Hello. I have now opened. Please go ahead, sir. It's a thing, Mark. Please go ahead.
Alright. Here we go. My name is Martin Seidenberg. I'm heading the Investor Relations function of Deutsche Post, DHL Group. Would very much like to welcome you to our first virtual tutorial.
We come to the details in a minute just to give you some context when we started into the year, our plan was basically to have a series of on-site events for investors and analysts to experience what we mean by saying excellence simply delivered, site visits together with expert talks, And obviously, under current circumstances, any physical gathering is not an option. However, we want to continue to not only do, current, short term management, but also want to focus again on what's going to be a very important driver for the group's development going forward, a lot around digitalization. And if you look at page to, what we have prepared for, for you in the near future is not only today a deep dive on where our forwarding business stands on zip utilization, but also later on in the supply chain and We're hopeful that in the further course of the year, there will still be opportunity to meet again with you physically on the various sites So stay tuned. This is the beginning of that series, our first virtual tutorial format. And therefore, if things run perfectly well.
I'm going to say I'm expecting, expected that anyway. If there are little hiccups in the meantime, this is our premier. So, as you see for the program today, I'm glad to have with us Tim, Tim Shelvert, the CEO of our Forwarding And Freight's division. He's going to give you a brief, state of affairs in the forwarding market and our division in this market. And then we come to, if you like, the domain acts, Thomas groom out introducing to you where we stand on IRR and the new products and features that we just recently has introduced and what we are planning to do going forward.
If you follow this on the webcast, and I think most of you are, you already find now in the screen below of field where you can function questions that you have, those will only be passed on to us, and we're going to deal with that after the presentations. Alternatively, a bit more old fashioned, but still, you can dial in, via the number that you see on the screens, 49 for Germany, 30, and then 232, 531, 411. That would give you the opportunity to place your questions right into this stream and have Tim Thomas or even me answering that. So without any further ado, thanks for joining. Thanks for making this possibility, Tim and Thomas, And I'd like to hand over to you, Ted.
Thank you, Martin, and welcome everyone to this webcast. Good morning, good afternoon, good evening, wherever you are. I'm sitting in my home office in Hamburg today. I come to the home office situation in later stage. I hope that everyone is doing well, and I hope that our families are high and safe.
Earlier did on the current state of affairs of the freight forwarding industry and also based on the Q1 results, which we presented, I think it was 2 weeks ago, I think if you look at the first quarter of 2020, you really have to divest or look into each month in a way because each month was different. First of all, if you compare Q1 2020 to 2019, there was already before Corona hit us, the ship that the famous Chinese New Year was in January this year compared to February last year, and this was already a change. So everyone knew that January would be a bit more weaker compared to the year before and also we came in 2019 from a weaker peak season than we had in 2018 going into 2019 it was always important, especially on the airfreight side, on the volume developments of the first month. So our 1st month was okay, in line with what we planned. And then of course, something happened that we had the Chinese lockdown in February.
And I always called internally that the Chinese New Year in a way was postponed. Now it was prolonged. We didn't have the usual week. We had up to 4 to 5 weeks, depending where you were in China, where the the country was locked down. No volumes coming out.
And things really sage. And then as you know, in March, China started opening up again. We saw volumes coming out again, very nice volumes coming out again. And then the lockdown started first in Europe and then gone to the Americas. And you know, the situation where we are now is being slowly opening up again.
I think what went very positively operationally was that DGF was able to move into a home office scenario more or less than 72 hours. And we had over 80% of our people working from home. Please bear in mind that a lot of our handling facilities are outsourced and we do not have so many blue color colleagues, but our backbone, our IT systems worked very well. And we had very good business continuity programs in place that we were able to to manage the situation, which was also something which to be fair, no one before we detested and no one thought this would happen. But in the meetings, we had afterwards and all the phones conversations we had.
It was really good to see the morale and good to see how the entire organization adapted to the situation. But we also noticed very early when China was locked down that we felt that there's one silver bullet out of the situation if something like this happens, that's capacity. The one who has capacity early is the king. So if you secure in a situation like this capacity early, you are able to make a better margin than if you don't do with that early in wait a bit too long. And I think we were very successful in really closing capacity deals at a very early stage already in February, and you see this also at our Q1 numbers where our margin and airfreight went up.
We also had a very good cooperation with our colleagues from Express, sharing capacity and working together and also what was really well is that we were able to very quickly when we spoke to our customers, explain to them how we can solve the issue of moving freight out of China when China reopened or into into parts of the world. And we really felt that this is also part of our purpose connecting people, improving lives and making sure that volumes flow. This continues. And also, of course, if you take Q2 and to look at Q2, the discontinued and also in Q2, where the capacity or the demand out of China became stronger with all the medical devices, the masks and protectively, which was being moved then made the limited capacity more strained and rates went up even higher. But again, because we were able to very early secure capacity, and we have a good relationship and a good collaboration with, with our expressed colleagues.
We were also able to move goods in a very good way right now. And we see a lot of positive feedback from our customers, a lot of positive remarks. And I keep saying to our customer base and to the organization, imagine what a great forwarder, you can be if you're already a great forward in a crisis, if you go into a normal way of working again. So overall, we plan right now quarter by quarter. So what quarters we will bring is already a bit too early to tell, but one thing we do sensors that the capacity of the air freight side will remain stressed because the passenger airplanes will not come back as we were used before corona, before the corona situation.
And if we see these ghost flights where airlines bring empty passenger planes into certain trade lanes and markets. They are a bit of a relief, but they are not a real relief. And the reason is structurally that these airplanes are not made for cargo movement You can use the belly for lower deck, lower deck containers, which you can put in there. However, the upper deck where we normally sit as passengers cannot be used for normal freight for pallets. It starts that you can't get a pallet through the passenger door as that is built and constructed for passengers.
And also staff that these airplanes are not constructed for high weights of the upper part of the airplane, the higher weights at the lower part of the airplane. So the airlines are doing this for reasons that they want to make sure that the pilots can keep their licenses and they keep these airplanes in the air because if an airplane is too long on the ground, you have to go through certain checks. And this is something the airlines are trying to avoid because they also need the flexibility in ramping up again when we see the possibility to travel more Internationally. But as you know, and I know, it's very difficult to tell that this will be the case and we have to keep just an eye on these things. So if you look at our results together from Q1, there was a pitch about dent, I would say, in the conversion rate based on the fact that the February was the way the February was and things happen also then in March as they happen.
But I think business. I'm very positive. This is only a dent and we will continue the upward trajectory and we'll continue working on the plans that we have get it to a better conversion rate scenario comparable to our peers. So if we go to the next slide then, please. Which will be slide number 6.
Here you see an overview of the strategy house, which we developed for our Sanjay 2025, delivering list in the digital world. And, it shows our purpose, our vision, our values, our mission, the business, the business unit focus and also how digitization plays an important part of it. And I think this is the key which you want to talk about day is to explain to you what we mean in forwarding when we speak about digitization. This can be a bit different if it's at the parts of the business, but forwarding here is the main the main focus. So if we then go again to the next slide, Slide 7, please, you see the key part in this.
And it's all about these four things that shown in this, in this slide. We have to, and remember, we come from a legacy that we have a lot of older systems which we are working with. And we are moving them now into the Cargowise 1 environment, which is easy said or in an easy words, one system per main product. The same system per main product, the global system, which we use. So we'll automatically come into more standardized processes.
This will give us enhanced transparency And if you define forwarding, forwarding at the end of the day, is having a transparency and based on that transparency, having a discipline to work with the data to be more factual in the decisions that you make. This will then, of course, also support you in an improved customer interaction And that interaction is important because of the customer asking your question, you need to be able to quickly answer the question based on facts and video steps so that you both, you and the customer can find solutions or try to solve the problem and you need a simplified interaction. And the last two parts, we improved customer interaction the simplification, that is all that's when we speak about my DHLI, what it's all about. And Thomas will give you more details. On Page 8, You see that the technology will simplify and accelerate many steps in the fall volume business.
And one is it will give us the possibility to come with additional features for services and growth. For example, we will be able on the ocean freight side to bring our supply management supply management functions that we have, especially in Asia, closer to the ocean state departments. So it's a more seamless way of working together which is easier for our customers to understand. It will be a better service for them and we can grow the business a better based on the one platform with CargoWise 1. And the higher operational efficiencies will automatically mean that we have we'll be able to generate higher margins in a better GP because today with the new system, and we see this already on the ocean freight side, where we have 97% of our volumes working on the new transfer management system, efficiencies, the central steering of this enables us to be better in the accounting of the shipment that makes us better in order to understand if we need to pay something or not or what we can also charge extra to the customers.
So in general, this will enhance us to become a better, greater, straightforward company with the size and the network and the people and the volumes that we have will be, of course, a very important cornerstone for better conversion from our business. So this was my part, and I hand over now Thomas to give you more of the details when it comes to Cargo Wise 1 and my DHLI. Thank you very much.
K.
Thomas, we can't hear you. One second. We have
some some problems here. Just a second. Mister No.
No. You have to, dial in, just call
it again. You're a lot. We can't hear you.
It looks like that's one of those problems I was talking about. Think what we learned over the past couple of weeks just yet. Those Skype gatherings are typically very reliable, but have their their weak moments as well. So she'll turn us back on, Frank. I'm still not hearing Thomas.
Yes. We can, hear Thomas, via Zoom, but
we can't, we we can't see info about Skype.
Okay. As long as she's audible on the webcast, why is Zoom that's good enough for me?
Okay. Just a second. So let me know when I'm able to restart.
Well, I can hear you now again, Thomas.
Frank, can you hear me?
To do we have the voice line from Thomas on the webcast?
Can you say something, Mister Kona, please? Yes. I'm on the line here now. Can you hear me back so I can go ahead please? Okay.
Thank you very much. So sorry for the technical issues. So let me start again. So thank you, Tim, for handing over to me. And around welcome to everybody, this afternoon this morning or this evening, depending on where you are.
So let's take a look at what's still already already mentioned. I think, yeah, we actually underlined our strong position in the market throughout these difficult times. With our market position and capabilities, I think once again proven, We are the leader in the freight forwarding industry, and we also truly believe that we have the right initiatives in place with the IT renewal road map, which we have started, already a couple of years ago and also with our initiatives when it comes to digital customer action. So with this, with these 2 initiatives, we complement our DGFS market positions, meaningfully better. We had, we had the strong position in many, many aspects.
And now actually that our IT renewed roadmap and our digital customer experience, we will create higher efficiency and better service quality for our customers and also be able to this is a foundation that actually will know roadmap to develop a best in class digital experience. So, DGFS has implemented the IT renewal road map really with a high focus and speed And, this brings me actually to the point that I would like to give you just a sequence at what the life cycle of the shipments looks like so that you gain a better understanding of how complex this processes and why technology is actually key to, be successful in the global forwarding markets. So when we look at this problem, it's really more than just brokerage of transportation. It is managing all steps along the life cycle of the shipments, right? So, it's a complex environment caused by noticeable standard and regulations because you have to keep in mind, we are not just operating in one country.
We are talking about the whole growth And of course, there are a lot of bits in place. So the success in Poland was really built on experience as well as local knowledge, Of course, excellent customer relationships, processes, and of course, also economies of scale. In all of this, it is especially important to be able to develop the right system and technology support amongst these various touch points along the shipment process. Because only if you really understand how, this process works, you are able to set up the rights technology on a global base. So in this range, it's for a multitude of systems, and we've only highlighted a few year along the shipment process, the online quotation tools so that customers can execute.
We accept pricing online in real time instantly, assays tracking tools in order to really see the shipments are. And then, of course, continuous IT system upgrades because this is, of course, a collection engine task, on a global scale. And these are just a couple of examples that highlights the complexity along with in our IT Renewables measures. And how does it help to modernize our IT landscape? So when you look at it, we have basically 3 key things and that's the lower part of the page, 3 key phrases in mind.
There is a quotation to cash. You can consider this as all possible related processes get the carrier to, carrier book into payments. This year, these are the closest, for the carrier or supplier related process. And, of course, Also, the pickup to delivery will be at the full internal and process to display realized data along the complete shipment process. And our vision is really to take it along these 3 key processes to completely automate the, the systems and the processes And in order to come to this point, and that's, of course, not an easy undertake.
If you put the idea in your roadmap into place, our digital backbone for managing global straights. So I think many times also reference to catalyze our new TMS, but there are other systems that can go along with this. Paperless forwarding. I mean, if you imagine today, these would be not operating on paperless forwarding, what Tim says to get into 72 hours, all employees into the home office would be impossible because they would still wait for the couch of papers to operate the file. So only because we have done a very good job in digitalizing these processes we were able that quickly to transfer the business into and into the home office of our employees.
Potation tools, especially in these times when prices are critical, pricing is critical for our customers, track and trace shipment visibility, but not to underestimate the complete steering logic. So putting systems in place that help us to efficiently manage the freights and to efficiently manage our business. And there are many, many more to me. So we can really say that we are very, very happy with the progress that we make with the rollout of Cargo Ypsilon and, our stitches backbone progress in very, very well. So we consider carloads 1 roll out in ocean freights is completed.
In air freight, we have already reached over 30% of all five small wins on CardWise 1. So we've started with the Aflac rollouts following the, startup ocean freight and, we did start this ethics roll out in in last year, and we make really, really good progress on this one. So we are very, very happy about this. And all of this is really, I mean, car washroom and all the systems, which I briefly touched are really kind of the starting point for the benefit realization, and that enables us to further drive automarkization. So We basically achieved really an end to end shipment ownership.
We achieved data accuracy and, of course, a gradual harmonization of processes in the application landscape, which goes along with this because this introducing one major system, we actually have the opportunity also to, harmonize your application landscape as well as the processes to ensure that anybody works with the same approach. So Looking a little bit deeper into the IR benefit realization, there are 6 focus areas to get, to materialize on the P and L. One thing is the automated data entry. In the past, many data was basically keyed in multiple times and due to different systems, due to, not an idea of how these systems communicated with each other. And that allowed us not to automate for revenues and costs and also to really ensure that we have all the carriers bookings electronically.
We've introduced this Carlwise 1, a single file concept so that our operator in one country is exactly seeing the same like an operator in the other country. So when you look from an export and an inputs perspective, Both of our involved people are basically going to see the same data, which makes it much more convenient and of course, much more efficient, to operate this site. When we talk about the whole topic of end to end ownership, well, we believe that this is a key driver to, enable our people, to manage the GP on, on file level with a simplified intercompany invoicing and to ensure ownership of gross profit in our operations and actually correct GP sharing on the file. And with this, this is a foundation for us to really efficiently manage the the shipments of our customers. Simply side reporting, we only had one thing is sort of true, yes?
And that, of course, takes also a lot of time and energy So we are all referring to the same data. And why it's so important to measure data? Because now this is one single truth, which is the thought truth, we are able to improve ourselves against the performance that we measure in order to actually, accelerate. We find visibility. This time stamps catch up within 1 hour.
So what we call near real time, and immediate visibility to our operators, but also to our customers, we actually made a huge step forward. So with this, with these interconnect or with interconnected systems, we are able now to capture all this information, and then we will discuss it at a later stage also displayed this information to our customers. I briefly touched on the paperless forwarding, but, and the work on electronic filing. I think, yes, I mean, it's very simple. If you have the data in one case, it's accessible by everybody, There's no searching, searching anymore for any kind of pouch forwarder, which was done in the traditional forwarding.
And, all information is available right at the file. And then, of course, also a simplified TGF data and IT landscape
converging to
global solution and data signals. So what does this all mean? So we've developed station metrics out of this. So this is just for illustrative purpose, of course, but this gives you a sense, an idea of what our operators are basically seeing in the day to day work. And it is our local operations to take better educated decisions due to better transparency and higher data quality.
So with the station metrics dashboard, we provide basically on station on country on regional level with visibility on operational KPIs like volume, time stamps, bookings, but also, and that's, of course, also very important on our key financial KPIs. So really given the visibility on the 5 profitability, the GP, the cost of the shipment, and if they aim We do this all with the aim to strengthen their accountability to maximize EBIT and GP conversion. So what happens? What happens if you have actually all these information in one single place? Well, this enables us to offshore processes to our global service center.
And with this, we are able to take repetitive tasks to serve to take time intensive tasks to our 5 global service centers ranging from India to Colombia and to take these and, to actually make that realize benefits for potential savings and realizing these benefits out of and out of standardization. So we have in total 14 service lines implemented in our global service centers. And have identified a range of services, which are mandatory, which are now mandatory rooted to these shared service centers and that where all of these activities basically take place in the global service center. And then once the task is being completed, operator in the respective export or import country is taking over again and is continuing to work on the file. Why is this why do we highlight this here?
Now if you think about Process Automation Technology, of course, and this is the reason why it's actually highlighted here in yellow, you must imagine that if you think about and if we actually and we see that already in our projects that we are running on advanced analytics and artificial intelligence that this is process automation technology we actually need to have certain tasks at one location because that way we can hand in hand work with our colleagues in the global service center to automate this process with the experts. And then also once we have implemented the automatization, we can, on cases, which are not covered by artificial intelligence or advanced analytics, we can actually can have our people to build a service center, they'll take over and then actually also train the machines in a very, very efficient manner. So we believe that this is really the way how to drive this and to further leverage, leverage the potential savings of standardization. What we are really proud is the fact that throughout this huge endeavor has a customer satisfaction benefit. And we see this We, we use here the Net Promoter Score, which we measure, on one end on a yearly basis, but also on a monthly basis, we track continuously in the different DTS countries, the Net Promoter Score.
So we asked our customers would you actually recommend this, our service to a friend? And with this, I think, most of you know, the Net Promoter Score We have a good indication that we are on the right track, and it makes us very proud to see that we already see this big uptake that's clearly above 40 in 2019. And we are continuously working on to move this in further. And, so I think that is, a very, very good message, you know? So with all these steps, I think we can clearly say we can make a big tick mark.
It's the ideal roadmap our foundation of further modular application for internal efficiencies. And we consider, as I said, ocean freight as done. And we are working hard on air freight. Of course, it makes us very excited that we see the benefits that we already can see in our in the ocean trade and to bring them actually also completely into air freight. So but why is it even why is it in beyond this importance?
Well, we must imagine that the IT renewal road map is basically our heart. This is hard. It powers all the digital customer experience because it's kind of the engine in order to electronically communicated our customer. So this is the reason why we have not started, this in parallel to the IT renewal road map. We have made a little bit to get the basics right.
And now, basically, since, Since a couple of months, we have developed our new my DHLI portal, which we are going to talk a little bit more about as you can now.
So
the lower part of the picture, you probably already remember. These are, this is an internal view of the 3 key processes of the IT renewal road map. And as I said, This is really kind of the heart of it. And, now that our might need July takes on the perspective for the so the perspective of the customer, we provide our customers the same view to the data that we actually have in our systems. But just in a very, very user friendly way and the top notch customer interface We will get them our customers with full access to all information, yeah, documents, status of shipments, etcetera.
But on top of that, we also reimagined our collaboration and for our customers can work with their team and with their stakeholders like suppliers as suppliers as well as their own clients. And we have highlighted this on this slide as well, 360 degree visibility, what our customers care the most about is the shipment, and they want to get a complete view on this. And therefore, we are really committed to the level or to provide them with the best 360,000,000 visibility on the shipment that they can imagine. So my DHLI is basically the shopping window to our IQ the window to access all this information. So how have we started our journey here?
This MyDHL Life Forum book that we have launched in March 2019, we have basically developed a first very important elements of our customer, our digital customer experience. What is new to this and what was new to the industry is that we choose an approach that we will deliver instant food and booking cross transport mode. So if the customer, as you're requesting a quote with my DHLI, he is actually able to get a price for his air if he gets the price for the shipment if he wants to deliver, he wants to deliver it or, transported via air. By ocean freight LCL. And now since February this year, we have even added the ocean trade FCL option.
So this allows our customers with a few clicks to compare the price the trend in time of the shipment. And because our customers really care about this, about the environment, they can see the carbon emission of that respective shipment. And they can based on these 3 active groups, their decision on which modes to choose. If it's a time critical shipment, then most likely we will choose, they will choose the assay shipments. If they have, it's not that time critical and they're actually capitalized, they will probably choose for FCR option.
But it allows them to really kind of look into this. And That's also very important. They are able to, to, they are able to directly book insurance and also to come offset the shipment. So that was our first element, launched in 2019 with floating book. Next, MyDHL Analytics.
In October, last year, we launched MyDHL Analytics because We understood that our customers want to really gain an understanding of what they are shipping with us. So they are keen to get their hands on the standard dashboards spent. So basically what gets invoice to them, volume to what they have shipped with us to get an overview about the service quality. So we are very transparent in this. Happy to deliver the things on time, where can we actually where we have areas to improve, and then also the customs activity which brings them very much about, duty space, etcetera, to really get them on our services and losses.
And if this tool, they're able to drill down and explore the numbers it is. And So our customers are really excited about, and that, of course, makes us also very happy. So at that, we launched it in October 2019, and we saw an impressive uptake in usage over the last couple of months. There's more and more customers actually requesting to get their hands on it. So Let's talk a little bit about customer experience.
So basically, March last year, we said We need to reimagine how customers want to expedite virtually and how they actually want to and what what is actually, what what what what do they actually want to see? So we really said that focus on the most important thing, our customers and their experience, and we have listened to our customers because one thing is important, We might not have been the first to the party when it comes to waste the cheap systems, but we strive to be the best in all aspects. And therefore, we have defined 3 guiding principles for the development of my DHLI. One thing I've already mentioned, 360 visibility. We want to provide the entrance visibility to our customer for their shipment.
It's a possibility to really understand all the aspects of the shipments. That no and no with no matter on which stage they're shipping this. Multi channel, I think everybody knows that from its private life, It is not that everything is digital or everything is analog. We are actually living in a much more complex world. So our customers and we understood this are actually requesting to use some parts, potentially some products offline.
And this is for us, very, very important elements. So no matter which channel the customer wants to use, we will provide it anywhere at any time. Significantly achieved our customers have asked us or asking us for guidance via the extras. And therefore, they're asking us, can we please Can we please get notified? Can we get information when actions are needed required when a document is missing?
Yeah. So please ask please help us to get through this. And in order for you to get a better understanding what I mean by that, we just basically brought a couple of quotes from our research. So I need to know the shipment status because I need to inform my customer. So It's not only important for them, but also for them to communicate this properly.
I don't know if it joins visibility on my shipment with my supplier. Or we do so much time every day waiting for either replug and asking for information. So this is something that we need to tackle. And I really want to see the shipments that need my attention right away instead of checking long list of single shipments because we have, of course, also a lot of customers that transport 1000 of shipments. So we put all this into our thoughts, and it might be HLSforce and book.
It might be HLS analytics we complemented it with track and documents. So we developed a module on track. It's a beautiful interface. And module on documents, which is very important. And these are two key aspects that we have added to the MyDHLI platform.
But that is not all. We introduced and we actually reimagined the way collaboration our industry should be, and we will take it to the next level. With my DHLI follow on share, we introduce social media features to the logistic industry. So customers are able to follow shipment and receive notifications about updates, something that they have really requested, and to share shipments with their colleagues, customers and suppliers so that they can invite Cordic's customers and suppliers to really work and see the same information also on the 9th July. And All of this is integrated in one stop might be a short quarter and the best really is We've developed it with the World Mobile First Design approach, MyDHLI can view seamlessly on all devices anytime, anywhere, So you can use it on your smartphone, you can use it on your tablet, you can use it on your desktop, and you can we are really proud to say It is best in class user interface and usability that is available in the market right now.
So we started already to roll this out to customers. We might have, I'm sure, yes, recognized that we launched the system yesterday to the public, but we have already onboarded customers onto this platform because you wanted to also understand what they think about it. And not to leak actually company that is doing health care products really gave us a very, very nice feedback. I really like the system. It helps me a lot, but I instantly get an overview of all my shipments, and I can see if there are any updates to them.
This saves me a lot of time. Or from Durango in which we are very proud of to actually welcome to the very early stage of the rollouts It's one of the largest pharmaceutical companies in the world, and headquartered in Ingenheim, It operates globally with 146 appraised and more than 47,000 employees. And we also we are very, very, happy about this statement. It's much better than the current platform. The portal is much more user friendly.
And it is a more efficient communication model. And I mean, this is really what we were striving for. We're very proud to see that our customers value the simplification, which my VHI brings to their business. And In order to show you this and to also get a firsthand experience of this, I would like to give you a very, very brief demo on this. So let me switch to, to my DHLI.
So Once the customer has logged in, and you should be able to see now my, the virtual my DHL I dashboards, you will see a map on the top of the page with all the shipments. So we have here now basically a demo account because, of course, we take the data of our customers very serious, and we wouldn't share this. So we have, to basically set this up for, for the demo environment based on real data. But if you look at it, we have all the shipments on the map. You can actually filter and say, I would like to see the rate rates in trended and it's being highlighted.
And the top map is the only widget, we call it, which is these elements which is not configurable in terms of that it can be turned on or turned off. But you see below the map already, the managed widgets button. So you're able to decide what you want to see. So in a very easy and efficient way you can disable and enable the different widgets. So these are my settings and the settings are in the virtual by user.
So everybody can I can, modify this to its own needs? So on top of it, I have the forward shipments. I can also see the last few shipments because these might be the or these are possibly most likely the most recent shipments. If I scroll down further, I not only have the opportunity to jump into a list of follow-up shipments if they are more, but also I can actually see a list of the last updated shipments, so where we actually provided a recent update on data. And in the bottom, I already get a nice overview on the, from my DHL analytics, but of course, I have the possibility to deep dive into it, to drill down, if I want to understand better what are the differences compared to 2019.
So when I go here on top, I see also the left, the menu So I can actually also look into shipments. So as I click on here, the system is loading. What you might see on top. There's a search and the system is constructed in a way that it remembers what the user has actually done last. So in my last, in my last search, I was actually looking for Pittsburgh.
And because I might changed to another screen to get a different view. This is being remembered. So if I'm not interested in this, I can just simply deselect it, But in fact, for this demo purpose, it's quite good because I'm sitting and imagine I'm a logistic manager sitting in Pittsburgh, I can see now all my shipments that are being transported from Pittsburgh. And in fact, I'm very, very much interested in the shipment that just deposits on 14th May at airfreight as you can see. So you can see the mood there as well.
You can see from the origin, you can see the destination. But of course, also this is completely configurable. So you the customer gives the customer a broad range of items and they can actually move this around and, move it actually to a different stage so that they are able to envision what this is about. So I can put in last event. And now when I go back, I will see the last event being displayed here on the list.
So there's one click I basically get into the details So here, I had a nice high level overview of the shipment in a visual way as well, Pittsburgh, And so it has been received in the picture of Pittsburgh warehouse. It's good. It's on time. And I can scroll down and actually see what is the root and which stage are we here. So everything is on time and I can go through the chat details.
I can see you as a shipper. I can see the consignee. I can see the customer. In reference, I can see what's the volume of this is a very, very small shipment. And I click when I click in here, on the document, and that's the document module I can actually get access to all the documents which are seeing, in our Cargo WES 1 system, so what the customer has actually provided you on.
So this is actually this electronic archive that's well known and we can actually look at all documents to check with. And, of course, he's able to provide us more documents. I've talked already a lot about foreign share, so that I'm interested to get regular updates on the shipments. I simply click here on the yellow star, and make it a favorite. And as of now, I basically get regular updates and milestone change happen.
And I can share the shipments by entering an email address. So I would like to share this with the colleague So I'll share this with Bjorn Miller for my team. I'll share this. And I get the notification that this has been shared with Bjorn Miller. But in addition, I can also just simply copy the link of that, shipments.
So now it's in my pay sports, And I could actually take this now and insert this into an email that I just want to send. So this is a follow onshore concept. And now Bjorn basically receives an email with the information about the shipments. So you already get the summary of this. And with this, he's able also this one click to get to my EHR.
He's able to log in and sees all the shipment information that I see and is also able to follow it or to share if its user account analysis. Because we, as I said, we take the data privacy very serious, And I think that is really the key aspect of the system. So when we work, especially with larger customers with the multitude of of users, we actually discuss and understand what should be the roles and rights of the different users to ensure that they also get the right access to the data. So with this, I would actually jump back to to the presentation. I think this gives you a good understanding of where we are with our digital customer induction.
And so I think we also can put the first, check mark in. Now this with my DHLI, we have really, enabled our customers to work in the best possible way with us and to experience the best possible digital customer experience that you can imagine. Thank you. So over to your market.
Good. So I should be audible again? Good. All right. Thanks, Tim.
Thanks Thomas for that comprehensive rundown. On the new functionalities. In the meantime, as I said, we have received a couple of questions, which were passed on to us on the webcast. Nonetheless, would give those following us on the phone also opportunity to place their questions. So the operator will briefly tell you on how you would be placing your questions.
And then how do I help you?
Thanks. Ladies and gentlemen in the phone conference,
Okay. Eleanor, I'm I'm sure you've got the first question being placed over that line. Let's start with one of the questions that came in over the web. To Tim and in chronological order, so to say, the first question came actually from The person is from Jefferies and is simply referring to, your Tim observations and ocean freight volumes in the course of April and going into May, what your business support what weird Frank and Melanie talking about last week that there are signs of recovery of normal industrial volumes?
Well, one sees recovery in certain trade lanes, But, overall, not some tradings, but overall, like Maersk already announced a bit, the situation is not as positive as one might hope, but in certain trade lanes, there's a very good trend
to see the things are getting better.
Okay.
David, that's a useful answer to you. And also, the rest, Eleanor, you just step in here if you've got any questions coming in from the phone.
I will do. There are none at the moment.
Alright. Good. Well, one more for Tim and Neil Glen from Credit Suisse was kind enough to place those. How close is you mentioned the co cooperation with the other businesses? How close to optimize is The DGFF coordination with other businesses in, maximizing the group's share of customer wallets and what are the opportunities to do them more?
I think, the way of working together has become better over the last couple of months. It started already, pre corona situation and it's also become even better throughout the cold exit situation. I mentioned the part with Express where we share capacities. We are working together also between the supply chain and us on the NLP product where we offer to our customers solutions to manage their transport departments and between freight and P and P, we have found good ways forward on the bulk measurements that freight, sorry, P and P has in Germany, where freight is taking over the distribution in these difficult times also. So you can see compared to when I joined the group, there's much collaboration and much more tangible collaboration also between the different divisions.
And there's probably much more one can do based on the size every division has and based on the possibilities and the business models of the different divisions.
Thank you. Let's continue with the questions referring more specifically to Thomas Parks. Again, with with Neil asking, yes, we were not separating out in our reporting GP or or EBIT by by Anna Ocean. That the the early experience now with, Carlo Wise Rollard Complete And Ocean, do you already start to see significant differential and efficiency levels to before and after.
So is this a question now for me? Why don't we start? Okay. I can I can check? So When you look at it, I mean, as you said, we started a lot of cargo as 1 for for Ocean, of course, just 2 years ago.
And we already see the impacts, which this has. Of course, when you look at it, why is that? I mean, I explained a little bit about data transparency about the possibility to see, to see the GP of the file, Of course, when you look at it, it's very important to also understand whether, whether, the, to file a whether we get charges for car carriers, etcetera, and to then you work really on the file, and that's the harder for Flowwater. Can you give them this transparency? He's able to actually work on the file and to actually take up the discussion with the customer because they are unforeseen charges And that is that is active working on a file.
And with this, we are very happy to see that the system is is greatly supporting this. And therefore, we already see an uptake, especially in, in stations and countries the car wash has been rolled out. So this is what we call benefit realization. And of course, we are following this very, very closely. Also to identify where we need to, further train colleagues, you know, to actually develop our colleagues on the, on the ground, and to make them even better forward us.
Okay. Thank you for that. And I think there's a cluster of questions, which I like to group as follows and to direct to you, Tim, where do you see us now with the current functionalities, positioned versus the peers offering in the fees of digitization.
Well, I think we had to catch up. I think it was clear that we were not in the position to be seen as some as seen as a company, which is comparable comparable functionalities out there. And with my DHLI, we believe we have caught up and even set a bit of a benchmark and are more forward than others. I'll give you 2 examples. What Thomas pointed out, and this demonstrated the follow and share collaboration model, which brings a social media aspect into the way of working because we believe that our that the employees and our customers are used to this in their private life and also their private shopping.
Is something which none of the other systems have as far as we know. And we also believe that the mobility portability of the system, so the capabilities to use it on your your mobile device, be it a phone or be it a pad anytime, anywhere is also something which is totally different what we know from the systems and our competition has. We have looked, of course, into this and tried to differentiate ourselves. We wouldn't go on the market and do a press release if this was something that was the first comparable. I think it's also very important to mention that in part of our strategy to digitalize our internal and external systems, we have continued to invest and we will continue to invest also in this part.
And there's more to come. We have another few more things up our sleeves, the basics for us to doing this is that we roll out cargo wise more and more. So whenever we get on cargo wise or the TMS project transport management system project that we do in the freight division will also have a benefit because this could also be then on my DHLR. Now our vision is to have one system where anyone, any customer of ours who works with us in the forwarding world can use this system. And we're also having discussions internally to widen this to other divisions.
Okay. Thanks Tim for that. And there's a question, a very good question again from Bernstein. Tim, I would like to pass that on to you, but also to you, Thomas, we talked about cash feedback customer reaction. That's an important aspect for sure.
But what have you experienced as a feedback from the employee side during the rollout? Was there a lot of resistance to be overcome or how that has evolved?
Should I start? So if I would start, I think it's something which we could use internally very well for our employee. I mean, I think the 2 sided questions are the carbo wise rollout. The employees, we're very happy that we, that we show that we invest into a new system which makes their life also easier. Because for them, if they don't have to search for data in the legacy systems anymore, have it on with one file and have one view on the on the shipments that they're working on with a full transparency also on how much GP they generate with that shipment gives our employees a better feeling for how their work is being valued.
And we had people joining us who knew that we are investing into a new system and they saw still the terminals of the old system, and we're very happy that they knew that the new system is coming up because our legacy system was not even close to being state of the art. So there was no difficulties from getting the people motivated. What we did experience was that we needed to train our people because we gave them based on the transparency, the files, more power and also a a higher value in their work and they have to start to learn and use these things. This is something that we also saw some great benefits going forward.
Okay. Thomas, anything you want to add from from the employee perception angle?
Yes. Sure. Mean, Tim has described very well on the on the CargoWise 1. I think that is also where, that's most important that you really kind of set your people with us. And because only if they're happy with the system, they can, deliver excellent service.
What what I must say when we look at our digital customer experience and our systems that we do for customers, And of course, we showcase this to our people. The excitement and the joy and the the power we've seen the reaction, the positive power and direction was really, really and exciting. And, so I think everybody has recorded, it's fired up and ready to go. And everybody is really striving to roll this out to our customers And to present in the best possible mail lines, I think the last, the 6, you know, if you have to, get into the other domestic people, our colleagues, then I think this is the best to underline that this will be in successful exercise.
All right. Coming back to the general market conditions and Andy Trujes were referring to your introductory remarks, Tim. How stressed do you still see the market for charter capacity, and also how we get other questions who are wondering what the current capacity situation means for the competitive landscape going forward. Particularly with regards to smaller players who may be having more difficulties in securing capacity.
Okay. I think On the freight capacity, I think we've, what we see now is that the demand is slowly because the PPEs that the hype on those have gone away a bit. So the peak rates that we saw are slowly coming a bit down, but they're still much higher than at this time last year. We also saw a notice that small and midsized customers were not able to secure cargo and small and mid sized customer, this is for us, sorry, who, who, did not have a network approach, also had difficulties in getting their goods on airplanes. Let me explain how that would harm mean that.
If you take, for example, the market of Austria where the main airport is Vienna, Today, nothing moves out of Vienna because there are no passenger planes out of Vienna and the freighter services into Vienna are very limited. If you want to fly out of Vienna, you actually have to use Frankfurt Brussels, Luxembourg, Amsterdam, if you want to cargo from Vienna, for example, to go to China to Shanghai. That means if you're not able to have a freight forward, a midsize freight forward out of Vienna to secure capacity in Frankfurt, you have a problem with your customers. A larger freight forwarders are able to do this because they have new P and L networks. So and they also have offices everywhere.
And, and you need contact and a good collaboration with the carriers to get these things done. As I pointed out earlier, we were very early in securing capacity on the flights. And today, for example, we we track everything from the end as either to Frankfurt or Amsterdam and slide out from there. And we won additional business out of Vienna based on the fact that mid term players or local players, local, large players locally in Austria not able to deliver this, we were able to deliver business out of this.
Okay. And also in terms of the more technical financials working out, is it correct that if you by charter, you're more or less, buying on signing your, you're paying on signing the contract and there's a time to go until the actual flight goes, right?
It depends. And if you are if you work on a charter chain, so more than one charter, you can also have different payment terms around this. What you don't do is you normally don't use the CAS system for charters. And in the And in the real charter world where you have one charter, you pay upfront the charter and your customer also has to pay upfront the charter.
All right. Good. We have further questions coming in referring much also to, the wider IRR rollout. That's the current situation push out our targets on completing the rollouts now also into air and, what are our expectations there?
Okay. So when we look at that, we have to clearly say that we, of course, can't foresee how the development in the next couple of months is going to happen. But what we probably can imagine that due to the travel restrictions and not the travel restrictions that we gave to our people, but just on a global scale that this is, of course, something which, it's just not easy to handle. But we've already in the past rolled out also systems and also the IR system, the color wise, virtually. So what that means is that we do sessions with our employees like to do it here.
This works especially well in smaller countries. And for larger countries, if it's a little bit different, then we actually, let's figure out that for an efficient rollout. It is beneficial to be, there and, to support the colleagues. Just on a, on a local level. And so right now, we don't see that the asset rollouts will take longer than we have envisioned.
But this is, of course, also something which we will definitely need to watch very carefully throughout the next month. And then we will actually, be as agile as it requires to deal with recurrent situations.
Okay. Thanks Thomas for that. We've got a couple of questions referring to your slide showing the lifecycle of the shipments, two angles to that. What do you think in ocean freight what percentage of these steps is now with the new system set up already sort of frictionless or the other way around, in what areas would you expect, manual work still being required for the longest time, which are the areas where there is digitization alternatives going to kick in at a later point in time only.
So, I mean, when you look at this, shipment cycle, this is, of course, something that you developed and it simplifies because, it's it's it would be a huge page when we want to put all the details in. But, I mean, as we also only highlighted a few, I think what you can say is that, from end to end, we have really covered the main topic sales already. But of course, there are aspects in this whole process where, where we still have a couple of manual steps. So for example, if customers are just sending us, the commercial invoice. So just a pack of paper.
They're sending us a pack of paper. Imagine leading me to scan this because we
still have customers that do
it that way. You need to scan it. And then, of course, they say because of the usual shipments, So can you please just, ship it like, on a regular, as you do it on a regular basis? But this still requires that we actually capture that information scanning and then, of course, also to create the career booking. And, so there are certain elements in the whole process that third takes manual interaction, which is the typical, let's say, topics and you engage with the customer.
So they provide you with information in a certain way, and you need to find the most efficient way to view it. And therefore, we also look very much into AI predictive analytics, natural language and processing would have described also with the complete global service center approach where we take mandatory services that are already the global service center and then actually automate them step by step with best in class technologies. And I think with this approach, we will, going forward, really get close to our vision to automate end to end the 3 key processes.
Okay. One further aspect to it and maybe that's for you, Tim. So the whole database approach, how important do you see that for us to retain or win over customers? And, if that's a great percentage, how big a risk do you see for a competitors copying what we have been put together now with this whole setup.
Well, I think it's one thing to put the setup together, but I think it's more of the usage of the setup, which will make the difference. Bit also the discussion we have when we talk about cargo wise, how DSV uses cargo wise, how we use cargo wise, how geologists, how yes, all these companies and money future will use cargo wise. And it's a bit like it's it's the same approach that I always want to explain in the past, but it's like a sand box we are playing in and you have the ability to move around in the sandbox and do things very differently. So I think I'm not worried about other companies duplicating what we are duplicating because in a way we also duplicating other companies duplicating. It's more how you use the data and how you work with it.
And I'll give you an example. MyDHNI has a quote in book function, as you know, so we are very much keen and our trust is use the quote function because based on the quote function, using the analytical things and ideas that we have in the group, we can also then pinpoint what is the right price for a certain trade name based on the behavior of our customers. So if we see, for example, that a customer get submits the call, gets the price back in books immediately, and either we made made a mistake in our rates suchulo, or we had a real problem. And if you see He does this 3 or 4 times in a week or 2 weeks, then we can visit them and see through the regular business. Is that something going we can support other things.
So this kind of behavior we can use, and I think we have more resources in the group to use this kind of data to be closer to our customers. In this in the corona situation that we are now, we have seen also a much better way of working together with customers and get much better, get a very high feedback because we are very much solution based in the situation now. And I think we can take that with the new systems also going forward. And part of the reason why we could do this was because we had an ocean freight at least cargo wise out and quote and book is something which we have been out there in the market since March last year. So we could use this data already in this situation.
Okay. I think that's covering most of the questions that we received. And sorry for the individual contributors, I think we've got certain clusters, so this is why I don't single out necessarily all the names. Let me ask, Eleanor, the operator, whether in the meantime, we have any interest to place a question live on the
phone? Be expressed at any time.
So then I'd say, let's maybe sort of approaching the synergy line here with 2 questions that are still out there. 1 is from San Blant from JP Morgan. You referred to the collaboration with the other divisions. Is the act capacity that we hold in the Express division and an important element of your overall air freight business or is it just adding to the flexibility? Or what's the main advantage there?
Well, the main advantage goes both ways. We secure sometimes capacity on on trade lanes where Express also needs support. So they co load with us on deals that we have or the other way around, we co load with them on certain trade lanes. And it gives us flexibility. And it can also bring us depending on the customer, on the customer advice or what the customer needs.
Also bring our solutions which only we can offer to customers because we have the flexibility of being the only large freight forwarder with a larger sister who has a lot of airplanes. So this gives us a great opportunity. And the working together part in this is really great to see. There's one, one, one, one, one other element, one has keep in mind is we can also use now certain airports, the express facilities for the handling, the import handling of air freight pallets. This can save a customer between 6 to 9 hours depending on where the airplane lands on airport because the process is that The airplane lands, someone from the airport picks up, the pallet brings this to a handling agent who's paid by the airline, and then the forwarder picks it up at that handling agent.
We can now bring the talent in front of the facility of Express because they're always, always at the atomic. And then we pull the goods through the facility onto our onto our forwarding truck and bring the goods to the customer, do the customs clearance, anything else and bring the goods to the customer. This is something which unique, which only we can do. And then those are the great examples how the collaboration within the group is there and it can also be further developed.
Okay. Very good. I would say, interestingly, I think a very good question summarizing all the bits and pieces that we heard now from you and Thomas, coming coming from the buy side, actually. So with all that now, manifesting. What does this mean for your long term growth outlook and for our profitability relative to peers.
In other words, how instrumental is this, digital capability?
I think it brings us into a comparable situation with our peers, especially with TSB and Pune Nagel at the moment. Because system wise, I think we are in a comparable when we have finalized the roll out of air freight, we are system wise on a comparable level with them. And I think this should then give us the opportunity to continue year by year to get into a profitability situation on the GP conversion rate which then at least goes in the direction with Kooner. And if that is we'll do that then later on into the next level that we as we had. And I think it's just a question of timing and having the motivational teams around it to see this as an objective and to work on it.
Of course, there will be dense like we have now with the situation, which we no one planned and no one saw coming, which we're in right now. But once this is over and we have a normal way of working again, with normal fluctuates and normal KPIs, I have no issue in a state that in the
past and continue to
state that we can continue on the path that we've been in the past 2 years and continue that.
Okay. Excellent. So that now brings us 80 minutes into the whole thing. We want to keep it, on the point. I think we've brought across all the key, information that we had for you, I'm hopeful that we were sort of putting together the topics that you wanted to cover with all your questions.
If not, as always, the IR team is ready here to deal with any follow on questions. For now, I would like to thank you, Tim, and Thomas, of course, for taking the time. And the effort to really take us through what you've been doing and how you see us positioned right now. For you out there. Thank you very much for joining.
I hope that an overall virtual format sort of worked out okay for you. Pretty sure there's room for learning curve also on our side. The next opportunity to practice will come in the not too distant future. When we would look at how digitalization and technology is also helping Tim's colleague and the supply chain division, Oscar Debach and his team. So with that, I'd like to thank you.
I want to thank you, my team. We've done a very good job in putting this together. And wish you all a good rest of the day or the afternoon wherever you are and looking forward to talk to you soon. And in the meantime, please stay safe.
Thank you.