Measuring performance, benchmarking and setting objectives

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1 Measuring performance, benchmarking and setting objectives ATC Global Session 3 Ralph RIEDLE Chairman Performance Review Commission 17 September 2014

2 Topics ANS in the European aviation context Performance oriented approach in ANS ANS performance review examples Conclusions Measuring performance, benchmarking and setting objectives 2

ANS in the European aviation context (1/2) GDP from Air Transport in EU $160 B Source: ATAG Air Navigation Services $10 B Safety is the primary objective!

3 ANS in the European aviation context (1/2) GDP from Air Transport in EU $160 B Source: ATAG Air Navigation Services $10 B Safety is the primary objective! No accident with ANS contribution since 2011 Reported incidents in 0.3% of flights Safety Environment Costefficiency European IFR traffic Capacity 6% of Airline operating costs (Europe) 6% of aviation related CO2 emissions (0.2% of total emissions) Air transport delay (2013) All 9 min. per flight ANS-related 1 min. per flight Although ANS is comparatively small in aviation context. Measuring performance, benchmarking and setting objectives 3

4 ANS in the European aviation context (2/2) the stakes are high! ANS generates. Value.. Safety Efficient flow of air traffic Costs. Total economic cost $ 14 B (SES area) Direct ANS provision costs (user charges) Indirect service quality related costs (delays, non-optimum flight profiles) Airborne equipment costs to be added Environmental impact Indirect service quality related costs $4 B Direct ANS Cost $10 B SES area Flight efficiency ANS related delays ATCO costs Support costs Total economic cost $14 B High penalties to economy if disrupted CAPEX Scope for improvements! Other costs Measuring performance, benchmarking and setting objectives 4

5 Performance-oriented approach in ANS (1/5) You can t manage what you don t measure! Measuring performance, benchmarking and setting objectives 5

6 Performance-oriented approach in ANS (2/5) Strategy & objectives (what must be done well to implement strategy ) Verified Data Reporting, monitoring & analysis (actual vs. targets) (understand achieved performance) Performance Review Framework, KPIs & PIs (How success should be measured) Target setting (Quantification of what should be achieved) Objectives (What should be achieved?) Commonly accepted framework (What should be measured, targeted: KPAs, KPIs?) Performance targets (How much should be achieved? When?) Performance monitoring (Are we on track?) Corrective measures (As necessary) Measuring performance, benchmarking and setting objectives 6

7 Performance-oriented approach in ANS (3/5) Delay crisis Delay crisis PRC ECAC Common ATM Performance strategy SES SES II PRB Start RP1 Start RP2 ECAC institutional strategy (1997) Common ATM Performance strategy Focus on outcome, not only means (e.g. technology) Independent Performance Review Commission (PRC) (1998) Independent Performance review Light-handed regulation: objective information, recommendations Single European Sky (SES II: 2009) SES Performance scheme Enforceable performance targets (EU, national/fab levels), incentives Performance Review Body (PRB) advising the European Commission Measuring performance, benchmarking and setting objectives 7

8 Performance-oriented approach in ANS (4/5) ICAO high-level expectations of the ATM community Security Safety Access & Equity Participation Safety management Interoperability Costeffectiveness Cost management European focus areas for target setting Capacity management Capacity Flexibility Environmental sustainability Predictability Environment Efficiency European focus areas in line with the 11 Key performance areas (KPAs) defined in ICAO Global Air Traffic Management Operational Concept Binding targets for Safety, Cost-efficiency, Capacity and Environment Other KPAs measured Measuring performance, benchmarking and setting objectives 8

Performance-oriented approach in ANS (5/5) Safety management Within region Cost management European focus areas for target setting Capacity management Benchmarking dimensions Over Time Environmental

9 Performance-oriented approach in ANS (5/5) Safety management Within region Cost management European focus areas for target setting Capacity management Benchmarking dimensions Over Time Environmental sustainability Across regions Different dimensions of performance benchmarking enable to: Understand and position own performance Identify performance gaps and scope for improvement set ambitious but realistic targets Well established publications on ANS performance in Europe: Annual Performance Review Report (system view, all KPAs) ATM Cost Effectiveness Benchmarking (ACE) reports (Economics) Ad hoc reports (US/ Europe comparisons, etc.) Measuring performance, benchmarking and setting objectives 9

2009 2010 2011 2012 2013 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 En-route ATFM delay/ flight (min.

10 En-route ATFM delay/ flight (min.) 0,9 0,8 0,9 1,0 1,2 0,9 0,63 0,53 1,1 1,4 1,4 3,31 3,20 3,14 2,2 2,0 2,9 2,9 2,5 Traffic index (base: 1997) 4,91 4,87 4,86 4,5 Safety Environment Annual Performance Review Reports (PRR) Costefficiency European IFR traffic Capacity SAFETY: Review of safety incident evolution in order to identify trends (RI, SMI, etc.) COST-EFFICIENCY: Analysis of ANS unit costs und underlying drivers inefficiency (%) 6,0 5,5 5,0 4,5 4,0 3,5 3,0 2,5 2,0 2009/10 KEA data based on regression analysis 5,0 4,5 4,0 3,5 3,0 2,5 2,0 1,5 1,0 0,5 0,0 Average en-route ATFM delay per flight PRU analysis Flight Plan (KEP) Actual trajectory (KEA) ENVIRONMENT: Monitoring of flight efficiency en route and in terminal areas; ATC Other (strike, equipment, etc.) OTHER (Special event, military, etc.) WEATHER IFR Traffic source: Network Manager CAPACITY: Evaluation of ANS related en route and airport delays and constraining factors; Verified facts and performance indicators Independent critical analysis (wide spectrum) Recommendations to decisions makers Measuring performance, benchmarking and setting objectives 10

ANSP benchmarking ACE reports Safety Environment Costefficiency European IFR traffic Capacity ATM Cost Effectiveness Benchmarking (ACE) reports Widely accepted performance framework (ICAO Doc 9161)

11 ANSP benchmarking ACE reports Safety Environment Costefficiency European IFR traffic Capacity ATM Cost Effectiveness Benchmarking (ACE) reports Widely accepted performance framework (ICAO Doc 9161) Verified data, official performance indicators and metrics Factual analysis at European level, within region, over time Purpose: Inform decision makers, support target setting within SES, etc Measuring performance, benchmarking and setting objectives 11

Global perspective: US-Europe comparison Facts 2012/2013 Europe USA US vs. Europe Geographic Area (million km 2 ) 11.5 10.4-10% Nr.

12 Global perspective: US-Europe comparison Facts 2012/2013 Europe USA US vs. Europe Geographic Area (million km 2 ) % Nr. of civil en route Air Navigation Service Providers 37 1 Number of en route centres Number of APP units (Europe) and terminal facilities (US) Number of fully trained Air Traffic Controllers (ATCOs in Ops.) % Total staff % Controlled flights (IFR) (million) % Flight hours controlled (million) % Average length of flight (within respective airspace) 551 NM 515 NM -7% Relative density (flight hours per km 2 ) x1.7 Share of General Aviation 3.9% 21% Similar conditions (geographical area, average flight length) US controls more IFR traffic (+57%) with fewer staff (-39%), including ATC Controllers (-22%) What are the underlying drivers of performance? Measuring performance, benchmarking and setting objectives 12

Performance in capacity and cost-efficiency En route delay Traffic index Reactive policy in the 90 s: delays go up while costs go down, and vice versa As of 1998, performance-oriented approach and

13 Performance in capacity and cost-efficiency En route delay Traffic index Reactive policy in the 90 s: delays go up while costs go down, and vice versa As of 1998, performance-oriented approach and improved capacity management contributed to reduction of both delays and unit costs Enforceable SES performance targets apply from 2012 onwards Measuring performance, benchmarking and setting objectives 13

14 route extension (%) Environmental performance Filed flight plan Actual flown trajectory ENVIRONMENT: Performance targets on en route flight efficiency within SES scheme 0.0 Source: PRU analysis Target RP1 Targets RP2 Flight efficiency first measured in 2006: continuous improvement since then Good routing efficiency of ANS ( 3%) compared to other transport modes Yet significant economic impact (fuel burn, flight time) Impossible to reach 0% with full civil-military traffic load SES targets on Environment set for 2014 (FPL), 2019 (Actual, FPL) Improved flight-efficiency compensates for air traffic growth Carbon-neutral growth of aviation (due in 2020) already being met as far as European ANS is concerned! Measuring performance, benchmarking and setting objectives 14

15 Conclusions Performance is the bottom line for ANS policy Impact on more than $14B p.a. in EU, while ensuring safety European Performance-driven strategy delivers, but margins for significant further improvements remain Independent Performance review since 1998 (PRC) Stronger regulation under SES II (enforceable targets, regulations) EUROCONTROL supports both PRC and EC/PRB Global benchmarking reveals best practices, weaknesses EUROCONTROL willing to engage with benchmarking partners More details in workshop Driving excellence in ATM performance ( Workshop theatre, 19 Sep., 10am) Reports available at Measuring performance, benchmarking and setting objectives 15

The Total Economic Value. Its application to the Single European Sky 2nd Reference Period

The Total Economic Value. Its application to the Single European Sky 2nd Reference Period The Total Economic Value Its application to the Single European Sky 2nd Reference Period 1. The idea of Total Economic Value. The Total Economic Value (TEV) is a term introduced officially into the Single