Accelerated growth for Kenya Airways through people and systems development

Kenya Airways

Executive Summary
Thanks to remarkable growth, Kenya Airways decided to meet rising expectations by investing in and developing its personnel and systems. An initial TRACC assessment was done in the technical workshops. Opportunities for improving efficiency were identified, followed by a limited best practice implementation. Lean principles were also applied. Later, the cargo services department approached CCI (the people behind TRACC) and a pilot improvement programme was subsequently launched, aimed at improving equipment availability. The proven TRACC methodology, positive feedback and significant cost savings led Kenya Airways to opt for a fully-fledged implementation in the technical and ground services departments. Over nine months, cargo services reduced unplanned maintenance and subcontractor costs by US$215 000, and the technical division lowered Beyond Local Repair (BLR) costs by US$166 000. Other benefits included reduced turnaround time and improved customer services.

 

The situation
The airline witnessed remarkable growth in its network and customer base and wanted to meet rising expectations of staff, stakeholders and, most importantly, an increasingly diverse customer base. Thus, the board and senior management decided to embark on a strategic plan to invest in and develop people and systems, instituting various initiatives in most key departments.

In the cargo services division, a reduction of unplanned maintenance and subcontractor costs has yielded a saving of KES14 million (US$215 000) over nine months.

 

ActionKenya Airways
This thinking compelled Kenya Airways to seek ways and means to improve and enhance performance in the technical department. CCI was invited to submit a proposal to the technical department for an assessment of the mechanical and avionics workshops. In the assessment, opportunities uncovered were: to reduce outsourcing of so-called BLR (Beyond Local Repair) items and improve processes such as turnaround time and labour efficiencies. Over four months, a limited best practice implementation followed with special focus on support services and processes. Lean principles such as identifying customer requirements, process mapping and waste identification were also applied.

A year later, Kenya Airways requested a similar assessment for the cargo services department, a division of the ground services department. The division is responsible for optimising the cargo belly capacity on passenger flights, as well as developing a dedicated freighter network. Using Jomo Kenyatta International Airport as its premier hub, KQ Cargo offers both belly and freight capacity mainly to freight forwarding agents.

Kenya Airways

After completing the assessment, a TRACC pilot improvement programme was launched in the unit load device section and the equipment maintenance workshops, with the emphasis on improved equipment availability. This soon resulted in positive client feedback and quantifiable cost savings. Based on TRACC’s proven methodology and encouraging results in the pilot areas, Kenya Airways signed up for a fully-fledged TRACC implementation in the technical and ground services departments. A few months later, World Class Operations (WCO) was officially launched by the airline’s former managing director, Titus Naikuni.

Combined, the savings translate to a 200% ROI for Kenya Airways – which is extremely encouraging for a WCO programme in its infancy.

Results
Initially, the project experienced some difficulty because of the post-election violence. Nevertheless, overall results were good and there was a strong endorsement from all quarters for WCO to continue. Introductory training was completed, Site Steering Committees and Implementation Task Forces were put in place, and Master Trainers were trained.

In the cargo services division, a reduction of unplanned maintenance and subcontractor costs has yielded a saving of KES14 million (US$215 000) over nine months. For the same period, the lower BLR costs in the technical division amounted to a saving of KES10.8 million (US$166 000). Other benefits realised such as reduced turnaround time and improved customer services haven’t been quantified. Combined, the savings translate to a 200% ROI for Kenya Airways – which is extremely encouraging for a WCO programme in its infancy.

Company Background
National carrier Kenya Airways was founded in February 1977 following the breakup of the East African Community and subsequent disbanding of the jointly owned East African Airways. Wholly owned by the Kenyan government, Kenya Airways was privatised in 1996 after which it acquired KLM as a strategic partner. Since then, the airline has grown in leaps and bounds, serving over 4 million passengers annually and flying to 56 destinations in 38 countries. In addition to boasting one of the most modern fleets in Africa with 34 aircraft, Kenya Airways is also a major employer with more than 4 000 employees. The airline won The Best Airline in Africa award at the World Travel Awards 2016.
Kenya Airways

Disclaimer
This resource has been prepared for general guidance on matters of interest only, and does not constitute professional advice. You should not act upon the information contained herein without obtaining specific professional advice. Competitive Capabilities International (CCI) does not accept or assume any liability, responsibility or duty of care for any consequences of you or anyone else acting, or refraining to act, in reliance on the information contained in this resource or for any decision based on it.

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