Air Fayre
Air Fayre is an airline caterer with a difference: it has no kitchens and doesn't
handle food. Instead, the company works with specialist food suppliers and with
its customers to deliver aircraft meals. These are prepared for the customer's individual
menu in the quantities required and with the freshness of an airside kitchen. In
this way the company provides high quality products with the lower operating costs
of a 'mass producer'. The operations department of Air Fayre provides the logistics
link.
The objectives of the project
Air Fayre had traditionally been an entrepreneurial business, but the company was
making an unsustainable loss on a turnover of circa £40m. Cash was in limited supply.
The Chairman asked Collinson Grant to support the company’s managers as it initiated
its 'Operational Excellence' project. The objectives were:
- to improve customer focus and so increase the profitability of contracts
- to reduce labour costs by £1.2m
- to design and implement standardised business processes that all staff would follow
- to select and implement an IT system to support the company’s information processes
- to define and implement better operational controls.
What we did
- Collinson Grant prepared a survey to understand the views of customers. This was
used to ensure that improvement initiatives considered all points of concern, from
'communication' to 'cleanliness'. At the same time we developed the skills of Air
Fayre’s operational managers in the areas of project definition and management,
problem solving, the processes, thinking and application of ‘lean’. This ensured
that our work would make an immediate impact in the workplace.
- We led some process mapping workshops. These defined the weaknesses of the current
operating processes before drawing a conceptual 'future state'. This allowed us
to define the ideal organisational 'shape' of the company, departmental job roles/responsibilities
and the IT system required to support future processes.
- Working with the staff, we built a labour model. This defined the times that every
activity should take during each step of the material handling process. By knowing
the number of flights per day and the times of the flights – both in-bound and out-bound
– we were then able to calculate the number of direct operating staff that all departments
within the factory should need to do the work. This was before any further process
improvements were made.
- We helped managers to choose and then implement an IT system that linked the operational
and financial processes, providing greater visibility of costs and waste. This exercise
also helped the company develop a Quality Assurance system.
The results
- An immediate benefit of the staff development was the application of the '5S' principles.
These halved stock levels held in the bar and dry pack areas, which in turn enabled
their re-location, which reduced overall 'move' and 'wait' times.
- The cost of direct labour was reduced by circa £2.5m.
- The new managerial processes and supporting Microsoft Dynamics AX4 system enabled
the business to make a further saving of circa £1m in indirect head count.
Improvements that attracted United Airlines
The nature of the company's business and the work being undertaken caught the attention
of United Airlines during 2008. This led to them selecting Air Fayre to be their
catering provider in Los Angeles. Collinson Grant was asked to support the start-up
operation.