“Partnering for Innovation” is IBS’ strategy when it comes to continuously developing its booking platform to create a true “Digital Ecosystem”. In partnering with CargoAi, which markets itself as "The only artificial intelligence-enabled airfreight platform that connects freight forwarders and airlines", the two companies complement each other in established and new networks, giving clients the opportunity to maximize potential revenues through faster access to market offers. CargoForwarder Global, asked Ashok Rajan (AR), SVP & Head of Cargo & Logistics at IBS Software, and CargoAi’s CEO, Matthieu Petot (MP), to explain the partnership in more detail.
IBS and CargoAi have been working together since July 2020 to build a rich platform-level integration using a scalable, API based architecture. Ashok Rajan, SVP & Head of Cargo & Logistics, IBS Software, underlined that the latest development is only a flick-of-the-switch away for customers, and that ease of implementation was a key focus for both companies, who have done all the preparation work in the background already to enable the logistics world to benefit from this simple, effective digital ecosystem. “We believe that innovation can be fast-tracked by partnering with companies like CargoAi bringing in new and improved ways of doing business like in sales and distribution, which is still very antiquated and legacy-based in the air cargo industry." Matthieu Petot, CEO of CargoAi, explained: "The integration currently covers real-time e-booking and e-quoting, flight availability searches and shipment tracking. Lots of other possibilities exist, but this partnership is already showing just how essential synergies are in order to make digitalization accessible to all stakeholders in our industry, a goal that we share with IBS."
CFG: How and where did IBS and CargoAi meet?
MP: We reached to IBS, as they are one of the leading air cargo system providers, to offer them to partner and propose an additional sales distribution channel for the airlines working with iCargo.
AR: We have been tracking the evolving air cargo digital ecosystem extremely closely and we've been aware of CargoAi's groundbreaking work for some time. We were excited when they got in touch.
CFG: Would the development have happened without a pandemic?
AR: The pandemic has prompted a huge and much needed drive to digitalize the industry, and we're delighted to be working with companies like CargoAi that share our vision.
CFG: What will change for iCargo users exactly?
AR: We have established a platform-level integration between our iCargo customers and CargoAi through a custom defined API gateway platform, which means they can quickly and easily connect to the CargoAi platform without the need for bespoke, complex integration projects. This gives our customers more choice of digital channels to connect with their clients, a highly scalable solution as demand for such services expands and delivers a faster time-to-market to launch such services to their customers.
MP: CargoAi and IBS are connected which means that all the IT integration has been done with iCargo for the airline. Forwarders that login to CargoAi can see the flights that are available and book a shipment with their contract rate directly into the airline system. They will get an instant confirmation as our 2 systems are connected. Freight forwarders will have the exact same answer and rate as if they call directly the airline agent or send an email, but the process is much faster and efficient for everyone.
CFG: What challenges were encountered since you began working together in JUL20?
AR: We started work on developing the platform level integration in July 2020, so like every other business, we were limited by necessary restrictions on working in-person, on-site. We found that collectively we were able to put in place measures for teams to handle the integration remotely with no issues. Far from presenting challenges, we even saw productivity increase and the project ran smoothly.
MP: Both teams are skilled, and the APIs were well documented to the integration and testing went very smoothly on both sides.
CFG: What is the fees set-up? Add-on for CargoAi, or included in iCargo package?
MP: There is no integration cost for the airline to be available on CargoAi. As a sale distribution channel, we take a marginal fee on each shipment booked by the freight forwarder through us. Our APIs also cover track and trace at no additional cost. The airlines is therefore making savings on the tracking updates costs that are usually sent through Cargo IMP/XML messages.
CFG: Do the "new and improved ways of doing business" through CargoAi mean the need for training for iCargo users?
MP: Bookings done through CargoAi will be in iCargo system the same way as bookings made through the airline portal or EDI so there is no new process for iCargo users. Smooth and simple digitization of the industry is our aim.
AR: There is no extra training needed. In fact, digital channels like CargoAi provide a self-service platform that provides an automated sales process for airlines and their customers, which can bring down the quantum of manual intervention required by sales or call center teams.
CFG: How does the IBS-CargoAi partnership differ from other IBS booking platform partnerships? And is this the first such partnership for CargoAi?
MP: We can’t disclose our partnership terms, but this partnership is great news for our customers, as we did the heavy work by doing all the technical work and propose a solution to them with no investment. We are very proud to be able to partner with professionals like IBS Software and to be at the service of renowned air freight users (airlines, freight forwarders and GSSAs). This allows us to continue to develop our range of services and to innovate.
AR: CargoAi brings its own unique capabilities and added functionality, which will enhance the booking and quotation process for our iCargo customers. We are delighted to be working with CargoAi and we share their passion for innovation in the industry.
CFG: "Lots of other possibilities exist" - what is meant by that?
MP: There are, in fact, different ways to provide our industry with the digitalization it requires, and this type of partnership is one of the ways to do this – quite simply because we need each other to move forward. We are also moving in this direction by adopting other methods. There are a few possibilities to have deeper integration and continue adding value to our customers. For example, CargoAi is the only digital booking platform to have a solution for the quote request process and this can be done via an API. This will enable iCargo users to receive and answer to e-quotes directly in their system which will be much more efficient than email or phone.
AR: We foresee rich digital integration between supply chain partners in the air cargo industry as a big growth area. There is still plenty of scope for further advancements in digitalizing the industry. We're still in the early stages of a process that will transform air cargo for the better.
CFG: "Scaleable API" - does this partnership open opportunities for any new client groups?
MP: CargoAi is built on the latest serverless technology on AWS which means that our platform will scale its resources automatically and will perform the same if we have 10 or 10,000 users or bookings at the same time.
AR: The concept of rich integration using a flexible API model is still relatively new for the air cargo industry and represents the next generation of data sharing. APIs will push the boundaries of digitalization in a way that existing legacy infrastructure cannot support. We have invested in creating platforms to enrich partnerships leveraging modern concepts such as APIs between a variety of stakeholders in the supply chain, from customers to GHAs to partner airlines. A scalable platform will pave the way to on-demand services, and as the partner community grows, the capabilities will increase at scale.
CFG: Where do IBS and CargoAi see the partnership in 5 years? What innovations might have been jointly developed by then?
MP: I have a few ideas of where our partnerships will be in a few years and where it could be in 5 years, but we will make progress step by step.
AR: In five years, I firmly believe we will back and say that 2020 was an inflection point in transforming the air cargo sector. The challenges and opportunities that this has brought have expedited innovation. The industry is just warming up to digitalization. As it becomes more widespread we will see a plethora of functions evolve as data and analytics start to drive more automation and automatic decision making. I would draw a parallel with the hotel industry. The adoption of digital hotel bookings led to fundamental changes in the way business is done and accelerated innovation in the sector. That will happen in air cargo, too.
CFG: What are the threats/risks/opportunities to digitalization in this pandemic situation?
MP: The major risk of the pandemic was that airlines would not have the capacity to invest to adapt their systems to enable the right level of digitization despite the great ROI. Therefore, IBS and CargoAi have decided to make all the integration work and the airlines have no investment to make anymore. They just have to turn on the switch and watch the booking flow in their system.
AR: The only risk is that the industry doesn't ride the wave of change and capitalize on the opportunity to push the boundaries of digitalization. The pandemic has forced the industry to think in new ways and led to a major acceleration in digital transformation. Together, we are thinking of new ways to automate how we do business to keep the industry flourishing. Significant progress has been made in advancing digital channels and adapting business practices and we need to use this momentum to build on what has already been achieved. Digitalization will be the engine that drives the future of the industry. We have a golden opportunity to revolutionize the industry and we have to take it.
Thank you, Ashok Rajan and Matthieu Petot!
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