Aviation Industry Holds Lessons for MBAs as IIMB Hosts FOAA 2020

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The International Conference on Future of Aviation & Aerospace (FOAA 2020) conference hosted by IIM Bangalore and Bangalore International Airport Limited with Toulouse Business School France on February 22 could hold valuable lessons for MBAs.

The one-day conference saw senior professionals from the aviation and aerospace industry calling for better skill development and talent management, as well as policy and structural reforms in the sector, IIMB said in a press statement.

Takeaways for MBAs from Aviation Conference FOAA 2020

India Set to Become 3rd Busiest Aviation Market

India was set to become the third busiest aviation market in the next 5-7 years, Satyaki Raghunath, Chief Strategy and Development Officer, BIAL, said. “The market size of India is certainly a huge opportunity for MROs (maintenance, repair and overhaul), cargo, logistics, tourism, travel, etc. The impact of what aviation does in terms of driving the economy can never be overstated. Technology has changed the way the aviation industry operates – be it drones, AI, ML, and that creates huge opportunity.

“Today, BIAL employs over 20,000 people. The growing industry can create huge employment. There are challenges too – regulatory policies that, among other things, should also prevent airlines from folding up,” he added.

The dearth of Talent, a Challenge

“The dearth of talent is another challenge – the sector is struggling to find the right talent. It is going to be incumbent on all of us to find and deploy the right talent. Third, from an urban growth perspective, in an emerging market especially, where workers migrate when opportunities arise, our primary cities need to gear up in terms of urban planning – providing facilities and transport for the people who migrate for work,” he pointed out.

Domestic Travel, a Silver Lining Amid Market Slowdown

Professor S. Raghunath, Director, General Management Programme for Aerospace & Aviation Executives at IIM Bangalore, in his welcome address, said at present, the industry was under pressure both from a slowdown in the sector as well as the threat of the coronavirus outbreak. The silver lining was domestic travel in India.

“These are interesting times for regional connectivity. The Government is trying hard to restart the engines of the economy. Connectivity through aviation will take knowledge workers to regional hubs and improve rural logistics, even for healthcare service providers, apart from giving a boost to tourism,” he said.

Observing that drones can be game-changers in rural logistics, he said the recent advances in powerplant technology could enhance payload and travel distance of drones and dramatically improve the economy and quality of life in rural India.

Bangalore, Ideal Hub for Knowledge Sharing

IIMB Director Professor G. Raghuram said Bangalore is an ideal hub for knowledge sharing in this sector. “The focus is not so much on technology, which is there, but on how the sector leverages it, impactfully. Second, we need a better focus on finer market segments.

“For example, the airports in Bengaluru, Mumbai, Hyderabad etc. run under Private Public Partnership (PPP) are probably ahead in terms of market orientation be it for the arriving, departing or transiting passenger.

“Countries like Qatar, Singapore, Muscat and Addis Ababa with hub airports are already moving into that space. India’s thinking at the policy level and service provider level has not quite reached there,” he said.

Policymakers must focus on transport to enable the development of the economy and encourage the PPP model. The question gets trickier because the Airports Authority of India (AAI) has a monopoly on air traffic control. “We need policy and structural reforms in India,” he added.

Professor Christophe Benaroya, Toulouse Business School, France, focused on new challenges that called for out-of-box thinking in areas of air traffic control, and air traffic management.

Panel Discussion: Growth Opportunities

In the first panel on ‘Looking to India: The Next Growth Opportunity’, chaired by Satyaki Raghunath, Chandra Shekhar Y, Head, Regional Sourcing, GE Aviation, spoke of the need to set up a final assembly line in India and the opportunities in material sciences, additive manufacturing and electric/ hybrid, skill development in all areas from manufacturing to management of airports, Big Data and NextGen technologies.

Striking a lighter note, Amber Dubey, Joint Secretary, Ministry of Civil Aviation, and an alumnus of IIM Ahmedabad, said he still took notes – today from his former professor at IIMA and current Director of IIMB, which were holding him in good stead while making his address.

“Aviation in India is in a great space right now because this government gets us – they are giving this sector national priority. Udaan and PPP are great examples of this commitment. It’s time now for ‘dando’ (business) and making money. However, at times, it’s better to have a flatline growth and profitability rather than a 20% growth and frequent collapses.”

On the drones and their potential in growth opportunity, he said the Home Ministry, Ministry of Civil Aviation and Ministry of IT were working together to ease permissions and leverage the talent of young tech disruptors and start-ups in this space.

To a question on the collapse of airlines, even in times of opportunity, Manish Raniga, Acting Chief Commercial Officer, South African Airways, said airlines have very thin margins, especially in a market like India. “Therefore, what you inject into the market in terms of supply should match what is there in terms of infrastructure, network, talent and demand. Has the airline industry in India gone a bit too aggressive – this is a question worth asking,” he added.

On the issue of finding funding for research, the panellists drew attention to partnerships between industry and centres of excellence in institutions like the IITs and NITs. “I also encourage industry to use social media when faced with R&D challenges. Young tech disruptors will reach out and respond because that is the universe in which they live and work and collaborate,” said Dubey.

He also drew attention to lack of a policy on environmental sustainability and growth and the need to formulate it. “Everyone focuses on numbers but lack of attention to the environment can delay projects and incur huge losses for the service provider,” he added.

Panel Discussion: Research & Development

Dr Anantha Agastya, Former Executive Director, HAL Management Academy and IIMB alumnus (PGP 1981), chaired the panel on R&D and Design at the conference and focused on the drivers of the ecosystem for R&D, listing strengths and weaknesses and providing a wish list for the next 3-5 years that includes technologies in avionics, stealth, armament management, advanced aerodynamics, synthetic/ enhanced vision, vectored thrust and major upgradation of production technologies.

“India is different, so managing R&D here, in terms of human resources, is even more so,” said Dr Yogesh Kumar, Former Director of Light Combat Aircraft, HAL. “One must also insulate one’s team against criticism and negativity here!” Giving the example of the Tejas programme, he said projects themselves are great motivators.

“All aerospace and aviation hubs that we have set up have become big economic multipliers,” he said, adding that aeronautics should be defined as a strategic sector. Defining drivers for R&D in the sector, he listed continuity of projects, industry to lead in the setting up of labs in institutions and private companies, funding to cover risks and a finishing school concept for engineers and managers, especially product managers.

“We do not fail because of technology, but we fail because of management of technology,” he added.

“While the Indian aerospace industry is willing to take the deep plunge, financing and limited in-house R&D are our weakness,” he said.

Welcoming growth opportunities for the aerospace sector, Dr Kota Harinarayana, Former Programme Director and Chief Designer of Tejas, said he did not see the same enthusiasm in the civil aviation sector. “We need an agreement that helps India’s R&D and industry to grow. Private industry should start investing in technology and product development,” he added.

Panel Discussion: Talent Management

Chaired by Professor N.M. Agrawal, former faculty at IIMB, the panel on talent featured Sajit TC, CHRO, BIAL, and Suraj Chettri, Regional Director HR, Airbus India & South Asia.

“If you think organizations know how to manage their talent, then you are mistaken – they don’t,” declared Suraj Chettri, Regional Director HR, Airbus India & South Asia. “In a VUCA world, all is not well in the talent landscape. Demographics are changing, technology is getting complex, and there is a proliferation of global teams that work across geographies. HR needs speed and agility to match the expectations of such a workforce with reality.”

The industry needs “system thinkers”, but the pipeline that supplies leaders to the industry has not evolved. He also urged individuals to take responsibility for their development and not expect the managers and the HR teams in their organizations to do it for them.

Stating that talent has plenty of opportunity in the aviation sector in India, Sajit explained how OEM opportunities help borrow knowledge and grow talent to enhance the capacity of the airline and the airport and the capability of the infrastructure and the support system.

“Currently, India is the 7th largest aviation market in the world. In 5-7 years, we are expected to be the third-largest after China and USA. We have a workforce that learns differently from the earlier generations. So, we focus on e-learning and situational learning.”

Panel Discussion: Start-ups

Sethuraman, Director, Finance, Sasmos, said in the aerospace industry, platform and product development is for the long term. “A start-up needs to stay focused on market, money, men and mission,” he said, adding that while staying mission-focused, the start-up must adapt; it must factor in more money than required; it must estimate market size and delivery time, correctly; and keep the workforce needed to last the initial stretch and beyond.

With a word of caution for start-ups in aerospace, he said when India gears up its ancillary systems over the next five years, early movers need to be well prepared.

Describing the challenges in the aerospace manufacturing industry in India, Rakesh SB, Associate VP, Aerospace Division, Sansera Engineering, listed global competition, human challenges in terms of skill development and team building, building a complete ecosystem with approvals, inventory logistics, among others.

The session was chaired by AN Chandramouli, MD, Starrag Heckert Machinetools.

Panels also discussed MROs, customer experience, and the next frontier in AI, Big Data and IoT. Speakers included executives from Safran, Lufthansa, Accenture Technology, GE Aviation, Boeing Research & Technology, and BIAL, TBS and IIM Bangalore.

The event was organised by the Executive Education Programme of IIMB in partnership with TBS and BIAL.

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