COSCO Logistics CIO Wang Xinbo: it innovates enterprise operation mode
2015-07-24 Read 146

shipping cannot do without containers. Maritime transportation has always been an extremely competitive industry. Shipping enterprises not only need to compete with domestic counterparts, but also face the challenge of more powerful shipping enterprises in the world.

affected by the financial crisis, low price has become a helpless choice for many enterprises, and some enterprises even use the way of lower than cost price and negative freight rate to "die". But this low price way of "drinking poison to quench thirst" can not solve the fundamental problem of enterprise survival. Some enterprises begin to compete in the service field, looking for customers with higher value contribution rate.

industry statistics show that if the oil price remains above US $100, some small companies in the container transportation industry will close down, while large companies will continue to develop. The impact of the financial crisis has not changed the market structure of the industry, and the container transportation industry is still in a state of low industry concentration. 90% of the market share is in the hands of the top 20 liner companies. Maersk, the largest company, has 13% of the market share. Other companies have no more than 10% of the market share. Fierce market competition has become a normal.

Wang Xinbo, general manager of COSCO Transportation Information Center

"speed up and slow down" to develop high-end market

the shipping company has always been operating in the mode of arranging ships on the route, receiving and sending goods regularly. But this model was challenged at the beginning of the financial crisis. During that period, the demand for international shipping was greatly suppressed, and the liner companies reduced their freight rates one after another in order to survive, and the whole industry fell into a price war. At the worst, the freight rate is difficult to cover the operating costs, and many liner companies are in a loss situation.

the strategy of "speed up and speed down" was implemented in this fierce competition. "In essence, liner companies are companies that operate heavy assets such as container ships. Every ship stops for one day and has a depreciation cost of tens of thousands of dollars. Coupled with the floating fuel price, the cost is very high. The strategy of" speed up and speed down "can make every ship start and reduce the fuel consumption through speed down. However, in order to achieve an accurate break even point and make the "speed up and speed down" strategy achieve the purpose of reducing costs, we need to rely on it systems to conduct in-depth mining of business data. " This is what Wang Xinbo, general manager of COSCO transportation information center, said.

the strategy of "acceleration and deceleration" is implemented based on the accurate data provided by BI system. According to the system data and oil price fluctuation, COSCO's Operation Analysis Department calculated the specific implementation value of "acceleration and deceleration", which greatly reduced the company's fuel cost. This method has been imitated by peers one after another. When to add ships, when to slow down, and when to stop sailing, all are guided by this set of data.

informatization is as important as "air"

there are opportunities in difficulties. It can be said that it innovation can help enterprises get rid of difficulties. As for the relationship between it and innovation, Wang Xinbo said: "at the first level, it is a supporting means for enterprise innovation. For example, when we make airplanes, we have to board. We used to have paper tickets, but now they are e-tickets and direct flights online. A business process reengineering must rely on information system; second, the premise of business process reengineering must be the existence of information system. Because of the centralized system, it is possible to re divide the work within the whole system, which work should be done in China and which work should be left in the United States. The implementation of information system has brought the concept of business innovation. The third level is that technology itself promotes business innovation, which is different from providing technology. It promotes a series of business innovation. Without GPS, who would have thought of navigation. "

the complexity of container transportation industry determines the importance of information system management. "For COSCO's centralized transportation, information work is as indispensable as air, otherwise it will be impossible."

in order to gain competitive advantage in the complex market environment, it is necessary to build a flexible operation mode, which requires COSCO to comply with the trend of business model change, further refine the cabin management, reduce the waste of cabin space, and improve the utilization rate and operation efficiency to reduce costs. According to the comparison of the utilization rate and price of some routes in the system, the operators adjust the guidance price and business indicators of the sales personnel in various regions, so as to improve the operating efficiency. On the issue of empty container return, COSCO allocates the empty container cost through system analysis.

Service Mode: from "port to port" to "door to door"

"only by promoting the operation efficiency of enterprises through it and obtaining higher profit margin, can we win in the competition." Wang Xinbo's view comes from the observation of competitors and market analysis. Among the top 10 liner companies in the world, the former Hong Kong Chief Executive Tung Chee Hwa's Dongfang overseas company has the highest operating efficiency and profit margin in the world, even higher than Maersk. This kind of high profit margin is based on the enterprise's investment in it system and enterprise operation ability for several years, and its single box it investment is several times higher than that of similar enterprises. The operators of OOCL believe that informatization investment is a kind of ability investment, which will be effective after a long time, and once this ability is formed, it is difficult to be imitated by competitors in a short time. In addition, in order to adapt to the changes of market and customer demand, COSCO's service mode has developed from "port to port" on time delivery to "door to door" on time delivery under the current multimodal transport mode. This requires COSCO to cover the IT system of the whole supply chain, and excavate the space to reduce cost and improve efficiency from all aspects, so as to improve the level of refined management of containers.

in terms of business process optimization, COSCO established a global document center in Shanghai as early as 2005, transferring and centralizing the global document processing in Shanghai through it system, reducing the operation cost. In terms of service, COSCO Container carries out the whole process tracking of goods through the e-commerce platform to ensure on-time delivery. Through the further promotion of handheld devices, we can realize the visualization management of the shipping process of "door-to-door" on-time arrival. At the same time, Wang Xinbo said that COSCO Jiyun also plans to integrate customer information and improve CRM, so as to realize the accurate governance of its members, and have a clear record of its past cooperation, so that customers feel faced up to and concerned.