The Importance of Risk Management in Shipping Documentation through Technology

 

Documentation is the lifeline for various transactions and regulatory compliance in shipping and freight.

However, the number of the documents used in shipments and the unique complexities of each of these documents such as bills of lading, cargo manifests and customs declarations do pose several risks which sometimes can result in errors, delays and fraud.

These are just some of the challenges capable of disrupting the flow of goods and supply chains globally. The use of suitable technologies have come across as a vital ally in finding solutions to mitigate these challenges and risks in shipping documentation.

 

Common risks in paper shipping documentation

Errors : Manual data entry and capturing are known to be prone to mistakes which often includes incorrect customer or cargo details leading to regulatory and compliance issues, incomplete or incorrect charges leading to mis-invoicing and potential business and financial losses.

Delays : There are several cases of delays in the transfer and transmission of paper-based documentation across the globe. These delays can cause unexpected and unnecessary and avoidable costs like demurrage, detention, storage not to mention delays in receiving cargo. These delays of course have the potential to disrupt manufacturing and production of goods.

Fraud : Paper documentation is susceptible to fraud including forged documents, tampering, duplication etc all of which is a major risk and threat to the integrity of shipping transactions. The lack of a clear audit trail makes this a great risk to customers and all stakeholders in the transaction.

These risks impact individual ships and have a broader impact on global supply chains with eh potential for disruptions, increase in costs and erosion of trust among partners, not to mention some of the regulatory penalties.

 

How technology is assisting in risk management and in reducing risk

Using digital documentation and payment platforms like ODeX users can automate data entry and validation processes reducing the likelihood of human errors and increasing the accuracy of shipping information provided to various authorities.

Through streamlined digital workflows, the platform accelerates the documentation process and real-time updates of payments, reducing the risk of errors and delays while also enhancing security and authentication of key documents such as Import Manifests and other trade documentation.

 

PIL Case Study using ODeX Platform

PIL India’s customers have been able to reduce their Form 13 processing turnaround time by 60% using ODeX’s platform while also helping in eliminating customer follow ups based on visibility on the platform.

On the delivery order side, the platform has assisted in eliminating manual entry and email communication as delivery order tracking is available on the single dashboard for client and carrier. This has assisted in reducing turnaround times for delivery orders by 90%.

While this has helped in mitigating risks relating to documentation delays, on the payment side, the real-time payment confirmation to PIL has allowed a zero error reconciliation for payments made via ODeX platform.

 

Conclusion

In summary, the effective management of risk in terms of documentation and payment is essential in maintaining smooth and efficient operations in shipping. Digital platforms like ODeX are playing a key role in addressing the risks created by capturing errors, documentary delays, payment delays and follow ups and documentary fraud.

Businesses are encouraged to contact ODeX’s customer service representatives to explore and adopt this innovative technology and embrace the future of shipping.