2020 is a year to make our mark

Teleport’s 2019 in-review, and my 12 wishes for 2020

Hi Team,

This time last year I wrote a holiday note to the team with my 12 predictions (wishes) for the upcoming 2019. It’s always fun and a little surprising to look back at how on-point or completely off-base some of those predictions have aged one year later. Case-in-point: we’re no longer RedCargo, and we no longer are interested in just air cargo.

I also sent out last year’s note internally, but our audience has since grown from the team to include interested customers, joint venture partners, portfolio companies, would-be competitors and future hires. We operate in an environment where transparency is often lacking, so writing this in a public medium lets anyone interested in our thinking access it, but also sets the right tone for how we want to operate, going forward; to do business the right way, enable our customers to access us and our infrastructure easily, and communicating our thoughts and intentions openly.

A comment I heard often last year was that people had to speculate about our plans through the media and press. Well, we’d rather you heard it from us directly, and that’s on me to lead by example. This means when we make mistakes, contradict ourselves, or change our approach, you’ll definitely know about them, and that’s the trade-off we are willing to make.

So, how do we look back on 2019? Let’s get back to those 12 predictions.

1. Teleport will be the most attractive company within AirAsia to work for;

I honestly have no idea if we are (violating the SMART rule to make all goals measurable etc.), but our intention is to be the best place to work, period. This can only happen if we demonstrate that we can make everyone that works with us, top to bottom, significantly better. Our approach has to work for everyone — interns, internal transfers, outside hires, or seasoned executives. No one is left out. This is the bar we set ourselves.

I always tell new joiners our intention is that everyone is hired to grow with us for 10 years. We’re in this for the long-haul with you. This forces us to hire carefully, select leaders that can coach and make those around them better, and really map out how each individual can develop with us. Last July we released our first major employee survey, measuring amongst other things, overall workplace satisfaction (expressed as eNPS, a score ranging from 0–100). 89% responded (111 people in total) and we scored 50.45. This basically meant there are 2 engaged employees for every 1 unhappy employee in Teleport. Respectable, but not good enough for the bar we set ourselves. Digging further what we found were that only 10% of the team were ‘unhappy’, expressing their dissatisfaction with a sense of favoritism, lack of teamwork and open communication, poor workplace safety and facilities at the warehouse. We have work to do.

For starters, we will run the internal company-wide survey twice a year. We will listen more, hold ourselves accountable for feedback and communicate what we are doing to address issues that pop up. We will also launch a unique program to train and promote managers, the #TeamTeleport way (I’m excited by this).

As to whether we are the most attractive company within AirAsia to work for? I’m just proud some AirAsia Allstars think Teleport is cool. If at the start of the year anyone would associate cargo and logistics with “cool”, I’d take it. Keep buying our merchandise folks.

2. To open new offices in Indonesia, the Philippines, China, Singapore and India;

Check, we did this. We expanded from Malaysia to six other countries in the past year, including another that wasn’t on the original list, Thailand. Teleport is now a regional company, maybe the first of its kind, with local partners in Thailand, India, Indonesia and the Philippines. Why does this matter? We are a physical business, and if we want to help our customers move goods and e-commerce seamlessly anywhere across Southeast Asia (and beyond), we have to be present for them in each major country we operate to.

3. Teleport to move into our new 15,000 sq ft headquarters in Malaysia;

Sort of. We have expanded our office space ambitions in Malaysia, with three locations in total. A small team (most of the corporate services, and some product / tech functions) will remain in RedQ Level 5, most of the operations-related functions in Malaysia will move into the new office on the second floor of the GTR Air Cargo hub to be closer to our operations and customers, and a big chunk of the team (in particular, the teleport.social gang) will move into our brand spanking new office in Damansara Heights, come April 2020.

It goes without saying that when the whole team no longer sit together in one place, we have got to be very deliberate in how we communicate and align by putting in place a strong ability to constantly update the team company-wide, hold effective meetings that keep things moving, and avoid the trap of email as a primary form of talking. Tall tasks ahead. Going forward most of my internal CEO updates will be made public (probably as a post), and more frequent (weekly in some form, as I’m feeling ambitious on the 1st of the year).

4. To be able to deliver door-to-door in at least 8 cities across Southeast Asia;

I’m counting with two hands but we’ve got Jakarta, Singapore, Kuala Lumpur, Kota Kinabalu and Kuching. If I’m feeling generous, we may have launched Brunei, Miri and Tawau just in time. That’s just about 8, phew.

Goes without saying this is my primary area of focus for this coming year. We’ve got to prove we can deliver packages door-to-door anywhere in Southeast Asia, within the same day to really make a dent in the whole supply chain. Same-day is a definition of within 24 hours from pick-up to drop-off for starters, but eventually it’ll be within the actual day itself.

Why are we trying to do this? Buying stuff online is a game changer in Southeast Asia, but logistics (and payments, but more on that later) is, and will be the biggest pain-point in our view. Eventually the 40%+ growth a year in e-commerce will hit the painful reality of inadequate logistics to support it. Today, 7 cities in Southeast Asia are responsible for more than half of the internet economy purchases. You can bet as you venture out of those 7 mega / capital cities, the infrastructure just isn’t there, and the players aren’t investing yet. We think our competitive advantage lies in moving small packages between cities, and borders seamlessly and fast, and that’s where you will see us invested. Thanks to AirAsia we already fly to many of those other cities already, and we can serve the same populations that fly with us, to buy online using us too.

Does this mean we aim to compete against many of our customers today? There is some overlap, but by and large we think we are addressing a slightly different segment (some demand which hasn’t even been created yet). For one, we don’t deliver within a city. Two, we are focused on speed and convenience of delivery between cities / borders which, at best, addresses ~30% of the market. The 70% majority remains price-driven, and that is best done at scale by some of our other competitors. Third, we are focused on the as-yet untapped potential of buying and selling on social media platforms / conversational commerce / social commerce. It’s early days but we are here to prove it can be done. This means tackling product development, merchant and customer acquisition, digital marketing and payments on top of logistics and that’s what teleport.social is about, all while trying to prove this is an immediately unit profitable model vs. traditional upfront cash-sinking e-commerce marketplaces.

5. All remaining AirAsia airlines to be IOSA certified;

This is the IOSA certification program: https://www.iata.org/en/programs/safety/audit/iosa/

Yes, we got there in the end. AirAsia and AirAsia X in Malaysia, AirAsia Philippines and Thai AirAsia went through their (re-)certifications this past year, all passing with flying colors. Our teams played a smaller part in the overall process, but we are happy to see our airline brothers and sisters come through a rigorous process. Few companies are as regulated as airlines, and that type of shared responsibility embeds a deep respect for good governance and strong ways of working for a startup like ours. We’re better for it.

6. AirAsia and AirAsia X (Malaysia) to be dangerous goods ready (so we can carry electronic items);

This was quite a process involving collectively training 2,119 cabin crew and 1,015 pilots in Dangerous Goods Regulations (DGR) during 2019, which we managed to complete by November itself. On top of that, we needed to renew our Dangerous Goods permits which was done, to submit a revised set of manuals and specifications (~5 in total between flight operations, cargo and ground operations) to the Civil Aviation Authority of Malaysia (CAAM) for approval, to audit and ensure all our ground and cargo handlers are complaint to handle dangerous goods, and to get approvals from foreign regulators for carriage. AirAsia X is now pending only approvals from foreign regulators and we should be able to begin carriage when that comes through. Our target is February 2020. AirAsia Malaysia is pending a submission to the revised manuals and so our best guess is by April 2020 we could be in a position to begin dangerous goods carriage.

We did not quite reach the complete goal in 2019 itself, but why is this important to us to quickly get there? Well, so much demand (including many types of e-commerce) are still out of reach for us to carry because they are classified under dangerous goods of various classes. This is one major reason why our overall cargo utilization is still low compared to some industry peers. The delicate balance we manage is always the safety and security of our operations (for extreme reference, look at the countless cases of lithium batteries that have exploded on-board) versus accepting more demand / business. So, in 2020 we’ll be very mindful and careful to roll this out properly, focusing mainly on items of manageable risk, and allowing customers who buy directly from us to have first access. We will communicate expectations upfront and clearly, and have a thoughtful process on how we go about managing this.

7. Thai AirAsia and Thai AirAsia X to join Teleport fully;

It’s 1 Jan 2020 today, and the entire network of Thai AirAsia and Thai AirAsia X is now integrated for the first time into Teleport. This means we can, for the first time, sell the entire air cargo capacity and network of the AirAsia airlines in Southeast Asia (6 in total) as one. We do believe this is what many of our Teleport for Business customers and partners want - to deal with one operator instead of many different parties for their needs, and more importantly the combined network we now have, covering 100+ cities, 10,000+ flights per week and, 1 million tons of available capacity is an attractive product. When I look at how we ship fresh vegetables from Trichy to Singapore, live seafood from Medan to Taipei, or human hair from Delhi to Yangon I see examples of how our network can enable so much value for our customers. We’ve got to do a better job showing the power of our combined network to even more potential customers, and that’s in the plans for 2020.

How does Teleport Thailand play a role in all this? Effective 1 Jan 2020, Teleport Thailand sells all domestic and export cargo out of Thailand for Teleport. The rest of the network (i.e. import, or transshipment through Thailand) is sold directly by Teleport and not through Teleport Thailand or Triple i any longer. This is so that the combined network is managed as one, so that for example any shipments out of China into Southeast Asia, regardless of whether carried by Malaysia, Thai, Philippines or any combination of carriers no longer matters. Only the origin and destination counts.

By the 1st quarter of 2020 Teleport Thailand will also begin delivering door-to-door e-commerce shipments within cities in Thailand as well as into and out of Thailand, using our partner Triple i to help with import and export customs clearance activities. Domestic e-commerce movement in Thailand requires no formal customs activities (unlike in Malaysia for example), and so this will start almost immediately. The sooner this starts, the sooner teleport.social in Thailand can also roll out.

8. To get offloads at ramp down to 1% or lower in all countries;

The percentage of offloaded cargo each day is our version of On-Time-Performance (OTP) for passengers; anything that doesn’t go on the flight that is booked is a potentially disappointed customer. Anything that doesn’t get flown on the day itself is a delicate supply chain that is disrupted. In the age of e-commerce with millions of parcels or packages delivered daily, 1% of a large number is significant. Our goal remains to deliver a high service level to customers regardless of whether we ship cargo or parcels.

So in 2019 we receive no pats on the back for this. This problem proved hard to tackle because we could not even start by accurately measuring how we performed. We do have streams of Whatsapp messages and other clues but really no hard data captured in the back end, and spent most of 2019 struggling to address this.

We had to start by first figuring out how much cargo was accepted at each cargo terminal in each airport we operated from. By the end of 2019 we had integrated about 80% of the information we needed. I say “about” because we still don’t know exactly, and this is the team’s collective failure that I take responsibility for.

We do meticulously track daily offloads across all our airports in Malaysia and the Philippines and by all that we do measure, we are at about 70% accepted-as-booked (the rest are no-show, inaccurate, or offline bookings), and 90% flown-as-accepted with a majority of our offloads happening in Kuala Lumpur (KUL).

We introduced ramp-side digitalization (via a mobile-app made available to our ground handler in KUL) in November, but have found it hard to get our ground handlers to replace their current processes with it. My target for the operations teams in Malaysia is 1% offloaded (or “lying”) overall, and not just offloaded at ramp only. This remains a work-in-progress.

Whilst we have completely digitized most of the major parts of our network (like all airports in Malaysia, Thailand and in the Philippines) there are still blind spots that remain e.g. in Wuhan, Busan, and on occasion Singapore, Shanghai Pudong, Xian, Penang and Cagayan de Oro. We still need to do more to encourage our handlers to improve their processes and integrate their operations with ours. A second major reason why we don’t know exactly where we stand is because there are still cargo bookings made outside of our systems. This usually happens when customers can continue to access bookings with us through certain agents offline. We get to know this only when billing time comes around (twice a month) and our Finance team valiantly, but manually try and reconcile our records against those self-reported by our customers and agents. Not only is this a painfully recurring exercise, but it leads to material revenue leakage on our end. 2020 has to be the year we incentivize against, or punish this behavior, starting with the ability to bill directly and automatically using our systems.

9. Customer support to receive at least 20 compliments / thank you emails a day;

In the early days when Teleport inherited the cargo operations from AirAsia, I used to help man the customer support desk for our cargo business. It was important for me to do so because that was where I could get the best feedback on what needed to be fixed, and in what order. By most accounts we were known for being unresponsive and distant. So I put in place a simple rule designed to shock and awe - I said we would be responding immediately to any customer email anyone wrote us, and no emails would remain unread by the end of each day (Saturdays and Sundays inclusive). I also gave my email out to anyone who faced issues with our service, and asked them to feel free to copy me in case issues were not resolved on a timely basis. That way, my inbox became a measure of if we were solving problems as advertised. If it went silent or if email responses were thank you’s I knew things were okay. Crude, but effective.

Fast forward to today and we now have a dedicated customer support team that tracks tickets, uses an online customer support platform to manage responses and for the most part no longer deals with forwarded emails from customers to me asking what on earth is going on. Are we good enough? Definitely not. Product knowledge is still work-in-progress; the team needs training and better exposure to the details of operations. We do not manage customer support entirely as one group across the network. Also, we need to measure what matters. What makes a happy customer? Resolving their issues at the first time of asking.

Do we get 20 compliments or thank you’s a day? I have no idea. We don’t track them as a category. Is it worth tracking over other metrics? TBD.

10. To double our headcount to 200 across all countries;

My best guess is we are closer to 300 than 200. Crazy.

11. To see at least 10 new promotions from within;

I’ve counted ten. Farihan, Khairul, Alif, Razmin, Vinod, Dora, Zia, Roel, Ernest and Darika. All within operations.

This is something we need to do much better at as a way to stretch our people, create effective managers across the board and build long-term culture. I would like to see a more healthy cross-section of promotions across countries, functions and seniorities in 2020. Also, it shouldn’t be so hard to count to 10 the next time.

12. To reduce printing by 50%.

I really hope so.

So that was 2019. Many wins, some missteps and so much more than was predicted. I am very proud of the team, the work that has gone in and the culture that is being built, parcel-by-parcel.

2020 is the start of another decade, and a really nice, symmetrical round number. A memorable year to make a mark. So, in keeping with tradition, here are my 12 wishes for the upcoming year:

1. No one describes Teleport as a “cargo” company any longer. We’re a wider logistics business amongst many others things, and we have to demonstrate that;
2. 1% offloads across the network is a reality and we can measure it reliably;
3. We re-build and train an effective sales team in Malaysia within 6 months, with 50% of our Malaysia-based revenue contributed by direct customer relationships;
4. Teleport gets into the lockers and pick-up and drop-off business; any competitor can use our lockers (it’s universal);
5. Our successful “same-day” completion rate is 90%;
6. Teleport.social processes more cross-border orders than in-country orders;
7. We launch our own direct-to-consumer merchandise brand selling exclusively on social media. We use it to test all our future product features;
8. When asked for feedback, Teleport is described as an effective team (or similar) by whomever we interact or work with;
9. It is an unexpected delight for anyone to deal with our finance, legal and people teams;
10. We recruit, promote and onboard a regional senior leadership team with at least 50:50 male / female representation, and 4+ nationalities represented. My number of direct reports reduces to 10 or below by the end of the year (from 20+ currently);
11. We welcome new independent directors onto the Board of Teleport;
12. We figure out a more reusable approach for our packaging (boxes, sleeves, gunny bags etc.);

I’m excited already.

Pete