DFDS Customs

Since its founding in 1866, DFDS has built a unique infrastructure of ferry routes connecting European countries with each other and has more than 11,000 employees, 7,000 clients, and revenue of DKK 25 billion (£2.9 billion). DFDS Customs, with revenue of DKK 188 million (£22 million), forms a critical part of DFDS’ organisation.

Amid the rise in demand for customs services following Britain’s departure from the European Union (EU), DFDS Customs’ ways of working had developed locally across 10 countries, with no standardised way of operating. Instead of using uniform processes and IT systems, the business had a patchwork of both. And the need to keep goods moving meant people and teams were using their experience to find ways of working that suited them.

Our operational improvement experts joined forces with DFDS Customs and mapped every process, from receiving client requests to invoicing, and found there were 110 variations of producing import and export declarations. By studying how they developed and evolved, we turned these 110 processes into just two. With implementation on the horizon, this promises to create 25 percent more resource capacity to complete more import and export declarations, giving clients a better service, cutting the risk of mistakes, and making the business more resilient.

Key successes

• Simplified operations across 13 offices in 10 countries by standardising 110 processes to just two
• Created a potential extra 25 percent capacity by reducing time to process customs paperwork
• DFDS Customs are forecasting to generate an estimated DKK 43 million (£5 million) a year in extra revenue thanks to the extra capacity that allows them to process additional import and export declarations.

Adapting to a new customs landscape

The impact of Brexit means no goods can move between the UK and the European Union (EU) without customs paperwork, and, where appropriate, without duties being paid. The import and export of everything from food to cars depends on this happening efficiently, especially for perishable goods like fresh food.

And while DFDS Customs was a major player in processing customs paperwork, it wasn’t getting the full benefits of its scale. The business had previously tried to standardise processes and systems for more efficiency, but it had proved challenging to raise productivity across the entire organisation.

PA operations improvement expert, Richard Danby explained: “Businesses moving goods in and out of the UK from the EU now have to complete import and export declarations and pay any duties due before the goods can leave the docks. It’s vital this happens without any delays. Any mistakes might mean goods are stranded at the docks, leaving businesses with a bill for storage and unable to distribute goods to shops.”

Looking for more capacity

DFDS’s customs business had grown quickly in the wake of the new Brexit shipping requirements that came into force in July 2021. The business handles around half of all fish moving in and out of the UK, for instance. And while its 230 employees were keeping customers satisfied, for example generating paperwork for time-critical fish transports within one hour of every request, they needed to free up capacity.

Mapping operations to unravel complexity

Our experts scrutinised how the customs business worked, breaking every process down across all 13 locations. Through workshops with each team, we mapped these processes, from when a team got a request for customs documents, to when they invoiced clients.

Danby said: “In all, we mapped 110 different processes and found more than 90 standard operating procedures. The same went for IT. We found 35 different systems for customs documents, invoicing, and Customer Relationship Management (CRM), as well as dealing with customs authorities. And because these often didn’t ‘talk’ to each other, or teams weren’t trained in how to use them or didn’t have access, they’d need to copy data into spreadsheets and manually transfer it to another system.”

Designing DFDS Customs’ future operating model

While processes standardisation was key, our team knew that to really transform the way DFDS Customs operates, they needed to consider the bigger picture. “Processes are just one dimension of a company’s operating model,” explained PA digital and data transformation expert, Sebastian Schwolow. “We know from experience that changing only your processes without tweaking the surrounding operating model is seldom successful in the long run. If we didn’t adjust DFDS Customs’ operating model to reinforce our new processes, there was a high risk they’d be rejected by the operational environment that shaped the old processes,” he continued. 

To properly embed process changes across all sites and avoid the risk of teams reverting to old ways of working, we outlined a new operating model and presented its recommendations in a series of workshops with DFDS Customs senior leaders.

Creating simpler, standardised processes

As a result of the standardisation work, DFDS Customs is now positioned to replace the 110 processes with just two: one each for import and export declarations.

Together, we estimate the simplified processes will create an extra 25 percent capacity to complete more import and export declarations. This should generate an extra DKK 43 million (£5 million) a year in revenue. It will also minimise the risk of errors, making operations more resilient. And most importantly, customers will now see a quicker turnaround of customs paperwork. Because there’s less variation in the process, they’ll spend less time filling in said paperwork.

With implementation on the horizon, DFDS Customs now has a plan for how to put the new simplified process into action across all 13 sites. This ensures they can feel confident deploying the recommended operating model changes to make these process changes stick.

Now, DFDS Customs is well positioned to deliver faster and for more clients, keeping the flow of goods moving between Britain and Europe.