Open Innovation in the Airfreight Industry is a Runway Success

Published Apr-16-12

Breakthrough:
Lufthansa Cargo turns to the crowd for new ideas on a variety of projects.

Company:
Lufthansa Cargo, Germany

The Story:

Open innovation is a powerful catalyst for radical thinking as Lufthansa Cargo is well aware of. The global cargo airline wanted to benefit from the wisdom of crowd to help reduce its environmental impact and to improve its services.

So it launched the ‘Air Cargo Innovation Challenge’ inviting participants from all over the world – particularly logistics experts, airfreight customers and academics - to come up with creative solutions, innovative ideas and future visions.

According to the carrier it was the first such open innovation initiative in the airfreight industry.

Submissions could cover any aspect within the Lufthansa Air Cargo Supply Chain (Handling, Sales, Transport, and Customer Service) and be either in the Green Solution or Add-On Services Category.

To help with the framing of ideas, and to ensure that Lufthansa Cargo didn’t receive a plethora of concepts that were far wide of the mark, organisers suggested that solvers consider the following questions:

For Green Solutions

• Which green processes and solutions along the supply chain could take
place over the short, medium and long term?

• Is there additional green information required from the perspective of
forwarders and/or shippers that should be offered by a cargo airline?

• What will define a green airfreight carrier in 2020?


For Add-On Services

• Which additional services are currently missing, and can improve the
cooperation and processes between shipper, forwarder and airline?

• Are there additional services required from the perspective of small and
medium-sized companies that should be offered by a cargo airline?

• Which new innovative services would you expect from a cargo airline in
2020?

The contest was open for seven weeks and a website platform was set up for submissions and for the community to evaluate ideas and post comments. The ideas were judged by an international panel of experts selected by Lufthansa Cargo, and the criteria used to evaluate ideas included innovation spirit and novelty, feasibility, cost-benefit ratio and comprehensibility.

Prize Winners

The top three prize winners were given round-trip economy tickets on Lufthansa to present their ideas to top management and members of the Lufthansa Cargo board in Frankfurt. Their prizes also included air miles and flight training in a flight simulator.

The first prize winner was for a blast proof luggage container that the jury said would enable Lufthansa to transport products that had previously been non-deliverable.

The second prize went to a solution called ‘Navigate My Cargo’, which the jury claimed would allow the carrier to select the most environmentally friendly route.

The third prize ‘LH Cargo Training Center’ is an initiative that the jury believes will help Lufthansa cargo reach new target groups and further improve quality.

In addition to these prizes 25,000 Air Miles was awarded to the Most Valuable Participant based on discussion activity during the contest, quality of contributions and support from other members.

Key Benefits

For firms such as Lufthansa Cargo, open innovation contests offer a number of key benefits including:

• A fast, efficient and safe way of doing some market research
• To complement internal resources
• Generate new products and services
• Taking thinking down new and hitherto unexplored avenues
• To show customers they are valued and taken seriously

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