22.10.2021 | Reading time: 6 minutes

KEY FIGURES IN CUSTOMS AND EXPORT CONTROL

Imagine sitting at your desk and looking at your ?dashboard? as a digital tool that displays all the key figures and risk parameters that are important to you, such as the company?s import and export operations. But you can easily filter for special information, such as exports to certain countries or country groups. You can [?]

Imagine sitting at your desk and looking at your “dashboard” as a digital tool that displays all the key figures and risk parameters that are important to you, such as the company’s import and export operations. But you can easily filter for special information, such as exports to certain countries or country groups. You can control customs department costs, such as training, external service providers, and manage your own resources. For example, if embargoed exports increase, more resources are needed internally to review transactions and apply for approvals if necessary.

Your personal “dashboard” pulls information relevant to import and export operations from all relevant systems from customs service providers, ERP and other data sources and aggregates it in a meaningful way.

Even better, as processes change and business units are added or removed, you can always adapt your flexible dashboard to keep your metrics focused on what’s important.

Want to use key performance indicators to control and monitor your area of responsibility? This article shows you how to use metrics in a way that allows you to immediately identify and minimize risks. You can better control your resources and thus also provide colleagues and superiors in the company with important information without getting bogged down in the details.

 

Why key figures are important in the field of customs and export control

 

“Key figures, that’s just something for controllers from accounting”. What are the most important key figures you should know as a customs expert? The answer is: It depends. It’s important to know what you’re responsible for and which processes. If export control is strongly represented by many dual use goods and operations requiring licenses, the number of licenses in the quarter, exports to embargoed countries, would be interesting as a basis, in addition to exports in general. With many imports from preferential countries, the use of these preferential benefits would then need to be monitored.

If you keep track of the changes in standard procedures for imports and exports, you will be able to react much faster. When regulatory changes, such as the preferential agreement with Japan or others, require you to review whether this new agreement matters to you, you are quickly able to evaluate figures on Japan imports and exports and make a clear recommendation to management on how to use the agreement.

These are just a few examples to show you that metrics and controlling your area from the meta level are essential for you as a customs expert in the future. As an expert, you are a consultant in the company and thus prepare important information that contributes to control and thus also forms the basis for decision-making. We want to give you a few steps with which you can easily deal with the topic of key figures.

The most important thing, however, is before you decide on the choice of “tool” in the form of software, you should be clear about what data you need and what metrics are important to you now.

 

What data do I need? Analyze data sources and formats

 

First, you need to get an overview of which systems are interesting to compile your “data pool”. For example, the ERP system, such as SAP, is used by many. Furthermore, customs systems can provide important data, from providers such as AEB, Format, BEO or others. If you do not handle your imports and exports yourself, ask your customs service provider if monthly import and export data can be delivered as XLS or CSV files. You should also talk to your internal IT about possible export formats. Interfaces can be addressed when you know for sure which data you need and how. It is important to first get an overview and collect the data. The first thing to do is to gather everything available.

The second part, after you have an overview of the data sets quantitatively, is to check how good is the data quality? Which data is generated automatically, such as document numbers of customs declarations? What data is determined by human processes, such as customs tariff numbers, or entries in the field, “Reference”? The best thing to do is to first create a large table and an overview. Next would be to see what data is usable to incorporate into a metrics model. This phase can take some time, depending on the quality of the data, as it is the prerequisite for a functioning metrics model.

 

Which key figures in customs and export control are important for me?

 

Which key figures do I now need to compile from my data pool? This is a very common question. In a standard reporting system, which ideally always follows the same structure, one should consider: Do I want to use my key figures to

– control costs?

– Check process quality and thus manage risks?

– Perform resource management?

– Make or buy decisions?

The question of what you want to say depends essentially on the question of what are you responsible for in your area of work? What processes are you responsible for? Then it often helps to ask yourself for the topic of quality and compliance, what result does the process have to show so that the quality is right? How can I check this now? For example, the import handling process. If you have 40 import declarations a month and change notices have to be requested for more than 10 imports, the quality is probably not good. That would be a possible metric to check the process quality.

We at Grenzlotsen have compiled an extensive catalog of key figures from different areas and sizes for those responsible for customs and export control in the company, because there are no “key figures” for everyone. Everyone has to check for themselves what fits.

Usually, this is also a period in which you have to check your own key figures in customs and export control again and again for “usability, objectivity and cost-benefit ratio”.

 

We recommend working manually in this phase in order to first get clarity about what you want to say in terms of content. The next step would be to check which tools I can use to create the key figures as automatically and easily as possible.

 

System analysis, which tool meets my KPI requirements

 

All the data from the previous systems that we identified in the first step must be compiled in a meaningful way so that the key figures that you compiled in the second step can ideally be determined automatically. In the course of digitization, we now want to check which digital tool (software) can support you in the best possible way.

In the first step, our recommendation is to check the existing software programs that you have in the company for possible applicability. For example, Microsoft Power Business Intelligence (BI) offers ways to bring data together and present it in dashboards. Depending on the ERP system, you could inquire through your IT department to see if there are corresponding analytics apps or areas that can be configured.

If these tools are out of the question, one option would be to ask specialized providers in the area of customs and foreign trade, or even more generally analysis tools that are available on the market. It is important that as much data as possible of different formats can be integrated and that one is able to adapt the dashboards accordingly.

Ideally, after the project phase, there is a key figure admin for the tool that can also generate constantly changing key figures and analyses. Experience shows that there are often requirements for ad hoc evaluations and changes in standard reporting.

Another advantage of the digital dashboard for the key figures is when you can activate colleagues for certain work areas. For example, for purchasing, the evaluations on imports and the use of preferential tariff rates can also be interesting. This also saves you having to send and compile the information again and again.

 

The implementation of key performance indicators in a digital dashboard

 

Now that you have an idea of your key metrics, have done your data analysis and selected a tool, the question is – how to implement?

Ideally, you start here with a small pilot. The most important or simplest metrics are presented in the tool and made available to a group of recipients. And then: gather experience, get feedback. Do you work with the figures? Are they meaningful? Does it need something else, does it need more? And then the “changeability” of the dashboard can be tested directly.

After this phase, evaluate: Do we need more metrics, changes in the process? Where is there still a problem in order to really control customs and export control processes in day-to-day business with key figures?

Do you need support for more clarity around key figures in customs and export control? Then register with us for a webinar or arrange a free initial consultation. We will be happy to advise you at any stage on the subject of key figures and digitization!

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