© 2009 Sabre Inc. All rights reserved. wearelistening@sabre.com

2005 Issue No. 1A MAGAZINE FOR AIRLINE EXECUTIVES

T a k i n g y o u r a i r l i n e t o n e w h e i g h t s

Lufthansa benefits fromclose-in re-fleeting

Cathay’s cargo businessdrives revenue

Frontier Airlines enlistsstrategic partners

22

45

76

I N S I D E

I N T H E B L A C KA conversation with …

Joe Leonard, CEO and Chairman, AirTran Airwayspage 59

China Eastern’s new

airline operations center

enables it to rapidly

respond to costly

disruptions such as

mechanical problems or

weather-related delays.

Personnel at China Eastern’s new airport operations center at Hongqiao

International Airport play a vital role in making sure customers arrive at their

destinations on schedule. During times of disruption, the airline’s AOC man-

ages a variety of tasks, such as swapping aircraft types, to ensure customers

are re-accommodated in a timely fashion.

By Craig Parfitt | Ascend Contributor

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ascend 51

As the ticket agent looks over adeparture lounge filled with pas-sengers scheduled to take a

flight from Shanghai to Beijing, China, hisphone suddenly rings with the dreadednews from the maintenance supervisor thatthe aircraft is out of service. After consultingwith the airline’s operations office, it isquickly determined that a spare aircraft isnot available, and the part needed to repairthe original aircraft is hours away.

Faced with the unpleasant duty ofinforming 121 passengers eagerly waiting toboard the aircraft that the flight must be can-celled, a call is placed to China EasternAirlines’ reservations center to inquire aboutspace on one of its flights. Once the call isreceived and transferred to the new airlineoperations center, a group of professionalsquickly assess the situation.

Utilizing advanced technology, ChinaEastern operations coordinators determinethat an Airbus A320 has just been releasedfrom a series of maintenance checks and willbe available to transport all the stranded passengers from Shanghai to Beijing. The man-ager on duty alerts all departments that arerepresented in the AOC by generating a mes-sage and, in a matter of minutes, the passen-gers are re-accommodated on the new flight.

Airlines throughout the world arefaced with this dilemma on an hourly basis,and only those that possess the best hard-ware and software, coupled with highlytrained operations professionals, succeed intoday’s constantly changing airline environ-ment. Although major carriers all utilizesome type of automation, some small orregional carriers still rely on manual methodsto track aircraft utilization and maintenancechecks. Airlines with a small number of air-craft can manage these routine tasks; how-ever, as their fleet grows, this processbecomes unmanageable.

As the economy in Asia continues tosurge, airlines operating in the region strug-gle to utilize their fleet in the most efficientmanner, sometimes extending maintenanceand flight crew times to the maximumallowed duty limits. During off-scheduleoperations, airlines are challenged to deviatefrom their published schedules and optimizea scheduled recovery as quickly and effec-tively as possible. Multiple cancellations anddelays are usually associated with these

events, sometimes leaving passengersstranded for days at a time.

Personnel working in AOCs are inun-dated with critical decisions that will deter-mine when and how passengers will ulti-mately arrive at their destinations. By substi-tuting or “juggling” different aircraft typeson selected flights, passengers can be re-accommodated in a timely manner. It is dur-ing these events that airlines possessingskilled operations personnel and automationcapable of monitoring their schedules rou-tinely generate additional revenue.

Realizing the potential of advancedautomation and a highly trained work force,China Eastern Airlines’ senior managementhad the vision to take the necessary steps tocreate a new operations center. On the out-skirts of Hongqiao Airport located inShanghai, the airline has constructed astate-of-the-art AOC that encompasses thelatest technology, including the Sabre ®

Movement Manager, the Sabre ® DispatchManager and the Sabre ® Load Manager.

Bringing together its operations func-tions helps China Eastern better respond tounexpected delays, which helps improvecustomer service and, therefore, retain valu-able customers. Centralizing its operationshelps the airline minimize delays caused byunexpected disruptions, ensuring passen-gers are re-accommodated as quickly aspossible, which helps lead to repeat busi-ness and continued loyalty.

The genesis for this project beganwhen China Eastern management contact-ed Sabre Airline Solutions Consulting to con-duct a scoping study to assist with the inte-gration of its operations. It had become clearthat if the airline sought to combine its oper-ations into a single entity and continue togrow, some drastic steps had to be taken. A scoping study was conducted in August2003 focusing on an in-depth review of the airline’s nine branch offices and two subsidiary operations. After a thoroughreview of the consulting team’s findings andrecommendations, China Eastern decided to build an AOC. Sabre Airline Solutionsassisted the airline with the development ofits new operations facility and provided train-ing and onsite representatives to help theairline bring the AOC to life. Additionally, aconsultant from Sabre Airline Solutions willremain onsite for two years to assist with

the development of business processes thatutilize the industry’s best practices.

“We are confident we will see excel-lent results by implementing the recommen-dations made by our valued Sabre AirlineSolutions partners,” said Yu-Lin Wu, vicepresident for China Eastern Airlines. “Weexpect that the new efficiencies we willachieve through the operations control con-solidation will heighten our performance inthis highly competitive marketplace.”

A major part of the AOC successcomes from centralizing key departmentsunder one roof and making unified decisions.

“Having the ability to integrate ourtotal operation and bring together our mosttalented individuals in one location will ulti-mately lead to increased productivity andadd to the efficiency of the airline,” saidChina Eastern Director Andy Yang. “Mostdelays in airline operations occur simplybecause decision makers within the airlineare in different locations, making it almostimpossible to deliver timely decisions. The‘ripple effect’ then takes place, and the cus-tomer is the one who suffers.”

Another major step China Eastern hasundertaken is the development of a crisiscenter and the updating of its emergencyresponse procedures. The types of emer-gency situations the AOC must contendwith include sabotage threats, hijacking, air-craft accidents, natural disasters, militaryoperations assistance and severe weathersituations. Without clear emergency operat-ing procedures, these types of incidentsbecome extremely difficult to manage.Additionally, the training aspect of key deci-sion makers is a never-ending challenge thatstrains even the most sophisticated airlines.China Eastern has taken the approach ofselecting the right individuals to fill thesepositions while incorporating the latest tech-niques and strategies to train them.

With its new AOC and emergencyoperating procedures in place, ChinaEastern is well on its way to becoming oneof the most profitable carriers serving theregion.

Craig Parfitt is management pricipal forSabre Airline Solutions Consulting.

He can be contacted atcraig.parfitt@sabre.com.

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