Documentary errors cause delays, cost time and money to resolve. Some shippers and even shipping lines suggest that as many as 50 percent of all documents require amending to get them right. This is an extraordinary state of affairs: no wonder shippers in particular have been complaining.

So what can be done about it? The European Shippers' Council believes it has the basis for a solution. In conjunction with representatives of the liner shipping industry (ELAA) and European freight forwarders (CLECAT), a framework has been developed which identifies key performance indicators and best practices that, if implemented and followed, would go a long way to removing the causes of inaccurate transport documentation and invoices.

All that is required is for people to work out how to implement it.

You would think that, given the scale of the problem (find me a shipper who does not think this issue represents a considerable strain on their time and resources) and the costs of continually dealing with re-drafting documents, challenging incorrect invoices and trying to get a speedy resolution, that people would be snapping up the 'guide to best practices and KPIs'. Seemingly, however, since the release of the work on the 28th March this year for wider consultation within the freight industry, there has been very little in the way of media interest and barely a trickle of people picking up the documents and commenting on them.

One carrier has suggested that establishing an industry-wide standard approach to the issue, in itself might represent a restriction of competition.

Freight Forward International (the organisation that represents some of the larger third party logistics companies, formerly known as Freight Forward Europe) somewhat disappointingly declined to take part in the project, suggesting a lack of interest.

In my view, these people are wrong. This is a significant issue. If you cannot get the paperwork right what hope is there for getting the service right?

Things that create the errors include wrong use of terminology used in the process from quotation through to invoicing: it is often inconsistent, confusing and sometimes incorrectly used. Some may refer, for example, to a bill of lading when in fact they mean a sea waybill or vice versa. Customs officials don't help matters much either: they often require different procedures, documents, information because of a local interpretation of the rules; in some places they accept electronic documents, in others they don't. Banks often require information included on letters of credit, for example, that may seem completely irrelevant to the carrier and either overlooked or not entered in the manner or detail required.

The appropriate or inappropriate use of standard shipping terms and INCOTERMS in the production of transport documents is another area which causes confusion and misunderstandings; and it remains a hot debate as to who should be billed for different charges and surcharges, depending on the terms of sale agreed between the buyer and seller of the goods being shipped.

Personnel can be to blame: it has to be recognised that it is sometimes the inexperience of staff employed by shippers and carriers that cause problems: customer service should not be left to new employees or those assigned to this role without the necessary training and supervision, but that is what does happen in many cases. Shippers must have the requisite knowledge to know the shipping business, and customs requirements in order to know what information is required. Seemingly innocuous inaccuracies in the data or information provided at the early stages of the information process chain can create big problems later on; failing to review or update information in good time likewise causes major issues and errors in documents. Sailing schedules and itineraries are often out of date: a shipper quoted in the Shippers' Voice Digest (Spring 2008, see www.shippersvoice.com for details) said, "We have become very reliant on the lines NOT sticking to their schedules! They aren't worth the paper they are printed on… Vessels are switched around at short notice which gives us great problems with documentation that requires the vessel details." Another shipper quoted, simply said, "We look at the schedules, but we never trust them."

Everyone agrees that the more one can migrate the process to a fully electronic process the better. This would remove errors caused by re-keying data; it would provide greater scope for automating the responses and error reporting (on an exception basis), speeding up the whole process. But not everyone operates the same systems or 'open standards'. Shippers systems may be incompatible with that of carriers or even the portals that offer services in this area. Carriers may be reluctant to alter their systems and shippers unwilling to pay the costs: as one shipper I spoke to on this subject put it, "this would be like paying for the privilege to be told your freight is delayed."

The KPIs and best practices are available to download from The Shippers’ Voice website at http://www.shippersvoice.com/index2-11.html?id=130 or else from ESC’s website at http://www.europeanshippers.com/docs/press/080328pr.jsp.

Clear, accurate, timely and consistent information will reduce the errors. Monitor and act on findings and the errors, the causes of errors and the time and money wasted on errors could be a thing of the past!

To me, the key to the success of this initiative is to accept that everyone has a responsibility to work together and play their part. As one shipper involved in the project put it "Any obligation on a carrier to deliver must be counterbalanced by a commitment from the shipper to supply the necessary information, accurately and in good time in order for the service to be given."

What has been provided is a framework to help. It may not yet be perfect, but it is a start.

Labels: customer service, documentation, KPIs, liner shipping, sea freight, shippers