Manchester Airports Group
Manchester Airports Group (MAG) is the country’s largest, UK-owned airport operator.
Its four airports – Manchester, East Midlands, Bournemouth and Humberside – serve
28 million passengers every year. The Group has 2,784 employees, the vast majority,
over 2,200, based at Manchester. MAG is publicly owned by the ten local authorities
of Greater Manchester and is commercially managed on their behalf. As well as providing
airlines with the services they need for their daily operations, MAG runs several
thriving businesses: developing property, retailing; car parking; airport security;
fire fighting; engineering; advertising; and motor transport.
Objectives
A review of strategy in the summer of 2008 having set the direction for the next
business cycle, the Board decided to examine the organisation and its costs to ensure
that MAG was ‘fit and focused for the future’. Collinson Grant was engaged for thirteen
weeks:
- to review the structure of the organisation
- to assess the work of the managers and office-based staff
- to analyse the efficiency and effectiveness of the direct, customer-facing staff
- to review the total cost base of the business and recommend changes
- to understand the impact that MAG’s current and planned initiatives would have and
to create a single, integrated view of the future.
What we did
We used Process Activity Analysis (PAA) to assess the structure and work of the
managers and office-based staff. Six managers drawn from different functions and
sites were trained in this technique. Their work as a project team created an opportunity
to reduce the indirect staff by 20%.
Many of the problems recognised were structural. So our analysis of the direct staff
complemented the outcome from the PAA and MAG’s own initiatives. The integrated
effort revealed opportunities to extend the managerial plans to cope with the seasonal
and daily peaks. Many costs are fixed, some by regulation. But others have significant
discretionary elements. We examined and categorised the costs, then reviewed the
budgets and forecasts with the managers. This revealed a range of potential savings.
What we achieved
The project had very effective, high-level sponsors. We met the Executive Committee
to keep the work on track and to report on our initial findings and conclusions,
and made three formal presentations at milestones. This process ensured that the
Executive fully understood the conclusions and recommendations presented by MAG’s
project team. After the analysis, that team worked with managers for eight weeks
to embed the savings into the business plan through the annual budget process. In
late February MAG announced proposals for re-structuring the business.
This assignment highlighted our ability to work collaboratively at the highest level
of a business to draw up detailed proposals that command assent from senior and
middle managers. The thoroughness of the analysis was conducive to rapid implementation
of the recommendations.