Economic Regulation - IATA

APPENDIX b: THE IATA AIRPORT BENCHMARKING INITIATIVE
IATA has developed and successfully used a simple but
effective benchmarking model to:
• Compare performance with other airports.
• Identify improvement areas.
• Track performance development and lead cost
reduction campaigns.
Basic Framework of Analysis:
The focus of the benchmarking is on the main cost drivers
for services to the users. There are four main areas of
analysis to provide a balanced comparison across airports
in any given region.
Figure 1.
Areas of Assessment for Cost Efficiency
Indicators and Metrics:
The Benchmarking uses a standard set of 16 indicators
to populate the four areas:
Figure 2.
Indicators Used for the Assessment Areas
[Key Performance Indicator (KPI): metric]
Financial
Revenue sharing: aeronautical revenue as a percentage of
total revenue
Depreciation impact: depreciation cost as a percentage of
total revenue
ROCE: return on capital employed
Operating profit: operating profit as a percentage of total
revenues
Financial
01
Productivity
02
Cost-effectiveness
03
Quality of service
04
• Justification for financial practices
• Transparency of cost base
• Transparency of good/bad practices
• Recognition of productivity shortfalls
• Recognition of cost driver impacts
• Visibility of performance evolution
• Visibility of performance gaps
• Prioritisation of improvement needs
Productivity
ATM staff productivity: aircraft movements per employee
Pax. staff productivity: passenger throughput per employee
ATM capital productivity: aircraft movements per capital
employed
Pax. capital productivity: passenger throughput per capital
employed
Cost-effectiveness
Unit ATM service cost: total revenue per aircraft movement
Unit pax. service cost: total revenue per passenger
Unit staff employment cost: total staff costs per passenger
Unit operating cost: total operating costs per passenger
These areas ensure a logical flow of cost impacts:
• Financial illustrates areas where financial practices
may have an impact on the cost base, whether or not
they are under the direct control of the airport.
• Productivity is a measure of unit output per unit input
and defines the level of utilisation of staff and capital,
while giving an indication of the potential for improved
internal practices.
Quality of service
Stand availability: stand availability per landing
Runway capacity availability: average throughput capacity vs.
maximum capacity
Passenger satisfaction: aggregated output of passenger
satisfaction surveys
Baggage system availability : aggregated serviceable hours
of systems vs. desired hours
• Cost-effectiveness quantifies the cost per unit of
output of services including assessment of the unit
cost for staff and operations.
• Quality of service qualifies the quality of the out puts as
additional customer impacts from the service provided.