While most of us only ever see the inside of the arrival and departure halls at both the Airport and Harbour, for Doug Bannister, the chief executive of Ports of Jersey, it’s a complex business.
As reported in today’s news pages, juggling the air routes and guaranteeing passenger numbers isn’t easy. Quite apart from being at the mercy of the weather, you’re relying on other businesses and the various vagaries of their supply chains.
One of the primary reasons given for incorporation was to allow Ports to pursue commercial activities to diversify their income streams. So where are they with that goal? ‘We are ahead of targets on new business,’ says Mr Bannister: ‘We set ourselves five year goals and one was having £3 million revenue from business that did not exist before incorporation. We are currently around £2.6 million and the forecast is to be closer to £5 million by the end of five years.’
This new business includes property development, such as the airport garage and the new hangars for private and corporate planes: ‘This will treble the corporate aviation capacity and it’s a growing sector. We are seeing high demand and we are really excited about what this market segment can yield for us.’
The project has hit a delay with a planning appeal, but Mr Bannister is still hopeful it can get underway later this year.
What about other less tangible business initiatives? ‘One of the really exciting things we’re doing is the remote or digital air traffic control towers. It was tech we identified about three years ago as having a pretty huge transformative effect in air traffic control, so we are deploying that as a contingency operation for us here in Jersey. We believe we will have the first remote or digital tower in the British Isles. We are in discussion with a number of airports, primarily in the UK, to extend our capability to their operations. If you can think of what life was like before the internet and what life was like after, that’s how transformative this is for air navigation and Jersey is at the leading edge of this. We are starting to build a bit of a reputation in emerging technologies in this field.’
The team are looking at other satellite-based navigation and automatic weather observation systems to increase the resilience of the Airport: ‘The mindset of a commercial business is how do I maximise these? There are compelling and interesting propositions across the whole suite of air traffic control [systems] and our engineers are looking at how we might be able to support others. It could be joint ventures or contracted out services, or it could be just consultancy.’
Technology is not just creating revenue, but also saving costs. The Airport has just installed a critical part-monitoring system. This takes in the most secure area around the airfield where the planes park. In the past it would have had a team of roving security guards, but now they have a combination of CCTV, radar and a back-office system to understand what the front end is picking up. They are able to spot anything unusual automatically.
While sea passenger numbers may not have been doing so well in recent years, marine services and technology have been turning into a lucrative business. The team are winning contracts as far north as Scotland, and a lot of it centres around the Harbour Tug: ‘Many people look at the Duke of Normandy and think it just does towing and pushing, but it is a very high-capacity asset. It’s a sophisticated working platform, so it’s a combination of infrastructure surveying work like buoy and navigation aid changing and it also places tidal sensors on sea beds and retrieves them. We’ve also recently added a multibeam echo sounder, which gives us really clear images underwater. Having that survey capability means we have quite a lot of interest in deploying that technology for people rather than sending divers down to survey.’
So how important is this kind of revenue generator? ‘It’s a development area for us. I don’t know how big it can go, but so far we have grown it on the back of reputation and contacts and if we put more energy into it I can foresee significant growth to establish jersey as a place for innovative and sophisticated marine services, which is also important in terms of creating interesting career prospects for our young people.’
As with any business, people are key. So how does Mr Bannister take a diverse government-run organisation and imbue it with a commercial culture? ‘About two years ago we launched an acceleration programme in the company, a Lean Six Sigma styled programme, where we equipped everyone in the company with the tools to ask the question, “why are we doing it this way?” We have uncovered many inefficient practices that we wouldn’t have looked at before. We’ve made over £400,000 worth of savings. The Acceleration programme has had a profound effect on helping us transform and improve the culture of the company.’
Third-party specialist HR help was initially brought in to mobilise the change, but now the business is supporting this programme internally. It isn’t just about cost savings either: ‘The Duke of Normandy business has grown out of the passion for what those guys are doing and all we have done is create the right environment for them to do it. We have opened peoples’ minds up to the opportunities that exist and allowed people to try different jobs.’
Mr Bannister isn’t just saving and generating money, he’s also spending it. The new Airport terminal is going to cost £42 million. Is this absolutely necessary? ‘We looked at a variety of options to comply with the obstacle removal regulatory requirement and doing the minimum was only a couple of million cheaper. The £42 million is about reconfiguring the stands and forecourt and moving our fire service to a new location, as well as taking down the arrivals building and old hangar. It’s a big programme of work but what it will do is it will allow us to combine everything in this building (departures) which leads to greater efficiencies.’
What about the white elephant in the hangar, the Aircraft Registry? This was launched by the States in 2015 and cost the Island more than £800,000, but has secured just two registrations. It was recently handed over to Ports of Jersey to see if the initiative could be revitalised: ‘I am working closely with Economic Development and there is a collective acknowledgement that perhaps the model wasn’t right. We need to secure the services of a registration or technical service provider, because that is the gatekeeper for allowing aircraft onto the register. We are trying to identify candidates for that role. We are also considering a number of delivery options. Some work is going on with outsourcing the commercial and operations side, so the function of identifying and landing aircraft on to the registrar would be done by a third party in a way not dissimilar to others.
‘There is a big programme of work to get through, including legislative changes to the existing law, but the guys from Economic Development have allocated some law drafting time to get it over the line.’
At the Harbour things have been a little more positive. The Ships Registry was also transferred and 2017 saw its busiest year ever. There is also more interest coming from further afield.
Bringing it back to passenger numbers, Ports is tracking a little behind on their business goal of 2.5 million passengers. They are currently working on getting a new direct-to-Edinburgh route with Easyjet, which might help, and they are also working more closely with Condor and Manche Isles at the Harbour. The latter has seen their business growing year on year and has recently launched a new inter-island service.
It’s important to remember says Mr Bannister: ‘Over 60% are visitors to the Island and we require a robust visitor and tourism sector if we are going to maintain all these routes that residents can enjoy.
If it was only down to Islanders it would be six flights a day to Gatwick and four to Southampton and we’d cover the main demand.’
New revenue is good for everyone. While Ports of Jersey is a limited company, it is wholly owned by the States. All profits are reinvested into the Island. The new Harbour Master Plan is due to be published soon and that promises to have a lot more initiatives about how to deal with a two-and-a-half year old business that has huge regulatory obligations and some assets which are hundreds of years old.
