase
quality
qualityof
of
information
information
Reuse
Reusecustomer
customerdata
dataininan
anautomated
automatedway
way
Improve
data
accuracy,
integrity,
Improve data accuracy, integrity,validity,
validity,consistency,
consistency,criticality
criticalityand
and
information
completeness
information completeness
Access
Accesselectronic
electronicdata
datainstead
insteadofofpaper
paperthat
thatcan
canbe
bedamaged
damagedororlost
lost
Sustain
Sustain
development
development
Be
Beeco-friendly
eco-friendly
Boost
Boostcompany
companystatus
statusininthe
thecommunity
communityby
bybeing
beingpart
partofofthe
theGreen
Green
Revolution
Revolution
www.iata.org
23/25
6.6. Main costs to consider
Organisation
IT Strategy & Governance
e-freight business
At high level, the management of the

relationships with stakeholders is
essential in the success of the project
and coordination is required.
Through the Business process
transformation, the processes are
adapted, fine tuned and dual
processes during transition period run
in parallel.
Another key aspect of the project is to
manage the change and the rollout,
including training and communication.
The e-freight solution and the
message distribution model need to
be defined as well as the required
level of security in message
exchanges.
Business Process
Transformation
Solution Integration
Risk Management
& Security
There are some costs to consider in the development of the solution and its maintenance, as presented in
the diagram below.
Management of Change & Network Rollout

Stakeholder Management
Operational Management & maintenance
The main activities to consider during the integration of the solution are the updates of the information
system(s) and interface(s) as well as the management of all technical aspects such as:
Project management and solution development life cycle (user requirement, architectural
governance, development, tests, integration and validation, etc.)
Installation of printer software on PCs at outstations
System enhancements based upon outstations requirements
System problems investigation and solving
Technical support during the pilot run and transition phase
The need of additional printers during the transition period is justified by managing both e-freight and non efreight destinations: for 100% e-AWB rollout in Hong Kong, Cathay Pacific has used a neutral printer,
purchased one neutral AWB printer and three laser printers as well as four new PCs.
During the transition phase, there is also a need for equipment at the outstations. Printers are required to
cover some countries requirement on neutral Air Waybill, interline carriers who are not yet adopted
electronic Air Waybill or laser Air Waybill. Customs and other government parties may request airline to
produce hard copy documents when requested.
www.iata.org
24/25
7. The Cathay Pacific next steps

Cathay Pacific rollout e-AWB to oversea stations where feasible during 2012. The current feasible countries
for Cathay Pacific are Singapore, Malaysia, UAE, Australia, Korea, Canada, Japan, Taiwan, Thailand, New
Zealand and Europe.
Cathay Pacific will continue working closely with capable e-freight forwarders to increase number of e-freight
shipments in existing 36 e-freight enabled Cathay Pacific stations.
IATA will pursue effort to get the remaining countries adopting e-freight and Cathay Pacific will adjust the
rollout plan accordingly.
We believe e-freight can bring benefits to the members and will be the future for the air freight industry.
Jackson Chan, Cargo Services Manager e-freight, Cathay Pacific.
www.iata.org
25/25

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CASE STUDY

Productivity gains (in %) obtained in e-freight environment

Cathay Pacific and Hong Kong e-freight shipment trend 2010-2011

Cathay Pacific cutover 100% e-AWB

3.2. The electronic Air Waybill (e-AWB) and e-freight

3.2.2. Electronic Air waybill (e-AWB)

4. Cathay Pacific first IATA member to be 100% e-AWB

5. Main constraints and issues in a paper environment

Collate all air

5.2. Export process prior to e-freight adoption

5.2.2. Perform incoming checks on received documents

5.2.3. Sort the received documents

5.2.4. Perform outgoing checks and deliver to the aircraft

5.3. Import process prior to e-freight adoption

5.3.2. Retrieve goods and documents for consignee delivery

The detailed existing process is:

5.4. Summary - main constraints & issues and impacts

5.4.1. Export Process

5.4.2. Import Process

5.4.3. Accounting Process

Collect all air

5.4.4. Data archiving

6. The benefits of e-AWB and e-freight

6.1.2. Perform incoming checks on received electronic documents

6.1.3. Sort the received documents

6.1.4. Perform outgoing checks and deliver to the aircraft

6.2.2. Retrieve documents for consignee

6.3. The challenges of the transition towards 100% e-freight

Cathay Pacific and Hong Kong e-freight shipment trend 2010-2011

Cathay Pacific cutover 100% e-AWB

6.4. Main savings identified along the processes

Task to perform in both paper environment and in e-freight environment

Task slightly improved (5%)

Task partly eliminated, usually around 50%

Task eliminated except when special documents to handle

6.4.3. Export process

Retrieve and check the documents

100% e-AWB + eHouse Manifest

Performs a quality check on electronic FWB

Detaches the shipper copy of the Master Air

Detaches another copy of the Master Air

After acceptance, receive correction advise

Update the air waybill record in the

Sort rest of received documents

Retrieve documents for preparing flight

Check documents against flight manifest

Check documents against flight manifest

Put all documents in the flight bag (flight

Container build up instruction based on

Deliver the Master Air waybill and the House

Take the flight bag and deliver it to the

6.4.4. Import process

Retrieve flight bag from aircraft and bring it

Split the local arrival flight bags from the

Print AWB laser copies for consignee copy

Sort and store temporarily the documents in

Deliver to the Freight Forwarders the

100% e-AWB + eHouse Manifest

Complete the Shipment Release Form, and

Copy of the air waybill.

6.4.5. Accounting process

Collect all air

For each flight retrieve all physical air