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WINTER 2016/SPRING 2017 AGS AIRLINE GROUND SERVICES www.ags-airlinegroundservices.com DEALING WITH SAFETY FIRST: FOCUS ON WORLDWIDE DIRECTORY MISHANDLED PRIORITIES FOR THE ASIAN OF GROUND BAGGAGE THE FUTURE MARKET SERVICE PROVIDERS
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EDITOR’S LETTER | WINTER 2016/SPRING 2017 LETTER FROM AGS WINTER 2016/SPRING 2017 AIRLINE GROUND SERVICES THE EDITOR www.ags-airlinegroundservices.com DEALING WITH SAFETY FIRST: FOCUS ON WORLDWIDE DIRECTORY MISHANDLED PRIORITIES FOR THE ASIAN OF GROUND BAGGAGE THE FUTURE MARKET SERVICE PROVIDERS W elcome to the Winter 2016/Spring 2017 issue of Airline Ground Services, published against the JAMES SHERIDAN Chairman backdrop of the US presidential elections that took james@evaint.com place on 8 November. PARVEEN RAJA Defying the polls, Donald Trump gained the Publisher victory over Hilary Clinton in a political upset somewhat reminiscent parveen@evaint.com of the surprise EU referendum result in the UK in June. Among the MEGAN RAMSAY remarks the president elect made during his acceptance speech was Editor a promise to “rebuild” the country’s infrastructure – including its meganlouiseramsay@gmail.com airports. At this early stage, it is of course difficult to speculate on the HARLEY KHAN details of those promises, but I for one will be watching with interest Head of Commercial to see how things unfold during his term of office, particularly with harley@evaint.com regard to the aviation industry and its environmental responsibilities. YASMIN LYDON In this edition of AGS, meanwhile, we speak to the heads of two of Events Coordinator yasmin@evaint.com the big handlers – Swissport and WFS – to see how each of them is settling in to their roles: Eric Born became CEO of Swissport about a GEMMA KEEN year ago while Craig Smyth joined WFS much more recently, in August. Events Coordinator gemma@evaint.com This issue also looks at several aspects of baggage handling, following on from our update on IATA’s resolution 753 in the Summer SHOBHANA PATEL Head of Finance edition. We consider not just lost luggage and some of the ways it can shobi@evaint.com be minimised, but the problem of damaged luggage too. CHARLOTTE WILLIS Safety initiatives, the latest technology updates, luxury lounge Events and Circulation design, developments in airline catering, Russia’s clampdown on charlotte@evaint.com monopolies, opportunities in the Asian market and the impact of social SHELDON PINK media on ground handling are all considered in these pages – and we Creative Director sheldon@evaint.com gather a range of perspectives on some of the big challenges facing the industry, too. Address changes and subscription orders to: circulation@evaint.com I hope you find something to inspire you as we move towards 2017. ISSN 2040-476X It seems likely to be a year of significant change for the world at large, EDITORIAL CONTRIBUTORS and potentially for our industry too as a result. Q David Smith, Eugene Gerden, Martin Courtney, Chris Lewis and Anthony Harrington PUBLISHED TWICE A YEAR BY EVA International Media Ltd Boswell Cottage, 19 South End Croydon, London CR0 1BE Tel: + 44 (0) 20 8253 4000 Fax: + 44 (0)20 8603 7369 Website: www.evaint.com PRINTED BY Headley Brothers The Invicta Press, Lower Queens Road Ashford, Kent, TN24 8HH, UK DISTRIBUTED BY Ascendia EVA INTERNATIONAL MEDIA LTD PUBLISHERS & EVENTS SPECIALISTS MEGAN RAMSAY Is s u e 2 2 © 2 0 1 6 | w w w. e v a i n t . c o m Content may not be reproduced in any Editor format without written permission from meganlouiseramsay@gmail.com EVA International Media Ltd www.ags-airlinegroundservices.com WINTER 2016/SPRING 2017 Airline Ground Services 1
CONTENTS | 8*/5&3413*/( CONTENTS 1 Editor’s letter 6 4 Fertile soil: an interview with Eric Born, Swissport CEO 6 Where next? Thoughts on the future of ground handling 9 1PJOUTPGWJFXJOEVTUSZlHVSFIFBETDPNNFOUPO TPNFPGUIFNBJOJTTVFTGBDJOHIBOEMFSTUPEBZ 14 Upgrading: we catch up with new 8'4$&0 $SBJH4NZUI 18 Diverse strategies: different approaches UPUIF"TJBOHSPVOEIBOEMJOHNBSLFU 22 4UBZJOHUIFQBDFEFWFMPQNFOUTJOUIFBJSMJOFTFDUPS 25 4BGFUZlSTUBDPOWFSTBUJPOXJUI ex-IGHC chair Marsha Ragusa 28 No such thing as a free lunch: EFWFMPQNFOUTJOBJSMJOFDBUFSJOH 32 5IFDPNQMFUFUSBWFMFYQFSJFODF7*1MPVOHFEFTJHO 36 /BWJHBUJOHUISPVHIUIF5XJUUFSTUPSN NBOBHJOHTPDJBMNFEJB 14 40 Lost and found: one way to deal XJUINJTIBOEMFECBHHBHF 44 42 2VJDLlYIPXUPDPQFXJUIUIF QSPCMFNPGEBNBHFEMVHHBHF 44 Airport technology trends for 2016 48 4BUJTGBDUJPOCBHUSBDLJOHBOE*"5"T3FTPMVUJPO 49 "O"NFSJDBOlSTUJOBJSQPSUXJOUFSTVTUBJOBCJMJUZ 50 3VTTJBPOWFSHFPGCJHDIBOHFT 51 AGS Directory 2 Airline Ground Services Winter 2016/Spring 2017 www.ags-airlinegroundservices.com
WE TURN AROUND YOUR BUSINESS Swissport International Ltd. Ground Handling, Cargo Services, Aircraft Maintenance, Fueling, Executive Aviation, Aviation Security WWW.SWISSPORT.COM
INTERVIEW | ERIC BORN: SWISSPORT SOIL A Eric Born took up the Swiss national, Born I have a different leadership style holds a BBA from the but that’s not been an issue. Rather post of CEO of global University of Applied than multiply filtered information, I handler Swissport on 1 Science in Zurich and prefer honest interaction and open dis- August 2015. He talks to an MBA from Simon cussion so we can all see what’s really Business School at the University of going on – the opportunities, where we AGSBCPVUIJTlSTUZFBSJO Rochester NY. He came to Swissport can improve or develop, the good, the that role and how he sees from a background in retail, logistics bad, what is needed… I encourage my and aviation services, including six teams to have discussions and there is UIFDPNQBOZnBOEUIF years as CEO at Wincanton and four perhaps more emphasis on this now JOEVTUSZnHPJOHGPSXBSE years at John Menzies plc as a non- than there was prior to my time here. executive director. Our role here in management is to get the company to perform well. Q. You’ve been in post as CEO of Swissport for just over a year now. Q. Can you also give an overview What were the challenges involved of how things were at Swissport in adapting and settling in to when you joined – the context in your new role, and how did you UFSNTPGlOBODJBMQFSGPSNBODF GPS overcome them? instance? A. There haven’t been that A. Things were ok. They were in- many challenges actually. I teresting times in the sense that there used the first few months was interest from the current share- to travel and meet with col- holders (HNA Group) in purchas- leagues and customers so ing the company from PAI Partners I could get a good insight when I joined. I was still working for into our strengths and de- the old shareholder for the first seven velopment areas. As far as months, so there was no change, which things to overcome are gave me a great opportunity to learn concerned, we have grown the culture of the business. There are relatively rapidly – and a lot in fact multiple cultures by station or of that has been through ac- country, which is not surprising given quisitions such as Servisair. our merger and acquisition activity When you have two compa- that has got the company to where it nies of this size, the change is today. Now, we are working towards is not perfectly digested every- a common culture that values account- where so we did have some op- ability and where employees are en- erational challenges in the begin- couraged to step up and speak up. ning but we have dealt with them The business continues to perform well since then. well. Our revenue development plans I have a different leadership style but that’s not been an issue. 3BUIFSUIBONVMUJQMZlMUFSFEJOGPSNBUJPO I prefer honest interaction and open discussion Eric Born 4 Airline Ground Services Winter 2016/Spring 2017 www.ags-airlinegroundservices.com
INTERVIEW | ERIC BORN: SWISSPORT are where we want them to be. Our day but the future so we are building nesses. People need to take account- biggest cost is labour while there is on our leading position. We are strong ability and ownership at a local level, also a push on price from the airlines. in Europe, North America, Africa and there has to be a behavioural change, We have to optimise our productivity, Latin America but the Middle East while we (that is, the management) follow best practices and ensure con- and Asia offer significant room for help them centrally and regionally. sistent quality at each station. our future geographic expansion. We The key issues for the industry in- have plans in place for that. It’s part clude service quality, training, health Q. Have you made any changes as of our focus – for instance, in China and safety and the reliability of ground CEO? How far have you managed with HNA Group as our shareholder. ops. Our industry should never cut to take these changes up to now, I envisage we will have operations up corners here – that is non-negotiable. and are you happy with how they’re and running in China within the next At the same time, there is pressure going? 12 months. on prices from the customer. How do A. Part of the changes has been to we optimise the cost/quality equation? give people the opportunity to speak Q. Do you think the ground handling We have to be able to generate a return up, listen and share their ideas. An- industry as a whole needs to change in order to invest in the business at a other part is that after the transaction in any way(s)? If so, why – and how market-clearing price. A certain level in February and the meeting with the might this be achieved? What role of quality is expected and you have to new shareholders, there was a change is Swissport taking to support this deliver. You can do a certain amount to the top management team so that agenda? for efficiency – but it has to be within we are a single company with a single A. Safety is a key focus; training these non-negotiable cornerstones. team. Three people left, a new CFO programmes and tools must be pro- From what I’ve seen while travel- joined and the role of COO was cre- vided. Equally, aircraft damage, near ling, as an industry, we should be very ated – rather than having three EVPs misses and so on are important. You mindful of this. at the head of three divisions, which have to have clear targets for each sta- created silos that were not cohesive. tion and country. We have significantly Q. What are your hopes for the Everyone on the team is aligned with beefed up our support for health and future? our key priorities. safety and quality because we want to A. I will be further developing our continue to reduce accident rates and leadership position, taking us to the Q. What are your plans for taking not damage equipment. As an indus- next level of performance and corpo- the company forward over the try, we all need to do more. As the larg- rate maturity. I’m incredibly pleased coming years? est player, Swissport has a responsibil- at the amount of commitment, at all A. The overall aim is to further ity to lead that initiative. levels of the business, to go the extra develop the organisation, leveraging You have to ask how well is the first mile on a day-to-day basis in a busi- on our operational practices across line trained? Do they immediately cor- ness that, depending on geography, the globe. When you buy from Swiss- rect their behaviour? It is a day-to-day can be a very tough job. I’ve been ex- port, you get Swissport whether you’re business objective, and a responsibil- tremely positively surprised. This is a in Africa, the Middle East, America ity, to operate safely. Governments and great platform to work with – it’s very or Europe. There is consistency and other authorities can help but it has fertile soil if you want to drive plans to quality. We are managing not just to- to start at the level of individual busi- further improve and expand. www.ags-airlinegroundservices.com Winter 2016/Spring 2017 Airline Ground Services 5
FORECAST | LOOKING AHEAD Anthony Harrington looks at some of the latest developments in the ground handling sector and where they might lead T he ground handling sector Markets. This represents a forecast had no choice other than to compound annual growth rate (CAGR) come into being as a huge- of around 7.3% for the next 10 years. ly fragmented accumula- At that level of growth, funding for a tion of isolated businesses, general and potentially long-running each springing up to handle the local consolidation of the sector, with a requirements of one or two local air- number of mid-size and large players ports. Many either started out as a part running ‘buy-and-build’ strategies, is of a national airline, or quickly forged virtually guaranteed. long-lasting agreements at a particu- lar airport with a national airline or a LEADING THE CHARGE handful of foreign airlines. The history of all the larger ground Sometimes, when a carrier opened handling operators shows much the up new routes at a new airport they same pattern. Dubai-headquartered would (and still do) take their own in- dnata, which started life back in 1959 house or their favourite outsourcing as a team of five to provide ground Gary Chapman, dnata president baggage and cargo handler with them. handling services to the then new Dubai However, for a couple of decades, as air International Airport, has been at the travel developed and passenger num- cash generative businesses that re- forefront of international acquisitions. bers mushroomed, new ground han- quire significant funding both for ac- Time and again, the purchase of es- dling operations found it very difficult quisitions and for capital equipment. tablished ground handling companies to break through established monopo- At a time of low to negative returns in new regions has helped dnata to ac- lies to offer competitive services. for cash, investing in ground handling celerate its growth. The firm’s acquisi- Even today, in a number of air- companies is essentially a bet on the tions of ground handling operations ports, the monopoly provider is still en- onwards and upwards march of com- at London Heathrow and Manchester trenched, but there is no doubt that the mercial air traffic. Airports in 2009 are an obvious case sector is undergoing a radical change Taken in its totality the global in point. that is steadily transforming the land- ground handling business is expected Earlier this year, dnata reportedly scape. Established suppliers from out- to be worth around US$7.4 billion an- purchased US ground handling spe- side a region are increasingly seeking nually by 2025, according to the lat- cialist, Ground Services International, to outbid incumbents, offering airlines est research report from Research and which has operations in more than 20 better pricing and promising better quality services. Big ground handling SUSTAINING GROWTH companies are getting bigger. Mid-sized Dave Sheddon, head of communications at Menzies Aviation, feels that re- companies are getting squeezed and sourcing is the biggest challenge at major airports. “Whether it’s getting the smaller single-airport organisations are right people and keeping them, or optimising the way we deploy our teams and under incredible cost pressure. equipment, it remains an area on which we must always focus. Beyond that, The reason for the ‘big squeeze’ is the typically competitive nature of the handling environment at large stations simple economics. Ground handling is a big pressure, as is the complexity of managing an operation with so many today is an increasingly capital inten- moving parts.” sive business. Modern ground han- dling equipment is expensive and ser- Sheddon says ground handling is always equally demanding both in terms of vice providers have little choice other the capital investment in equipment that it requires, and the human resources than to automate every possible pro- UIBU OFFE UP CF EFQMPZFE h1VU TJNQMZ DPNQBOJFT OFFE B TVGlDJFOU CBTF PG cess in order to hold down costs. Air- capital on which to build. Without such a base, there’s a danger that a growing lines are themselves trading on wafer IBOEMFSNJHIUlOEJUTFMGTQSFBEUPPUIJOXIFODIBMMFOHFTBSJTFUIFHPPEUJNFT thin margins and are constantly pres- are easy to work through, but it’s tough to weather the harder times if a busi- suring their suppliers to do more for ness is overstretched.” less, more efficiently. .FO[JFT GPSJUTQBSU JTDPOlEFOUPGJUTDPOUJOVFETVDDFTTBOESBQJEGVUVSF No surprise then that we are see- growth, having announced its intention to acquire ASIG earlier this year. ing one acquisition after another. The As to whether the market is consolidating, Sheddon believes that “the dy- stakes are reasonably high, given the namics of the market are moving things in that direction. There have been a asset base and staffing levels that many number of major acquisitions in recent years, signalling a process of increasing ground handling companies have built consolidation, and we’ve contributed to that trend in announcing our proposed up. However, funders rather like the acquisition of ASIG.” sector since it is comprised of solid, 6 Airline Ground Services Winter 2016/Spring 2017 www.ags-airlinegroundservices.com
FORECAST | LOOKING AHEAD airports across the USA. This was dna- Since then a series of acquisitions STRATEGIES ta’s first US acquisition and gives it a around the world, from Ireland to Swe- Despite the success stories, there is no significant presence in the US market. den, as well as more in the US, have easy way for a ground handling company Moreover, it seems that a second added to the Menzies portfolio. The that begins life in a single location to US acquisition is already on the cards. latest move is the proposed acquisition transform itself into a global player. dnata president Gary Chapman was of ASIG, an aviation services and fuel Çelebi started out back in 1958 as the recently quoted in Gulf News say- services provider, with a useful ground first privately owned ground handling ing that dnata is in discussions with a handling operation as well. company in Turkey. It took the company small Canadian cargo handling opera- The deal for the Orlando, Flori- just shy of 50 years to take its first step tor. The company is said to have a war da-headquartered company is said on the road to becoming an international chest of some AED3.5 billion (nearly to be worth $202 million. When it player, when it commenced ground US$1 billion) for further acquisitions. goes through it will give Menzies an handling operations at Budapest Chapman reckons that the company is added presence in 88 locations across Airport. Since then progress has been well positioned to expand its presence seven countries and will double the steady rather than spectacular. In 2009 in the States through further takeovers size of the company’s North Ameri- it began operating in Mumbai, India, and he signalled an interest in acquir- can operations. One of the huge ben- adding Delhi a year later. In 2011 it ing part or all of two other US airport efits that deals of this scale bring to began providing services in Frankfurt. service companies. the acquiring company is that they The company is building up con- Like dnata, Menzies is another sup- greatly enhance the relationship with tract wins with major carriers on the plier leading the growth-through-ac- key airline customers by making more ground handling side as well as pro- quisition charge. The group’s aviation services available in more locations viding cargo services. Çelebi’s Delhi business, comprising a range of ser- around the world. operation, for example, began provid- vices including cargo and ground han- Dr Dermot Smurfit, chairman of ing ramp handling services to Cathay dling, got off to a flying start in 2000, Menzies called the deal “transforma- Pacific Cargo from 1 February 2016. when it bought the global ground tional”, adding: “It will create one of It now has more than 300 customers handling operations of the US-based the largest aviation services businesses around the world and is active in 30 Ogden Aviation Services. At a stroke in the world and will strengthen Men- airports in Turkey, one in Hungary, the $118 million acquisition doubled zies Aviation’s service offering at major one in Austria and two in India. Menzies’ aviation support business international gateways such as London Swissport International began life and announced the group’s arrival as a Heathrow, San Francisco, Denver and as Swissair Ground Services, when it major ground handling player. Los Angeles.” was simply the ground handling arm /Keep cool Temperature-controlled transport and storage of your goods on the apron: -30° C to +30°C. Living ideas – Connecting lives AeroGround offers temperature-controlled vehicels for the transport of tempera- ture-sensitive freight between handling agent and aircraft. Please contact our sales team sales.aeroground@munich-airport. de or visit our Website to find out more about our ground services in Munich and Berlin: www.aeroground.de www.ags-airlinegroundservices.com Winter 2016/Spring 2017 Airline Ground Services 7
FORECAST | LOOKING AHEAD Æ CHALLENGES contract for low-cost carrier Scoot, a subsidiary of Singapore Airlines, at Stewart Sinclair, CEO, Bangkok Fuel Services, gives his perspective on the King Abdulaziz International. pressures facing a ground handling operation in a busy airport There are clear overlaps between “The major pressures … frequently stem from the airport operating over its cargo handling and ground services, original design capacity. This creates infrastructure-related issues such as lim- not least because airlines like Delta ited check-in counters at peak periods, immigration congestion, overloaded carry substantial cargo loads on pas- baggage systems requiring transfer bags to be handled in a separate facility, senger flights. So the larger ground lack of contact gates at peak periods, especially A380-capable gates, runways, handling companies also tend to have taxiways and some apron areas requiring repair due to heavy usage. large cargo handling arms. Worldwide “Other challenges revolve around staff retention and suitable language Flight Services (WFS), the world’s skills. In our case, all of these infrastructure issues are being addressed by the leading cargo handler, also has one of airport and other authorities. However, the growth at the airport is such that it the most extensive global ground han- continually outpaces the infrastructure upgrades. dling operations. In March this year “Ground handling is equally testing both in terms of the investment it re- WFS became even bigger when it ac- quires in capital equipment and in human resources. quired Consolidated Aviation Services (CAS), the largest cargo handler in “Expanding out from a local base is very challenging, and most local ground North America. handling companies never make the transition to becoming an international Once again, the deal was basically operator with multiple sites, unless they are able to make acquisitions or are an exchange between two PE houses. themselves acquired by an international brand. BFS is fortunate in that we are Platinum Equity acquired WFS in part of the WFS Group, so we have access to the global network of WFS oper- 2015, and CAS was part of the portfo- ating at over 145 locations worldwide. As a special purpose com- lio of investment firm ICV Partners, pany BFS is limited to operating at BKK. However, BFS has an which specialises in middle market investment in BFS Cargo DMK, which provides cargo handling companies. CAS has operations in 45 services at DMK airport. All expansion outside Thailand is un- North American and South American dertaken by WFS. airports. “It is worth noting that for widebody aircraft there is really WFS provides an example of yet no difference between the requirements of cargo handling another expansion strategy avail- and passenger baggage handling, as the vast majority of able to ground handlers as they seek the cargo and baggage is loaded in containers and loaded to benefit from consolidation in the BOE PGmPBEFE VTJOH IFBWZ MPBEJOH FRVJQNFOU 5IJT CFJOH sector: its subsidiary Bangkok Flight TP B GFX NPSF QBMMFUT PS DPOUBJOFST UP MPBEPGmPBE EPFT Services (BFS) is a joint venture with not take up much time. Bangkok Airways, Thailand’s second- “Curiously the bigger challenge is with narrowbody air- largest regional carrier. BFS is based craft – and especially low-cost carriers who carry cargo. at Bangkok Suvarnabhumi Airport. 8IJMTUUIFXFJHIUNBZOPUMPPLUPCFTJHOJlDBOU UIFOVN Its latest carrier win was in Febru- CFSPGQJFDFTUIBUOFFEUPCFMPBEFEBOEPGmPBEFEDBO ary this year when it provided ground CFTJHOJlDBOU5IFDIBMMFOHFJTGVSUIFSDPNQPVOEFECZ handling, passenger and cargo servic- this being a labour-intensive process, with relatively lit- es for the inaugural flight of Myanmar tle automation, and a requirement to complete the task National Airlines. in minimal ground times.” Like many carriers, SAS, the Scandanavian carrier, had a long tradition of using its own ground of Swissair, formerly Switzerland’s na- with more than 270 locations in 48 handling arm. However, it has had tional airline until, after various mis- countries, and an annual turnover in a steady programme of outsourc- adventures, the airline became part excess of three billion Swiss francs. ing these services in recent years at of Lufthansa. The private equity (PE) Not surprisingly, with that kind various airports around the world. In house Candover acquired Swissport, of reach, announcements from Swiss- May this year, SAS signed a letter of then a wholly owned subsidiary of port of new contract wins with airlines intent with Aviator Airport Alliance Swissair in 2002 and sold it on to the and new ground handling agreements Europe (Aviator) whereby it agreed Spanish infrastructure firm Ferrovial that extend its presence globally, are to outsource ground handling at in 2006. It was acquired by its pre- a frequent occurrence. The latest an- Gothenburg and Malmö. sent owners, the French PE firm PAI nouncements of this sort at the time However, SAS decided to continue Partners in 2010 for €654 million – a of writing were an agreement with to do its own ground handling at the price that already signalled the extent COBALT, the new Cypriot national main Scandinavian airports. Accord- to which Swissport had become a pow- carrier that takes Swissport into 13 ing to SAS, outsourcing has saved the erhouse in the international ground airports where COBALT has a pres- group some SEK 300 million ($33.3 handling game. ence, and an agreement with Jazeera million) over the past two years. But Swissport has become a highly Airways KSC to provide ground and the carrier argues that a major digiti- successful acquisition management air cargo services at King Abdulaziz sation programme currently underway operation, with one transaction after International airport in Jeddah, and will enable further streamlining and another turning cash positive for the King Khaled International in Riyadh. customer improvements to be made company. It is now, with some justi- Jazeera Airways therefore becomes in ground handling, and that it is best fication, able to claim the title of the Swissport’s launch customer in the placed to do this at the major Scandi- world’s largest ground handing group, Saudi capital. It has also picked up the navian airports. 8 Airline Ground Services Winter 2016/Spring 2017 www.ags-airlinegroundservices.com
GROUND HANDLING | CHALLENGES As 2016 draws to a close, and with the discussions carried out at this year’s IATA Ground Handling Conference in mind, AGS gathers perspectives on four major challenges facing the ground handling industry S afety is a vital pillar of is working towards better safety per- “Working day and night on the the GH industry. Which formance is dnata’s One Safety pro- ramp in all weather conditions is initiatives ought to be gramme, which includes specific train- challenging for man and machine so pursued in order to improve ing of front-line supervisors so that well-maintained equipment including safety standards, and why? What they recognise how crucial their roles anti-collision and other safety meas- makes these things so important? are in managing safe turnarounds. ures makes handling safer. And here The general consensus on this topic This includes both technical train- comes the dilemma. As a carrier, we is that “Safety is the prime considera- ing on risk identification as well as of course want our GHA to use only tion and the driver for everything that cultural awareness and coaching, di- GSE with the latest available technol- happens within the industry,” as Paul visional senior vice president Stewart ogy; as GHA, however, upgrading all Craig, managing director at Aviance Angus outlines. The programme also GSE to the latest available technology Ghana, puts it. “When we push for involves specific training for all ramp is not always feasible and also costly. faster turnarounds and examine OTP staff on hazard identification, safety The question here is if new technology we must never trade safety against awareness and cultural training. This shouldn’t without fail be integrated performance; however, working safely includes training on how to perform into new equipment by the providers? takes no longer than cutting corners. peer observations, so that all staff are This would help to challenge all GSE The golden rule of aviation is to follow fully cognizant of the role they play in providers to further invest in research procedures. The human factor com- safe turnarounds. and provide best possible solutions to bined with SMS training has to be at the industry,” he suggests. the heart of the operation. We should As for the Ground Damage Data- not place one above the other as it is a base, which supports the reporting cul- combination of cultures that makes it ture already alluded to, Jossart notes: tick,” he sums up. “By reporting every incident and thus Several initiatives take prime im- making it available to the experts, the portance in the drive for improved experienced mishap will help to define safety in ground handling. According adequate and standardised processes to Forsyth Black, president and man- to make ramp handling all around the aging director of Menzies Aviation, world safer. We should not hide be- “The first is training. Ensuring that hind confidentiality or other protec- our employees stick to official proce- tive arguments to not report aircraft dures will make the greatest impact on damages as only by providing this in- our safety performance. Our operating Paul Craig, managing director formation will solutions be elaborated. procedures are designed explicitly to at Aviance Ghana We are currently preparing our ISAGO avoid safety risks, and they’re written implementation and are confident that by experts on the subject; our job is to Finally, One Safety covers “proac- it will lead to a more standardised, continually reinforce how important it tive communications with our airline documented and an even safer ramp is that they are followed to the letter.” customers to ensure a common focus handling operation,” he adds. The second major point is estab- on the safety of people, cargo and air- Protege managing director Mário lishing a reporting culture. “Hand craft and that this is never compro- Baptista suggests that on top of train- in hand with a determination to do mised for a speedy turnaround. There ing, an efficient quality control pro- things right, must go a willingness to is no single solution when it comes gramme, with a solid corrective and report when they go wrong,” Black ex- to ground safety. Every one of our preventive action plan, forms an im- plains. “Only by completing this feed- initiatives is designed to support the portant part of safety management – as back loop can we maintain a clear pic- achievement of a ‘One Safety’ mindset does an internal safety committee that ture of where our greatest safety risks and putting this into action in every- can discuss possible improvements – and hence our most pressing training thing that we do. Total safety is the and bring these to fruition. These three needs – are, and act accordingly. product of all our initiatives working initiatives are interdependent, but he “There’s a theme here, because both together,” he points out. feels that having in place a good qual- of these are behaviours. We’re a people At LuxairCargo, executive vice pres- ity control programme will automati- business and behaviour matters more ident Laurent Jossart adds that besides cally bring about the other two recom- than anything else: the right ones keep training, GSE with the latest technol- mendations through the prevention us safe,” he adds. ogy is also of vital importance, as is the and corrective action plans. One example of how the industry IATA Ground Damage Database. Baptista also comments that man- www.ags-airlinegroundservices.com Winter 2016/Spring 2017 Airline Ground Services 9
GROUND HANDLING | CHALLENGES Æ agement must participate in safety ference in a global market and we are initiatives to help encourage staff to constantly working on new and inno- behave in accordance with safety pro- vative ways to enhance our operations tocols. Kürsad Koçak, general man- for our customers.” ager at Havas Ground Handling Co, Elsewhere, “I make no secret of the is in strong agreement with this point. fact that I believe transitioning from a “Safety commitment requires a strong paper-based to a digital environment leadership, and without this manage- is the right way to go – but crucially, ment effect, it is not possible to miti- it has to be right for our customers,” gate the risk factors to required levels,” says Black. “We’re already incorporat- he declares. ing digital processes, and it’s something Following a similar line of thought we’ll continue to do; however, ensuring to Baptista, Norbert Bielderman, man- that our customers are bought in to – aging director and CEO at Nigerian Protege’s Mario Baptista and will see benefit from – each switch Aviation Handling Company (Nahco will be the most important factor in de- Aviance), emphasises the importance tified training facility where we termining the rate of our progress.” of a safety management system, “gen- perform all sort of training but all In the passenger business, carriers erally described as a systematic ap- training have one thing in com- began providing the possibility to indi- proach to managing safety, including mon: safety first! vidual customers to compare rates and the necessary organisational struc- • State-of-the-art and well-main- book a ticket for themselves through tures, accountabilities, policies and tained equipment. At SGS, we year- the Internet. In order to be able to procedures” as essential for operations ly invest millions in purchasing and compete, all carriers had to adapt and in the sector. It is a process that should maintenance of equipment. propose an on-line booking solution, be a significant part of the operations • An open culture of communication which led to the development of a pa- system of any ground handler as a com- and feedback regarding any possi- perless process from booking through prehensive and effective process for ble incidents, unsuitable routines payment to embarking. managing safety risks. A safety man- or risks. A communication culture In the cargo business, on the other agement system helps ground han- of openness and rewarding sugges- hand, the booking and consequently dlers to reduce safety risks to the bar- tions on how to eliminate potential all the paperwork including Customs est minimum. Beyond the regulatory risks is key to reduce potential risks formalities are mainly provided by for- aspect, ground handlers should adopt and further improve training re- warders or cargo agents, all of whom and implement a safety management sulting in improved safety.” use different IT tools and systems, Jos- system from a legal and best practice sart points out. operational perspective,” alongside It has been said that the large-scale “As a consequence, the process participating in IATA’s ISAGO and buy-in of paperless processes is and especially the data transfer, even Ground Damage Database initiatives. lOBMMZHBJOJOHNPNFOUVNBTUIF if already standardised, remains more “These three initiatives are im- ‘millennials’ enter the workforce complex. As a GHA we see it every day portant because they provide oppor- in greater numbers. Are efforts to with the amounts of AWB data capture tunities to review existing safety risk encourage or even force change all we need to arrange even though a hard processes by conducting in-depth root in vain? Can the industry afford copy of the AWB is available and the cause analysis into incidents and ac- to wait longer for the change to information on those AWB has been cidents and providing functional solu- take hold naturally? And why has keyed into an IT system at the start tions and procedures, thereby creating cargo been so much slower than of the forwarding process. There is no learning curves for safety risk improve- passenger to get the switch to added value in re-arranging the full ment,” he sums up. “I would advise that digital processes started? AWB data capture and it is in fact diffi- the most important of the three pro- As an industry, ground handlers cult to understand why progress takes cesses is the ISAGO audit programme have historically been slow to embrace so long. Expensive manpower should as it encompasses the SMS review new technology and automation, An- be used for more valued tasks and du- and the GDDB reporting processes. gus agrees. However: “dnata sees tech- plicate of works prevented. Unfortu- However, ground handlers that do not nological innovation as a point of dif- nately as a GHA, you do not have any subscribed to the ISAGO programme possibility to enforce the data transfer can implement an independent safety – with the exception that you can en- management system and still achieve courage carriers to avoid the accept- significant safety improvement.” ance of shipments without available In conclusion, summing up the electronic data by making the service general feeling in response to this ques- payable.” tion, Saudi Ground Services general Koçak echoes these views, pointing manager marketing and sales Ahmed out that when it comes to air cargo op- Jannah considers: “Safety is, no doubt, erations, there are numerous links in the outstanding most important aspect the supply chain, Integrating any digi- of our service. It’s an aspect never to tal system into this complicated struc- be compromised. To safeguard a very ture requires the systems of all parties high level of safety I believe the follow- involved to be synchronised, making it ing three aspects are key parts: less simple than digitising passenger • Staff training and follow-up. At Ahmed Jannah of SGS operations. In Turkey, he says, IATA’s SGS, we have our own IATA-cer- e-AWB and e-Freight initiatives are 10 Airline Ground Services Winter 2016/Spring 2017 www.ags-airlinegroundservices.com
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GROUND HANDLING | CHALLENGES Æ helping to solve the problem. Indeed: “Paperless processing is and although the political situation is In general: “Since this is a digital the future in aviation operations and still foggy the way to overcome barri- age, paperless technology has become it is fantastic to see the momentum in ers is always to invest in quality and an important necessity in our daily buy-in from across the board,” remarks safety.” operations. As of 2013, we have been Bielderman enthusiastically. “The ad- Baptista reckons Africa offers the using electronic service forms and vantages of implementing paperless most challenges – but also, perhaps, invoices. Implementing this paper- processing across ground operations more opportunities than other regions. less system within our organisation cannot be over-emphasised. Nahco Handlers in Africa are “severely affect- allowed us to achieve huge savings Aviance recently upgraded its cargo ed” by operational challenges such as of paper while we handle thousands management software to enable it run inadequate infrastructure – many Afri- of flights a week. Using computer- better and also integrate effectively can airports are obsolete, Bielderman ised systems would also contribute into the enterprise software programs says, and this is often the reason why to the operational productivity while to facilitate -cargo operations. ground handlers cannot efficiently “I believe strongly that the efforts meet service level agreements. to encourage paperless processing “Handlers in the region are also are not in vain as the improvement in plagued by the high cost of operations, numbers of organisations subscribing high charges from regulatory authori- to the system is increasing by the day. ties and government agencies who Airway bills are mostly paperless now manage the airports across the conti- and major airliners and ground han- nent and skyrocketing GSE costs due dlers have been able to integrate their to unstable currencies and economic software to seamlessly process cargo. challenges across African countries.” This will only improve as millennials On the flip side, Bielderman com- who are technology savvy begin to join ments that European sector has per- the aviation workforce.” haps seen greater challenges to safety Bielderman feels that the crux of and security with regards to the recent Kursad Koçak, general manager at non-implementation of paperless pro- terrorist attacks at airports in Turkey Havas Ground Handling Co cessing in cargo operations has been and Belgium. down to “divergent interests and fear Whatever, the efforts to overcome increased quality and punctuality of of the unknown”. To a large extent, ma- challenges for the continued growth work has become highly important in jor stakeholders already have the re- and stability of the aviation industry the ground handling business. quired systems in place, but some are must include all stakeholders. Govern- “For example, Havas uses simulator concerned about losing control and ments ought to take responsibility for systems during pushback training for independence over aspects of the cargo increased safety and security of the fly- its pushback operator candidates and processes. Corruption also plays a role, ing public in Europe, while the African takes advantage of technology in this he believes, especially with regards to industry needs all industry stakehold- area, which results in minimising the some of the state agencies that form a ers to make concerted efforts at re- risk factors and enabling quick adap- critical part of the cargo handling pro- vamping the industry, improving air- tation of the personnel. Both of these cess and who have formed the greatest port infrastructure and implementing efforts play major roles for our envi- roadblock to total e-Freight opera- palliative measures against currency ronmental policy by saving paper in tions, in his view. fluctuations, he urges. our daily operations and burning less Furthermore, Craig notes that not Still, as Baptista observed, there fuel during the training.” all parts of the world are at the same are opportunities in Africa. Bielder- Baptista, meanwhile, feels that stage of development when it comes man goes on: “The African market has technology is there to help, but that to technology. For instance: “Sub-Sa- been growing significantly in the past change cannot be forced because haran Africa is an emerging continent years and this has been an encouraging “in general people are afraid of any but so many modern-day processes factor for airliners and ground han- change”. Therefore, smooth transitions rely entirely on Internet-driven com- dlers. Passenger numbers rose at our are very important – as is staff buy-in. munication – which we do not have. In main hub in Lagos from 5,654,122 in Plus: “Costs for sure are a barrier my opinion most ‘paperless’ processes 2009 to 7,561, 507 in 2014, a difference for implementing new technologies end with a paper trail.” and nowadays even more due to the current global economic situation. So, Which region of the world poses in my opinion cargo, due to safety con- the greatest challenges for the GH cerns and low return (maybe because industry, and why? How can these cargo is not a priority within the com- challenges be overcome – is it mercial airlines), is behind in the tech- down to handlers, their customers, nological race.” governments...? What are the While acknowledging that cost is a opportunities there that make it necessary consideration, Jannah feels worthwhile persevering to develop a that modern technology is “an obvi- presence in this region? ous opportunity that we must avail “If I can point out the difficulties ourselves of. Continuous development in Brazil, they are very related to regu- and improvement is a normal part of lation and economics,” says Baptista. our work at SGS. We must all be most “The Brazilian market has changed Laurent Jossart of LuxairCargo open to changes!” considerably in these last two years 12 Airline Ground Services Winter 2016/Spring 2017 www.ags-airlinegroundservices.com
GROUND HANDLING | CHALLENGES of about 25%. The same was the case gion in question, because finding ways signed the resolution denouncing the at the busiest airports on the continent over today’s hurdles is what will deliver illegal trade in wildlife and wildlife (OR Tambo, Johannesburg; Cairo In- tomorrow’s successes.” products,” he adds. ternational Airport; and Cape Town Baptista sees ground handlers as International), which recorded growth 5IFSFJTKVTUJlBCMFDPODFSOPWFSUIF having an important role in preventing figures of 8.84%, 2.1% and 11.8 % re- scale of the illegal wildlife trade. illegal trade in wildlife – but feels that spectively between 2009 and 2014.” What can – and should – the GH all players must meet to discuss and As far as Sub-Saharan Africa goes, industry be doing to help put a stop define how to stop it happening in the Craig highlights problems relating to to this? How can the industry’s aviation environment. bureaucracy, infrastructure, education suppliers, customers and partners Koçak is clear on how the indus- and culture. Overcoming these chal- help? try should act. “The first step would lenges takes time so handlers have to “This is a subject close to my heart,” be sustaining an operation that is in work within local limitations while says Angus. “dnata4good is an inter- compliance with the global standards steadily driving change. “Everything is nal engagement programme which al- of animal transportation regulated possible but the route to achievement lows our staff to raise money for good under IATA Live Animals Regula- differs from country to country,” he causes with their donations matched tions to avoid illegal wildlife trade. says, stressing that “There is not and These regulations must be followed should not be a global answer.” by industry suppliers and customers There are some regions where air- as well as by other involving parties. lines have suffered disproportionately It should not be possible to accept liv- from poor service levels, delays and ing animals that do not have a shipper aircraft damage. These seem to in- declaration form in particular – and clude USA, Canada and Latin America checking documents like CITES (the according to Angus – who reckons that Convention on International Trade challenges are overcome and improve- in Endangered Species of Wild Fauna ments made in those areas where there and Flora) can also help handlers to has been a commitment on the part of understand the transportation re- all stakeholders to make a concerted strictions on animals and avoid any effort to change the status quo. possible illegal trade risk.” In Koçak’s opinion: “Liberalisa- IATA Live Animal training has tion and growth in ground handling dnata’s Stewart Angus been provided to Havas Cargo staff to markets continue particularly in Latin make sure that they are familiar with America, Africa, the Middle East, East- by the company up to AED1 million the requirements of live animal ac- ern Europe, Russia and Asian markets. (US$272,279) per year. Through this ceptance. Koçak is confident that fo- On the other hand, each market has its scheme, we have already established cusing on industry standards should own challenges like different local pro- a rehabilitation centre for orphaned be sufficient to avoid attempts at trad- cedures and regulations, unions, infra- rhinos along with a mobile medical ing illegally in wildlife. structure and working culture. These services unit in South Africa as well However there are obstacles. “What elements must be carefully evaluated as anti-poaching controls to help pre- we have observed is that corruption during the planning stage of an in- serve this beautiful and rare animal. It and compromise by some criminal gov- vestment project. However, the strong is a good feeling to know that our staff ernment officials who are supposed to growth in those markets and limited are making a difference to the world. be the first line of defence against il- competition in some areas still make We also work with many of our airline legal wildlife trade is the reason why those emerging markets attractive for customers to prevent the air transpor- the trade has continued,” Bielderman ground handlers. tation of illegal wildlife.” remarks. “Ground handlers are not di- “We believe all stakeholders have to dnata4good is just one example rectly responsible for checking the con- contribute to the solution of the prob- of a proactive response to the illegal tents of shipments and will only accept lems in their areas. Like many other wildlife trade. Black sees improve- a shipment that has been certified as foreign investors, ground handlers also ments in cargo security as the most OK by government officials. Govern- seek a reliable and stable political en- productive route, while Jannah states ment agencies should conduct a com- vironment and regulatory framework simply: “The GH industry must always prehensive risk analysis of each and which support competition and service follow applicable rules, laws and in- every cargo shipment and fully under- quality. These factors offer a strong po- structions issued by different bodies. stand the adverse effects of letting such tential when combined with an emerg- No exceptions!” Craig believes that shipments escape their searchlight.” ing aviation market. Eventually, all governments should take the lead, but Furthermore: “Government agen- aviation industry stakeholders includ- that “everyone is a stakeholder to drive cies and NGOs focused on animal ing authorities and air carriers benefit change”. rights can do a lot to create awareness from a stable and reliable ground han- Similarly: “Every GHA, same as about the ills of illegal wild life trade dling industry and therefore, all play- the carriers and forwarders, should be and also implement severe sanctions ers should support it.” aware of and work hand in hand with for those found erring. That said, Black’s view is that every region the local authorities to prevent illegal ground handlers can intensify moni- has its own unique blend of challenges wildlife trade,” Jossart affirms. “Trans- toring efforts by double-checking at and they are too nuanced to permit any parency is key and as soon as you have the screening points and exit points sort of ranking. As for the second part a doubt, you should proactively report using advanced technology such as of the question, he says: “It’s always to the authorities and have the ship- comprehensive RA3 protocols and worth persevering, no matter the re- ment checked. Luxair has recently ETD technology.” www.ags-airlinegroundservices.com Winter 2016/Spring 2017 Airline Ground Services 13
INTERVIEW | CRAIG SMYTH: WFS One of the ‘big four’ handlers, WFS, appointed a new CEO just a few months ago – and he has clear plans for the company’s growth in the years to come C raig Smyth joined WFS in couple of months into the role, how routines of the future. August after more than have things been going? There are no big surprises. WFS is two decades at John Men- A. Today I think is eight weeks in what you think it is: people that are zies, his most recent post the post for me. I’ve been with Menzies steeped in cargo. It’s a 40-year-old being CEO of Menzies from the start and I’ve closely followed business. Most people I’ve met have Aviation (a role he assumed in 2004). other businesses in the industry. WFS been with the organisation for more A qualified accountant, he previously was always a business I had followed than 20 years so slightly more history served as the company’s CFO. AGS closely and admired, and had certain than somewhere like Menzies. They’re spoke to him at The International Air views on. Now, I’m inside the business all very passionate about what they do Cargo Association’s 28th Air Cargo – in the guts of the business. I’ve been – very passionate about cargo. They’re Forum & Exhibition held in Paris dur- splitting my time between induction, all great people They’re ‘people people’ ing October, to find out how his new learning, understanding and meet- who are big into relationships both role is panning out so far and how he ing people as well as some of the basic within the organisation and with cus- sees the future. routines that have to be done in a big tomers. They’re not ‘here today, gone organisation – so, meeting with share- tomorrow’ with customers. Custom- Q. You were appointed to the post holders and bondholders, monthly ers trust them implicitly over a long of CEO of WFS in August. Just a reporting and setting up some of the period of time. If things do go wrong, there’s a lot of patience and goodwill to sort out whatever the issues are. Everybody has made me incredibly welcome. I did say to somebody the other day that WFS is like a league of gentlemen. At Menzies, we came from very humble beginnings with very Celtic roots so we were sort of the small guy hustling. I guess in the last five or 10 years or so the business came of age. WFS is very graceful – that’s probably the French heritage as well, plus the type of people that have grown up in that business. It’s a different culture – a culture that I’m happy to belong to, to grow and develop within their ex- isting culture rather than change it to something that would be alien to them. That’s certainly not my intention. 14 Airline Ground Services Winter 2016/Spring 2017 www.ags-airlinegroundservices.com
INTERVIEW | CRAIG SMYTH: WFS Q. What particular skills and for high-volume, low-cost and legacy still learning the network and some experience – whether from the airlines, that is, narrow body airlines. of it is a crossover with Menzies while handling arena or elsewhere – are So I know the cargo business pretty some of it is new. It’s trying to work you able to bring to your new well but I think my skill is as an ex- with local people from local cultures position that you believe will take accountant who is an administrator and make them feel supported, be it WFS forward? and who usually never had an original with the tools or be it with the align- A. Well, the caveat is that I’m only thought in his life! But you see the best ment of goals and the spirit. This isn’t eight weeks old. I think WFS has grown that’s out there and you think, ‘That’s a absolute, but you have an American up rooted in France with acquisitions, good idea, why don’t we do that some- running America, a Brazilian run- a bit of organic development and joint where else?’ Or, ‘That’s a good process ning Brazil, a French person running ventures. As most handling businesses or a good discipline or a good system.’ France – and then fuse that with the have in common, it’s got great people, It’s about trying to put people together process and structure and products of great safety and security, great financial and borrow from different parts of the a cargo and ground handling business. performance and great customer rela- organisation or other organisations, tionships. It’s been incredibly success- be they in this industry or other indus- Q. How much involvement do you ful in the main because it’s had really tries that we could learn from. think Platinum Equity is going to have good people – and again, really good That’s what I bring to the party: in determining the future of people in cargo and with cargo tools. I’m an administrator of complex, WFS? I do believe in people having the multinational businesses in avia- A. I had my sec- right tools for the job so there’ll be tion services where you really ond op con, which is an element of further investment in are reliant on groups of people like a board meet- cargo, honing the cargo product. WFS working as a team with com- ing, last night and is the biggest and the best cargo han- mon goals. they’re very sup- dler in the world and we want to make portive. If you sure that position is cemented for the Q. Obviously WFS has look at what they future; there’s more support we can EJGGFSFOUPGlDFTBSPVOEUIF did, they invested give to the people in the field when it world. How do you bring the a lot of money comes to the cargo product – making different cultures into play? in WFS and then sure we have the right chill stores, the How do you manage that? right pharma trucks, the right capabil- A. I think it’s difficult to ity to handle live animals or human stipulate from a WFS point of remains or secure products or pharma view because I’m so that we are a 21st-century business. Some of that will take a small invest- ment. The IT system is quite good but there’s more technology we can har- ness. There are slightly different ver- sions of some of the cargo systems so we’re looking at levelling up. WFS is the biggest and the best Cargospot is the main one that cargo handler in the world and we we use. There’s Hermes in one or two want to make sure that position places and there’s still ABS out there. is cemented for the future It could be that there’s a front end that Craig Smyth could sit on top and drill down, and could give the KPIs and the customer information, so we’re looking at that. WFS was run as a diverse geo- graphical network with almost no cen- tral functions, so at the moment I’m building the central capability. Lots of the business is operating very well and has good processes and people, but it’s not really coordinated and run as a network. Without losing the entre- preneurial spirit out there, I want to give more central support so the WFS brand gets taken to the next level and you can say, ‘These are the 10 things you always get with WFS,’ be it physi- cal or intellectual property. I know the industry pretty well and my roots were in cargo – starting off with AMI with cargo forwarding, then cargo trucking, then cargo handling. Then ground handling was the big success – finding the magic formula www.ags-airlinegroundservices.com Winter 2016/Spring 2017 Airline Ground Services 15
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