Steering an outsourced handling agent at Lufthansa Cargo AG/ Miami, USA

Tesis , 2005 , 102 Páginas , Calificación: 1,7

Economía de las empresas - Aprovisionamiento, producción, logística

“If an enterprise does not get the best people at the bottom of its management pyramid then some years down the line it is not go-ing to find them at the top, no matter how much outsourcing it might be doing.” (Chorafas, D. N. (2003), p. 97)


This diploma thesis will analyze the outsourcing partnership between Lufthansa Cargo AG (LCAG) and GlobeGround Inc. (GG) at the station Miami/ USA. The paper will represent the current situation, detect sensible subjects and will give recommen-dations to the local- (MIAFH/A) and the regional- (MIAFH) Handling-Management at LCAG in Miami.


The main business of an airline is to offer transport services from Airport A to Airport B. The transported object can either be passengers, cargo or mail. In the 1990’s air-lines followed the strategy to integrate more pre- and after-flight related services into their part of the value chain. Enormous pressures lead to changes in strategies. These pressures are mainly caused by the events of 9-11, SARS, the global reces-sion, the Iraqi war, the latest oil-price trend and not to forget the current exchange rate of the US$1 2 . The yield per kg is also decreasing as there are more competitors on the market and even forwarders started to charter own equipment for flying goods around the globe.3 But, even if there are some break points in growth; several studies forecast an annual growth of air cargo of about 6% worldwide during the next years. 4


Outsourcing non-core businesses is one attempt to reduce overhead costs and to versatile the business for being more competitive. It often seems as the easy avail-able medicine to cure suffering businesses. The possible loss of know-how, control and quality of services is often neglected. Steering an outsourcing relationship is therefore one of the main tasks in such a cooperation and require, besides costs and time, also the according knowledge.

Table of Contents

• 1. INTRODUCTION
• 1.1. Background and Aims
• 1.2. Construction of the Paper
• 2. BASIC KNOWLEDGE
• 2.1. Introduction into the Airfreight Business
• 2.1.1. Differentiation
• 2.1.2. The Transportation Chain and its Relevant Parties
• 2.1.3. Cargo Ground Handling
• 2.1.4. General Varieties of Stations and Operations at Lufthansa Cargo AG
• 2.2. Involved Companies
• 2.2.1. Lufthansa Cargo AG
• 2.2.2. GlobeGround Inc.
• 2.3. Market overview
• 2.3.1. Miami as an International Air-Cargo Hub
• 2.3.2. The Station Miami (MIAFH/A)
• 3. THEORY TO OUTSOURCING AND ITS MANAGEMENT
• 3.1. Terminology
• 3.1.1. Steering
• 3.1.2. Outsourcing
• 3.2. Reasons for Outsourcing
• 3.2.1. Overall Aim in Outsourcing - Strengthen the Competitiveness
• 3.2.2. Cost Aspects
• 3.2.3. Strengthen the Core-Competencies
• 3.2.4. Service Improvement
• 3.3. Outsourcing – Lifecycle
• 3.3.1. Overview
• 3.3.2. Determine Sourcing Strategy
• 3.3.3. Define the Operational Model
• 3.3.4. Provider Selection
• 3.3.5. Contract Development and Negotiation
• 3.3.6. Transition to the Provider
• 3.3.7. Operating an Outsourcing - Cooperation
• 3.3.7.1. Managing the Provider's Performance
• 3.3.7.2. Monitoring
• 3.3.8. Backsourcing
• 3.4. Critical Success Factors
• 3.4.1. Critical Hard Factors
• 3.4.2. Critical Soft Factors
• 3.5. Steering an Outsourcing - Cooperation
• 3.6. Incentive Systems and Motivation Assurance
• 3.7 Risks and Negative Impacts from Outsourcing
• 4. ACTUAL ANALYSIS AT MIAFH/A
• 4.1. Course of Action
• 4.2. Initial Situation - Foundation of Steering Mechanisms at MIAFH/A
• 4.2.1. History of the Cooperation LCAG and GG at MIA
• 4.2.2. The Contract
• 4.2.2.1. Responsibility and Quality Assurance in the contract
• 4.2.2.2. Pricing and Cost Structure
• 4.2.2.3. The Service Level Agreement and Escalation Procedures
• 4.2.3. Layout of the LCAG-Station (GCHS) at Miami International Airport
• 4.2.4. Authorities and Interfaces between LCAG and GG
• 4.3. Hard factors
• 4.3.1. Contractual Service Standards
• 4.3.2. Non-Contractual Performance Indicators
• 4.4. Soft Factors
• 4.4.1. The Evaluation Process
• 4.4.2. Results of the Questionnaire
• 4.4.3. Results of the Interviews
• 4.4.3.1. General Results and Basic Issues
• 4.4.3.2. The General Problem - Lack of Discipline
• 4.4.3.3. Cultural and Language Barriers
• 4.4.4. Meetings and Communication
• 4.4.4.1. Meetings
• 4.4.4.2. Communication
• 4.5. Summarization and Criticism
• 5. RECOMMENDATIONS
• 5.1. Overall Recommendations
• 5.2. New Layout of MIAFH/A
• 5.3. Improvement of the Reporting-system at MIAFH/A
• 5.3.1. Daily Monitoring at Supervisory Level
• 5.3.2. The MIAFH/A - Scorecard
• 5.4. Improve Interactions
• 5.5. Audit
• 6. CONCLUSION

Objectives and Key Themes

This diploma thesis explores the practical challenges and opportunities of steering an outsourced handling agent within the context of the airfreight industry. The work investigates the complexities of managing a collaborative relationship between Lufthansa Cargo AG and its outsourced handling partner, GlobeGround, at the Miami International Airport.

• The crucial role of effective steering mechanisms in optimizing the performance of outsourced operations.
• The influence of contractual arrangements, performance indicators, and communication on the success of outsourcing partnerships.
• The impact of cultural and language barriers on collaboration within an international business setting.
• The development of practical recommendations for enhancing the steering of outsourced handling operations.
• The significance of continuous monitoring and evaluation for ensuring the success of outsourcing ventures.

Chapter Summaries

Chapter 1 provides an overview of the background and aims of the thesis, focusing on the significance of steering outsourced handling agents in the airfreight industry. Chapter 2 introduces key concepts within the airfreight business, including cargo ground handling and the specific operations of Lufthansa Cargo AG and GlobeGround. This chapter also examines the market overview, highlighting the strategic importance of Miami as an international air-cargo hub. Chapter 3 delves into the theoretical framework of outsourcing, exploring its various aspects, including terminology, reasons for outsourcing, lifecycle stages, critical success factors, and the management of outsourcing partnerships. Chapter 4 provides a detailed analysis of the specific case study at Miami International Airport, examining the initial situation, the contract between Lufthansa Cargo AG and GlobeGround, as well as the existing steering mechanisms and their effectiveness. This chapter also presents the results of a comprehensive evaluation process, including questionnaires and interviews with key stakeholders. Chapter 5 focuses on developing practical recommendations for enhancing the steering of the outsourced handling operations, including improvements to the layout of the station, the reporting system, and the overall communication and interaction between Lufthansa Cargo AG and GlobeGround.

Keywords

The main keywords and focus topics of this thesis include airfreight industry, outsourcing, steering, handling agent, Lufthansa Cargo AG, GlobeGround Inc., Miami International Airport, performance indicators, contract management, communication, cultural barriers, and recommendations for improvement. The thesis aims to provide insights into the practical challenges and opportunities of managing outsourced operations in the airfreight industry, highlighting the critical role of effective steering mechanisms and the importance of continuous monitoring and evaluation for achieving success.

• Universidad: Heilbronn University
• Calificación: 1,7
• Autor: Daniel Effenberger (Autor)
• Año de publicación: 2005
• Páginas: 102
• No. de catálogo: V36858
• ISBN (Ebook): 9783638363747
• ISBN (Libro): 9783638726870
• Idioma: Inglés
• Etiqueta: Steering, Lufthansa, Cargo, Miami