OceanX – Rate$ & Drinks – Report May 18th 2021
We were glad having had many OceanX members join for two exciting sessions on Rate and Allocation Management today, featuring Christian Ove Sorensen as our special guest and a virtual cocktail hour for a casual catch up afterwards. The two sessions summarised a few interesting insights on the subject and where the future of our industry might be going.
During our EDPx classes and in recent discussions with members, we noticed a particular interest on the area of rate and allocation management. Thus we were glad to arrange two special sessions, covering different time zones, for members on the subject, featuring Christian Ove Sorensen today.
Christian has a wide experience on the subject having worked on different sides of the aisle, from leading carriers to global forwarders and in his role at one of the leading providers for rate management solutions, Portrix, which is now part of Descartes, he has been part of many implementations and an excellent overview on the market.
Following a brief introduction by Ruben, based on the previous work of OceanX with members that we have done on Rateflow, reiterating the importance of an efficient “rate kitchen”, Christian took us through the history of rate management and industry digitalisation.
In an interesting analogy he outlined the carriers current journey towards more of an “airline” business model, that will split between an approach to the sailing specific SPOT market and one of weekly commitments for specific volumes and customers, with the previous segment of FAK rates likely disappearing. Christian made clear that he believes the capacity and equipment issues are to continue, as carriers have understood the levers they hold in a world of less players. And that they will no doubt continue to increase their investments into vertical integrations, as they will have little interest to put it into ships and damage the advantageous supply-demand-situation.
He illustrated how digitalisation will be key for logistics players that remain in the middle between carriers and customer, as markets will just become faster. Also how artificial intelligence and machine learning will be essential to support this speed as humans will no longer be able to react fast enough, a key element that was also further elaborated during the Q&A session in the end. Christian elaborated that becoming more tech savvy will be important for forwarders overall.
Finally he shared an interesting perspective with the example of a Digital Eco-System for logistics companies, where effective market players will need to combine different digital tools to optimise their organisation and where just one system will not solve all needs, but combining the right ones and interweave them processes, will be the best way forward.
Christian closed, with providing some interesting learnings from his experience, starting with the importance of speed, avoiding to think in silos, focus on differentiation, but also being aware of the limits of the own control.
The sessions concluded with an interactive Q&A section, diving deeper on some of the subjects, for example in terms of how generations X and Z are changing decision making for example, what role standards do and will play and what the timeframe and speed of change will likely be.
During a virtual cocktail hour, following the session, members had an opportunity for some personal interaction time, discussing on the subject and touching base with each other.
A recording of the session is accessible for OceanX members through the OceanX WebApp and MobileApp.
OceanX is a non – exclusive global network of leading ocean freight providers and NVOCCs dedicated to delivering bespoke innovative solutions, in particular on FCL services, LCL consolidation, dangerous goods and chemical logistics, temperature control, fashion logistics, as well as project cargo handling.