To succeed in today’s service economy, airlines must learn to perform a difficult balancing act. On one hand, they must raise service levels to build a more profitable customer base. On the other, they must lower service costs in a turbulent labor environment. This can be tough as business is highly competitive and daily events – everything from bad weather to mechanical malfunctions – can conspire against conducting planned ground operations.
Take AeroMexico. This member of the SkyTeam Alliance and the largest carrier in Mexico faced ever-increasing passenger traffic, overworked agents, and enormous waiting lines at its busiest airports. The challenge: How would AeroMexico improve service for a growing customer base with the same number of employees? The solution: Make employees more productive by better matching staff availability to demand.
According Dr. Alfonso Villegas Zuniga, VP Strategic Planning at AeroMexico, “Very often airport supervisors ask for more people than they really need. This can lead to a very unhealthy negotiation between the supervisors and the top managers who say that the supervisors don't need to operate with so many people. The fact is, neither side really knows if they do or not.”
Staff scheduling becomes especially onerous when the travel season changes. “Every time we go through a change in season we have to re-roster the plans for airport personnel,” says Villegas. “Flights are canceled, flights are added, and the types of aircraft on different routes change. And in the past, we have always done this manually.”
First Step: Automation
AeroMexico’s strategy was to automate all planning (monthly, day-to-day, and real-time) of employee allocation against specific job functions and assignments. The first step was to sharpen the accuracy of AeroMexico’s load factor predictions and to determine when passengers arrived at airports, which required analyzing the arcane data related to travel profiles of AeroMexico passengers.
AeroMexico also engaged Ascent Technology Inc. of Cambridge, MA, whose software is implemented in some of the world’s busiest airports including Atlanta, London/Heathrow, Toronto, and San Francisco. AeroMexico had Ascent install its SmartAirport® Personnel Allocator product for several of the airports into which AeroMexico flies. The program uses IATA flight schedules and receives in-flight positioning information automatically from national air traffic control to help it plan in real-time. AeroMexico accesses Ascent’s application over the Internet, yet gets the same performance and functionality it would gain if the system were installed locally. AeroMexico also avoids the expense of buying and maintaining its own application servers. As far as language barriers are concerned, Ascent has staff members that speak fluent Spanish.
Through automation, AeroMexico can maintain efficient staffing levels of airport ground operations no matter what happens – flight delays, early arrivals, etc. Sick time, holidays, vacation schedules, overtime, and job rotation can also be monitored.
Also, AeroMexico can now set up scenarios to model different service levels and can then analyze their entire planned schedule for the impact of such scenarios in terms of costs, as well as impact on employee rosters. The system can also plan for using part-time or split-time employees to handle certain operations. The unique value of the automated process is that once a scenario validation is finished, they can smoothly transition plans into operational rosters and assignments that track operations and evolve as disruptions occur.
View From the Ground Handler
According to Israel Reza, Planning Manager for SEAT, ground handling services provider to airlines at the 46 Mexican Airports, “The most important benefit for my department is that the head count can be planned in advance. It is easier to use scenarios to simulate different operating conditions; and it is possible to analyze the costs of each simulation.”
They have agreed on the principal terms and conditions relating to providing in-flight Internet and wireless in-flight entertainment service – Gogo Vision – on at least 75 aircraft.
Grupo Aeromexico received $65,000,000, from Delta Air Lines Inc. as part of Delta's investment in Mexico's flagship airline's capital stock.
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