CallingtheCape

Western Cape Innovation Award 2005

A call made from Lufthansa GMBH head office in January 2004 would put into motion a series of events which would forever change the face of the South African Contact Center industry. Over the course of the next 6 months a project team under the auspices of Kai Kehlbeck (Project Manager) and Frak Muller Pirker, a long time Lufthansa employee and overseen by Birgit Thumecke Managing Director of Lufthansa’s wholly owned outsource partner subsidiary Global Telesales (GTS) would work tirelessly at using the latest in technology, communication advances and entrepreneurship to open an new era in outsourced work – this would culminate on 3 May 2005 with the opening of Global Load Control.

In the rapidly consolidating industry of aviation – driven by global uncertainty, rising oil prices and a stagnant European economy driving costs synergies without compromising on quality, service and safety are of paramount importance for those players that aim to succeed. The business rationale is simple – focus on your core business and examine what alternatives exist for other areas of your business.

Prior to 2002 the ground handling process of aircraft weight and balance sheets for Lufthansa flights were calculated at the respective airports of departure. In 2002 the entire process was consolidated into two centralized Load Control centers.
It is under this banner that a corporate decision was undertaken to investigate the possibility of outsourcing some of the more complex work taken in getting 5000 daily flights globally airborne, on time, safely and efficiently.

To understand the reason for the call one sunny day in January it’s important to trace the history of outsourcing by Lufthansa within the South African market. In 1999 Lufthansa established a global strategy called “Following the Sun” establishing its first service contact centre in Africa in Cape Town. The centre branded Lufthansa Global Telesales would flourish; handling calls in three languages from across the globe aimed at delivering a service for all strata’s of its customer base. In time over 1 million calls a year would be taken by the local Cape Town operation. Global Telesales would prove a huge success for the Lufthansa outsourcing strategy. Driven by costs savings and improved quality of service the centre would develop into the Jewel of Lufthansa’s Outsource crown. By April 2004 the local GTS crews were ready for a new challenge and one would arrive that had not been expected.

An extensive global analysis was undertaken by Lufthansa with various countries considered for the Load Control venture – Bangkok, New Delhi and several East European countries were the prime candidates. After this extensive analysis Cape Town was chosen as the preferred destination – the reasons were numerous. The country offered political and economic stability coupled with a stable judicial framework and government commitment to investment of this nature. In specific Cape Town offered competitive labor costs, low attrition rates and suitable working conditions. The language proficiency and European time zone advantages were additional benefits.

In order for an aircraft to successfully take off and fly, complex weight and balance calculations have to take place. These calculations govern all aspects of the flight – fuel requirements, fuel efficiencies, take off and landing distance requirements, thrust requirements for take off – all taken under the banner of safety which is of paramount importance. The requirement was simple was it possible and viable to undertake this activity without any compromises from an outsource location. Over the next 6 months the project team would investigate and see if it was possible – and so Global Load Control was established.

For the first time in the history of one of the worlds largest airline companies its load and take off sheets would be done from an outsourced location. SAS had set the ball rolling a few years previously with an established Load Centre in Thailand.

A Project Team would work tirelessly to format all the requirements for a successful roll out. Embracing that well known German entrepreneurial spirit the team would work around the clock. Success was not an optional extra it was the key driver of the project team. Processes were developed, staff had to be recruited, staff had to be trained, a complex IT structure was required and all of this had to be done within a tight timeframe.

To begin with a complex analysis of the costs and possible Return on Investment was undertaken. Was it in fact possible to migrate a function like this, ensuring optimal performance was achieved and at the same time deliver financial benefits to the business? The initial business model showed that the per head costs of an employee in Germany was significant in Euro terms, the same costs in South Africa were substantially cheaper. With an established first world telecommunication infrastructure, a clear and growing presence in South Africa and a large pool of educated German speakers the possibility of success was increased.

The benefits for South Africa and the Western Cape in particular were also marked. Foreign Direct Investment in the local economy being the primary benefit. Employment opportunities were generated and a pool of equipped load specialists nurtured. With a clear and driven focus on corporate responsibility the company’s growth thought its Global Load Control Centre would benefit not only the local economy but indirectly those benefiting from the company’s local corporate responsibility programs.

Staff were seconded from Germany to assist with the set up of the programme, from our training offices in Seeheiem Germany training modules were developed, tested and retested – in time the training would be undertaken within the local South African operation. The IT infrastructure in South Africa was developed from scratch – the importance of this aspect of the business could not be underemphasized. It was suddenly possible that a slight glitch in a system in Cape Town could delay or cause a safety alert for a flight taking off at a destination half way across the world. In parallel with the installation of the IT infrastructure it was necessary to begin identifying and migrating the necessary databases for use in Cape Town.

The recruitment process was complex – individuals needed to be able to work at all hours but especially at peak flying hours – these primarily being European peaks. In addition it was necessary that the individuals were fluent in German – the primary language of communication within the Lufthansa network. The specific skill requirements were an excellent ability to undertake complex and varied arithmetic calculations, an ability to work in a highly stressful and fast moving environment and good attention to detail.

In early 2005 the first pilot stage of the programme was initiated – on 6 July 2004 a flight, LH 2065 from Basel to Frankfurt being the test flight was undertaken. From the Global Load Control Centre in Cape Town the trim calculations were made, cargo and luggage loaded into the plane and the fuel consumption requirements calculated. This detail completed the information was relayed to the airport and the aircraft was released from its blocks, 65 minutes later the plane landed safely at its destination. For the first time in the history of Lufthansa – load balance and trim calculations had taken place successfully outside of Germany. Cape Town now joined Lufthansa’s two primary hubs – Frankfurt and Munich as the only other location globally where these calculations take place for aircraft departing from remote destinations.

In order to ensure a comprehensive and complete service is delivered the South African team make use of sophisticated technology termed IGCC (Integrated Ground to Cockpit Communication). Using global positioning systems and satellite communications it is possible to have direct contact from the Cape Town Centre with the cockpit of any Lufthansa aircraft. A simple entering of a flight number and contact is made; this allows for communication requests or additional information needs that the captain may have to be dealt with efficiently and effectively.

Over the course of the next few months the project was expanded, it became a 24/7 operation – additional flights were added and a decision was taken to include the complex Wide Body Airline calculations into the project. With the majority of the flights being European the number of aircraft that would benefit from the Cape Town project grew. By May 2005 over 3000 flights calculations a week were undertaken from the Cape Town Centre. An initial staff component of 16 had grown to 50 with projections that it would expand to over 70 by the end of 2005. Within 6 months Cape Town would handle more flights than the second German hub Munich.

At present over 14 airlines weight and balance calculations are made from Global Load Control Cape Town. TAP, Austrian Airlines, Lauda Air, Condor, SAS, Croatia Airlines, Sun Express, Lufthansa, Cityline, Eurowings, Air Dolimiti, Augsburg Airways and Contact Air all benefit from the operations that happen just bellow Table Mountain.

The financial benefit to the Lufthansa group of company is significant – it is estimated that the initial capital investment will be paid off within two years and that the subsequent savings will be significant.

That flight one European summer’s day in July 2004 would change not only how a company did business but add an entirely new innovative concept to a country’s contact centre portfolio.