paper logistics - passenger handling process and value chain improvement - jose fernandes
TRANSCRIPT
Frankfurt University of Applied
Sciences
University of Petroleum and Energy
Studies, Dehradun
Masters of Business Administration in Aviation Management
Logistics
Passenger Handling Process and Value Chain Improvement
Professor Loveraj Takru and Professor Mandan
José Joaquim Fernandes - 1034431
14th August 2014
Page i
Table of Contents
List of Appendices ....................................................................................... ii
List of Figures ............................................................................................ iii
List of Tables .............................................................................................. iv
Abbreviations ............................................................................................. v
Abstract ...................................................................................................... vi
1 Introduction .......................................................................................... 1
2 Problem Statement .............................................................................. 1
2.1 Scope ............................................................................................ 2
2.2 Selection of literature .................................................................... 2
3 Airport, Airline and Passenger Handling Process ................................ 2
3.1 The Value Chain ........................................................................... 3
3.2 The Aviation Industry Value Chain ................................................ 4
3.3 The Airline Value Chain ................................................................ 6
3.4 The Airport Value Chain ................................................................ 8
3.5 The Passenger Handling Process ................................................ 9
3.6 Empirical investigations .............................................................. 15
4 How can the passenger handling process further improve? .............. 16
4.1 Operations – Check-in and Boarding .......................................... 17
4.2 Baggage services and loading .................................................... 19
4.3 Flight disruption management services ....................................... 20
5 Criticism ............................................................................................. 21
6 Conclusions ....................................................................................... 22
7 References ........................................................................................ 23
Appendices .............................................................................................. 28
Page ii
List of Appendices
Appendix A Selection of literature ...................................................... 28
Page iii
List of Figures
Figure 1 Porters Generic Value Chain ....................................................... 4
Figure 2 Aviation Industry Value Chain ...................................................... 6
Figure 3 Airline Value Chain ...................................................................... 7
Figure 4 Airport Value Chain ...................................................................... 9
Page iv
List of Tables
Table 1 Passenger Handling Process and recommended KPIs .............. 11
Table 2 Level of Service Maximum Waiting Time Guidelines .................. 12
Table 3 Observed service times for passenger processing facilities ........ 14
Page v
Abbreviations
ACI: Airports Council International
CUTE: Common Use Terminal Equipment
CRS: Computer Reservations System
FIDS: Flight Information Display System
KPI: Key Performance Indicator
LOS: Level of Service
MRO: Maintenance, Repair and Overhaul
PTB: Passenger Terminal Building
ULD: Unit Load Device
Page vi
Abstract
This paper performs a theoretical analysis of the passenger handling
process that take place from a passenger enters the Passenger Terminal
Building (PTB) until aircraft pushback; and from aircraft on-block until the
passenger exits the PTB.
It set out by establishing the theoretical basis for using Porters Value
Chain (Porter 2004).
It then establishes the framework of the Air Transport Industry Value
Chain, the Airport Value Chain, and the Airline Value Chain and devises
the Passenger Handling Process as result of where passengers interact
with ground handling personnel in either the Airport Value Chain or the
Airline Value Chain.
It uses empirical investigations to document and confirm the link between
the passenger handling process, the airline value chain and the airport
value chain.
The paper conclude that limited added value can continuously be
achieved by further optimising the existing passenger handling processes
or by continuously further entertaining the passenger while queuing.
Instead, the paper concludes that the deployment of mobile technologies
in three main areas of the Value Chains of Airports and Airlines; Check-in
and Boarding, Baggage loading and Flight Disruption Management
services, will yield the most improvement and value to Passengers,
Airlines and Airports in the years to come.
Page 1
1 Introduction
According to Ministry of Civil Aviation (Ministry of Civil Aviation 2010)
India’s aviation market is expected to grow at a rate of 9-10% annually
until 2020. Despite the continued growth in the aviation market competition
for passengers remain fierce.
Traditionally airports were part of a system, where the absence of price
competition reduced efficiency measures (Barrett 2004).
Full service airports have traditionally been able to count on decade-long
relationships with their legacy-airline customers (De-Neufville 2008). New
airports serving low cost carriers can not necessarily rely on decade long
relationships with low cost carriers (De-Neufville 2008).
Creation of further value for the airlines, the airport and the passengers is
therefore important in order to stay ahead of competition.
2 Problem Statement
This paper performs a theoretical analysis of the passenger handling
process that take place from a passenger enters the Passenger Terminal
Building (PTB) until aircraft pushback; and from aircraft on-block until the
passenger exits the PTB.
It set out by establishing the theoretical basis for using Porters Value
Chain (Porter 2004).
It then establishes the framework of the Air Transport Industry Value
Chain, the Airport Value Chain, and the Airline Value Chain and devises
the Passenger Handling Process as result of where passengers interact
with ground handling personnel in either the Airport Value Chain or the
Airline Value Chain.
It uses empirical investigations to document and confirm the link between
the airline value chain and the airport value chain.
Page 2
The paper finds through review of empirical studies that limited added
value can continuously be achieved by further optimising the existing
passenger handling processes or by continuously further entertaining the
passenger while queuing.
The paper ends with self criticism and concludes that the deployment of
mobile technologies in three main areas of the Value chains of airports
and airlines; Check-in and Boarding, Baggage Loading and Flight
Disruption Management services will yield the most improvement and
value to Passengers, Airlines and Airports.
2.1 Scope
The scope of this analysis is the passenger handling process, which is the
interaction process that take place between ground handling staff and an
airline passenger, from a passenger enters the Passenger Terminal
Building (PTB) until aircraft pushback; and from aircraft on-block until the
passenger exits the PTB.
The author define the ground handling staff as an employee either working
in the airline value chain or the airport value chain.
2.2 Selection of literature
The research articles were selected by undertaking a search through the
search engine Google Scholar and through the electronic databases
ScienceDirect and ResearchGate in addition to a general search on
Google.
For a detailed description of the selection of literature, please refer to
Appendix A.
3 Airport, Airline and Passenger Handling Process
This chapter establishes the concept of the Porters Value Chain (Porter
2004), the Aviation Industry Value Chain, the Airline Value Chain, the
Airport Value Chain and the Passenger Handling Process. The chapter
Page 3
ends by supporting the Passenger Handling Process as an outcome of the
Airline Value Chain and the Airport Value Chain by empirical
investigations.
3.1 The Value Chain
This section establishes the concept of Porters Value Chain (Porter 2004)
and why this is a relevant analysis tool.
Value chain analysis has been widely used as means of describing the
activities of an organisation and relating them to an assessment of the
competitive strength of an organisation or its ability to provide value-for-
money products or services. The purpose of using value chain is to
describe the separate strategies which are necessary to underpin the
organisation’s strategies and how they link together both inside and
outside the organisation (Johnson and Scholes 1997).
Porter (Porter 2004) and (Porter 1998) argue that an understanding of
strategic capabilities must start with an identification of the separate value
activities.
An important outcome of the value chain analysis is to identify those
competencies which critically underpin the organisations competitive
advantage (Johnson and Scholes 1997). The bundle of skills and
technologies that enable a company to provide a particular benefit to
customers are also what Hamel and Prahalad (Hamel and Prahalad 1994)
call core competence.
The author is also aware of Stacey’s criticism (Stacey 1996) of Porter’s
Value Chain analysis in that the only circumstances to which a Value
Chain Analysis can possibly apply are those close to certainty and
agreement; a situation that neither airports nor airlines necessarily would
find themselves in; if for nothing else; due to the volatile nature of low cost
carriers (Graham 2013) and due to the risk of lack of long term certainty
for airports (De-Neufville 2008).
Page 4
Applying, however, a post-modernistic perspective to the systems of value
chains of organisations implies also that the borders of the individual
organisations’ value chains are not fixed (Stacey 1996).
The value chain remains a powerful tool to analyze a business at strategic
level by identifying and analyzing the core activities and supporting
activities and links them with the analysis of competitive strength of the
organization. The value chain is a network of processes that create value
for customers (Evans and Collier 2007).
The focus is on primary activities of airport and airline companies, and on
the passenger side of the aviation industry.
In the below figure generic model of a value chain is displayed with an
overall impression of the activities of a company that is created by filling
out the business specific processes.
Figure 1 Porters Generic Value Chain
Source: http://eavoices.com/2014/04/05/business-architects-whats-at-the-core/
3.2 The Aviation Industry Value Chain
The aviation industry is a service industry providing transport services. Air
transportation shows many characteristics which are typical for service
Page 5
industries, e.g. the intangibility and perishability of the product and the
high importance of personal contact to the customer. Airlines and airports
are the two main actors in the industry. Airlines offer the actual transport
service; airports provide the ground infrastructure to handle aircraft
movements. The manufacturing industry and aviation suppliers assemble
aircrafts and provide spare products. As a provider of supplementary
processes, the industry relies on general service providers such as air
traffic control (Tretheway and Markhvida 2014).
The aviation supply chain is characterised by a high degree of vertical
disintegration. As a general rule, airlines have limited or no ownership
interest in other sectors of the value chain. Over the years airlines have
gradually divested their ownership interest in several sectors of the
aviation value chain, either as a result of changes in national laws,
regulatory interventions or decisions to improve business competitiveness
and financial performance. Examples include airlines' past ownership and
subsequent divestiture of assets in aircraft manufacturers, computer
reservation systems (CRSs), maintenance, repair and operations (MROs)
providers and hotel chains, among others. At the same time, airlines have
invested in certain supply chain partners such as providers of fuel, ground
handling services, in-airport customer services, catering or other services.
Another sector where investment by airlines can be observed is cargo
terminal facilities, cargo handling operations or trucking operations related
to pick up and delivery of air cargo. In some markets, airlines have also
invested in airport terminals, although this is a more recent trend.
However, despite the high degree of vertical disintegration currently
observed, it is important to note that the aviation value chain is not a
collection of firms that operate in isolation of each other. There has been
significant facilitation in terms of creating standards and operating
procedures across the value chain members, and this has lowered
industry costs and increased customer service levels (Tretheway and
Markhvida 2014).
Page 6
The Aviation industry value chain is shown in the below figure.
Figure 2 Aviation Industry Value Chain
Source: Adapted from (Wittmer and Bieger 2011)
3.3 The Airline Value Chain
The airline industry is characterized by fierce competition. Airlines
compete on a polypolistic market. On the one hand, the latter is
characterized by low entry barriers and a variety of different business
models. On the other hand, the airline industry is extremely capital
intensive and comprises specific investments in long-term assets that
create high exit barriers. While Information Technology, maintenance,
repair and overhaul (MRO) and catering providers are usually located
nearby the respective airlines (commonly large airlines), the airline leasing
market is dominated by two companies (duopoly). Oligopolistic structures
occur in regard to airports, usually one or a few of them dominating whole
regions or nations. At airports, often only limited competition exists
concerning ground handling services. While airlines and airports are
enclosed by the manufacturing and supplying industry on the upstream
side, the final customer is located at the downstream side. In addition to
competition stemming from within the industry, airlines and airports have
to cope with new competitors and are subject to potential substitutes
(Wittmer and Bieger 2011).
Within each airline category, specific activities are presented to provide a
basic understanding of the underlying complexity and requirements of the
General Service Providers
•Air Traffic Control
•...
Manufacturing Industry and Suppliers
•Aircraft Manufacturers
•Propulsion Systems
•Equipment Manufacturers
•Commodity Suppliers
•...
Airline Industry
•Airlines
•Leasing Companies
•IT Providers
•MRO Providers
•Catering
•...
Airports
•Airport managers
•Ground Handling
•Fuel Suppliers
•...
Page 7
various processes. Within the airlines’ value chain, special attention should
be set onto the primary activity of operations since this includes the hub
management function. If an airline configures its route network as hub-
and-spoke system, hub management (as part of its network management)
is of special importance (Doganis 2005). It affects all conceptual,
coordinating and operational tasks for optimising the quality of hub
services. The most important factors influencing hub quality are transfer
reliability and punctuality. These influence both the airline operations as
well as the passenger‘s perception of the airline. Hub management thus
includes developing and implementing concepts for optimising the use of
central resources such as gates and aircraft positions, as well as
optimising and securing minimum connection times. Hub management
(along with decentralised station/spoke management) is one of the core
functions vital for ensuring ongoing operations. It also concerns the
organising and monitoring of many of the services and activities that are
provided by third parties, significantly increasing the complexity and
number of interfaces of this core activity (Albers et al. 2005).
The Airline Value Chain is shown in the below figure.
Lost and found
Complaints mgmt.
Lounges
Reservation ServiceTransfer (Luggage and
Media announcement
Fleet assignment
Route planning
E-tickets
Frequent flier programs
Advertisement
Pick & drop cab service
Ground handling
Base maintanance
Security Checks
Catering
Hub Management
Catering
Flight Disruption Management
SU
PP
OR
T A
CT
IVIT
Y
FIRM INFRASTRUCTURE: Financial Systems, Accounting, Legal Affairs, Management
HUMAN RESOURCE MANAGEMENT: Personnel Recruiting, Pilot-, Crew-
and Security Training, Luggage Dispatching Training, Sales Training, In-flight
training
TECHNOLOGY DEVELOPMENT : Computer Reservation System, Yield
Management Systems, Customer Relationship Management Systems, Online Check-in,
Self Service Check-in, Product Development, Market Studies, Onboard Internet
PROCUREMENT : Fleet, Fuel, Information and communication Technologies
SERVICE
PRIMARY ACTIVITIES
INBOUND OPERATIONS OUTBOUND MARKETING & SALES
Slot Allocation
Yield Management
Fuel Calculation
Scheduling
Crew planning and
Supply of production
Ticket offices
Ground handling / Dispatching
Flight operations
Service on board
Figure 3 Airline Value Chain
Source: Adapted from (Albers et al. 2005) and (Khan 2012)
Page 8
3.4 The Airport Value Chain
IATA (International Airline Transport Association 2004) has defined the
passenger service and planning standards in its airport development
manual. This contains established level of service (LOS) parameters for
airport planning, although principally only relating to the queuing and
waiting standards in the main processing areas, which are in widespread
use in the airport industry. There are six levels: A (Excellent), B (High), C
(Good), D (Adequate), E (Inadequate), and F (Unacceptable). Typically
most airports design facilities to operate at level C in the peak (Graham
2008).
Similar to the airline value chain, the airport can classify its activities in the
airport value chain. There is a key difference between the airlines’ value
chain and the airports’ value chain, in that the value chain of the airport
does not include outbound logistics. This is because the airport offers the
product ―infrastructure which starts and ends at the airport. In other
words, there are no outbound logistics to perform.
Primary and supporting activities for a generic airport company are
illustrated in the below figure. In its narrow engineering sense, the core
tasks of an airport are the supply, maintenance and protection of the
infrastructure that is necessary for landing, starting, taxiing and parking of
airplanes. In its full social and commercial sense, its role is to facilitate the
link between passengers arriving by car, taxi and other modes and their
access to the aircraft. Additionally, and to support these primary tasks, the
airport provides facilities such as terminals, gates and maintenance
facilities which are essential for the completion of flight operations, and
which facilitate the access to energy, water or fuel for the aircraft. These
activities are the inbound logistics activities of airports (Albers et al. 2005).
Underdeveloped until the 1980‘s, the primary activity marketing has finally
turned out as an integral part of the value chain of an airport as well,
reflecting its importance as the core activity of a commercially run
enterprise also for the airport business (Graham 2008). Airports and
Page 9
Airlines involve vertical relationships if the airport is seen providing
infrastructure and general services with the airline as its customer. The
airline, however, is only one customer of the airport—passengers and
other businesses also buy services from airport companies; the interests
of passengers, airlines and airports thus overlap. It is in these areas of
overlap where coordination of airports‘ and airlines‘ efforts can potentially
generate the greatest benefits for their customers. Such coordination can
be more complex for airports than for airlines. While airports regard both
airlines and passengers as their key customers, airlines only view
passengers as their customer group and consider themselves as
customers of the airports (Graham 2008).
The Airport Value Chain is shown in the below figure.
Retail, catering and other services
Conference facilities
Communication and internet
Room renting
Supply of advertising space
Air service development
activities
Media announcement
Baggage Handling system
Outdoor marketing
Social media
Online marketing
Television ads
Print mediaground operations, cleaning)
Flight disruption Management
Ramps/Baggage (Loading,
unloading the airplane, baggage
transfer)
Security checks
Emergency Services
Passenger (Luggage dispatch,
check-in, ticketing, transport
of passengers and crew)
Airplane (Crew briefing
SERVICE
PRIMARY ACTIVITIES
INBOUND OPERATIONS OUTBOUND MARKETING & SALES
Runways, Apron
Buildings (Hangars, terminals, car park etc)
Access to energy, water fuel
Resource planning
Cargo Facilities
Terminal facilities (offices
check-in counters, offices)
SU
PP
OR
T A
CT
IVIT
Y
FIRM INFRASTRUCTURE:Financial Systems, Accounting, Legal Matter, Management
HUMAN RESOURCE MANAGEMENT : Hiring staff, training emergency service
staff, refreshers training for such services, Safety trainings, System training, hiring force
to manage the systems, Luggage Dispatch Training, Sales Training, Catering Training
TECHNOLOGY DEVELOPMENT : Baggage sorting systems, check-in Systems,
Airport IT Systems, Parking Guidance, Market Studies, E-commerce solutions
PROCUREMENT : Purchasing, Service contracting, Co-branding, leasing land and
services, Building, landside and airside infrastructure, Baggage Handling system,
Ground Equipment
Figure 4 Airport Value Chain
Source: Adapted from (Albers et al. 2005) and (Khan 2012)
3.5 The Passenger Handling Process
The passenger handling process is the joint interaction between the airline
passenger in the airport value chain; and the airline passenger in the
airline value chain. The process consists of those facilities necessary for
the handling of passengers and their baggage prior to and after a flight. It
is the elements which links the ground access system to the air transport
system. The terminal curbs provide the interface on the ground access
Page 10
side of the system and the aircraft gate devices provide the interface on
the airside of the system (Horonjeff et al. 2010).
In determining the particular needs of a specific component in this
process, knowledge of the types of passengers and the extent of visitor
impacting on each component is necessary (Horonjeff et al. 2010).
In his study Correia (Correia 2005) considers the following elements of the
passenger handling process: Check-in counter, Security Screening,
Departure Lounge and Baggage claim. In addition to the elements covered
by Correia (Correia 2005) will for international passengers also be
Immigration for departing passengers and immigration for arriving
passengers.
The Airports Council International recommended practice (Airports Council
International 2013), furthermore expands the passenger handling process
with baggage carts and transfer services and defines the passenger
process and their associated KPI’s for measuring passenger process
times as follows:
Passenger Process Key Performance Indicators
Ou
tbo
un
d P
roce
ss
Baggage Carts Number of baggage carts available
Check-in Average waiting time Counter processing speed (pax/hour)
Passport Control Average waiting time Checkpoint processing time (pax/hour)
Security Check-points
Average waiting time Checkpoint processing time (pax/hour)
Transfer Services Average waiting time Checkpoint processing time (pax/hour)
Boarding Process Time until the last passenger leaves the gate
Inb
ou
nd
Pro
ces
s Baggage Delivery Time for first bag to arrive on carousel
Time for last bag to arrive on carousel
Passport Arrival Average waiting time Checkpoint processing time (pax/hour)
Page 11
Customs Inspection Average waiting time Checkpoint processing time (pax/hour)
Table 1 Passenger Handling Process and recommended KPIs
Source: (Airports Council International 2013)
How waiting times are managed is important because it has a real impact
on passenger satisfaction (Airports Council International 2012). In general,
the longer a passenger has to wait, the lower the satisfaction the
passenger perceives. There is as such a negative correlation between
waiting times and overall passenger satisfaction (Airports Council
International 2012).
Passenger satisfaction is important because dissatisfied passengers might
make a different choice of either airline or airport the next time they
choose to travel, and passenger satisfaction can as such impact both
airlines as well as airports profitability.
ICAO (International Civil Aviation Organization 1997) has in their
recommended practice 6.16 set a goal of 60 minutes for the completion of
departure formalities of departing passengers, calculated from the time of
the passenger’s presenting himself at the first processing point at the
airport (i.e. airline check-in, security control point or other required control
point depending on arrangements at individual airports) to the scheduled
time of his flight departure.
ICAO (International Civil Aviation Organization 1997) has in their
recommended practice 6.29 set a goal of 45 minutes for the clearance of
arriving passengers, from disembarkation to exit from the airport, for all
passengers requiring not more than normal inspection at international
airports. Although this includes time taken by government inspection
services, it provides an indication of an acceptable time framework.
IATA (International Airline Transport Association 2004) has defined the
following level of service maximum waiting time guidelines in minutes:
Short to Acceptable Acceptable to Long
Page 12
Check-in Economy 0-12 12-30
Check-in Business Class 0-3 3-5
Passenger Control inbound 0-7 7-15
Passenger Control Outbound 0-5 5-10
Baggage Claim 0-12 12-18
Security 0-3 3-7
Table 2 Level of Service Maximum Waiting Time Guidelines
Source: (International Airline Transport Association 2004)(International Airline Transport Association 2004)
For airports and airlines that clearly do not fulfil the acceptable limits in
ICAO (International Civil Aviation Organization 1997) and IATA
(International Airline Transport Association 2004) recommended practices,
attempts to employ process optimisation methods, such as Lean Solutions
(Womack and Jones 2003), (Womack and Jones 2007) and Six sigma
(Pande et al. 2003) in order to achieve the goals set forth by the
recommended practices, should be considered.
Numerous papers and thesis’s are written on the topic of optimising
various parts of the passenger handling process (Quang et al.
2014),(Stolletz 2011) Airport Passenger Forecasting (Ahmadzade 2010),
Passenger Security Screening (Lee 2009), (Nikolaev 2008), (McLay 2006),
(Nie 2008), Airport Check-in Facilities (Ahyudanari and Vandebona 2005),
Aircraft Boarding Strategy (Bazargan 2007), Boarding Models (Tang et al.
2012), Boarding Methods (Milne and Kelly 2014) and how increased
security screening affect passenger satisfaction (Gkritza et al. 2006) and
how models and tools affect customer satisfaction in the aviation sector
(Arif et al. 2013).
According to ACI (Airports Council International 2012) there are three main
ways of impacting actual waiting times at an airport:
By opening more counters/lanes
By increasing the number of staff available
Page 13
By improving the efficiency of the process, which means improving
not only the efficiency of the staff (through training for instance) but
also the efficiency of the machines
To optimise the airport processes, and to know how many counters to
open and how many employees to make available at different times of the
day, it is necessary to do waiting time measurements in order to be able to
define quantitative standards.
The observed service times for passenger processing facilities at airports
are shown in the below table.
Component Type Service rate per passenger, Seconds
Standard Deviation
Entrance and exit doors
Automatic with baggage 2.0 - 25 0.5
Automatic without baggage 1.0 – 1.5 0.75
Manual with baggage 3.0 – 5.0 1.0
Manual without baggage 1.5 – 3.0 0.75
Stairways 3.0 – 4.0 1.0
Escalators 1.0 – 3.0 1.0
Moving Sidewalks 1.0 – 3.0 1.0
Apron Doors
With stairs 3.0 – 8.0 2.0
Without stairs 3.0 – 7.0 1.5
Jetway 2.0 – 6.0 1.0
Ticketing and Baggage
Manual with baggage 180 – 240 60
Manual without baggage 100 – 200 30
Baggage only 30 – 50 10
Page 14
Information 20 – 40 10
Automated with baggage 160 – 220 30
Automated without baggage 90 – 180 40
Security
Hand-check baggage 30 – 60 15
Automated 30 – 40 10
Seat Selection
Single flights 25 – 60 20
Multiple flights 35-60 15
Baggage Claim
Manual 10-15 8
Automated carousel 5 – 10 5
Automated racetrack 5 – 10 5
Automated tee 6-12 5
Table 3 Observed service times for passenger processing facilities
Source: Adapted from (Horonjeff et al. 2010)
Most of the time, airports are limited by space, financial and human
resources. In such cases passengers have to wait anyway at the different
processes. However, airports can try to influence the perceived waiting
time, that is the waiting time the passengers think they actually spend in
the different queues (Airports Council International 2012).
According to ACI (Airports Council International 2012) there are three main
ways of impacting perceived waiting time:
By clearly organising waiting times
By providing approximate or maximum waiting times
By entertaining passengers while they are queuing
It is possible to influence perceptions of waiting times through better
organization of the queues.
Page 15
Impacting the perceived waiting time can also be done by giving the
passengers indications of how long they will have to wait.
This can be done either through static indicators or dynamic indicators.
Static indicators are where signs displayed along waiting lines or average
waiting times or communicated on the airport website. Dynamic indicators
are regularly updated, real or estimated waiting times displayed on
screens or through baggage delivery screens showing the status of the
delivery.
The last way of impacting the perceived waiting time is providing
entertainment for passengers while they are queuing.
Airports can implement different types of distractions to entertain the
passengers and reduce the perceived waiting time. According to ACI
(Airports Council International 2012) there are three main categories:
Process related media
Other media
Non-media
Process related media consists of informing the passengers about airport
processes through displays or virtual assistants.
Other media groups all kinds of media that are not linked to the airport
processes. Advertisements on television, internet stations or media art
installations are included in this category.
Non-media, refer to the use of live performances.
3.6 Empirical investigations
Empirical investigations over the past decades support relations and
continued work on improving the passenger handling process, minimising
time which does not create value to either the passengers or the other
stakeholders.
Recent empirical analysis and findings from ACI (Airports Council
International 2012) are that:
Page 16
Economy passengers in Asia Pacific have the shortest check-in
times.
For passengers flying in business or first class, Africa / Americas /
Middle East has the lowest waiting times at slightly more than four
minutes.
European airports have the lowest waiting times at security, for both
regular and priority lanes.
Local and foreign passengers in Europe have the shortest waiting
times at immigration.
Airports from Asia Pacific have the lowest waiting times for the first
bag at baggage delivery, and for the last bag European airports
have the shortest waiting times.
The empirical investigations are important as they document and confirm
the link between the passenger handling process, the airline value chain
and the airport value chain.
4 How can the passenger handling process further
improve?
Airlines and Airports play a major role in constantly improving the
passenger handling process and creating value. Airlines and airports are
continuously working on improving profitability and satisfaction.
With the amount of research and mathematical optimisation models
available, there is only so much process optimisation which can be further
performed and so much further information and entertainment which can
be given to passengers. The author believes that significant improvement
in value chain creation will come from deployment of new mobile
technologies in the following three areas of the value chain:
Check-in and Boarding
Baggage services and loading
Flight disruption management
Page 17
The below sections briefly elaborate on each of these topics.
4.1 Operations – Check-in and Boarding
On the passenger side of Check-In and boarding, mobile devices are
already in use, allowing passengers to perform their own Check-In and
generating or printing their own boarding cards, thus reducing the cost of
Check-In personnel and reducing the requirement of check-In counters,
while giving passengers and added sense of improved service by allowing
them to select their own seating.
Adding now location specific capabilities to the already existing mobile
services, allows an airline to even further market, target and customise its
additional ancillary services and at the same time increase the airlines
marketing knowledge of the behaviour of its passengers as they proceed
through the airport.
Already upon arrival at the Passenger Terminal Building (PTB) a
passenger could be notified that Check-In/Baggage drop is at a given
location.
This could reduce the time needed to search a Flight Information Display
System (FIDS) for the relevant check-In or Bag-Drop counter information,
reducing the time spent trying to determine where to go next.
Approaching the Check-In counter, an airline would be able to make on
the spot offer of upgrade facilities available to the passenger, potentially
convincing him to purchase an upgraded product at the time of Check-In.
Approaching security check, an offer of fast track security processing,
against a fee, could be made, again potentially increasing ancillary
services revenue.
Crossing the security check and entering airside of the PTB, passengers
could be made a range of offers, all potentially increasing ancillary
services revenue while giving the passenger a sense of increased
personalised service. On-the-spot GPS directions to lounge facilities for
eligible passengers could be pushed to the mobile device. For non-eligible
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passengers, on the spot offers of lounge access against a fee or against
accrued air-miles could be made.
Airports always have an interest in keeping passengers inside the
shopping section of the PTB for as long as possible.
The increased exposure to services and goods inside the PTB not only
gives an opportunity for potential sale, but also reduces clogging of
passengers around the space-constrained boarding gates.
In anticipation of generating additional sales while the passenger is inside
the PTB, targeted marketing offers could be made, either against payment
or against redemption of accrued miles.
When passing a shop, special offers of interest to that particular
passenger could be made, for example, books, watches, tax-free sales
etc.
Example: “Your wife’s favourite perfume is available with the tax free shop
at a special discount available to you upon presentation of this message”
Linking social networking with location specific PTB sales could mean that
a passenger would know who of his social network were present inside the
PTB at the same time.
Airline lounges, food establishments, bars and cafes could then promote
the opportunity to offer a passenger his social network connections
present inside the PTB to meet at a lounge against a fee or to meet at a
food establishment, bar or cafe again for a special group offer upon
presentation of a personalised message.
In relation to flight delay management and passenger boarding, linking
these passenger processes to location specific services would give the
gate personnel a better opportunity to keep track of passengers that do
not show up at the gate in time for boarding.
In Copenhagen Airport, for example, passengers transiting through the
airport and causing either boarding delays or baggage offloading, were
Page 19
often found to be having lost track of time either in the Duty Free Shopping
area or in one of the many pubs available inside the PTB.
Being able to pinpoint the exact location of a particular passenger at the
time of boarding would allow the airline to directly approach the passenger
and advise him of boarding, rather than making endless number of last-
minute boarding calls. This facility could potentially reduce boarding delays
caused by passengers.
As with at the time of Check-In, at time of approaching the boarding gate,
additional targeted customer specific offers could be made to the
passenger, specifically relating to upgrading and in-flight services prior to
the passenger boarding the aircraft, again giving the airline an opportunity
for generating additional ancillary revenue.
On the ground staff side, equipping check-in agents with a mobile CUTE
Terminal (Common Use Terminal Equipment) might even completely
eliminate a passenger’s need for visiting a dedicated landside check-in
counter in a fixed location inside the PTB prior to security check.
Check-in staff roaming with a mobile device might be able to assist with
check-in of passengers, for example passengers with hand baggage, as
they proceed directly from the entry of the PTB towards security. Such
measures could ease the flow of passengers through the landside PTB
while at the same time further reducing the airline’s requirement and cost
for fixed CUTE check-in counters.
4.2 Baggage services and loading
One of the biggest worries for most frequent travellers is the “Send and
Pray” approach that passengers have had to adapt to their checked
baggage.
Typically, we see our suitcase disappear at the check-in counter or at the
bag drop, and pray that our chosen airline will successfully be able to
deliver our checked baggage at the correct baggage belt at our arrival
destination.
Page 20
Most of us have surely been very anxious to the extent of feeling a
complete ruin of either a business trip or a vacation, particularly when our
checked baggage appears at the “last bag” on the baggage carousel.
Even worse is, of course, the situation when the baggage does not turn
up.
Airlines would be able to remove much anxiety and concern for travellers,
by being able to push real-time information about each passengers
checked baggage to their mobile device.
Most of us are used to the real-time tracking of our DHL or Fed-Ex
package, and a similar approach would be welcomed by many travellers in
relation to our checked baggage (International Airline Transport
Association 2012).
On the operations security side, such real-time tracking might aid check-in
ground staff and ULD- and belly loaders in improving baggage
reconciliation. This might in particular be the case if information of a
passenger’s location sensitive mobile device could safely be related to the
baggage reconciliation process.
Real time tracking might even be a preventive measure to limit misdirected
baggage. A passenger having boarded one aircraft, receiving information
on his mobile device that his checked baggage is in the process of being
loaded on another aircraft, might even in a timely manner be able arrange
for the safe reloading of his checked baggage or arrange for minimal delay
in redirecting his misdirected baggage to his final destination.
4.3 Flight disruption management services
Flight disruption management services have traditionally been dealt with
by transfer desks only after a passenger reaches his final destination or
intermediary flight stop. The dreaded situation of being the last passenger
disembarking a 747 only to find all co-passengers queuing at the same
transfer counter for rebooking of the missed connection flight out of an
foreign airport, can sure haunt even the most hardened air traveller.
Page 21
Proactive notification of flight disruptions are unanimously preferred by
passengers (International Airline Transport Association 2012).
Being able to make use of in-flight Wi-Fi during actual flying time to enter
into a dialogue with passengers regarding re-booking, hotel overnight
compensation and airline delays would be able to address and remove
much anxiety of passengers already before they arrive delayed at their
next airport.
Using in-flight Wi-Fi, Airlines would be able to negotiate, agree and
transmit rebooking PNR, revised itineraries, hotel compensation vouchers,
airport meal vouchers, transportation arrangements and other relevant
information and documentation to the passengers. Consulates, embassies
and immigration authorities could be notified to facilitate unanticipated
time-limited entry into the nation of a transit airport which would normally
require an entry visa.
Airlines will, by entering into a dialogue with each and every passenger
during in-flight of a delayed flight, be able to spread out the peak load on
the transfer counters while at the same time providing far more timely
information to passengers, delay-stay hotels, supporting service providers
and consulates, embassies and immigration authorities, reducing the
requirement for un-predictable stand-by capacity in all these parts of the
value chain. Passengers will on their side arrive at their next airport
knowing that all possible measures have been taken by their preferred
airline of choice in accommodating their unfortunate delay.
5 Criticism
Very few academic references are dealing directly with South Asia. The
academic literature which I have found seems to discuss mostly Airport
and Airlines from a predominantly western European view, the American
view, and some recent optimisation models completed in the emerging
economies such as China.
Page 22
Huge cultural differences as well as significant stages of maturity of the
Passenger Handling Process, seem to have been experienced by the
author when travelling in India and when travelling abroad; and a model of
passenger handling process that works well in, say Scandinavia may not
at all be applicable across the globe, or in places like India without
significant modification or adaptation to very local circumstances.
6 Conclusions
This paper has performed a theoretical analysis of the passenger handling
process that take place from a passenger enters the Passenger Terminal
Building (PTB) until aircraft pushback; and from aircraft on-block until the
passenger exits the PTB.
It set out by establishing the framework of the Airport Value Chain, the
Airline Value Chain and devised the Passenger Handling Process as result
of where passengers interact with ground handling personnel in either the
Airport Value Chain or the Airline Value Chain.
The paper has through review of empirical studies found that limited added
value can continuously be achieved by further optimising the existing
passenger handling processes or by continuously further entertaining the
passenger while queuing.
Instead, the paper concludes that the deployment of mobile technologies
in three main areas of the Value chains of airports and airlines; Check-in
and Boarding, Baggage loading and Flight Disruption Management
services, will yield the most improvement and value to Passengers,
Airlines and Airports in the years to come.
Page 23
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Appendix A Selection of literature
The research articles were selected by undertaking a search through the
search engine Google Scholar and through the electronic databases
ScienceDirect and ResearchGate in addition to a general search on
Google.
In addition to this, research also involved studying Operations
Management and Supply Chain Management textbooks recommended for
use of the MBA in Aviation Management at Frankfurt University of Applied
Sciences (Chopra et al. 2013),(Christopher 2006),(Evans and Collier
2007),(Waters 2010) and(Johnston and Clark 2013) as well as
professional aviation text books by De Neufville (De-Neufville and Odoni
2003), Deshpande (Deshpande 2001), Horonjeff (Horonjeff et al. 2010)
Graham (Graham 2008), Kazda (Kazda and Caves 2007) and Wells
(Wells and Young 2004).
For the search engines and databases a number of searching keywords
related to Passenger Handling Processes (such as “Value Chain”, “Airline
Value Chain”, “Airport Value Chain”, “Airport Processes”, “Passenger
Process”, “Passenger”, “Security Check”, “Boarding”, “Check-in”, as well
as words related to a geographical region (such as “USA”, “Asia”, “South
Asia”, “India”). This produced an extensive range of diverse articles (130+)
which had to be narrowed down by considering their significance to this
paper.
One of the major difficulties in determining their relevance was that the
majority of the articles included the concept of processes on a very
specific topic, such as “Evaluating the multi-period operating efficiency of
international airports using data envelopment analysis and the Malmquist
productivity index”, “Monte Carlo simulation of animal-product violations
incurred by air passengers at an international airport in Taiwan” or
“Forecasting of Hong Kong airport’s passenger throughput” but not
necessarily a subject or a geographical limitation which could be
generalised.
Page 29
Consequently a subjective judgement had to be made as to whether there
was different coverage of focus for the relevance of this paper.
Whilst the database search ensured that international papers that
conventionally tend to be written in English were identified, a potential
limitation was that papers written in other languages, such as any of the
Indian languages, may have been omitted, which in turn may have
influenced the geographical perspective of the articles.
The majority of the bibliography and references came from specialist
Aviation sciences journals (Journal of Air Transport Management,
Transportation Research Part C) and from specialist Logistics journals
(International Journal of Production Economics, Computers and
Operations Research) but some also appeared in other journals, such as
Tourism Management.