ISAGO – Moving forward

IATA’s Safety Audit for Ground Operations (ISAGO) is gaining great momentum throughout the industry, and is closing in on its first milestone target – 100 audits – which is expected to be reached by early October. The growth in audit numbers is impressive, but what’s more important is the number of companies actively applying the ISAGO standards and preparing for an audit in due course.

ISAGO is designed for ground handling companies operating at airports. The aims of the programme are simple – improving operational safety, reducing ground damage and promoting audit efficiency. ISAGO audits are already being carried out worldwide, in locations as diverse as Harare, Hanoi, Hong Kong and Hurghadah. Twenty ground handling companies are already on the ISAGO registry, meaning that their corporate audit and at least one of their airport stations has been fully audited (the registry listing can be found at www.iata.org/isago).

ISAGO corporate audits, which focus on organisation and management systems, are carried out by the same audit organisations that IATA uses for IOSA audits. At the station level, where the audits are more numerous, IATA has formed a pool of auditors drawn from existing auditors in its member airlines that would normally be doing station audits for their own airline. To date, 38 IATA member airlines have joined the pool.

Support from regulators and airports

ISAGO is gaining strong support from the regulators, with over 30 civil aviation authorities and airports supporting ISAGO, and in some instances even planning to mandate it. I am not surprised by the government support. We all want the same thing – improved safety on the ramp. ISAGO is the first globally harmonised programme to help achieve this so it’s natural that States and airports, in the absence of any pre-existing guidance material, should latch onto ISAGO.

Support for the programme does not stop there. The International Union of Aviation Insurers sees ISAGO as “an initiative that will make a positive contribution to the safety and efficient conduct of ground operations.”

The UK Health and Safety Executive is supportive. The European Commercial Aviation Safety Team (ECAST) Ground Safety Team, which is charged with promoting and facilitating at European level the adoption of best practices on training for ground handlers, is planning to use the ISAGO training provisions to facilitate this work.

Difficult times in the industry

Getting a new programme moving during the aviation industry financial crisis is also an additional challenge. International scheduled traffic results for June show passenger demand declining 7.2% compared to the same month in the previous year, while freight demand was down 16.5%.

Unfortunately in June, the downward adjustment in capacity of -4.3% did not keep pace with the fall in demand, leaving average fares and yields under significant pressure. As a result, June revenue on international markets fell by a shocking 25-30%. But airlines continue to strive to reduce capacity in line with market demand and drive efficiencies through their organisations. In recent weeks the news from the world’s markets, particularly the financial markets, has started to improve. It is a question now of the aviation industry achieving an equilibrium.

In terms of the way ground handlers are reacting to this downturn, often it is not a question simply of individual station profitability. Handlers that have contracts to provide services across five or six different stations may continue to provide a service at a loss at one station in order to fulfill the contract at the others. On the other hand, some handlers have pulled out of stations where it no longer makes sense to compete; but sometimes contractual commitment requires them to stay and take the losses.

Although there are costs associated with undertaking the ISAGO audit, IATA is working to minimise these costs. Since the launch of the ISAGO project, IATA has been taking every step possible to reduce the cost impact of ISAGO. IATA absorbs all costs of design, update, management, auditor training, promotion and quality assurance of this major global programme. IATA member airlines conduct ISAGO station audits and this has enabled IATA to keep this part of the programme cost-free for handlers, since the airlines doing ISAGO audits are essentially doing those audits in replacement of a regular airline station audit they would have done anyway.

For the corporate audits, IATA is currently committed to using audit organisations and since these are commercial entities, they need to be compensated. The corporate audits occupy an audit organisation auditor for just two days on-site, but with preparation, evaluation of corrective actions and close out of the audit, the total audit costs $5,000, which is billed to each ground handler.

Corporate audits are done every two years and even though these amounts are relatively small, IATA has found them to be an impediment for many handlers wanting to move forward with ISAGO. Accordingly, IATA has been evaluating how best to solve this problem. I was pleased to announce at the IATA Ground Handling Council meeting in Cairo in May, that for any ground handler doing its corporate audit in the remainder of 2009, IATA will fund the $5,000, thereby removing that final cost barrier. The handler will still be responsible for the travel costs of one auditor but IATA works closely with each handler, and the auditors, to utilise available auditors with minimal travel distance.

ISAGO standards

The ISAGO standards were developed by a wide group of airline and ground handling specialists, and represent industry best practices. They require that processes be both implemented and documented. It is this latter requirement that may be considered a burden on some companies.

I would suggest, however, that documentation of processes is a rather important step in any case, and ISAGO should not be ‘blamed’ for enforcing this best practice. The ISAGO standards are in a process of continual evolution, always with the intention to simplify and consolidate wherever possible, to make the processes simpler for ground handling companies to conform to. Nevertheless, preparing for ISAGO does take time and effort but we believe it is money well spent.

Based on feedback from the early audits, both from auditors and from auditees, additional steps have become necessary to make the standards simpler. In terms of making the audit more efficient for both airlines and handlers, IATA is working to rationalise and reduce the number of audit standards. We are aiming to achieve the same audit result, in terms of assessing operational safety capability, but in a smaller package. The original suite of standards requires the presence of a three-person audit team on site at a station for up to three days, depending on the scope of services offered by the handler at that station. We will be looking to shave at least 20% off that timeframe, with further improvement as we go along and build experience. Additionally, IATA has combined the corporate audit management section – OMS or organisation and management systems – and the station management section – STM or station management – into one combined section, ORM or organisation and management.

Growth in demand

Demand for ISAGO audits arises on two fronts and it’s not always easy to find the balance, especially in these early stages of the programme. We have on the one hand the companies and stations that our pool members are listing as their priorities and on the other hand, we have ground handling companies coming to us independently and wanting ISAGO audits. Fortunately we have a match in many instances. I see this issue mainly as a teething problem, and that once more airlines are in the pool, any likelihood of a ground handler not being able to be matched with a pool member airline will be greatly diminished.

Training

IATA is finding it hard to keep up with the growing demand for ISAGO training. There are two categories of training. Firstly there is the five-day training course for pool member auditors, mandatory for any auditor planning to qualify as an ISAGO auditor. Nine such courses have been held in 2009. Then there is the three-day training course for handlers, to help them prepare for their ISAGO audit. This latter course is run in key IATA locations and is also offered “in-company”, an option that is growing in popularity, and six such courses have been held in 2009. Details of the schedule of all ISAGO training courses are available on the website www.iata.org/isago

All of the ISAGO training courses are delivered by qualified instructors from IATA’s Training and Development Institute (ITDI). This approach has given IATA good flexibility. With everything under one roof, we can make changes to the training material as and when we need to.

ISAGO data

Just as IATA is singularly well placed to run a global safety audit programme for ground handlers, so too is it well placed to start to get a handle on ground accident and incident data collection and analysis. Over the years there have been several attempts to get a global perspective, but no-one has yet succeeded. IATA has had a data analysis task force working in parallel with the ISAGO programme development, consisting of airlines, handlers, regulators and the insurance industry. Additionally, organisations such as Flight Safety Foundation, and the International Aviation Handlers Association have been supportive and committed data. All agreed that the project needs to go beyond just the collection and categorisation of accident and incident data, to look more deeply as to why these things are happening – the “why” in addition to the “what.” The ISAGO data is being integrated with the IATA-wide Global Safety Information Centre, now under development.

Insurance benefit

Having the insurance industry involved since the outset of the programme is already paying dividends. Insurers have a natural interest in any programme that could reduce ground damage, and claims. Because of that close co-operation, ISAGO provides a unique opportunity for the industry to bundle its aviation insurance buying via an insurance programme. This programme is now being finalised, and ground service providers that are ISAGO registered will be eligible for the programme. Participants will be eligible for increased market presence, lower premiums, better coverage, and better claims handling.

Full backing of the IATA Board

At its meeting in Kuala Lumpur in June, the IATA Board of Governors reiterated its support of the ISAGO programme. With the IATA Board support I believe that the pool membership will now increase, and more handlers will come on board. Programmes such as this don’t go from birth to maturity overnight. More pool members are coming on board, and more handlers are signing up. The synergies start to build exponentially.

Targets

The IATA Board has set a target of 80 audits to be achieved in 2009, and I am confident this will be met. The mix is different to what we were expecting – we’re doing more individual companies and smaller numbers of stations for each company. But we see this as a success factor in its own right, demonstrating the global diversity of ISAGO.

In 2010, in parallel with doing more audits and generally increasing the penetration of the programme globally, IATA plans to develop a standardised Ground Operations Manual for ground handling companies, to provide further opportunities for safety and efficiency improvement.