For sure, OTP possesses a particular attractiveness: Easy to calculate, required data is available, and it all sums up to one bold number — which is also perfect to benchmark.
I’ve seen and worked with several airlines entirely focusing on OTP, making massive investments and efforts to improve OTP’s fifth position after the decimal point.
No doubt, OTP is an indicator of an airline’s operational quality. However, I think it is a relic of the last century, and airlines that are passionate about their customers don’t care about OTP — at least not solely.
Airline on-time performance is airline-focused but not customer-focused
Let’s start with a small yet essential aspect. One which – from my perspective – perfectly describes the fact that OTP is primarily not a customer-focused KPI. When discussing OTP with airlines – very often – the discussion is all about our flights. “We have to improve the OTP of our flights,” “only three of our flights have been delayed yesterday,” etc.
I think this still is very traditional thinking from times when companies did care much about themselves and less about the customer.
Airlines have to understand that their primary business is to transport customers from A to B — seamlessly and on-time. Flights are just a means to an end. It is not about making flights on time; it is about satisfying the customer — a small yet essential difference when it comes to an employee’s mindset.
Airline on-time performance doesn’t tell you anything about client satisfaction!
But let’s leave the philosophic terrain and start with the hard facts, why OTP doesn’t tell you anything about client satisfaction.
We use a theoretical but straightforward example: An airline is operating five flights a day. Four feeder flights bringing passengers to its hub and one long-haul flight departing from its hub.
Let’s assume the feeder flights carry 100 passengers each, 50 of them connecting to the outbound flight. That means 400 passengers arrive at the hub and 200 connect to the long-haul flight. And finally, let’s assume that all feeder flights are entirely on time. However, the long-haul flight is delayed by three hours.
That sums up to 80% punctuality, which sounds quite lovely. And that’s precisely what I mean: Traditional airline thinking.
How does the truth look? The airline is facing 50%, unsatisfied customers. 50% of customers who did not arrive at the destination on time. 50% of customers might never fly with that airline again. It’s the truth, and it’s dramatic.
Undoubtedly, and as mentioned, this is a theoretical example, but the reality is not as far away as you may think. We did a lot of OTP analytics in the last years and also passenger-related analytics: You would be surprised and sometimes shocked when seeing the gap between the two perspectives.
Use KPIs that focus on your clients
What’s our idea? We’ve recently supported clients by introducing KPIs that matter, and that focus on their clients. And there’s not necessarily the one. So, let’s introduce a few examples:
A consequent evolution of airline on-time performance, not measuring the percentage of punctual flights, but the rate of passengers arriving at the desired destination on time. Introducing this KPI will dramatically change the mindset — it will be no longer about our flights but about “how many customers did we satisfy today.”
And worth mentioning: The KPI has to take the whole customer journey into account, not only single flight legs.
Customer Delay Minutes
What’s the average delay minute a passenger had to experience when flying with us today? And how many delay minutes did our customers experience in total today? These are questions every customer-focused airline should ask themselves. Again, this is not about delaying the minutes of a flight!
And from working with big airlines, I can tell you it’s shocking when the KPI tells you that your customers had to “experience” 4,000,000 delay minutes – on just one single day.
From an airline operations standpoint – what would you say, when is a customer delighted? From personal experience, I’d say, I’m excited when my flight departs on time, arrives on time and my baggage is delivered on time. Besides service, drinks, food, and all that stuff, this is what counts.
This is what customers will tell friends. And finally, this is what customers satisfy. So why not measure this and define a Customer Delight KPI?
There are a lot more concepts and KPIs which put the customer in the center of attention. And airlines that care about their customers should throw away the selfish OTP and start to measure what matters to their customers.