Inaugural Industry Growth & Safety Conference 2014 Tuesday, 4 November 2014
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1 Survival imperatives for full service thriving airline in Africa Inaugural Industry Growth & Safety Conference 2014 Tuesday, 4 November 2014
2 Survival Imperatives for full service airline in Africa Contents 1. Market Structure and competitive Rivalry 2. Full service airline challenges 3. Operational Challenges 4. Survival imperatives 5. Communicable Disease Plan 6. Questions and Answers 2
3 FULL SERVICE AIRLINE CHALLENGES Market Structure and competitive Rivalry Bargaining power of buyers Low Cost Carriers vs Full Service legacy Carriers Limited Price discretion High price perception cause customer switch to alternates e.g LCC Price wars unsustainable for Full Service Airlines but great for customers as they get best for less. Bargaining power of Suppliers Unavoidable cost burden services - Fuelling, Airports, Air Traffic Controllers, Parking and Landing,Ground handlers. Low Cost Carriers advantage low cost structure Legacy carriers have many layers of cost and rigidities accumulated over the years with protective labour regulatory environment. 3
4 FULL SERVICE AIRLINE CHALLENGES Market Structure and competitive Rivalry Threat of new entrants The growth of Low Cost Carriers (LCC) Direct selling models that generate cash Differentiation comes at a huge cost. Revenues and growth opportunities not as accelerating as more players get into the market. Threat of Substitute Products New entrance results in pricing wars Decrease in customer loyalty through shift to substitute e.g. Low Cost Carriers. Rivalry among existing competitors Compete on Scale dominance, Superior offerings at a huge cost Brand power 4
5 FULL SERVICE AIRLINE CHALLENGES Market Structure and competitive Rivalry INCREASED LIBERALISATION OF MARKETS Increased competition Middle Easter Carriers competitive advantage Creation of large single markets (e.g. EU-US) AIRLINE MARKET CONSOLIDATION Far too many airlines in the market Liberalisation removes restrictions on consolidation JV Alliances MAJOR SHIFTS IN GLOBAL AIR TRAFFIC New aircraft technology Inherent geographical advantages in midhemisphere hubs Airport hub dynamics 5
6 FULL SERVICE AIRLINE CHALLENGES Within the African context, full service carriers face a myriad of barriers to entry coupled with significant operational challenges across many markets Airport Infrastructure and Technology Monopolistic Service Providers in Africa Aging or non-existent airport infrastructure, equipment and technology are serious barriers to achieving service excellence objectives (e.g. IT, navaids, telecoms, power supplies, ATC, CAA); Catering, ramp and passenger handling is a major risk towards the aviation community achieving service excellence objectives and the reluctance in the aviation industry to sign SLA s with airlines absolves accountability Safety Management Aero-political Affairs and Regulation Safety risks monitored, managed and remediated within a broader integrated Safety Management System Constraints in respect of bilateral rights, air traffic uplift, regulatory, the CAA,ATC and international industry organisations such as IATA (IOSA), etc. 6
7 SURVIVAL IMPERATIVES 1) In airline terms, this means to provide a reliable, consistent, and superior service experience to Customers 2) Customers buy Experience across the entire operational value chain, but very importantly at customer-facing touch points not only the Airline but all aviation stakeholders 3) From an airline perspective, it is critical that the Precision Time Schedule (PTS) are adhered to as part of the operator s published flight schedule; and 4) Seamless transfers of Customers and their luggage 7
8 SURVIVAL IMPERATIVES Failure of any of the touch points by any stakeholder affect s the customer satisfaction Parking & safety at the airport Boarding Process Bussing / Bridges Immigration Baggage Delivery Ticketing - Airport Holding Area / Lounges On time Departure Bussing / Bridges Customs Overall Flying experience Check-in Internet, Mobile, Self Service Kiosk Security point & Immigration In- flight On time Arrivals Arrivals Lounge if applicable Page 8 ATC and CAA
9 SURVIVAL IMPERATIVES ACHIEVE & MAINTAIN FINANCIAL STABILITY Strengthen balance sheet Cost Management (including overheads) Revenue Management Cash Management SURVIVAL IMPERATIVES PROVIDE EXCELLENT CUSTOMER SERVICE Attractive value proposition Network optimisation (routes, brands, partnerships, alliances) Customer Service excellence Prompt Recovery CONSISTENT, EFFICIENT AND EFFECTIVE OPERATIONS Safety On-time performance Efficiency (fuel, productivity, sourcing, maintenance) PERFORMANCE EXCELLENCE Staff engagement Improved governance Performance management Benchmarking Key strategic themes to achieve operational excellence 9
10 COMMUNICABLE DISEASE PLAN 10
11 COMMUNICABLE DISEASE PLAN AIRCRAFT INCIDENCE ONBOARD SUPSECT COMMUNICABLE DISEASE COMMANDER ANNOUNCES FOR MEDICAL PROFESSIONAL ONBOARD. MEDICAL PROFESSIONAL CONNECTED TO SAA MEDICAL DR VIA SATCOM NO MEDICAL PROFESSIONAL ONBOARD. CAPTAIN IS CONNECTED TO SAA MEDICAL DR. VIA SATCOM/HF Patch SAA MEDICAL DR ADVISES DEPENDING ON PASSENGER OR EMPLOYEE CONDITION ATC CONTACTS PORT HEALTH OF THE DESTINATION PORT HEALTH AT DESTINATION SA: PHO NOTIFY REFERRAL HOSPITAL OF REPORTED SICK PASSENGER PHO NOTIFY THE COMMUNICABLE DISEASE PROGRAMME OF THE PROVINCIAL HOSPITAL ARRIVAL OF AIRCRAFT PHO INSPECT AIRCRAFT AND INFORM RESPONSIBLE CREW MEMBER TO REQUEST PASSENGERS TO REMAIN SEATED PHO OBTAIN INFORMATION ON SICK PASSENGER, MEDICAL OFFICER AT REFERRAL HOSPITAL CONTACTED IF NECESSARY PHO MAKE ARRANGEMENT FOR TRANSFER OF SICK PASSENGER TO HOSPITAL PHO HANDS OUT INFORMATION TO PASSENGERS WITH RELEVANT INFORMATION ON SIGNS AND SYMPTOMS OF SUSPECTED DISEASE AND CONTACT TELEPHONE NUMBERS IF SYMPTOMS OCCUR PASSENGERS RELEASED FROM THE AIRCRAFT PHO ARRANGE FOR DISINSECTION OF AIRCRAFT UNAFFECTED CABIN CREW AND PILOTS DIRECTED TO SAA MEDICAL SERVICES SHOULD THEY EXPERIENCE SIGNS AND SYMPTOMS? SAA MEDICAL ADVISES AFFECTED CREW ABOUT PRPOHYLAXIS DEPENDING ON THE SUSPECTED / CONFIRMED DIAGNOSIS OF SICK PASSENGER PORT HEALTH AT INTERNATIONAL DESTINATION, FOLLOW OWN PROCEDURES. ECC CONTACTS BY OCC SAA CRISIS MANAGEMENT TEAM Chief Medical officer; Customer Services; Communications; Airport Operations; GOCC; Flight Operations; Inflight Services; Logistics; SAAT; Revenue/Medical ; Reservations; Safety; Security CONFERENCE CALL AT EMERGENCY RESPONSE CENTRE SICK SAA EMPLOYEE AT INTERNATIONAL DESTINATION SAA MEDICAL AND MANAGEMENT TO BE NOTIFIED CONTACT EUROPE ASSIST IN JNB /8049 ON RETURN SAA EMPLOYEE TO REPORT AT SAA MEDICAL SERVICES CREW ONBOARD AIRCRAFT WITH PASSENGER SUSPECTED OF COMMUNICABLE DISEASE: CABIN CREW MEMBER ASSESS PASSENGER AND GATHER INFORMATION ON PASSENGERS CONDITION AND HISTORY ONE CREW MEMBER ALLOCATED TO PASSENGER, OTHER CREW MEMBERS NOT ALLOWED IN THIS AREA CREW MEMBER WEAR GLOVES, APRON AND A MASK CREW MEMBER DECONTAMINATE HANDS FREQUENTLY WITH ANTISEPTIC LARGE BIOHAZRAD BAG KEPT IN THE AREA NEXT TO PASSENGER FOR DISPOSAL OF SOILED EQUIPMENT OFFER ILL PASSENGER A MASK IF PASSENGER CANNOT TOLERATE A MASK, OFFER MASKS TO PASSENGERS WITHIN A METER FROM THE ILL PASSENGER STAY CALM AS NOT TO CREATE PANIC 11
12 COMMUNICABLE DISEASE PLAN Commander Duties COMMANDER announces for medical professional onboard. Medical professional connected to SAA medical Dr via SATCOM ATC Contacts port health of the destination PORT HEALTH AT DESTINATION SA Pho notify referral hospital of reported sick passenger Pho notify the communicable disease programme of the provincial hospital Arrival of aircraft pho inspect aircraft and inform responsible crew member to request passengers to remain seated Pho obtain information on sick passenger, medical officer at referral hospital contacted if necessary Pho make arrangement for transfer of sick passenger to hospital Pho hands out information to passengers with relevant information on signs and symptoms of suspected disease and contact telephone numbers if symptoms occur Passengers released from the aircraft Pho arrange for disinfection of aircraft Unaffected Cabin Crew and Pilots Directed to SAA medical services should they experience signs and symptoms? SAA medical advises affected crew about prophylaxis depending on the suspected / confirmed diagnosis of sick passenger NO MEDICAL PROFESSIONAL onboard. Captain is connected to SAA medical Dr VIA SATCOM / HF patch SAA medical Dr advises depending on passenger or employee condition PORT HEALTH at international destination, follow own procedures. 12
13 COMMUNICABLE DISEASE PLAN 1. Crew on-board aircraft with passenger suspected of communicable disease: 2. Cabin crew member assess passenger and gather information on passengers condition and history 3. One crew member allocated to passenger, other crew members not allowed in this area 3.1 Crew member wear gloves, apron and a mask 4. Crew member decontaminate hands frequently with antiseptic 5. Large biohazard bag kept in the area next to passenger for disposal of soiled equipment 5.1. Offer ill passenger a mask 6. If passenger cannot tolerate a mask, offer masks to passengers within a meter from the ill passenger 7. Stay calm as not to create panic Crew On-board 13
14 COMMUNICABLE DISEASE PLAN SAA Internal Emergency Control Centre Process ECC CONTACTS BY OCC SAA CRISIS MANAGEMENT TEAM Chief Medical officer Customer Services Communications Airport Operations GOCC Flight Operations Inflight Services Logistics SAAT Revenue/Medical Reservations Safety Security Conference call at Emergency Response Centre (ECC SICK SAA EMPLOYEE AT INTERNATIONAL DESTINATION SAA medical and management to be notified contact Europe assist in JNB /8049 On return SAA employee to report at SAA medical services 14
15 COMMUNICABLE DISEASE PLAN Ground Crew Most of these signs and/or symptoms may not be obvious at the counter. When in doubt regarding the health of a traveller, especially during an outbreak, refer to the South African Airways procedures. 1. Call your supervisor. If the supervisor agrees with your concerns, contact medical department immediately. 2. If the supervisor agrees with your concerns but medical support is not immediately available 2.1. deny boarding and ask the traveller to obtain medical clearance in accordance with SAA medical reservations policy, contact medical reservations. 3. If assistance is required to escort a sick traveller, and if the sick traveller is coughing, ask him/her to wear a face mask. 4. If no mask is available or if masks are available but the sick traveller cannot tolerate a mask and the airline recommends that designated passenger agents should do so under those circumstances 15
16 Q & A? 16
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