Creating a sense of common purpose
Dr Richard Plenty and Terri Morrissey reflect on some of the challenges airports working with private investors may face by embracing a more entrepreneurial culture.
We recently saw the much acclaimed film ‘Living’ where the main character, played brilliantly by Bill Nighy, spends his days in a bureaucratic office where nothing much gets done. He and his fellow workers spend their days pushing files around from one department to another.
Nighy plays a man without any real purpose in life. However, once he is told he has a terminal illness his behaviour changes dramatically. Realising he only has six months to live, he finally finds meaning and a purpose to his life in taking responsibility for delivering a children’s playground to a deprived area of London.
The film is set in County Hall London in the 1950s when the public sector was characterised by rigid hierarchy, inertia, rules, lack of initiative and no-one taking ownership. This is not an environment which supports the kind of culture that is needed in competitive, fast paced, cost constrained, commercial settings where the customer experience is important.
So fast forward a few decades and perhaps it is not surprising that public-private partnerships – the collaboration between government agencies and private sector companies – are seen not only as a way of providing much needed finance to government agency projects, but as a mechanism for bringing a ‘delivery’ ethos and sharper private sector thinking, attitudes and behaviours into the public sector. They are seen as a means of injecting life into the kind of cultural inertia exemplified by our film’s protagonist.
Airports have been using this approach for some time. According to ACI statistics (2017), airports with private sector participation account for an estimated 14% of airports worldwide, and handle over 40% of global traffic.
The expectation is generally that private sector involvement will help deliver efficiencies, higher performance outcomes and better value for money along with better customer service. But, as organisation leaders have found in many sectors – including energy, health and transportation – managing the transition to a more entrepreneurial culture is not without its challenges.
It can be difficult to keep all stakeholders happy. In a PPP, the government remains a shareholder and providing national, community and social value remains an important part of what is expected. To take just one example, cutting or reducing services to save money is not always a realistic option.
The best way forward for organisations with potentially divergent shareholders is to commit to a true collaborative approach where all parties develop a shared understanding of their roles and responsibilities in the partnership – and are clear on the overall purpose of the organisation. This should include vision, values and sustainability as well as economic considerations.
While it is relatively straightforward to do this for green field projects, the introduction of PPPs to existing enterprises merits particular attention. For example, adding a new ‘PPP’ terminal to an airport can lead to a clash of cultures (old vs new) with leadership, operational and HR issues and potential confusion.
And culture – the way we work together – is important. A recent ACI EUROPE report: Handbook for Airport Culture (2022), highlights the role that airport culture plays in creating high levels of performance and customer service. A shared vision, values and goals provide a foundation for those working in airports to play an ‘ambassador’ role in their dealings with passengers and create a ‘wow’ factor in passenger experience.
A clear and unified sense of purpose can be enormously powerful. The motivation and enjoyment that comes from achieving worthwhile outcomes – as exemplified by Bill Nighy – should not be underestimated. It can make life worth living.
Arrivals and Departures
Karl Eklund will become the new airport director of Stockholm Arlanda Airport and Stockholm Airports on February 1, 2023. He is currently deputy CEO of SAS Ground Handling Sweden.
Irish airport operator, daa, has announced that Kenny Jacobs will become its new CEO in January 2023, succeeding the departed Dalton Philips.
Myron Keehn will become the new CEO of Edmonton Regional Airports Authority when current incumbent, Tom Ruth, retires at the end of December 2022.
AGS Airports has appointed Andy Cliffe as its new CEO. AGS operates Aberdeen, Glasgow and Southampton airports in the UK.
London City Airport (LCY) has announced that, following an extensive search and selection process, Andrew Hodges is to be appointed as its new chief commercial officer.
South Carolina’s Greenville-Spartanburg Airport has named Kirk Eickhoff as its new senior vice president and chief financial officer.
St John’s International Airport Authority’s new CEO is Dennis Hogan. Hogan has previously held senior executive roles with the governments of New Foundland and Labrador.