QUANTIFY YOUR BOOKING TURN-TIMES - Inttra

QUANTIFY YOUR BOOKING TURN-TIMES
VALUABLE INSIGHTS GAINED FROM COMPARING TO INDUSTRY AVERAGES
EXECUTIVE SUMMARY
Shippers will be able to determine how their booking turn-times compares to the industry average. For some shippers the turntime
is a critical parameter as they might have an end customer waiting for the confirmation. In these cases, shippers will be able
to evaluate the turn-time performance they receive compared to the industry standard.
For carriers, these measurements allow a benchmark against the industry performance. For carriers who spend resources on
providing a rapid turn-time, these benchmarks allow them to quantify this benefit for prospective customers.
In either case, using these measurements enhance the use specific turn-time services levels in the contracting process.
YOUR TURN-TIMES: HOW TO FIND IF THEY MEET OR BEAT INDUSTRY STANDARDS
A majority of global shippers have tried it. A booking request has been submitted electronically; however the confirmation has
not yet arrived back from the carrier. For some shippers a quick turn-around, within 2 hours, can be of paramount importance.
Until now, a shipper could only know how many of his own bookings were handled within 2 hours. He had no quantifiable way
of knowing whether the service level he received was better, worse or in line with the industry average. Consequently he was in
no position to know whether to press for improvements. Similarly an ocean carrier was in no position to know whether they had
a competitive advantage compared to the industry average.
OceanMetrics has the ability to match booking requests submitted by shippers against booking confirmations provided
by carriers. This allows for the provision of quantified measurements of the booking turn-time differences across carriers
and shippers.
Such quantification of specific service levels provided opens entirely new possibilities for both shippers and carriers.
Additionally, a simple calculation shows that even a carrier with a perfect process to turn a booking request in 2 hours, might
only have 78% of their bookings turned within that timeframe.
Using OceanMetrics by INTTRA:
• Shippers can determine actual Carrier response times
versus industry averages
• Carriers can measure themselves against other Carriers as
well as the industry averages
• Services Levels can become part of Service Contracts
© 2012 INTTRA, Inc. All rights reserved.
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WHAT ARE INDUSTRY TURN-TIME RESULTS?
In the past 3 months, 49% of all booking requests, irrespective of carrier, have been confirmed within 2 hours globally. This figure
is known with considerable accuracy, as it is based on approximately 15% of all containers moved globally. The data spans 33
different container carriers.
However, each of the 33 carriers provides a different
level of turn-time performance.
It turns out that 28 of the 33 carriers provide a turntime
below the industry average of 49%. It is equally
clear that a shipper can choose between 3 distinct
types of carriers. The majority of carriers provide
a turn-time between 15% and 45%, and virtually
any performance in this range can be found. Four
OceanMetrics findings:
• Industry Average: 49% of all bookings are responded to
within 2 hours
• 28 of 33 carriers provide a turn-time below the industry
average of 49%
• 4 Carriers perform significantly above the industry average
carriers perform around the industry average, and four carriers provide a performance significantly in excess of the industry standard.
While these numbers offhand might seem relatively low, this is not necessarily the case. With a very simple approach it can be
estimated that even a very good carrier would have a turn-time performance of 78%.
Assume business office hours are 08:00-17:00 for both shipper and carrier. Also assume it takes 2 hours (on average) to turn the
booking. Finally assume that bookings are equally spread across the day and across the week.
This means that any booking submitted after 15:00 will be delayed as it will only be completed the next morning. The
consequence is that bookings received in 2 out of the 9 business hours will be late – that is 22%. Hence in this very simplistic
example we would expect a carrier working with perfect processes to have a performance of 78%. This is then a more realistic
benchmark in terms of what to expect.
AVERAGE DELAYS IN BOOKING CONFIRMATIONS
Additionally, for the booking requests which are not confirmed within 2 hours, the average response time is 51 hours. While
this initially might seem like a high number, our simple example from before will illustrate that this is not necessarily the case.
Bookings submitted the last 2 hours before business close will be 17 hours delayed, as they will only be turned the next
morning. Additionally late Friday bookings will be 65 hours delayed due to the weekend. Therefore we would – for the
perfect carrier – expect an average delay of 27 hours.
A Perfect Process:
• Incorporating business office hours into the calculation:
– 78% of requests answered within 2 hours = perfection
© 2012 INTTRA, Inc. All rights reserved.
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The OceanMetrics data shows that the 3 best performing carriers have an average delay time of 27-30 hours for those confirmations
that are late. Such an average would clearly signal that the delay is purely related to the effect of office hours, and the carriers
have the actual process well in hand.
Some booking responses are delayed because
problems arise for the carrier related to evaluating
the booking. Assume such problems tend to take
an extra day to solve. This would mean 24 hours
additional delay, except on Fridays where the
delay would be 72 hours. On average the delay
will therefore be 34 hours which is to be added
to the 27 hours (the effect of the office hours). We
OceanMetrics findings:
• Average Delays: 51 hours
• Incorporating business operation hours into the
calculation, expected average delay = 27 hours
• The 3 best performing carriers have an average delay
time of 27-30 hours for late confirmations
would therefore expect more troublesome bookings to have an average delay around 51 hours.
VALUE FOR SHIPPERS AND CARRIERS
For shippers and carriers alike these types of benchmark measurements provide an added possibility to enhance both business
value and contractual relationships.
A shipper will be able to determine how the booking turn times compares to the industry average. For some shippers the turn
time is a critical parameter as there might be an end customer waiting for the confirmation. In these cases the shipper will be
able to evaluate the turn-time performance received compared to the value of the industry standard.
Use the Analysis:
• Shippers: Review how your Carriers perform
• Carriers: Show off your performance or improve your
performance
For a carrier, these measurements allow a
benchmark against the industry performance.
For carriers who spend resources on providing a
rapid turn-time, these benchmarks allow them to
quantify this benefit for prospective customers.
USE IN SERVICE CONTRACTS
Easily accessible and readily available, OceanMetrics data on booking turn-time allows this service element to become part of
the service contract.
While both shippers and carriers could likely generate the turn-time data themselves, this is time consuming and costly. Using
OceanMetrics data will continuously provide an updated service level measurement, and such a measurement could be
incorporated into the contract itself.
Such a contract might take many forms. For some shippers a high ratio might be of paramount importance, and hence the
contract could include performance based bonuses and penalties.
However, it might also take a different form. Some shippers might not need a rapid turn-time on bookings. This could be agreed
in the contract – allowing the carrier to better prioritize customer service resources. Such improved prioritization would then
create value in itself due to optimized resource allocation.
© 2012 INTTRA, Inc. All rights reserved.
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OCEANMETRICS BY INTTRA
Start a Service Based Conversation
INTTRA’s OceanMetrics is a business insights platform that provides actionable ocean shipment performance intelligence based
on actual carrier and shipper transactions processed on the INTTRA e-commerce platform.
OceanMetrics enables shippers and carriers to measure their own performance and service levels, as well as the performance of
their ocean freight partners, using a common set of information.
Now shippers and carriers will have a shared understanding of consistent facts when addressing key service areas and can have
unbiased conversations targeted at optimizing supply chains and improving service delivery. OceanMetrics can help:
• Deepen customer and partner relationships
• Quickly identify customer service improvements
• Prioritize resources based on operational strengths and weaknesses
• Optimize supply chain planning and execution
• Elevate negotiations utilizing service and reliability measurements
How to Get It
Any carrier and shipper who use INTTRA’s e-commerce channels for bookings are eligible to obtain access to OceanMetrics data.
What Does it Cost
Obtaining access to OceanMetrics is free of charge for carriers and shippers using INTTRA.
Data Quality
Measurements include all transactions via INTTRA. An increased percentage of cargo booked through INTTRA automatically
results in more complete and accurate data.
Performance Measurements
A shipper will be able to view each of their carriers’ performance. A carrier will be shown their individual performance. Competitor
performance will be anonymous. The carrier may see data for other carriers, however the carriers cannot be identified by name.
This allows a solid baseline for performance measurements without exposing confidential information for named carriers.
© 2012 INTTRA, Inc. All rights reserved.
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