Showing posts with label LCC. Show all posts
Showing posts with label LCC. Show all posts

Thursday, May 2, 2013

Why everybody at SpiceJet loves Raymond

Two years back, Neil Raymond Mills took over as SpiceJet’s new chief. Then, the airline was unwell. He began by slashing costs. Strategies that didn’t make economic sense were forgotten. Today, the airline appears a turnaround tale. Reality is, the job isn’t over yet. Worse, harsh history could repeat itself

A simple analogy. If you drive a car at a constant speed minus stops, you burn less fuel. The gains don’t become apparent after each short drive. But in a quarter of a year, the reduction in fuel consumption starts to show. The results become more pronounced in a year. Much is saved in gas and cash. Common sense. But most airlines in India ignore such small money-saving acts. SpiceJet is not one of them. At the airline, this “constant speed” philosophy is communicated as a compulsory key message to each of its newly recruited pilots. These cockpit handlers are supposed to remember it every time they leave an air strip. The idea is to get the pilots to save anywhere between 0.5% to 1% of the airline’s fuel bill. A small chunk saved. But at SpiceJet, if a cost can be avoided, it is.

Cost-cutting doesn’t always help
The company’s hardheaded emphasis on lowering costs does affect its operational efficiency metrics. Unfavourably at times. In July 2012, SpiceJet’s On-Time Performance (OTP) on domestic routes was 84.3%. That meant, about 16 of every 100 flights were delayed beyond 15 minutes. Much of this is can be blamed on the constant speed norm that is in place at the airline. This makes the airline’s record only better than the havoc-stricken Air India’s (OTP of 81.2%) and now-stripped-to-the-bone Kingfisher Airlines’ (81%). All other airlines recorded OTPs in the 90%-plus range [IndiGo: 95.3%, GoAir: 90.3%, and Jet: 91.6%]. The company isn’t one to worry about offloading passengers to peer carriers (and cancelling flights) either, when load factors don’t justify economics. The carrier strives to maintain an average load factor (LF) of over 75%, and plans to increase it over the quarters to come [in Q1, FY2012-13, LF was 80.8%]. Result: SpiceJet’s flight cancellation record (2%) is only better than those of Air India (3.2%) and Kingfisher (8.2%). Others boast of a lower figure (IndiGo: 0.1%, Jet:1.4%, GoAir: 1.6%).

Mills... a number-loving turnaround guy
But CEO Neil Mills, who has turned around the airline in the past two years, knows that these numbers only tell a part of the SpiceJet story. He is familiar with how budget airlines work. An industry veteran of over 20 years, this former CFO of Middle-Eastern LCC Flydubai knows his numbers fall on the rational side. He measures every paragraph in the book by weighing data. That is exactly how he helped build Flydubai from scratch. He plugged cost holes at the company, and improved its balance sheet, helping the airline grow from a drawing on the whiteboard to a fleet of nine operating aircraft in just a year-and-a-half. Before Flydubai, he was at easyJet for 12 long years. Under him, the company grew from 4 to 174 aircraft, and became one of the biggest, most profitable airlines in Europe.


Source : IIPM Editorial, 2013.
An Initiative of IIPM, Malay Chaudhuri
 
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Friday, July 20, 2012

Change is The Call, can Society do it?

With The Government having failed to check cases of Sexual Harassment in Public Offices, ensuring The Impact of a new law Addressing The Menace of Sexual Harassment will be a Tough Challenge.

Despite the Supreme Court’s landmark Vishaka judgement of 1997, which gave a voice to India’s fight for securing protection and justice for women employees (after it became the first instance that recognised sexual harassment against women as a violation of their fundamental rights), cases of sexual harassment against women – more commonly known as ‘eve teasing’ – continue to flourish across sectors and organisations. Recent studies have revealed that sexual harassment touches lives of nearly 40-60% of working women in the country. But what actually poses as the biggest concern for victims and employees is that it is not always considered as a problem at the first place.

However, the government, possibly recognising the existence of sexual harassment as an evil in society at large, has approved the Protection of Women against Sexual Harassment at Workplace Bill, 2010. The bill, prepared by the Girija Vyas headed National Commission for Women (NCW) after consultations with several women and civil rights groups, is currently under the scrutiny of the Parliament’s Standing Committee on Women and also happens to be a part of the 31 pending bills that the government hopes to introduce in the Parliament for approval during the ongoing three-month Budget session.

Before we delve deep into the pros and cons of the draft legislation, here are some key features that the government is banking on. The bill, according to the government, seeks to ensure a safe environment for women at work places, both in public and private sectors – whether organised or unorganised. It also includes setting up of an internal complaints committee in every organisation. Considering that a large number of establishments (41.2 million out of 41.83 million as per Economic Census, 2005) in India are with less than 10 workers and setting up of an Internal Complaints Committee (ICC) may not be feasible for them, the Bill provides for setting up Local Complaints Committees (LCC) to be constituted by the designated District Officer at the district or sub-district levels, depending upon the need. This twin mechanism, says the NCW, is to ensure that women in any workplace, irrespective of its size or nature, have access to a redressal mechanism. Employers who fail to comply with the provisions of the proposed Bill will be punished with a fine which may extend up to Rs.50,000. Taking into account the possibility that the woman may be subjected to threat and aggression during the course of enquiry, she is entitled to the option of seeking interim relief in the form of transfer either of her own or the respondent or seek leave from work. The Complaint Committees are required to complete the enquiry within 90 days and a time-frame of 60 days has been given to the employer/District Officer for implementation of the recommendations by the Committee.

When it comes to understanding the intricacies involved in dealing with matters of such nature, the Vishaka vs Rajasthan case in 1997 proved as an eye-opener for the Indian judiciary and the country at large. The draft bill has also been drafted in line with the SC guidelines which were formed in the absence of any specific law against sexual harassment. These guidelines defined parameters that amount to sexual harassment, provided for preventive and remedial steps to make the workplace safe for women, framed guidelines to be followed in this context and went on to define the complaint mechanism and provisions for effective disciplinary action against those found guilty. In fact, it was only after this case that sexual harassment came to be categorised as a human rights violation. Vishaka guidelines apply to both organised and unorganised work sectors and to all women, whether working part time, on contract basis or in voluntary capacity. The guidelines are a broad framework which put a lot of emphasis on appropriate preventive measures that could be adopted. However, over thirteen years have passed since then and while the SC verdict in this particular case has been instrumental in bringing guilty to justice, there has been little improvement in the scenario in terms of making working women actually feel safe, which leads us to question : How effective the new policy will be?

According to the latest data provided by the National Crime Records Bureau (NCRB), the national capital alone accounted for about 25% of all rape cases, 1.1% higher as compared to 2008. In terms of crime against women in the country, there was a rise of 4.1% with a total of 203,804 cases registered in 2009 as compared to 195,856 cases reported in 2008. But what is notable is that records such as these only indicate the number of cases registered and do not have provisions to account for cases which never got reported. So, while the figures might lead you to believe that such incidences are declining, the other side of the story could also imply the hesitation among victims to go ahead and report unapproved advances by their superiors or counterparts. Also, there is no in-depth analysis to ascertain the causes behind the rise or decline in these numbers. Crimes against women include rape, kidnapping and abduction, dowry death, torture, molestation, sexual harassment, immoral traffic and indecent representation of women. The number of sexual harassment cases reported under section 509 IPC has decreased by 9.9% over the previous year (12,214). Andhra Pradesh has reported 32.0% of cases (3,520) followed by Uttar Pradesh 22.9% (2,524). Andhra Pradesh has reported the highest crime rate of 4.2% as compared to the national average of 0.9%.


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