In the post-COVID-19 environment, many airports experienced complications brought about by resource shortages and loss of operational knowledge. Trying to solve even small incidents became a problem as airports struggled to figure out which supplier could solve the problem.
By Kim Madsen and Per Engelbrechtsen
The situation revealed how difficult it can be for airports when dealing with more than one supplier in complex and challenging circumstances. What are the advantages of working with one supplier for both your baggage handling system (BHS) and its High Level Controls (HLC)?
Every BHS is composed of two components: the mechanical BHS itself and its software. For the airport, this gives rise to the question as to whether to look at the system as a whole and engage a single supplier of both the BHS and the HLC or engage separate suppliers to deliver different supply packages. There’s some misunderstanding in the sector that a BHS project is less complicated if there are separate suppliers.
For some airport projects – particularly where conveyor-based baggage handling systems are to be deployed – tenders for baggage handling solutions are issued in packages, one for the mechanical system, one for the HLC and one for hotline support and so on.
But for other performance-driven airports, the demand is that their supplier scope the best possible system that can deliver a specified performance over a specified number of years, including possible upgrades. The result being that they choose one supplier that can meet the required performance.
There are a number of advantages of having the same supplier for both the BHS and the HLC.
Firstly, the overall system is simplified because there is no need for an interface between the two views of the BHS and the HLC. Interfaces add a level of complexity in themselves but operations using a single supplier can remove this obstacle.
Secondly, a single supplier results in a single point of contact. This means the airport will not have the additional burden of figuring out who is responsible for resolving issues when they arise.
When there is more than one supplier, software questions will always be a matter of coordination between the suppliers. These scenarios can be to the detriment of the airport, because they often result in a lack of synergy and add additional investigations in a time-critical scenario to determine the root cause between the two suppliers who are less incentivised to help the other.
One of the greatest advantages of having the same supplier for both the BHS and its controls is that the airport will always have access to the ongoing developments the supplier makes to its technology.
While a typical BHS is designed to last 20-30 years, HLC systems have cycles that require upgrades more often to fulfil requirements for cybersecurity and hardware availability. The airport has to cope with a great deal of legacy when upgrading its software so it’s important to have a partner who knows how to deal with it.
In addition to the HLC and quality/cybersecurity, it is important to look for a certified supplier that is ISO 9001, ISO 27001, IEC 62-443 or CMMI-certified.
A single supplier is able to optimise the system in different ways than if two suppliers are involved. As the system designer, the single supplier knows exactly how to utilise the system to its greatest efficiency and with reduced OPEX.
The BHS software, controls and 24/7 hotline are very specialised and it makes sense that the supplier of the BHS is the same supplier of the HLC that supports it. And no supplier knows the system (both its mechanical and software components) better than the one who designed it.
This not only gives the airport a competitive edge but means less costs are spent engaging two organisations.
Data analytics tools are now playing a vital role in optimising and providing greater visibility into baggage handling operations.
Airports can achieve higher levels of data to drive more efficiency with a full-service supplier simply because the data lies within that supplier’s IPR sphere. A single supplier not only can see the entire scope of an issue that arises, it also has an organisation with a range of experts who will interact for the betterment of the airport.
The system experts have access to excessive data and are able to compare it with similar systems in the industry to uncover the possibilities for performance optimisation. This type of in-depth data analytics from someone who knows many baggage handling systems and has a higher-level perspective can really benefit the airport.
In a two-supplier scenario, however, the data captured from the BHS won’t or can’t necessarily be transferred to the other supplier and even when data is transferred, it can only be a reduced data set due to IPR. So, if an issue arises, it may not be visible to the software supplier simply because its system knowledge is limited to controls and not the entire baggage handling entity.
When working with two suppliers where not all data will be transferred, an airport can still benefit from working with its data but it may not be as deep and valuable to the airport.
A common reason given for using multiple suppliers is that the structure achieves greater flexibility, enabling an airport to better cope with unexpected events that could jeopardise baggage handling capacity.
But the problem with this is that the interfaces needed between a supplier of the BHS and a supplier of the controls are not necessarily a given. The end result can be that the airport ends up with two systems – and two customised solutions are not the same as one standard solution.
Having two suppliers may also seem logical as far as CAPEX is concerned because one can supply certain parts in a smarter and/or cheaper way than the other. While this is possible, most obstacles that occur are in the baggage handling operations and impact OPEX. And these can more easily be solved by one supplier with deep knowledge of both the system and the software.
When choosing a supplier, it is paramount to ensure it is a reliable partner with a sound business case. The airport considering a multiple-supplier strategy also needs to consider where and under which circumstances it makes sense to have more than one supplier.
The modern BHS is highly advanced and – depending on the system – is software-controlled. Just as phones and computers require regular system updates, routine software updates, minor bugs and security patches, so do baggage handling systems. A reliable partner and system integrator brings a manufacturer’s deep insight to the system, along with parallel experience with similar systems.
Working with one supplier can lead to the fear of vendor lock-in. It’s why choosing a partner who has a long-term perspective is crucial.
The post-COVID-19 situation showed how difficult and complex a situation an airport can find itself when dealing with multiple suppliers. The situation brought into the light the acid test when choosing a single supplier strategy over a multi-supplier strategy: the airport should always choose a supplier on the basis of how it acts in challenging circumstances. A modern and complex BHS solution requires the deep knowledge of both the actual system as well as the controls, which an ongoing system partnership provides.
