Airlines India, Indian Airlines

India’s airlines are growing fast. They are facing large-scale people problems – a critical shortage of skilled people to run highly complex businesses. The public sector is of little help in improving matters.

The Indian airline sector is experiencing a shortage of flying talent. Most of Indian airlines are hiring pilots from abroad. Cabin crew finishing schools are mushrooming, but training quality remains a concern because demand is rushing training. New airline entrants are poaching talent from existing airlines, and retention is becoming a problem. It is not just pilots or cabin crew, even ex-pat management attrition is an issue.

India is a study in contrasts. Our concerns with Indian aviation to date has focused on the lack of infrastructure. In addition, there is the matter of India’s growth potential and the government’s apparent inability to manage this. India has a population of 260m living on less than a dollar per day – which is nearly the size of the US population! There are tremendous challenges. While the private sector booms, the public sector cannot cope with the demands placed on it. Corruption is still a big problem, making change more complicated.

It is crucial to understand that a failing public sector risks everything good and great created by the private sector. Like China, India faces different growth rates in different regions. This leads to social unrest as the more entrepreneurial move to the opportunities. Since the public sector in India has massively failed in basic functions like provision of public schools, health care and water supplies, something as exotic as the aviation system cannot expect to get much attention. Hence the strong interest in privatizing India’ airports.

Investing in aviation infrastructure is one thing the Indian government cannot short change. A growing aviation sector means more tourism, which translates into lots of service jobs. Change management is a top priority throughout India. However, India’s bureaucracy is legendary in its ability to stymie change. Therefore, the government would be wise to co-opt the private sector in any way it can to overcome the various hurdles, from resource allocation to overcoming bureaucrats’ love of status quo. It takes only one success story to encourage change. If one state starts down the road of faster infrastructure development and reaps the rewards of faster growth, powered by, for instance, increased aviation use, others will follow.

The biggest problem in India is its people. There are many of them, but too few with the skills to exploit the myriad opportunities. For example, Indian airlines have ordered aircraft way in excess of their ability to crew them with Indians. This makes for trying times in airline HR departments. India is a very proud country with a long history. Despite old attitudes, the facts on the ground dictate the need for ex-pats in the aviation sector.

In the airline industry it is a good thing that India’s low cost carrier growth is are being encouraged. India has too few roads and its rail network is old. Aviation growth is a quick way forward to faster economic development. India, like China, is growing its aviation sector at breakneck speed. We expect more deals like the yet to be consummated Sahara/Jet merger. The main reason for this will be crew shortages. Cockpit crews are like gold, for now. India cannot produce enough crews to cope with aircraft orders placed. In the US, airlines typically have 14 pilots per plane. India needs thousands of pilots for the hundreds of planes on order.

In the short term, airlines are likely to treat crews well by paying them a lot. This will embolden the pilot unions. During the go-go years of rapid growth, airlines can manage this because revenues grow faster than costs. When grow slows, the problems kick in. By then pilots will have developed expectations of fat salary increases. However, revenue growth will not support that the fight starts. Look to the US as a model.

Currently the Indian market is hiring pilots from all over to overcome demand. In the next decade, the supply of Indian pilots will grow and make the nation less dependent on foreign talent. South Korea has found that foreign talent is no bad thing. The culture in the cockpit is not national, it is universal. Pilots around the world are typically trained to a common standard - but cultures are pervasive. Korean Airlines experienced a crash when an Aussie first officer and a Korean Captain were arguing over a landing. India has to watch for this.

Given this situation, our recommendations for the Indian aviation sector are as follows:

Pay the highest you can to acquire talent from anywhere now. The airline with the most crews wins because they can offer the most flights.

Fly at every hour of the day. Night flights are great and India is big. GOL in Brazil (an especially good example for India) does very well with its night owl flights and is making lots of money. This also ensures very high use of the plane (14 of more hours/day)

Pilots are like anyone else; they plan based on whatever information that have. Theirs is a global talent that goes where the money is. Like at the Gulf airlines - most pilots are ex-pats. Pilots love new planes and India will have lots of these. If they see a growing airline and they are busy, they will get on with the job.

One thing Indian airlines must watch carefully is their HR departments. With staff poaching, it is very important to have a consistent policy on hiring and retaining staff. Airlines may have to offer their pilots a stake to keep them loyal and this is becoming more common. On the other hand, once mistrust exists between management and crews, the company runs into difficulties. The airline industry is replete with examples of disconnects between management and crews. The customer loses every time and equity values plunge. It is critically important that there be no mixed messages. We do not advocate split HR departments (hiring and retaining), as this sets companies up for different messages and conflict. Only one message needs goes out - we are growing and we want loyal people.

In terms of best practices and learning from other industries, Indian airlines again can look at examples around the world. The best airlines are where pilots are treated well, but are also updated on finances. This way nobody kills the goose laying the golden eggs. Poorly run airlines are those where the information flow is restricted - once distrust seeps in, you have big trouble. It is awful when senior managers are making out like bandits and pilots have to “give back”. Look at the US for examples of this and, these days, look to European airlines for some of the best practices. Pilots are a professional group that can take their talent elsewhere. China is an attarctive market for their services.

Companies develop cultures. It is important that managers honor the culture and provide staff as much respect as they do passengers. Airlines are service businesses. The people who wear uniforms are customer facing and probably deserve the most respect internally. Company mistakes (as well as every external event) are handled by uniformed staff. Theirs is often the toughest job in an airline. Given a paucity of skilled airline people, India’s airlines have to be especially vigilant in respecting their staff.

Other non-airline industries do not offer India’s airlines much guidance. No other industry has such high capital costs, with vast complexity (airline network planning is an awesome thing to watch) with such low profits. It may be one of the highest risk industries in the world. The breakdown to failure typically occurs when labor costs get out of sync with revenues. Today a typical airline has 30% of its costs tied up in fuel. Airlines are a business where up to 70% of costs are fixed. The slightest mistake in pricing, leads to massive losses. But, even a slight profit - say 1% - on a billion dollars monthly revenue (found at many airlines) generates big profits.

PASSENGERS with just one item of hand luggage are being fast-tracked through security in new supermarket-style queues at Edinburgh airport.

The “one-item-or-less” check-in system is being trialled in the Capital in a bid to cut delays at security gates for passengers travelling light.

Business passengers and city break travellers are expected to benefit most from the new initiative, which could be made permanent in September if it proves popular.

Last year, airport chiefs came under fire over lengthy queues for the X-ray machines - delaying passengers for up to 30 minutes at peak times.

New figures released today show that owners BAA have turned this on its head, with nearly 99 per cent of passengers now making their way through security within ten minutes.

But around one in ten passengers are still waiting more than five minutes, and airport chiefs have vowed to continue tackling the problem.

Managing director Richard Jeffrey said: “I appreciate that security queues at Edinburgh Airport have been an area of concern for some of our passengers - that is why last year we put in place the challenging target of getting 95 per cent of passengers through security in under ten minutes.

“These latest figures show we are not only meeting that target but doing substantially better. However, we are far from complacent and are focused on improving performance further.”

The departure lounge at Edinburgh Airport is accessed via the first floor, and passengers must show their boarding cards before joining the queue for the X-ray machines.

The fast-track trial means travellers carrying one bag or less will instead be allowed to pass through a dedicated security gate.

Security manager Amanda Livingstone said: “The feedback from passengers during trials has so far been positive. Further consideration is being given to the logistics and detail of the scheme with a view to possibly implementing some form of ‘fast track’ system.”

The move follows another initiative launched by airport chiefs which allows passengers to buy goods before travelling and collect them on arrival in Edinburgh. The service cuts back on hand luggage carried on board planes.

Last October, one of Britain’s biggest airlines hit out at Edinburgh Airport describing security queues as “unacceptable”.

Nigel Turner, chief executive of BMI, said attempts to improve punctuality were being hampered by peak-time congestion.

In response, BAA created its action plan, with new figures for the first half of 2006 showing that 92 per cent of passengers waited less than five minutes.

A spokesman for BMI said: “We’re delighted with the efforts at Edinburgh Airport and the fact that they have turned the situation around. We do our utmost to make sure our planes run on time, so we’re delighted that the airport is also doing all it can.”

Police investigating the two suspicious deaths in Chennai’s Valmiki Nagar today traced the family of Jayant Nath, who was found dead with his girlfriend Shilpa, to Gurgaon’s Sushant Lok Phase III. Police say Jayanth’s father, Colonel N C Nath, who arrived in the city tonight, helped identify the body and was questioned at the Thiruvanmayur police station.

Shilpa, an air hostess with Jet Airways, and Jayant were found dead yesterday. Police say Jayanth could been “suspicious about her fidelity” and might have murdered her after which he killed himself.

The Gurgaon house of the Naths has been locked since morning. The first and second floors are occupied by other tenants. Neighbours say they don’t have any information about Jayant and last saw him in July. “We believe that Jayanth could have strangled Shilpa and then taken his own life. We are very clear that no outsider is involved,” a senior officer said. As Shilpa had not reported for duty for four days, police say she could have been dead since then. An officer said no suicide note was found but a bible was found next to Shilpa’s body. Police believe Shilpa, who was Christian, had underlined several lines in the bible “indirectly giving clues to the police as to the possible reasons for her murder and her boyfriend’s death”.

“Shilpa’s friends said she met Jayant when they were completing a catering course in Kolar. Shilpa got a job as airhostess and went to Mumbai and Jayanth worked in call centres in Bangalore. When Shilpa got a transfer to Chennai two years ago, Jayanth too took a job here.”Thiruvanmayur police said. Shilpa’s postmortem report indicates that her neck bone had not broken, suggesting she had not hanged herself.

Despite her ambitions to take flight, high up in the skies, her wings have been clipped.
Jennifer Chavan, an air hostess with Air India has come to Bombay High Court as the national flier has stopped her from flying a second time within two years, asking her instead to do mundane ground work. She claims that what surprises her most is that she has not been referred to a dietician or obesity specialist though the reason for her grounding is her being overweight.
Since 2002, Jennifer who was 53 years of age then had been deputed to the desk than to flying. She was first grounded in 2003 since she had put on more weight than what acceptable of an airhostess. This did not pass muster with Chavan who apart from being glamorous enough to be an airhostess, the hours spent in air gave her additional flying allowance, thus making her pay packet bulkier. The distressed lady got back into shape after which she was allowed to fly.
However, on Sep14, 2004, Jennifer was again grounded on the same grounds (obesity). She was sent to the medical board which said she could not fly. She rushed to High Court challenging the order passed by AI. Her petition was disposed of but yesterday a notice of motion was moved before the court in which Jennifer’s contention is she was not subjected to medical test before being grounded. When the medical examination was conducted, it was devoid of specific test on obesity.
Counsel for Air India, J S Saluja, argued that as per rules after the age of air hostesses has been increased to 58 years, every airhostess over 35 years of age has to undergo the Body Mass Index (BMI) test once a year, after 45 years in every three months and after 55 years every month. The division bench of Bombay High Court yesterday asked Air India to get the ‘BMI’ test done for petitioner at Nanavati Hospital which is on the panel of government-approved hospitals on September 2 (today) after which suitable action will be taken.

The arrival of the ninth new Q300 aircraft to Air Nelson this week, via a flight from the Bombardier factory in Toronto, is a key milestone in the delivery programme, marking its half way point as well as being the first anniversary of the delivery of the first Q300 which entered service 11 August 2005.

Air Nelson General Manager, John Hambleton said the airline was pleased to be at the halfway point in the programme, and that the Q300 had proven to be the right choice as a replacement for the Saab.

“Not only has our customer feedback been overwhelmingly positive about the additional passenger comforts offered – the Q300 is faster, quieter and has more room than the Saab – but also our pilots and cabin crew are enjoying working on the aircraft,” said Mr Hambleton.

Air New Zealand has invested $350 million in the acquisition of a total of 17 new turbo-prop aircraft as a one-for- one replacement for Air Nelson’s aging Saab 340A fleet. Delivery of the last aircraft is scheduled for August 2007.

The fleet replacement has meant a significant increase in capacity for Air Nelson’s regional routes as the Q300 aircraft has 50 seats compared to 33 seats in the Saab.

The aircraft are currently operated on selected services linking the regional centres of Nelson, Napier, Hamilton, New Plymouth, Palmerston North, Rotorua and Tauranga with the main hubs of Auckland, Wellington or Christchurch.

Other regional ports will be added to the Q300 schedule next year including Keri Keri, Gisborne and Blenheim.