Do you know what we like about Jim Bellinder, Vice President Cargo Sales Americas for United Cargo?
     Jim is an airline guy who moves in an upbeat fashion that might suggest he has a bit of Jet-A coursing through his system.
     Buoyant Bellinder seems to keep himself sunny side up.
     Not such an easy thing to do as business challenges and other cycles come into play in 2016, but in the big game, when the time is late and winning is on the line, you want Jim on your side.

What Happened Last Year?

     “Looking back over 2015, I’d say the most significant event was the West Coast port strike and the boost it gave to United Cargo—and the air cargo business in general—during the first quarter.
     “Global economic trends and industry conditions were such that that momentum couldn’t be sustained, as most of that business returned to the sea, but that wasn’t really a surprise.
     “The pleasant surprise was that many of the customers we worked with during the strike—the connections that began or deepened during that period—stayed with us as the year wore on.”

Customer Clinch Not Cliché
     
     “It sounds like a cliché—it probably is a cliché—but my top priority is customer service.
     “The things I focus on when I’m not actively engaged with customers in person, on the phone, or via email all reinforce that priority.
     “You build the best team because you want to give the best support to a customer.
     “Products are enhanced and an effort is made to keep current on industry trends so you can provide the best solutions.
     “Even personal traits like being humble, honest, appreciative, and empathetic are all based around what benefits our customers.”

Nobody’s Fool

     “This April Fools’ Day, I will have been in the air cargo business 30 years. (You and your readers are welcome to insert your own joke here!)
     “But seriously, the most important lesson I’ve learned in 30 years is that through positive and negative business cycles, and whether your company is riding high or going through challenges, the key factor is the quality of the personal relationships you’ve built.
     “I have a few phrases related to this principle which will probably be familiar to anyone who’s heard me speak: people like to do business with people they like and trust.
     “Never take customers for granted, and value every piece of business they trust you with.
     “Find out what problems your customers need to solve, then create a solution. Find a way to do business and be willing to do whatever it takes.”

The Only Constant Is Change

     “There’s a new challenge almost every day, but the consistent challenge has been trying to manage and meet rising expectations amid all the factors that affect your company’s or your own personal level of success.
     “It can be frustrating because most of these influences are out of your control—but most industries and businesses are in the same boat.
     “I think anyone who claims sole credit for an initiative needs to think again. Worthwhile changes in any organization are always a team effort.
     “Sometimes I had the idea, other times I was a facilitator or supporter of the concept, and many times I was involved in the execution.
     “The specific idea I would claim to champion is the customer service culture I talked about earlier: an approach based on communication and collaboration that I try to encourage in my team and colleagues.”

The United Forwarder Proposition

     “The vast percentage of United Cargo’s business is generated by the airline/forwarder partnership, and although the industry is always evolving, I don’t see that situation changing in the future.
     “In fact, our drive is to strengthen our forwarder relationships by boosting the level of cooperation and collaboration.
     “While the integrators are competitors in some facets of the business, they are also our partners in areas where our capacity supports the needs of their customers.”

United New Routes A-Poppin'

     “The United Cargo team is eager to take advantage of the new routes that will launch in 2016.
     “Most of the new services are focused around our San Francisco hub.
     “On March 30, service between SFO and Tel Aviv will begin; then on May 8 we’ll begin nonstop service between SFO and Xi’an, China.
     “This will be the first trans-Pacific service to Xi’an operated by any airline, and United will be the first U.S. airline to serve the city.
     “Then in June, United will begin nonstop service between SFO and Singapore using the new Boeing 787-9 Dreamliner.
     “This will become the longest nonstop flight operated by any U.S. carrier.
     “This is a route we’ve wanted to fly that became feasible due to the range and efficiency of the 787-9.
     “Completing the new routes from SFO this year is our service to Auckland, New Zealand, beginning July 1, also serviced with the 787 Dreamliner.”

Seasons in The Sun

     “Our seasonal service this summer is centered around routes between our east coast Newark Liberty and Washington Dulles hubs and Europe.
     “We’re introducing a second daily widebody nonstop between Newark and Brussels on May 5 and daily widebody nonstop service between Newark and Athens, Greece, on May 25.
     “On the same day, we’re launching a daily widebody nonstop between Washington Dulles and      Barcelona, Spain, and daily nonstop service between Dulles and Lisbon, Portugal.
     “For my North America West region team, the most exciting development is the return of a number of domestic U.S. widebodies this spring.
     “We’re starting up 777 service from both SFO and LAX to IAD, giving us much more lift and faster connections from the U.S. West to Europe and back.
     “We’re also flying Dreamliners from both SFO and LAX to IAH, which gives us the same boost to and from the Latin America region.”

Cool Control by TempControl

     “Looking at construction and product development, the highlight so far this year has been the grand opening of our new TempControl Center at our hub at Newark Liberty International Airport.
     “We’re very proud of this facility and its features and innovations because they were the ones most requested by our TempControl customers.
     “We plan to use the EWR facility as a model for similar TempControl Centers in other United hubs.”

Team Leader

     “As VP of Cargo Sales for the Americas, I plan and direct all the Sales activity in the Americas. I’m very fortunate to work with four very talented and experienced Senior Regional Sales Managers who lead the U.S. North, South, West, and Latin teams, along with experts in Specialty Sales and Courier Accounts.
     “Fortunately, our team is aggressive, highly motivated, and knowledgeable, so my role is to set priorities and provide guidance.
     “I spend two or three days during an average week traveling to meet with customers, and of course when I’m not on the road I’m connecting with customers via phone, email, or other technologies.”

Air Cargo 101

     “If a genie granted me three wishes (and I wanted to use one to change the air cargo business), I would make it much more collaborative, with each member of the supply chain aware of what the others need to prosper, and cooperating to ensure we all succeed.
     “I’d have fewer global procurement exercises and many more partnerships built on trust and empathy.
     “If I weren’t in the air cargo business, I’d probably be doing something that involved public speaking or presenting.
     “I really enjoy the challenge of getting up in front of a group of people and trying to convey some positive message about the best way to conduct business or build connections.
     “Especially high on my list of favorite situations is addressing a group and knowing when the audience ‘gets it’ and responds!”

A Feel For The New Normal

     “I think the air cargo industry is adjusting to a ‘new normal’ of lowered expectations where we can’t count on a certain percentage of increased business.
     “Most established economies around the world are flat or growing slowly, and the emerging economies aren’t emerging as rapidly as they were.
     “Then there’s the one-two punch of capacity increases: not only lower fuel costs resulting in long-idle freighters coming out of mothballs to begin flying again, but the steady rise in passenger demand serviced by new, more belly cargo-friendly passenger aircraft.
     “I expect the air cargo business to be in a healthier place by the end of 2016 than we are right now, though I have to admit that I can’t point to any specific facts, figures, or trends that support this outlook.
     “I’m an optimist by nature, so that might explain this prediction.”How To Improve Air Cargo? S/H
     “If you asked me that question a few years ago, I would have said, ‘More one-on-one meetings with customers.’
     “But recently the pendulum has swung the other direction, and some conferences are like “speed dating” with one meeting after another.
     “This leaves less time to circulate among the attendees, meet new people, and bat around innovative products, services, and cutting-edge ideas.
     “So the moral is ‘be careful what you wish for.’”
Geoffrey

A construction site sign can be seen behind a warning light at the BER Airport in Schoenefeld, Germany. In connection with the numerous postponed opening dates and cost increases amounting to billions of Euros, last month the Brandenburg audit office delivered a disastrous report to the Finance Ministry. Among other things, auditors proposed a reevaluation of the responsibility of the advisory committee under then state heads Klaus Wowereit and Matthias Platzeck

     In Germany—more precisely, in Berlin, its capital and former Reichshauptstadt—when it comes to the airport business, everything is far from being “in ordnung” (order); in fact to use another German word, things at BER are “chaos” (a mess)!
     The large infrastructure project at Berlin’s Willy Brandt International Airport has run out of money and despite huge cost overruns and a seeming endless period of time, it still requires more time to be completed.
     So maybe that is not big news, but keep reading.
     What has now emerged in the media and by word of mouth to us from trusted sources is an astoundingly complex system of mismanagement, graft, corruption, and incompetence, all reportedly connected to the airport building in Berlin.
     It now appears all of it is connected to both management and the supervisory board representing the three public shareholders: the State of Brandenburg, the city of Berlin, and the Federal Republic of Germany.

Report Of The Accountant

     This news not only came to light but also is, by means of a recently published confidential report of the Brandenburg General Accountant’s office, a matter of public record, which is something new and quite extraordinary.
     The 504-page report, written in elaborate German bureaucratese, outlines in detail the shortcomings surrounding the BER airport project from its very early stages. The report condemns both senior management and politicians acting on the supervisory board alike.
     A list of the shortcomings would fill several books, and in any case most of these have already been detailed in past issues of FT.
     In simple, direct words the general accountant’s office details how the supervisory board neglected their legal obligation to question and supervise the management’s decision and how some members even made sure that reports and facts imperative for decision-making were not communicated to the supervisory board the standard three weeks in advance, but in fact a mere day before the meeting, which dealt with the question of whether or not the second opening date on June 3rd, 2012, could be upheld.
     What emerges in the report is that most members of the BER board lacked any expertise or even elementary knowledge of the management of large infrastructure projects.
     Further, the report notes that despite crucial information being made available (albeit quite late in the game), the board decided to support the management’s decision to go ahead.

Two-Minute Wonders

     Revelations that some meetings of the supervisory board took as little as two minutes (tell me all you know in two minutes) is a real shocker considering what is (was) at stake and the general, unified uproar over the inefficiencies’ at play at BER.
     Particularly damning are a number of paragraphs in which the General Accountant’s office deals with the oversight executed by the State of Brandenburg’s Ministry for Finance.
     The explanations provided by the Ministry were rebuffed as untrue within the report.

Construct-As-You-Go

     The report explains that the Airport’s annual reports were neither challenged nor questioned by the Supervisory Board and the Ministry for Finance, despite clear evidence of insufficiently detailed risks and mounting budget overruns that would have mandated otherwise.
     The rather simple fact that changed EC Directives mandating additional security measures required a substantial redesign of the Terminal and that therefore construction activities were carried out, not based on blueprints approved by the authorities, but on a “construct-as-you-go” basis necessitated, in the view of the BER’s management, “a shifting of legal questions towards the end of the construction period” only.
     In other words, the airport was replanned and replanned again, changed and expanded and any plans for eventual approval were to be drawn later.

Horst To The Rescue?

     Horst Amman is experienced in large-scale infrastructure projects and serves as the technical manager appointed from FRAPORT. He had halted construction temporarily to get a grip on the mounting issues and problems, and to collect a detailed inventory.
     The report suggests that because Horst’s measure clashed with the schedule of former CEO Hartmut Mehdorn, he was relegated to a post managing the airports’ waste and water systems so as not to upset the political stakeholders by further halts in the construction process.

Gobbledy-Gook Reports Of Progress

     The controlling reports—submitted quarterly and detailing the progress of the construction—were deemed “implausible,” “inconclusive” and “gave no clear picture about the current state of planning and construction,” the general accountant’s report concludes.
     That the supervisory board conducted only the bare minimum of meetings (four per year) despite mounting problems, and never questioned advancing construction while approving annual reports in gross mismatch with projected figures is seen by the GA’s office as a clear neglect of duty on the side of board members.

Could Have Been Should Have Been

     Had the BER board asked questions regarding the plausibility of the management’s report on progress, the contractors involved would have outlined that they had communicated beforehand that from their point of view the anticipated finishing date was “impossible.”
     Another main issue is raised in the general accountant’s report here in the innocuous headline:
Lacking Validity of Increased Capital Requirements Because of Evident Risk Factors Not Having Been Considered.” Apparently, (according to the report) both management and board knew that the annual reports and projections were more wishful thinking than factually based.
     Apparently, to sum up, the only measure the board made was to support the switch of the airports sole technical expert, Horst Amman, who had expertise and a proven track record, to the task of waste disposal.
     In 3.2, the GA’s office simply concludes that “lack of business acumen and planning competence” were evident of the airport management’s side.
     3.4 concludes stating:
     “Serious shortcomings and lapses on the risk management side were evident,” as the management “neglected to either inform the board about important factors at all or too late.”
     The GA’s office summarizes that the board members were not qualified to supervise a large and challenging project such as BER and that in particular a previously conducted review of liabilities and accountabilities on the side of management and board members was “structurally faulty,” biased by conflicts of interest and that “factual and structural shortcomings were far too numerous to exonerate the management and board from the responsibilities of their offices.”

Criminal Dummkopfs

     The public prosecutor in Cottbus confirmed reports that his office was looking into the allegations and considering whether to file criminal charges against some of the former or current members of the BER management and board.
     As we go to press, Senior Prosecutor Horst Nothbaum denied previous reports within the German media that the investigations were directed at former Berlin Mayor and Head of the Supervisory Board Klaus Wowereit and former Brandenburg MP Matthias Platzeck.
     Stay tuned.
Geoffrey