The KC-135 and S&OP

 Following the interview with Paul Woodlief on CPFR, Dr. Brady wanted to continue the conversation--so they did! 

In addition to the application of CPFR, the DLA and the USAF started exploring internal collaboration using the common and commercially accepted S&OP processes.  Paul talks about the additional benefits they found with S&OP and talks about the synergies he sees when combining S&OP and CPFR.

Once again, a great conversation, and well worth the listen!  Let us know what you think in the comments. 

http://sctoday.net/?q=node%2F111

Also look at:
http://www.af.mil/information/factsheets/factsheet.asp?id=110

The Air Cargo Industry & its specialty – a personal experience

The Air Cargo Industry & its specialty – a personal experience                 by Archie D'Souza

The air cargo industry is quite obviously different from the passenger airline industry. Beyond both offering services that mostly focus on transportation via air the two industries share little else. Let's get into it.

The main focus for a passenger airline is to service passengers.  Cargo is only a bi-product though its revenue earning capacity is sizeable.  Services rendered to passengers are mainly confined to the time s/he is on board.  On the ground, it’s negligible and almost entirely contained within the airport.  Passenger airlines offer airport to airport services for passengers as well as cargo.  Any onward travel and accommodation at the destination is ultimately the passenger’s prerogative.

I started my career with the cargo division of Air India.  Like every passenger airline, it offered an airport-to-airport service.  This meant that an exporter had to get the cargo moved to the airport of departure, get the cargo customs cleared there and hand it over to the airline.  At the airport of destination, once the cargo arrived and was checked, the carrier would send a cargo arrival notice to the consignee, who in turn, either directly or with the help of a customs broker (CHA in India).  Cargo and traffic (dealing with passenger services) were two of the divisions of what is Air India’s Commercial Department.  Both these divisions had their similarities and differences.

Let me look at the similarities first.  Both are important revenue earners for an international airline.  A passenger needs a confirmed seat; cargo needs confirmed space in the cargo hold.  A passenger needs to carry a document called a ticket; cargo is carried by an airline after, among other things, the issuance of an air waybill.  A passenger cannot leave the country without a passport; the shipper requires to file a customs declaration, called a shipping bill in India.  Passengers need to pass through immigration; cargo needs to be customs cleared.  Passengers wait at a passenger terminal prior to boarding; cargo is stored in a cargo terminal.  On disembarkation passengers need to pass through immigration and customs; cargo shipments need to be customs cleared.

While these are the similarities, the differences are far more pronounced.  The facilities required to store and transport goods are far less than those required for waiting passengers on terminals and those travelling on board.  In an aircraft, the passenger needs aisle space, leg, head & elbow room and comfortable seating; cargo on the other hand can be stacked one on top of the other with no space in between.  Cargo doesn’t require refreshments and entertainment as passengers do.  Further, packages do not complain whereas passengers can be very vocal in their complaints.  The list could go on and on.

One of the biggest advantages or air transportation, compared with other modes, is the fact that there is hardly any limit to the number of places where airports – nodes for air transport – can be set up.  Due to this air routes are practically unlimited.  Thanks to greater movements of passengers and freight the density of air routes over the North Atlantic, inside North America and Europe and over the North Pacific is definitely greater.  Constraints with regard to air transportation are multidimensional.  Let’s take some examples.  A commercial plane needs about 3,300 meters of runway for landing and takeoff.  In addition, several other facilities need to be set up at airports.  Therefore, the site chosen must take these into consideration.  Also, airports cannot, for obvious reasons, be set up in densely populated places.  Climate, fog and aerial currents are other constraints that need to be taken into consideration with regard to air transportation. 

Air activities are linked to the tertiary and quaternary sectors.  What exactly does this mean?  The World economy and that of any nation is divided into various sectors – primary, secondary, tertiary, and quaternary.  These terms are used to define the proportion of the population engaged in particular activities.  Let us briefly look at each of these. 

Extracts and harvests - viz. what is mined or farmed is what the primary sector of the economy deals with; in other words, products from the earth.  It includes the production of raw material and basic foods.  Activities associated with it include agriculture (both subsistence and commercial), mining, forestry, farming, grazing, hunting and gathering, fishing, and quarrying.  The packaging and processing of the raw material associated with this sector is also considered to be part of this sector.  In developed and developing countries, a relatively low proportion of workers are involved in the primary sector; the figure in the US is 3%.  That is the percentage of the labour force engaged in primary sector activity today.  In the mid-nineteenth century, it was more than two-thirds. 

The secondary sector of the economy deals with, among other things, the manufacture of finished goods.  This includes all of manufacturing, processing, and construction.  Thus, activities associated with it include metal working & smelting, automobile production, textile production, chemical & engineering industries, aerospace manufacturing, energy utilities, engineering, breweries and bottlers, construction, and shipbuilding.  The tertiary sector of the economy is nothing but all the service industries, providing services to individuals and business & other organisations.  Retail & wholesale trade, transportation & distribution, entertainment (movies, television, radio, music, theatre, etc.), restaurants, clerical services, media, tourism, insurance, banking, healthcare, and law are some of the activities associated with this sector.  In most developed and developing countries, a sizeable proportion of workers are devoted to this sector – more than 80% in the USA.  Finally, the quaternary sector of the economy consists of intellectual activities. Activities associated with this sector include government, culture, libraries, scientific research, education, and information technology.

Principal among the tertiary and quaternary sector activities that the airline industry is dependent upon are finance and tourism.  However, if one looks at air cargo in particular, it is the secondary sector that it mainly services.  However, air cargo brings in a lot of ancillary and support services which are part of the tertiary and quaternary sectors.  Passenger services benefit from finance and tourism as they lean a great deal on the long distance mobility of people.  However, cargo services provide the distance mobility of goods.  Since the introduction of the Boeing 747 and other wide-bodied aircraft air transportation services have been accommodating growing quantities of freight.  Airlines are today playing a huge and fast-growing role in global logistics, most often with the help of global service providers.

Air cargo, in many ways, is a unique service.  There are many segments involved in it.  Among those we can list out are airport-to-airport, door-to-door, door-to-airport and airport-to-door.  Most of the World’s carriers (airlines) offer an airport-to-airport service.  The shipper (exporter) needs to hand cargo over to the carrier ready for carriage at the airport of origin.  This means, among other things, cargo has to be customs cleared.  The carrier, either on its own or using the services of other airlines, ensures that the cargo reaches the airport of destination.  The consignee is informed by the carrier about the arrival of the cargo.  Physical delivery of the cargo only will happen after customs clearance.  We have seen here that customs clearance takes at two points – the airports of origin and destination, the former prior to carriage and the latter prior to final delivery.  This service is not usually provided for by the carrier and the exporter/importer may not have the necessary expertise to carry it out.  So, they appoint customs brokers to do this job.  So, we see here an additional service provider.  I shall, in a future blog, talk about the role of intermediaries.

There exists a kind of carrier called an integrator who offers door-to-door, airport-to-door and door-to-airport services.  They also offer airport-to-airport services.  What distinguishes an integrator from the others is that they have their own fleet of aircraft and offer services which go beyond airport-to-airport.  Passenger airlines mainly focus on carrying people.  Air cargo is a bi-product albeit one that earns a huge amount of revenue.  They carry cargo in bellies of the aircraft.  They may also own a fleet of combi & freighter aircraft.  These terms will be defined in another blog.  Cargo airlines have fleets of only freighters, no passenger aircraft.  All integrators are cargo airlines.

Another type of service provider exists, the express-cargo or courier company.  These companies offer door-to-door plus the other services.  In other words, their representative will come to the exporter’s premises to pick the cargo up.  The cargo will be customs cleared by a customs broker called a custom-house agent (CHA) in India.  There are other service providers like IATA agents, freight forwarders, etc.  These service providers will be dealt with in a later blog.  Here, we have confined our focus on the role of carriers.  These will include passenger and cargo airlines, including integrators.

Aircraft & theirs uses

Aircraft and their Uses

- Archie D’Souza

[This constitutes an extract of a book I'm writing]

Do check this link [http://www.atlantisquest.com/Samar.html] 

The aeroplane is the fastest means of transport, whether of passengers or cargo.  Only spacecraft travel faster than aeroplanes.  We shall be looking at the exiting world of air transportation with an emphasis on carriage of cargo.  From the tiny bi-planes, which carry one or two passengers, to the gigantic jumbo jets and transportation aircraft which can carry huge machinery and battle tanks, air transportation has transformed the way humans think and live.  We shall be tracing the development of aircraft and looking at aeroplanes in use today and most important how freight is carried in them.  We shall also look at advantages and limitations of airfreight as a mode of goods transportation.

1.    History and Development

From the time mankind evolved on planet Earth, people have dreamed of flying.  Ancient Indian texts, like the Ramayana and Mahabharata and Greek one too had their legends about flying people and objects.  Kites were perhaps the first heavier than air objects which flew.  In 200 BC the Greek mathematician Archimedes discovered the principal of floatation.  This was used in the making of balloons.  Kites were possible the predecessors of gliders.  Balloons and gliders are not powered and therefore cannot be controlled.

Airships were the first powered objects to fly.  An airship is a lighter-than–air aircraft.  Its huge body contains a light gas like helium.  Like a balloon, the gas lifts the airship so it floats in the air.  However airships, unlike balloons, have engines that move them and can be steered in the required direction.  Balloons move wherever the wind takes them.  Airships also differ from aeroplanes and helicopters which are heavier-than-air and use their engines to lift them from the ground.

Although it was the Wright brothers who invented the aeroplane as we know it today, the idea of a modern flying machine was first conceived in 1500 by Leonardo de Vinci, an Italian painter.  He made a drawing of a flying machine with wings which would flap like a bird.  Between 1800 and 1903, several people tried to experiment with flying machines but were all unsuccessful.  It was only on December 17, 1903 that the Wright brothers flew their first aeroplane successfully.  The flight took place near Kitty Hawk in California.

The Wright brothers demonstrated that it was possible that it was possible to fly a manual machine that was heavier-than-air.  But, in 1895, eight years earlier, a Sanskrit scholar from the princely state of Baroda had designed a basic aircraft called Maruthsakthi, meaning air power. The scholar by the name of Shivkar Bapuji Talpade based his design on texts in the Vedas.  His unmanned aircraft took off in 1895 before a large gathering at the Chowpati beach in Bombay, now Mumbai.  While the Wright brother flew a manned flight, Talpade’s was unmanned.  However, while the flight piloted by Orville Wright crashed after covering a distance of 120 feet, Talpade’s unmanned flight reached a height of 1500 feet and covered a much larger distance.  A British historian, Evan Koshtka has described Talpade as the first creator of an aircraft.

The entire World has rightly recognised the achievements of the Wright brothers and celebrated its centenary on December 17, 2003.  However, Talpade whose invention was reported by the newspapers of his day was never accorded his rightful place in history.  India, it must be remembered, was ruled by the British, who were definitely not happy with his invention and made sure he got no help whatsoever to develop it.

Talpade was born in 1864 in the locality of Chira Bazar in Dukkarwadi which today, is an extremely congested part of Mumbai.  What is most fascinating about his design is that it was based entirely on material available in the ancient Indian Vedas.  A great Indian sage by the name of Maharishi Bharadwaja had in ancient times written a text called the Vaimanika Sastra (Aeronautical Science).  According to Western Indologist Stephen Knapp, the Vaimanika Sastra describes in detail a design similar to the one being developed by NASA today.  The design, in what is called the Mercury Vortex Engine, is the forerunner of the ion engines that NASA has developed.  According to Knapp additional information on the same can be found in another ancient Vedic text called Samaranga Surtradhara.  He says the text devotes 230 verses on how to use these machines in war and peace.

Another Indologist by the name of William Clarendon has translated the Samaranga Surtradhara.  In his translation is a detailed description of the Mercury Vortex Engine.  The following is a quotation from the same: “Inside the circular airframe, place the mercury engine with its solar mercury boiler at the aircraft centre.  By means of the power latent in the heated mercury, which sets the driving whirlwind in motion, a man, sitting inside, may travel a great distance in a most marvellous manner.  Four strong mercury containers must be built into the interior structure.  When these have been heated through solar or other sources the vimana (aircraft) develops thunder power through the mercury.”  Over a century and a decade ago Talpade was able to use his knowledge of the Vaimanika Sastra to produce sufficient thrust to life his aircraft 1500 feet into the air.

A great deal has been written on the subject in various Vedic texts.  An even greater deal has been lost to posterity.  Talpade’s invention finds mention in newspapers of the day.  Our imperial rulers made sure that it never took off.  He died un-honoured in 1916.  Greek mythology did make a mention of humans flying but ancient Indian texts give practical and workable methods on flying machines.  The Wright brothers rightly deserve their place in history.  No one should deny them that.  However, Talpade also deserves his rightful place and we should give it to him.  Remember, it was he who utilised the ancient knowledge of Sanskrit texts, to fly an aircraft, eight years before the Wright brothers.

Between 1903, when the Wright brother flew the first aeroplane and the First World War planes were mainly used for races and circuses.  The World War brought in the first military aircraft.  The World's first commercial flights were operated by World War I vintage bombers.

Between the 1920s and 30s, aeroplanes started increasing in size, speed and capacity.  Advanced navigational devices and pressurised cabins helped develop aircraft even further.  These planes like the Douglas DC 3 were propeller-driven.  The first passenger jet airliner was the Comet, a British plane which was put into service in 1952.  In 1955, the French built the twin-engine Caravel and the Soviets built the TU 104.  All these were small in size and had limited cargo capacity.

In 1958, Boeing, the company based in the US West Coast city of Seattle built a four-engine plane called the Boeing 707.  This was not only large in size but also could cross the Atlantic without refuelling.  In 1960, the US Company McDonnell Douglas put the DC 8 into service.  The Boeing 707 and DC 8 had huge capacities in their bellies, more than their predecessors.  Thus was born airfreight as a major commercial earner for airlines.

Till 1970, the Boeing 707 was the largest commercial aircraft.  However, compared to today's aircraft, capacities were still limited.  The introduction of the Boeing 747, the first jumbo jet, changed the way cargo was carried.  Compared to a passenger capacity of 150 in the 707, the 747 could carry up to 500 passengers.  With bigger bellies, the capacity to carry cargo increased from 6 to 8 tonnes to 16 to 20 tonnes.   Till the 1970s, aircraft manufacture was dominated by the Americans.  In the 70s the European consortium Airbus was formed and came out with the A 300 series of aircraft.  Today, Airbus and Boeing, between them control 90% of the aircraft industry.

Transportation and Logistics Management – Archie D’Souza

Transportation and Logistics Management – Archie D’Souza

(This article appeared in the Kochi edition of The Hindu on FEB 10, 2011)

India, the fourth largest and the second fastest growing economy in the world, is on the fast track where infrastructure spending is concerned. Some of the infrastructure areas where huge government spending is taking place are, roads, ports – major & minor, airports – expansion and modernisation of existing ones and building of new ones, inland waterways, coastal shipping and railway lines. There is also huge spending by the corporate sector both as PPP and private enterprises.

All this means huge career opportunities for fresh graduates and professionals. The movement of goods within and across regions and from one region to another plays an important role in economic growth. Roads, railways, air and shipping lines play a great role in this activity. Airlines, Shipping Lines, Railway Companies, Truckers and a host of allied services need professionals on a regular basis. These are sectors that hire high volume of people with improved and better pay options and transactions run into billions of dollars.

Transportation plays a very significant role in development. The transportation industry is the lifeblood of a nation's economy. In today's globalised situation it becomes the lifeblood of the world economy. How developed is a nation or a part of the World, or for that matter a region within a nation, state or even city, is directly correlated to its transport infrastructure.

When we talk about transport facilities we are not restricting ourselves to the physical infrastructure, which is very important. Also playing a great role is policy. A significant part of a quality course in Transportation and Logistics Management will be devoted to policies formulated and legislations involved in the transportation of goods. Free movement of goods leads to growth and development and thus a better standard of life for the people living in a given region. Procedural delays still exist in India, especially in movement and clearance of goods.

This is one lament of foreigners doing business in India. It is often easier to move goods by road from Rome to Amsterdam, crossing three international borders, than to move them from Hosur to Bangalore – a distance of 30 kilometres.

If transportation is the lifeblood of the world economy, logistics is the lifeblood of the corporate world. It is a very integral and important part of the supply chain. Technology, in today's global village, is available to anyone willing to pay for it. Quality products are taken for granted by every buyer and every supplier knows he needs to deliver. What makes one supplier different from another, today, is logistics. What exactly is logistics? It is all about movement of goods from supplier to manufacturer and from manufacturer to the consumer.

Every manufacturing enterprise as well as organisations in the services sector requires logistics professionals. The role of a logistics professional starts even before an organisation's operations start. Setting up a unit requires machinery and materials to be moved to the site. This may come from different parts of the world. Procuring, transporting and storing are all a part of the logistics department of a company. Once operations start, raw materials and components need to reach the factory site. These may need to be stored and later moved to the manufacturing areas. Finished goods need to reach consumers when they need them.

The commissioning of the ICTT will mean that containers that were previously transiting Colombo, Dubai, Singapore and Port Klang in feeder vessels will now be able to move on direct voyages in mother vessels. This will lead to all the major shipping lines bringing their mother vessels here for the purpose. Employment opportunities will be available directly with these shipping lines or with their appointed agents.

Shipping will bring with it other ancillary and support activities. Large scale warehousing, bonded storage and distribution centres are but some of the activities that will generate specialised jobs.

Cochin, as a whole, has a strategic location on the international seafaring route lying midway between Europe, Middle East and East Asia and the Pacific Rim. Its all-weather natural harbour and the large export of goods, especially spices and sea food makes it a very important port in India. The ICTT at Vallarpadam will tap into the large cargo movement along the international east-west sea lane. This will be a boon not just to Kerala but also neighbouring states like Karnataka and Tamil Nadu as well as the union territories of Lakshadweep and rest of India. The estimated value of the logistics market in India is $14 billion and will grow at a rate of 7-8 per cent.

Indian and multinational logistics companies operating in India cater to millions of retailers, manufacturers and service sector companies. This will translate into lakhs of jobs over the next few years.