C2K Presentation

Purpose and Benefits of Cargo 2000

Quality Standard for the Global Air Cargo Industry

April 2012

Cargo 2000 (C2K) Vision and Mission

Vision

C2K defines quality standards for the supply chain, is improving the efficiency of the air

cargo industry, improving customer Service and reducing costs to all participants by

implementing a program of agreed business and automation standards, which are

measurable and lead to quality competitive performance.

Mission

C2K is a self funded non-profit interest group sponsored by IATA, with the mission to

create and implement a quality standard and management system for the worldwide air

cargo industry.

What is C2K?

• Founded in 1997

• Not for profit Members’ Association

• IATA sponsored initiative

• Aimed at improving industry quality

• With a mission to create and implement a

quality management system for the global

air cargo industry

Trends and Dependencies

Cargo 2000 linchpin for Industry

Quality Standard

Workflow-management

(GH Procedures)

Web-

applications(XML vs CargoImp)

Strategy + Planning

Risk-management

Automation + Symplification(e-freight, e-AWB)

Quality-

Management(C2K as internal QMS)

Balanced

Score Card(Performance measuring)

SecurityMeasures

(Screening, Secure-Freight)

Business Reengineering(Interlining, Groups, Hubs, other MOT)

Product-development

(i.e. Time-Temperature)

C2K Development and Timeline

2010/122009200820072006200520042003200220012000199919981997

Vision & Development

ImplementationNew

Organization & Industry Quality

Vision

Volumes & Metrics

Data Publication& Industry Associates

Getting it Right!

Driving Internal Quality

30 30 28 29 29 46

1816K

85%

80%

57

3338K

91%

73%

64

7343K

90%

74%

71

11786K

91%

84%

66

13600K

92%

85%

82

14443K

91%

82%

Members

Shpmts

FWB

NFD

C2K House

Foundation

Stakeholder

Strategy

A2A Phase 2 (D2D)D2A-A2A-A2D

D2D(D2A-A2A-A2D)

Bilateral Route Arrangement and Verification Online (BRAVO)

Inter-CDMP Messaging

C2K

WebpageReporting

Data Base Q CargoTraining

ModuleBRAVO

Webpage

C2K Cycle Control

FrameworkC2K Quality Reporting

C2K Quality Management

System

Airlines Forwarders CDMP /

IT ProviderGHA/RFS Airports

• Member base • Members • Solutions• Quality

Growth Improve Support Deliver

Master Operating Plan (MOP) - Membership

Key Elements

IT Tools & Access

Quality Control

C2K Board

C2K Management team

AGM

Shipper

D2D(Piece Level)

PositioningObjectives

Airlines

Mr. Mattijs ten Brink (Chair) - AF / KLM Cargo

Mr. Daniel Roeska - Lufthansa Cargo

Mr. David Kerr - Etihad Airways

Mr. Peter Langslow – Cathay Pacific

Mr. Neel Shah - Delta Airlines

Forwarders

Mr. Max Sauberschwarz - Kuehne + Nagel

Mr. Mick Fountain (Vice-Chair) – OHL

Mr. Kunio Omae– Yusen Logistics

Mr. Thomas Mack – DB Schenker AG

Mr. Henrik Lundt - Panalpina

Mr. John Batten - Swissport (Advisor)

C2K Board

AirlinesAirBridge Cargo [+]Air Canada (*)Air France (*)Alitalia (*)American Airlines (*)British Airways Cargo (*)Cargolux (*)Cathay Pacific (*)China Southern (+)Delta Airlines (*)Egyptair [+]Etihad Crystal Cargo (*)Finnair [ t ]Iberia [*]Kenya Airways (+)KLM (*)Korean Air (*)Lufthansa Cargo (*)Martinair (*)Polar Air [+]Qantas [+]Qatar Airways [*]SAS (*)Saudi Arabian Airlines [+] Singapore Airlines (*)South African Airways [+]Swiss WorldCargo (*)Turkish Airlines (*)United Airlines (*)Virgin Atlantic [+]

ForwardersAgility Logistics (*)Aramex [ t ]Cargomind [ t ]CEVA Management LLC (*)DB Schenker (**)DHL Global Forwarding (**)Geodis – Wilson (*)Hellmann [+]Kuehne + Nagel (**)OHL [+]Panalpina [*]SDV International Logistics (*)UPS SCS [+]

Uti [+]Yusen Air & Sea (**)

GroundhandlersAACT [+]

Asia Airfreight Terminal (*)

Australian Air Express (*)

Aviapartner (*)

Cargo Airport Service [+]

Cargo Center Sweden [*]

Cargologic (*)

CSC India [+]

Flightcare Belgium [+]

Flightcare Spain [+]

Groundforce (*)

Hong Kong Air Cargo Terminals Ltd. (*)International Cargo Centre Shenzhen (*) Planehandling [+]SATS Ltd. (*) Servisair UK [+] Swissport (*) TAT (*)Worldwide Flight Services [+]Xiamen Int. Airport Cargo Terminal [+]

Who participates in C2K?

(*) = active Members who obtained the C2K Quality Certificate

(**) = active Members who obtained Phase 2 certification

[ t ] = Members who are presently testing the C2K Quality Management System (QMS)

[+] = Associated Members who are yet to implement the C2K QMS

IT ProvidersAirclic [+] British Telecom (*)Cargo Flash Infotech [+] CCN (*) Champ Cargosystems (*) Descartes Global Logistics (*) GLS (*) IBS [+]

Infosky[+]

Mercator [+] Riege Software (*) Traxon (*)Unisys (*)

Trucking CompaniesAccelerated Inc. (+)Land Air Express (+)Jet Airways [+]Towne Air [+]Wallenborn [ t ]

AirportsAmsterdam Schiphol / Cargonaut [+]

Members Industry Associates

Airlines + Forwarders

Global or Regional members

Associated membershipFull MembersImplementation stageQuality CertifiedClassified

Membership fee:USD 5.000,- / 10.000,- p.a. (Assoc.Member)USD 10.000,- / 25.000,- p.a. (Full Member)

GHA‘s / RFS‘s / IT companies / Airports

Global or Regional members

Industry Associated MembershipImplementation stageQuality CertifiedClassified (concept work-in-progress)

Membership fee:USD 10.000,- / 25.000,- p.a.

C2K Membership categories / fees

C2K - How it works?

Every shipment gets a plan

Every plan has milestones

Members receive alerts when milestones fail

Enhanced ability to re-plan and or recover

Detailed records are available for process analysis and improvement

The Route Map

ScheduledDEP

ScheduledARR

ActualFWB

PlannedNFD

ActualRCF

ActualDEP

ActualARR

Actual

RCS

ActualDLV

PlannedFWB

PlannedRCS

PlannedRCF

PlannedNFD

PlannedDLV

Origin Processes Destination Processes

Phase 1

AirlineIT System

ForwarderIT System

AirlineCDMP

ForwarderCDMP

constant data exchangeC2K

Reports Reports

Identical data and reports

Forwarder Airline Forwarder

AirlineIT System

ForwarderIT SystemReports

Different data

FormerStatus Reports

Different reports

Alerts if actual movement of the freight is not as planned !

Visibility & Control thru identical Data

C2K Value Proposition

Achieving transparency and visibility of the actual freight movement for the customer by applying C2K measurement of milestones and alert setting procedures during transportation

Improving internal processes to enhance service delivery by using the C2K milestone measurement and alert system as well as applying the C2K Quality Management System

Achieving recognition of adherence to C2K quality standards through structured auditing procedure and certification

Comprehensive reporting on compliance with harmonized C2K standards/milestones and selected KPI’s including benchmarking of performances within the industry

Gaining experience from knowledge and best practices of the C2K member organization in finding solutions for existing and future challenges to improve transportation performance

Getting access to comprehensive documentation of proven procedures and specifications of C2K processes and quality standards to measure and benchmark supply chain performance

Supporting and facilitating the alignment with new developments in the industry by harmonizing standards, procedures and business rules within C2K

What are the benefits of C2K? (1)

Increasing client retention & growth through enhanced service

Increasing new business based on “preferred supplier” status provided by quality performance backed by reliable data

Reducing the time spent for manual track & trace activities and for the management of irregularities

Increasing quality of warehouse and trucking operations because of standardized processes and fewer failures

Improving processes towards paperless shipping management

Reducing claims through improved visibility, control and quality

Ensuring reliable and timely delivery of freight through harmonized processes and standards of airlines and forwarders

Training of operational staff on identical standardized processes

What are the Benefits of C2K? (2)

Improving capacity utilization for aircraft, warehouse and trucking space by C2K planning

Reducing cycle times

Using same quality monitoring and reporting logic, airlines and forwarders rely on identical data to discuss quality improvements

Benchmarking of quality performance by a “neutral” body

Monitoring of real performance to ensure a high level of service delivery reflecting the requirements of different stakeholders.

Providing proactive information for shipper and consignee in case of deviation from transport plan.

Accessing knowledge from a well developed system with sizeable data of + 1 million reported transactions per month

C2K – What’s next?

• Development of C2K Platform

• Implementation of Phase2: • Alignment of C2K + e-freight:

- Review of the Master Operating Plan (MOP)

• Expansion of C2K for:

-Perishable products

-Security related products

-Air Mail services

- Enhancement of Reporting System

S C

Driving Internal Quality

9

9

Integration and completion of build up for high

quality C2K Industry Standard

Strategy

Element

Phase 1 Phase 2 Phase 3

Grow

Deliver

Support

ImproveEnsuring Data

Quality & Integrity 2

Au

dit

Act

ivit

ies

Pe

rfo

rma

nce

Im

pro

ve

me

nt

9

Priorities

Specs & Rules

Offset Management

Enhance Reporting

Shipments & Members

5

6 1

7

8

3

4

1

2

Improve congruence8

1 Review & Validate MOP, Phase 1 Specifications,

Milestone Definitions and Audit Process

2 Improve reporting process, outputs and broaden

scope. Deliver high level of Data Congruence

3 BRAVO - Standardize process, review & improve

delivery system

4 Membership differentiation, geographical growth,

increased implementation & innovation

5 Simplify terminology, develop integrated

communications plan

6 Align org. to support Delivery, Second Member

resources to increase speed to completion

7 Develop P2 Implementation Plans, Audits ….

Hig

hM

ed

ium

On

go

ing

Get initial information & ongoing support from your C2K Regional Director

Enter into C2K Membership Agreement

Start by performing a gap analysis between your current systems/processes

and the C2K specifications

Participate in C2K Local Association’s as a learning tool and support mechanism

Use the C2K quality matrix as permanent “to-do-list” and quality management tool

Participate in the C2K working groups

How can new Members start?

� …provides measurement & reporting as key elements of the C2K System

� …data initiates corrective actions and eliminates quality issues

� …enables benchmarking based on identical data / reports

� …is a well developed Quality Management System, ready to apply,

made by the industry for the industry

� …is a global organization, where all stakeholders of the airfreight industry

work together on quality improvements

� …members are audited and certified

� …is open to interested parties to join and help further improve industry

quality

� …is reaching out to shippers / customers to be part of this initiative ….

In conclusion

"Swissport is an active member of the Cargo 2000 initiative. As a service provider, we are deeply committed to customer satisfaction. The Cargo 2000 provides a common quality management system that allows our performance to be measured, reviewed and improved." John Batten - EVP Global Cargo, Swissport International

"We are definitely only talking to carriers that have it (Cargo 2000)".

Thomas Mack, VP Airfreight, Schenker AG

Customer Reactions and Testimonials

‘If not Cargo 2000, then what?’David Brooks, President of American Airlines Cargo

"C2K has become our internal quality program at United Airlines Cargo. Carriers, forwarders and logistics partners must share and act upon reliable, consistent data to deliver the highest quality service to our customers. C2K provides the data and framework to support our industry’s focus on continuous improvement."Scott Dolan, President of United Airlines Cargo

Contact Information / Working Structure

Tom PresnailRegional Director The Americas

and Asia Pacific

5091 Del Monte Avenue

Victoria British Columbia

Canada V8Y 1W9

Phone +1 778 977 4815

E-mail presnailt@iata.org

Michael Vorwerk

Executive Director

Thorsten LafleurTechnical Director

Cargo Network Services Corp.

703 Waterford Way Suite 680

Miami, FL 33126 / USA

Phone +1 786 413 1008

FAX +1 786 413 1005

E-mail lafleurt@iata.org

www.cargo2000.com

Lothar MoehleRegional Director EMEA

European Office

Erlenhorst 19

46499 Hamminkeln / Germany

Phone +49 (0) 2852 - 509 003

FAX +49 (0) 2852 - 509 003

E-mail moehlel@iata.org

Thank you !

Quality Standard for the Global Air Cargo Industry

Cargo 2000 Presentation,

May 2012