The Catch 22 of Cost Based OCC Decisions

Transcription

1 AIRLINE FORUM 2015 Airline Operations Control The Catch 22 of Cost Based OCC Decisions

2 The Catch 22 Costs are not the issue Airlines burn money every day Outdated IT Systems Cost based decision making requires integrated IT & real-time data The Aviation Reality Decisions consider safety & regulations 2 Manage your airline operations by exception

3 Airline Challenges Economic instability and uncertainty Difficulty creating accurate forecasts Volatile fuel costs Increased passenger expectations and choices Fragile schedules and ripple effect of delays Need to optimize asset utilization and efficiency 3 Manage your airline operations by exeption 9/5/2016

4 How Airlines burn money every day Many OCC work spaces are equipped with data silos Many applications, not integrated and isolated data Airline spend a lot of money on airport lounges, new aircraft, flat bed C-Cl seats, but also on disruptions Reservations Airport Slots Dispatch FPL $ Crew NOTAM PDF Very poor decision support with available data Time required to get the necessary information Time required to take decisions Mediocre on-time-performance SM N America $12.1 bn 31 airlines 12,608,000 flights 77,9% Europe3rd $3.3 bn 34 airlines 5,238,457 flights 83,6% $100 m / airline $390 m / airline All necessary information at a glance ME Critical weather $567 at airports m S America $0.86 bn 4 airlines 637,220 flights FTL of affected crew members on flights 77,8% 7 airlines A/C restrictions and maintenance requirements $141 m / 1,598,451 flights Airport slots and ATC airlineslots 84,2% $122 m Operational / airline costs for ACH/EQT, ETD, CNL Inbound & outbound Source: PAX IATA 2015 connections Asia $8.1 bn 33 airlines 5,296,120 flights 70,9% $245 m / airline World Total $ bn $228 m / airline 4 Manage your airline operations by exception 9/5/2016

5 What are the costs of an airline operations disruption? Prevention Daily Usage / pro-active Tools for early detection Curing Re-active problem solution Tools for curing 5 Manage your airline operations by exception

6 How airlines burn money every day Many airline operations control center work spaces are equipped today with data silos Many outdated airline IT applications, not integrated and with isolated data streams Airport Slots Reservations Dispatch FPL $ Crew NOTAM PDF Very poor decision support with available data Time required to get the necessary information Time required to take decisions Ops Controller using a cross-functional integrated OCC IT systems save costs Enhanced & fast operations decision support with all necessary information about Critical weather at airports FTL of affected crew members on flights A/C restrictions and maintenance requirements Airport slots and ATC slots 3rd Operational costs for ACH/EQT, ETD, CNL Inbound & outbound PAX connections 6 Manage your airline operations by exception

7 Let s consider an aircraft has to be swapped ACH or EQT what are the costs of each of the following items? With the given factors, the Ops Controller needs to look at some points: Aircraft restrictions (MEL) Aircraft version on this route? Pax capacity (off-loads), seating configuration (old or new C-Cl) Maintenance check for one of the aircraft considered? Aircraft lessor allows to fly to the specific destination? Runway long enough for B77W with possible high weight? Does the airport provide a GPU in case of an APU inop? Crew type rating? Licenses of Crew? Crew change? If crew is not changing, APIS? Operating costs (A321 vs A320) 3rd All necessary information at a glance Critical weather at airports FTL of affected crew members on flights A/C restrictions and maintenance requirements Airport slots and ATC slots Operational costs for ACH/EQT, ETD, CNL Inbound & outbound PAX connections 7 Manage your airline operations by exception 9/5/2016

8 Let s consider an aircraft has to be diverted DIV - what are the costs of each of the following items? With the given factors, the Ops Controller needs to look at some points: The weather/visibility is not below minimum condition? The aerodrome is open? Firefighting is available in satisfying category? How many runways? (Only one might restrict the company minima) Lighting facilities for the runway all working? (If not, minima go down) Navigation facilities / instruments working? (If not, minima go down) Runway long enough for B77W with possible high weight? Does the airport provide a GPU in case of an APU inop? Immigration facilities are available for international flights? How do we get the passengers to the hotel, to their connecting flights? How do we get the crew to the hotel, to their next flight? 3rd All necessary information at a glance Critical weather at airports FTL of affected crew members on flights A/C restrictions and maintenance requirements Airport slots and ATC slots Operational costs for ACH/EQT, ETD, CNL Inbound & outbound PAX connections 8 Manage your airline operations by exception 9/5/2016

9 Complex OCC Decision Making Requires Sophisticated Decision Support Tools and Data Integration OCC IRROP Decision Tree IRROP PAX Considerations IRROP Cost Considerations Do we have an aircraft Do we have a crew What happens to the passengers What happens to the revenue How much does it cost Are there any special circumstances How and how long will this decision impact airline What are the associated / future / indirect costs Do I have an alternative How many passengers could be impacted are there special accommodations passengers onboard When is our next flight available for the passengers or on OAL How long will each passenger be delayed in reaching destination How disruptive is the reaccommodation for the passengers overnight, long airport delay, multiple stops, missed connections Are there adequate passenger & crew accommodations available What type of market are we dealing with history in this market airport slots Revenue to be retained, lost Crew lost time, premium pay, accommodations Maintenance missed service, wasted resources Labor mechanic, ground service agent overtime Passenger servicing costs - Interrupted trip expenses - hotels, meals, transportation, denied boarding compensation, frequent flyer awards Any regulatory penalty or cost of delay (EU261) Cost of passenger god will 9

10 Integration of all kind of data is the key. Actual Data in Airline Operations Movements Airport Limitations Airport Slots Delays Operations IT Transfer passengers Critical weather information Crew rotations Passenger figures 10

11 Prevention is better than curing All Identified Operational Infeasibilities listed 11

12 Modern OCC Management Get the potential mixconnex costs calculated 12

13 Modern OCC Management Figure out decision alternatives and related costs 13

14 Modern OCC Management Figure out decision alternatives and related costs 14

15 Decision Support Which other tail for Kilo Bravo? Swap Candidate Filter 15

16 Decision Support Which other tail for Kilo Bravo? Swap Candidate Filter operating hourly costs per a/c 16

17 Decision Support with EU261 Costs Indication Potential PAX compensation claims calculated 17

18 Filter out flights affected from a strike in a specific country and get the costs for potential operational decisions 18

19 Decision Support with Crew data in Airline Ops, however what s the cos of CNL a flight with a check trainer assigned 19 Manage your airline operations by exception

20 Management reporting with sophisticated tools Generating dashboard and KPI reporting 20

21 Management reporting with DeltaMaster Getting most out of the operational data analyzing the leg export 21

22 Recommendation for Airlines IT Systems Get rid of nonintegrated IT systems and save costs Keep it simple Figure out a cost model which can easily be administrated The Aviation Reality Don t compromise on safety & regulations 22 Manage your airline operations by exception

23 Lufthansa Systems GmbH & Co. KG Daniel R.J. Stecher Senior Product Manager Operations IT Solutions Salzufer Berlin Germany Tel. +49 (0) Fax. +49 (0) daniel.stecher@lhsystems.com 23