Schneider Electric, a company so large it has not one, but seven, global transportation control towers, has been slowly and steadily centralizing the management of its transportation operations. That’s no small feat, given the company operates in 100 countries and produces 300,000 products under a number of companies and divisions.
Since 2015, Jean-Baptiste Delafoy, vice president of global transport and customs, has been leading the charge in a multi-phase, multi-year plan to migrate Schneider Electric’s freight audit and payment operations for the ocean, air, and parcel shipping to a central, standardized freight audit and payment process with Cass Information Systems.
Standardized global reporting on shipments and spend
Negotiation of global contracts with their largest global carriers
Carrier accountability and improvements in billing
Audit savings as high as 5%, depending on mode, region and carrier
"My ultimate goal was to achieve global visibility into freight movements and costs, and I believed then and now that the best way to achieve this was to centralize intercontinental air, ocean and express freight payment with a single provider", says Delafoy. The visibility into standardized shipment data and freight spend would support countless business needs and initiatives, including ongoing supply chain optimization.
After much discussion between Cass and Schneider, a plan was put in place to implement the global freight payment program by region, starting with APAC, and then Europe, Australia/New Zealand, South America, the Middle East and Africa.
Cass provided a global account manager and regional teams to support the project. The journey would be a major change for many of the Schneider Electric teams, and also for its carriers. Its key global ocean and air carriers were included from the beginning and would spend much time determining how to work most efficiently under this new model. Because freight payment is still a relatively new concept in many parts of the world, cultural barriers had to be overcome, and a lot of education provided, particularly with the carriers.
Achieve global visibility into freight movements and costs
Implement the global freight payment program by region
Global account manager and regional teams to support the project
Education and overcoming cultural barriers
Working closely with carriers, Cass provides a library of electronic invoice formats to make onboarding simple. Test invoices are always submitted before go-live to ensure they enter the Cass system correctly, include the required data fields, and are audited accurately.
Many carriers have reported positive developments. They have been challenged in many cases to improve and modernize certain contract and billing practices. What they report enjoying the most is the ability to log in to the Cass portal to see invoice and payment statuses. Because in most parts of the world, invoices cannot be short paid like they are in North America, carriers and Cass collaborate in various ways, depending on country or region, to arrive at a final, correct invoice that will be paid as presented.
There are two main reasons an implementation of this size is a multi-year project. First, there is no such thing as a global invoice standard or global legislation that allows for consistent global processing. Second, for most of the Schneider Electric carriers in parts of the world such as APAC and South America, this is their first experience with a freight payment provider. So, for today, onboarding is more of a tedious process than in North America where most freight carriers have been billing third-party providers for years.
