A few weeks ago I posted on Technology in the Courier industry. It is fair to say, from the verbal feedback I received, that it was one of the more provocative posts I have written.
Shortly after wards I saw that the NZ Herald was interviewing Dean Bracewell, MD of Freightways, so I thought I would post a question. Below is my question and his response:
A question from a Herald reader. They are interested to know how technology fits into the future of Freightways. They say that Freightways seems to have lagged behind their largest competitor - CourierPost - in this area, but they have maintained market share and profitability. Do you see any major disadvantages in not having had the technology?
Not at all, but that question's probably got three or four parts to it.
Just stepping through them, technology is a part obviously of running a transport business such as Freightways and it always has been a key part of what we're about.
We've actually three quarters of the way through a $10 million upgrade to our IT system, so there's a fair bit of money and investment attached with IT
It's played a pivotal role in the business for 20 plus years and the information systems that we have are geared around delivering scalability because our business has grown very strongly so you've got to have information systems that can cope with that significant growth.
It's a very robust system but it has also got to be flexible to meet the varying customer needs. So we've got a very powerful, core information management system.
The part about lagging a competitor and still maintaining market share, well I think we've actually done more than that. We've grown our market share and we've grown our profitability over a number of years, so it's not just about maintaining it.
I think we've done this by keeping in touch with our customer needs and developing our services to suit those needs rather than getting caught up in a side-game that technology can distract from what you're really here to do.
We think it's most important not to lag customer demand rather than try and keep up with a competitor whose strategies we might disagree with.
Are we disadvantaged by not having some of the technology? Well, we made a decision to roll out in-van data capture technology this year and that's as a result of our customer demand but a time when we've assessed the network that transmits that data as being ready for us and the scanners that will go into our courier vans as being ready for us.
So, a few things have needed to come together but we believe the time is right.
And whilst we've been lining up to make that decision about the technology in the vans we've been focussing very heavily on ensuring we deliver our core service, which is getting packages to the right place at the right time.
What we believe we now have is a very compelling customer offer - premium service, competitive price and the latest technology to over-lay it all.
You talked about the scanners - how are the trials for those going?
They're going fine. We're rolling them out into the Auckland marketplace which is the most rigorous, high volume market to test the scanners and we'll get any glitches that are involved with new technology out of the way in this market prior to rolling them out around the rest of the country.
What developments - technology or otherwise - can we expect to see from Freightways in 2007?
I think you're going to see more of the same and whilst that might sound a bit ho hum, it's kind of what our customers like.
They want consistency, they want reliability, they want innovation when they're ready to innovate and when there is demand for it.
So what you're going to see from us is really more of the same and hopefully that will continue to deliver the sort of performance to all our stakeholders - our people, our employees, our contractors, our customers and our shareholders.
The article serves as a timely reminder, well to me at least, that technology matters very little if you are not delivering your core service. In NZC's case that is providing consistency and reliability,
You can read the full Herald article [here].