Purchasing Power & Airports

For many years, I use a graphic overlay in Germany in my presentations. I plan to make it available in CheckIn.com in the near future on a European level… I think it speaks for itself.

The influence on airports to purchasing power. Yes, it’s a hen-egg question, but a fact that politicians should think about. Here’s the latest. May it be useful for you too…

Germany Purchasing Power vs. Airports

Sources: gfk.com + Wikipedia
Updated 2017

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SITA Communications

SITAcommunicationsFollowing the acquisition by my employer delair by SITA, I was not allowed to maintain a personal blog until our parting of ways in February 2016.

With centralized communications, employees are not encouraged to run personal blogs or activities that are out of the control of the company. To my personal believe and in hindsight, it is an example how SITA uses the new communication channels: They’re stuck in the Industrial Age type and hold on to supply-driven information:

eastman

We push, because “mother knows best”.

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Airport Development

Discussing Airport Development on a general and global scale lately with some renowned influencers in this industry, there were some thoughts, I would like to share today.

playmobilairportWho’s the Customer?

It was rather fascinating to discuss the “customer” issue with airports recently. Though despite we all know that we compete about the passengers, the airline is just as much a customer of the airport as are ground handling companies. As we published in our case study on Zurich’s new deicing management, one of the main cost savings factors, reflecting millions of savings (Euro, Dollar, …) comes from reduction of delay, faster recovery from overall delays or disruptions. With passengers and airlines alike benefiting from “pre-tactical” information.

Keeping the Status QuoWhich Network???

or why only the dead fish swims with the stream? There is a great tendency in our industry today to wait and see “others” and especially “the big ones” to invest in new technologies and try them. And only with many years of delays implement the investment into the own budget plans and maybe get it year(s) later. Be that the use of (free) WiFi at the airports for all customers or CDM developments to the benefit of airport operations – especially under adverse conditions.

IHS Janes Innovation Award 2014Saving, no matter the cost

A common argument against the investment is that the status quo functions. Airlines are i.e. “used” to have major delays during and after winter events. The throughput is lower, flights must be cancelled, after disruptions, the recovery takes time. Zurich having saved +20 million Euros in one season alone by “managed” deicing is a good counter example. With other airports/airlines stalling the implementation of the tool for their airports/terminals “for cost reasons”. Sorry, I will never get used to burning the amounts of money our industry does. We invest into “customer experience” but don’t bother about reducing flight delays.

ACDMsilosCollaboration vs. Silo

The global Civil Air Navigation Services Organisation (CANSO) and the Airports Council International have declared Airport Collaborative Decision Making (A-CDM) a management matter, joining forces in the promotion of the concept. Now airports and airlines alike keep pointing out that they have no common data. A major U.S. airport disqualifying it with the example that they don’t even get an Estimated Time of Arrival (ETA) or Departure (ETD) from their airlines. They learn of arrivals or departures once the aircraft is on approach or on engine start-up or pushback – thanks to kind information by the tower. The operator of a terminal at one major hub tells us, collaboration won’t work at their airport as the terminal operators strongly competing. Yes, there are workarounds possible (considering the controlled apron/tarmac area “the airport”), but as long as airlines and ground handlers keep up such self-understanding, we are a long way from “effective operations” or even a basic management of delays, disruptions and recovery.

Airport Strategy

Strategic Directions?
Strategic Directions?

In the discussion, we also talked about airport strategy. New airports are being build without giving consideration to A-CDM or TAMS (Total Airport Management, expanding A-CDM into the land side), but focusing on fancy design. (New) Nordic airports having trouble with the positioning of their deicing pads (also called “Central Deicing Facilities” or CDFs). Space for an “Airport Operations Control Center” (APOC) being later taken from existing office space, instead of pre-planning the necessity. Airport Operators like Avialliance, Vinci or even Fraport (a CDM-airport) focus on CDM locally, instead of considering solutions that improve the airport group. Just some thoughts on the issue as we discussed it and I joggled down my notes…

Food for Thought
Comments welcome

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The +50 = Useless Myth

Okay. So I turned 50 this year. And aside a major C-Check that will make me take additives for lost hardware and discuss health issues with friends and strangers alike? Aside being a dirty old man? Am I useless?

Why should I be?

EinsteinI still will likely work another 15 years at minimum – maybe 20 or more! Many retirees are still fit to work and get bored if they don’t. The majority of students taking up their first new job will be with the company less than five years in the end. Inexperienced and with low salaries companies invest heavily to train them on the jobs they do (or risk to invest into their mistakes). Whereas you can hire experienced people who know their jobs, make less (costly) mistakes and who have a “knowing” touch, usually good for building trust with new customers or prospects.

Not the U.S. ... China. But this graphs looks similar in any "modern" society
Not the U.S. … China. But this graphs looks similar in any “modern” society

Now we also have less and less young people entering the market here in Europe, as well as the U.S. Politicians and commercial bodies paint the picture of lack of junior employees. At the same time, they send their experienced workers home at relatively young age. Or disqualify them as employees as “too expensive” or “less resilient”. It’s the same issue about the demand of an “academic degree” for all employees. Misjudging and neglecting the value of “practical experience”. And yes, that also goes to you Marisa Meyer, whereas I also enjoy similar such personal experience with Lufthansa Group…

Mayer-Paltrow

What really bugs me about this, is that even renowned entrepreneurs and investors often disqualify older entrepreneurs from their support activities, very often, activities address “young professionals”, “under 30” and enjoy other such limitations. The same is true in talks, where “older” entrepreneurs are faced with far higher “expectations” and demands and still don’t get the investment but “hip” high risk investments by teams without any professional experience do. I believe the time to disqualify experience or “gray hair” are over soon. If companies look for good people, they will have to pay more for the few “young professionals” left, who proof to be less loyal and require more mistakes to become experienced. And I know of too many experienced people as well as honor students leaving “bad paid” aviation or not even interested to start in it, as motivation and loyalty are no one-way-street and other industries simply proof more attractive to them than ours.

German Birthrate Image by Welt.de
German Birthrate Image: Welt.de

Oh… And didn’t I just hear Germany became Champion again? In the f#%@ing lowest birth rate in the world!!! Well, that does confirm my own experience about “political child support” by our self-proclaimed “Christian-Democratic Union” led by our Chancellor Merkel. And no, I do not want to talk about “atomic exit”, Greece or “lobbyism” in Germany today. We just have a family tax system that supports DINKs (double income – no kids), but increasingly forces single parents into poverty. With the demographic results shown. So what was that again about 50+? Im now beyond 50. And happy 😀

Food for Thought
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Keeping Face

changeflightsJust screening all those wisdoms my friends keep sharing on LinkedIn and Facebook, here one from own experience…

People do not want to admit mistakes.

Developing online booking tools back in the 90s, when no-one (especially not Amadeus, Sabre, etc) believed in it, I learned that lesson good: Business travelers wanted to make the bookings with their travel department. But they wanted to CHANGE the booking themselves (online). Asked, why that is, it was simply that they considered the need to change a booking a “mistake”. No matter if the change was enforced to them. It also showed how important it was to them to keep face with their travel arrangers.

Food for Thought
Comments welcome

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CheckIn.com – Updates and Timeline

icon-routesBraunschweig, March 2015 Thanks to unforseen circumstances, the last days forced us to reconsider the entire development and timeline for the CheckIn.com project. So far, it was planned to be ready with development by February, Mid March and prepare for rollout at Routes Europe in April in Aberdeen. We have now decided to cancel that event overall, a hard and unhappy decision! But. Especially to digg out the U.K. statistical basics caused us major delays, getting incompatible figures from the same source, not just self-researched but also from the ONS (U.K. Office of National Statistics). We learned they mostly only cover England & Wales, neither Scotland or Northern Ireland. Sure with exceptions, which, if you’re kept unaware, simply cannot compute!

ONS

Scotland does not cover the Local Administrative Units Level 2 of Eurostat, they consider those useless and calculate “something” only on demand. Ireland came last (by end of February) and again with non-standard numbers we now have to “make compatible”. To qualify the difficulty to get the basics for the U.K.: Covering geographic Europe, including Balkan countries and other non-EU countries, the U.K. made it a multitude more difficult for us to get some useful information.

drivetimesAnother issue is drive times, where we have to deal with the fact that “unique administrative places” are not being found either in Google, nor by other on- and offline mapping tools. Often, road data is missing completely, making it impossible to calculate any drive times. Especially going east that caused us quite some headaches (and night shifts). So now finally, though with already some delay, we have everything covered. But we recognize that “mapping” is a major fuzziness, if we go with existing technologies – we should buy into commercial collections of administrative borders, though which also don’t completely match with the data we are having.

IGG_newLogos_forwebSo January 1st, we started the crowdfunding on Indiegogo, hopeful to get enough interest to finance the necessary development. Generating interest and funds mostly from unexpected sources, by early February our hopes shattered, our friends leaving us out alone in the cold. Very little buzz, not even supportive comments to us, even from our close friends, ad sure no orders for Isochrones. A real nice classic barrel burst. Simply dead silence. Not a bad thing, in fact it confirmed our initial approach to go in a step-by-step process, fund as we can, do what we can, but not to rely on investors (requiring fast return-of-investment, having their own agendas) and do “ourselves”.

surgeryThen came the shock. Within days, Jürgen went into sickleave, undergoing a major surgery Feb 27th, taken completely out of the loop for the better part of 14 days and being still hospitalized (4th week), depriving us from the most knowledgable and networked expert in our team. He is well now, still recovering, still hospitalized. The tumors identified turned out a haemangiome (as “known” since 2002) and a benign neuroendokrineous one.

So after recovering from the major surgery, he shall be almost as new (minus half a pancreas, the spleen and a bit of his liver and plus a possible diabetes). Celebrating his 50th birthday recently, he feels “old now” thanks to the fact that for the remainder of life he got to carry a pillbox and injection pens with him to cover for the lost half pancreas.

But the main setback is the delayed recovery; instead of the expected 10-14 days we now talk more about min. 4-5 weeks that we lost his support for. With all that baggage, we were faced with a tough decision. Do we keep up the plan to go live at Routes Europe? Or do we have to postpone? Especially with the desinterest showed for our crowdfunding, the missing funds to secure external development for the remaining solutions, problems with providing a solution for maps now and Jürgen’s missing help, we decided against Routes Europe and for a delay.

mathchallengeHaving the drive time calculations completeted for Europe, we will now start to work on North America already. With the custom tool received by Richard Marsden, we are hopeful to get that covered maybe in time for World Routes, for sure until next Routes Americas. Having the solution for the most complex of our algorithms (thanks Ori) we are also pre-computing the impact values for each airport from the municipality-view. As in most cases the passengers have not just one airport, but optional others to choose from. Depending on the size of the airport, the drive time to get there as well as the flight services offered. But yes, it is quite a bit work and even computerized a real lengthy task to apply these algorithms to all the airport-municipality pairs…

We also intentionally decided not to go into public transportation, as schedules make the connection inflexible – i.e. a good train connection that misses the flight is of no use. And we have found none good source for a generic application of public transportation, it only works for “given schedule”. But that’s then the task of the expert doing the route feasibility study – we specialize in the mass data, leaving individual data to the route manager.

For the maps, we now need to check “low cost solutions”, looking into Google (no “freebees” as Bing), offline mapping tools and maybe Open Street Maps. We assume this takes another 4-6 weeks minimum and we might have to use “offline mapping” as a work-around, with map-creation taking some additional “non-automated” time.

Without the admin borders, we think about a solution to quantify the passenger potential by municipality, thus making “hot spots” visible. Also something to keep us busy, but the benefits of not needing the municipal borders in the display justifying for that. We also got the funding to do a real good prototype of the dashboard, but it takes time to write the necessary software requirements specification.

dashboard.draftThen we have to find a web-agency that can do it (the famous needle in the haystack problem). But without map(s), the dashboard is incomplete, so there must be some “placeholder” while we create the map(s). All those tasks we now have to do on our own finally summed up to the painful decision to reschedule the development plans and skip Routes. Which was especially hard on Jürgen to convince, who is a great fan of that event. We do hope you can understand the reasoning behind our decision and appreciate your feedback – supportive, critical, honest. And if you have ideas how to speed up our agenda, if you have reference to a real good web-agency, you are very welcome! Just a little bit

Food for Thought
but as usual: comments welcome!
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Math Challenge (finished)

Thanks Ori for the speedy answer!

mathchallenge

Whoever gets me the result first in a way I can use it (calculate “percent” based on variable Z and time) can select either a dinner or a 100€ Amazon (or other online available) voucher. We need a curve calculation, fitting the following requirements…

  • X-axis is time, Zero (or 30) to infinity
  • Y-axis is percent, 0-100
  • Variable Z is a positive number between 0 and infinity (real: 1-200 mio).

The curve must not meet the X-Axis, so Y (percent) must always be larger 0, no negative values. At minute 30, the percent value should be 100. Or at minute Zero, then we simply add 30 minutes 😉 Depending on variable Z value, the curve shall slope faster or slower, but “reversed proportional”, the lower Z is, the faster the curve falls. Target values…

  • Z=500.000 should fall under 10% at about 60 minutes.
  • Z=5.000.000 should fall under 10% at about 90 minutes.
  • Z=20.000.000 should fall under 10% at about 120 minutes.
  • Z=70.000.000 should fall under 10% at about 180 minutes.

* 10% or 20%, but preferably not more! But the curve bending should be variable based on Z within that rough frame. If we have the curve, we need to calculate the coordinates, so percent (with min. two decimals), at given X minutes. We “know” minutes and the variable Z.

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Unique Selling Propositions

USPDuring my initial business education, more than 30 years ago, the General Manager of the company hosting me for the practical part told me: “Someone else always can sell cheaper”. At the time, concepts like “USPs” (Unique Selling Propositions) had not been “common”, but it practically was about how to position for success.

You Get What You Pay For
You Get What You Pay For

The mantra in the aviation industry is to be always the cheapest. The mantra in procurement / purchasing is to buy the cheapest. In Germany, we have two different words for “cheap”. Billig and preiswert: Billig is cheap. Preiswert is “worth the price”.

Another old saying is “You get, what you pay for”. And yet another saying I heard in procurement is: “Save money, no matter the cost”.

But my friend Richard told me some 15 years ago that there is a psychological price. He also told me that IT (what we both worked in and now work again in) is the first thing that procurement “saves” upon, as they don’t understand its value.

So if it is not the price, what could it be?

HAM: Hamburg Airport Marketing
HAM: Hamburg Airport Marketing

A unique identity could be one. For airlines: When I started in the industry, I could distinguish airline crews by their uniform. Today, the differences in the uniforms are so minor that flight attendants of different airlines standing in one group can not be distinguished any more.

For conferences, I keep refering to Hamburg Airport Marketing. From afar they can be identified. And even promoting Hamburg big on the shirts, it doesn’t look “cheap”, but gives identity! It can be even worn at the “business casual evening event”. And believe me, if you look for the Hamburg team, you do find them!

Though for some reason inexplicable to me, many sales managers deny to wear uniform, much less some easily identifiable wardrobe as that. They seemingly prefer to blend in with all the other black ties. Though why you want your company and products and yourself to “blend in” instead of standing out, is simply beyond me 🙂

If you can establish a unique identity, your customers associate intuively with your product, you increase your reseller base, as they will remember you when opportunity arises. If your reputation is bad, all you can do is to undercut your competitors in price. If that is your USP, I’d say you may have the problem with the fact that always, someone else can produce cheaper.

Quality is a good USP. And quality comes in many aspects. Part of quality can be friendliness – in the beginning of my career, at the time with American Airlines, we got “beaten in” that we always have to smile when interacting with other people. Not just customers, but also our own colleagues. As the saying goes “Formal courtesy between husband and wife is even more important than it is between strangers.” [Lazarus Long] – I found this especially true in companies. If you treat your own people bad, you will treat your customers likewise. Unfortunately, service is something that button sorters (accountants) don’t understand. Friendly Service does not have a price tag. Just if you don’t have it, you will pay the price. In lost customers.

BethuneQuote

Service is also how you manage with problems. Can you truly afford your customer(s) to be upset, just to save some money? Even if you do not pay, you got to talk to the customer and explain. Do not write. And don’t “outsource” your customer communication or you will loose them.

Time is also an essential difference maker. Why else would airlines reduce the prices if you connect making a detour through their hub (connecting airport), compared to a nonstop flight? In IT, time to delivery is of essence. Too many companies succeed by selling you dreams, but failing to deliver. Leading to the next Soft USP:

erf_you_dont_have_to_be_the_presidentHonesty. I was tought early in my life to never lie if possible. Bend the truth, better tell some truth that makes the people believe you lie (and proof them better later). When Obama visited Erfurt, press asked. All I communicated was “The Pilots’ Union said that Obama’s 747 cannot land in Erfurt”. What I did not tell them, that the Union’s “experts” had missed the fact that Air Force One is usually not “fully loaded” and has the advantage of some (so public sources say) 20% higher engine power. When it came to Erfurt, I had never lied. And ever since had a good standing with them. Honesty creates trust. If you lie once, you’ll have a hard time to recover.

These are sure just examples. But it strikes me odd, how many companies, especially in aviation, do not have an understanding of their business culture and their USPs. But if you don’t communicate that to your own, how do you think your customers will learn about them?

Samsung-S5-vs.-iPhone6A final example for this article today shall be Apple. I loved Apple. Past tense. They made the first smart phones. All others copied them. Now they struggle and their answer is “me too”-products. What was their USP?

I took the iPhone6 into my hand and decided: Too big. My iPhone 4S does all I need. Intuitively and without some double tab on home to be able to access the upper screen.
If I want to watch video, I use my tablet (did I mention I shunned the iPad and got a Windows-Hybrid?).

So Apple lost a customer. Because they evolved from the pioneers to the ones limping behind. It would be time for them to reassess their USPs, their business propositions and their strategy. Then maybe they might find that they left frustrated customers behind with their “bigger is better” and instead made their phones expensive Samsung-clones, just without a “Mini”.

Sell, sell, sell. But if you do not know what you sell, all you do is lower the price until someone buys. I predict that fate even for Apple. But if you can explain the differences, if you can explain the quality, you hardly need to sell. The people buy. Though that requires management to understand and support that, to drive, not being driven.

Hmm… None of the business plans and their revisions I worked on took less than several weeks to come from an idea or product to a sales strategy for the different “customers”. Capital investors, buyers, suppliers, partners. And to answer the main three questions (beyond the idea) that all business plans contain:

  1. What is the business case?
  2. What is the USP?
  3. What is the risk and opportunity (so-called SWOT-analysis)?

Once you can answer these three questions, you have your sales strategies, your elevator pitches, you understand. Then all you still need to do is: Communicate it to your people! Spread the word.

Food for Thought
Comments welcome

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