Industry stakeholders need to collaborate more effectively

posted on 20th November 2019
Industry stakeholders need to collaborate more effectively

The 2nd AGS Global Networking Summit took place in September in London and saw business relationships enhanced, business discussed, and pertinent issues debated.

The 2nd AGS Global Networking Summit from 10-12 September proved a huge success bringing together key-decision makers from across the ground handling industry.

More than 70 high-level professionals from ground service providers, airports, airlines and other stakeholders talked business and where the industry is at, when they attended the summit at the Hilton London Heathrow Terminal 4 Hotel.

Delegates also attended the extensive networking that was on offer, forging new relationships at the welcome reception and then at the dinner on day two.

A plenary session moderated by experienced industry professional Des Vertannes, on the morning of day two, helped set the scene for the event, as pertinent industry issues were discussed by a panel of senior industry figures and saw strong interaction from delegates.

Collaboration is the answer

The three principle ground handling stakeholders – ground handlers, airlines and airports – need to collaborate more to help develop and grow the industry, the plenary session heard.

Panellist Steve Allen, head of UAE airport operations at dnata, told delegates that the biggest problem in his opinion is that airports are a “total mess” and are also being developed without consultation with operators and ground handlers.

“We have this mish mash of everything trying to do business,” he said. “It makes it less safe, more expensive and people get a worse customer experience than they should be.”

The new chairman of the Airport Services Association (ASA), said ground handling should be a very simple service and seamless and safe, but is not as efficiently operated as it should be at some airports across the globe.

“A lot of effort goes into the passenger experience but there is still a lot of work to do below the wing on the ramp,” Allen noted. “My view is we need more collaboration between all the entities at the airports. All the focus should be on the customer experience, as that is where we make our money.”

This point was noted by fellow plenary panellist Robert Derr, ramp and ground handling manager at Heathrow Airport, who said the hub’s ethos is to treat every airline’s customer like their own.

The plenary session also heard of the positive impact that technology can have on ground handling in the future to aid operational efficiency and collaboration.

Allen said: “I think technology has a key place play in eliminating some problems in ground handling like retaining staff and training. If we go into robotics and automation, then we don’t need the manual handling we have today so that is one aspect.”

“The second is the ability to collaborate. If we get the right technology where we share data between all the entities – the airport, ground handler and airline – the data is shared and decisions are based on collaboration,” he noted.

“At the moment this has worked really well with ACDM [Airport Collaborative Decision Making] because it is ATC of the ground handler on pushback, but that could flow through everything we do if we all work off the same data to help us make decisions. If we bring in AI into that that could tell us what to do and help us to solve some of these problems.”

Allen said in his view technology has a key role to play in the future of the industry and has a “massive role” in solving any problems across ground handling and in driving collaboration.

Pressure on ground handlers

Ground handlers are facing unprecedented challenges as air traffic passenger figures continue to grow strongly and aircraft turnarounds surge.

Derr said Heathrow Airport itself is seeing great deal of pressure at the UK hub on ground handlers to “constantly challenge their prices” whilst also delivering a high-quality service.

Heathrow has more than 80 airlines and the airport sees around 470,000 air traffic movements across its two runways a year. It has been given permission to build a third runway that will ease capacity issues, but it could be six or seven years until it is opened.

“I see the tension and stress between ground handlers and airlines,” Derr said. “I think ground handlers struggle to structure business when they are on three-year contracts but with 90 days’ notice – so how do you build more robust business plans to work across that environment that can generate churn and instability?”

Heathrow has eight ground handlers providing services to airlines, and at one of the world’s busiest hubs, where around 80 million passengers pass through it each year, operators continually face immense challenges.

“When we look at that part of the world, we are concerned that there is any kind of pressure to race to the bottom,” Derr said. “From the feedback from ground handlers at Heathrow, I see a constant pressure and struggle to recruit and retain staff, I see that is one of the challenges each of the handlers have. Even those at the more premium end of the market still struggle to recruit and retain people.”

There is often talk of the need for a more standardised approach across the ground handling industry, to drive operational levels of operators.

Derr said that at Heathrow Airport, there is a wide variety of ground handling standards utilised across different providers, which in his opinion does not have a positive effect on operational efficiency.

“I see ground handlers handling 30 airlines with huge amounts of variation and even airlines within the same group that cannot agree standardisation for the same aircraft type,” he said. “That just drives instability and hesitation, drives a lack of consistency of process and safety.”

Derr also said that in his view, more data needs to be shared across the chain, as this would help boost operational efficiency and standards.

The second airline

Ground handlers are often arguably the forgotten part of the aviation chain, the middle- man, and it could be said their importance is sometimes not regarded highly enough.

Panellist Samir Shaikh, station manager at Air Astana, certainly holds ground handlers in high esteem and said that as an airline it relies on the ground handlers, who are in his view the “second airline” – so it is vital the carrier supports them where needed.

He noted that it can be difficult to choose an operator and in coming to a decision as to which handler is chosen for a station contract, the Kazakhstani carrier looks at KPIs, customer service and reliability of the operator.

Shaikh said one thing he would like to see implemented was ground handling staff wearing uniforms that match the airline so that they both look the same.

However, Allen noted that these kinds of details stem from the difficulties in the negotiation of contracts. Part of the problem, he noted, is they are often negotiated solely with the airline’s procurement team, who are only focusing on keeping costs as low as possible.

“Contracts are negotiated to reduce costs without taking into account the operational realities for what they have negotiated,” he said. “The best airlines we deal with are where the operators and the procurement team work hand in hand. Sometimes you can easily pay a very low price for a ground handler, but the moment you get one aircraft damage, you have wiped all those savings 10 times.

“I think that is a big issue in the industry – we don’t recognise the impact of saving a few pennies that create some multi-million-pound issues.

“The second thing is the moment your ground handler abuses one of your customers or doesn’t deal with them very well, and the customer does not come back, again you have wiped out the savings you have made on those incremental costs from the ground handling contract.”

Allen said that once the contract is signed that should not be the end of the agreement and ground handlers and airlines should continue to have an ongoing dialogue for the entirety of the contract, discussing how things have been or can be improved and how things can be done differently.

One interesting sub-debate during the plenary was whether ground handling is seen by airlines as a non-core or core part of operational activities.

Shaikh said Air Astana views it is a core component of service, but one view from a delegate from the floor was that it is simply “something that has to be done,” so not a core activity.

Tammy McKenzie, Head of Ground Operations at TUI Aviation, disagreed: “From a customer point of view, it is absolutely core. From our perspective we are a holiday airline and getting people from point A to point B, it is the first impression of their holiday and the last impression of their holiday for our customers, so it is absolutely core.”

Challenging but exciting times lie ahead, it would seem – for all ground handling stakeholders.