The array of reasons given for the air cargo industry’s resistance to innovation is as familiar as the litany of criticism. A sector that is – in too many cases – an adjunct to the core business of flying passengers has to compete for scarce investment funds with other segments deemed more important or strategic. Funding itself has shrunk in a tide of red ink that has tempted airport authorities and airlines to withdraw as much as possible from the sector, leaving it to third-party providers. Legacy systems languish in the latter decades of the twentieth century. The heterogeneity of the air cargo supply chain means that too many parties have to be courted to buy into new initiatives. Sometimes it seems miraculous that any progress happens at all in air cargo.
Still, seemingly despite itself, the industry has seen some serious steps towards innovation in the past year, and some operators have signalled that more is to come in 2013.
Airline reaches for the clouds
Lufthansa (LH) Cargo is driving the development of the Fly-Bag, a novel concept for an explosion-proof container that is currently being reviewed at the Technical Advisory Board of the European Union (EU).
With numerous product launches and unique service elements, such as special temperature-controlled containers, LH Cargo has established itself over the years as one of the innovation leaders in the industry. More recently it has also blazed a trail in harnessing the revolutionary ideas of customers and followers – which is where the Fly-Bag came in.
In addition to the established in-house stream of development, management decided in 2011 to solicit ideas for innovation from its customer base. This led to the Open Innovation Challenge, a competition, which invited submissions of novel ideas from around the industry. These were submitted to a special portal for public review and comments that allowed the further refinement of proposed concepts.
The first innovation challenge, launched in the autumn of 2011, saw the Fly-Bag emerge as one of the winners of the contest.
The second round of the innovation challenge, launched a year later, yielded 185 submissions that were discussed by 328 participants from 109 countries. Comments came from a broad group of participants that ranged from people in academia to operations staff at logistics firms. The winners were the LH Cargo Student Certification Programme, an online academy with the chance to obtain a final certificate; and Cargo TRIS, a mobile phone game where users can virtually plan and on-load freight in the aircraft hold.
“The perspective from outside the company provides us with valuable insights enabling us to measure up even better to serving customer requirements,” remarks innovation challenge project manager, Benjamin Pfeifer.
Initially, there were reservations about an open platform that allowed their competitors to see the entries as well as all the comments on them, but the view prevailed that transparency was essential, he recalls.
LH Cargo steered the broad direction of the contest by allocating a theme (digitalisation was the lead concept for the 2012 challenge) but it is important to allow room for submissions that are off the main banner, Pfeifer notes.
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