A service quality culture

BARA’s policy document Timely and reasonably priced airport infrastructure calls for a service quality culture to deliver valued outcomes to passengers and international airlines. To support these outcomes, BARA wants to apply the service level framework recently agreed with Sydney Airport to the other major international airports.

International aviation exists to provide services to people and businesses. Effective co-ordination, efficient service delivery and a focus on customers are integral to the industry’s success.

Availability, cleanliness and an ongoing culture of safety and efficiency at airports are elements of service quality that are critical for promoting high quality, adaptive and efficient international aviation in Australia.

Current commercial agreements between the international airlines and the major international airports are generally patchy when it comes to their commitments to improving outcomes for passengers and international airlines.

The Australian Competition and Consumer Commission’s (ACCC) 2013-14 Airport Monitoring Report found that while prices and margins for the major international airports had increased over the last 10 years, service quality had not improved or had deteriorated. While some parties continue to criticise the ACCC’s report, as far as BARA can see the airports and international airlines are yet to engage at the level necessary to improve service quality.

In response, BARA has devised a service level framework, which underpinned the international agreement recently negotiated with Sydney Airport.

BARA sees merit in negotiating and applying a consistent framework at each of the major international airports. The framework is flexible enough that its detail can differ across airlines and airports to suit individual requirements.

Outcome-focussed KPIs

The first element of the framework is a key performance indicators (KPI) regime. Solid performance data are necessary to identify areas for improvement and respond to and resolve emerging issues.

BARA proposes establishing two tiers of KPIs. The first tier will focus on the final outcomes for airlines and passengers and measure airline on time performance (OTP) and baggage outcomes (eg the proportion of bags on their correct flight). Improving these outcomes often requires the joint effort of all industry participants.

The second tier will cover activities more within the airport operator’s direct control, where specific improvements can directly support improved final outcomes. Some airport operators have included such measures in their agreements with airlines. Future agreements would benefit from standardising many of these measures across the major international airports.

Performance improvement projects

A sound understanding of airline and airport performance means the parties can then implement projects targeted at delivering improved outcomes.

Performance improvement projects need to start with a detailed analysis of current processes and outcomes; then initiatives to improve performance can be identified and ranked based on the cost and potential return of each initiative.

Improving final outcomes, such as OTP, often involves the joint efforts of the airport operator, ground handlers and airlines. Yet the need for joint responsibility should not be a reason for the airport operator’s inaction. After all, the airport operator is usually the party best placed to lead and coordinate performance improvement initiatives across the industry participants.

Understanding and recognising significantly delayed flights

Satisfactory OTP outcomes are critical for international aviation to deliver quality services to passengers and maintain commercial viability at each airport.

Airlines should be entitled to some level of compensation for flights that are significantly delayed because of issues within the power and control of the airport operator. There is a need to agree on: the definitions of ‘significantly delayed’; the service failures that can lead to the delay; level of compensation provided; and processes for assessing airline claims for compensation.

Through time, this process will generate a valuable source of data on the reasons for significantly delayed flights.

Effective consultative forums

Finally, the service level framework requires effective consultative forums to obtain airline engagement and implement the service level framework.

BARA sees merit in a formal forum with agreed terms of reference to promote effective engagement with the international airlines. Generally, four meetings a year should be enough to implement the service level framework, as much of the actual implementation occurs continually over the course of the year.

These forums would not be there to replace the resolution of operational and other issues through the airline operating committee (AOC) at each airport. Instead they would monitor performance and agree projects and works to deliver improved outcomes.