Schiphol International Hub

How many levels of complexity can you identify in Schiphol’s baggage conveyor network?

There are four levels of complexity:

a.       Physical complexity – The conveyor network is large and intricate. It must therefore envision specific logic to track, maintain, store and retrieve location of items, people and actions.

b.      Business complexity – There are many companies fixed to operate with the network in its own peculiar way. The conveyor network must be able to cope with the presence of different baggage governance policies. Also, the conveyor network is an effort of three large industrial corporations. Each of these companies has its own agenda in terms of revenue form the conveyor network.

c.       Social complexity – The system must be ready to support and aid the work of humans (e.g human baggage handlers) and also human-to-human relations (e.g security officer with conveyor technician)

d.      System complexity – Is the system is rigged to enact a co-operation between many technological layers both at software and hardware levels (e.g conveyor belts, scanners, security checkers)

What are the management, organization and technology components of Schiphol’s baggage conveyors network?

Management components:

         i.            Setting the goal – Right bag must be at the right place on right time

       ii.            Allocating human resources – In every level of conveyor there must be available human resources to control, manage and handle the bags.

      iii.            Allocating financial resources like they have invested over 1 billion in last 10 years

     iv.            New product development such they are going to inroduce new baggage handling and controlling system to handle huge bags in every year.

       v.            Try to inroduce new service offering and technology to give better services

Organizational components:

Like every organization in Schiphol’s baggage conveyors network is made up of different department. Each department contributes to the running of the business. The most common departments are:

-          Marketing and Sales

-          Finance

-          Human resources

-          Information technology departments

-          Production departments

Technological components:

It consists of Destination Coded Vehicles (DCVs), Automatic Bar Code Scanner, Radio Frequency Identification Tags and High Tech Conveyor Sorting Machine.

What is the problem that Schiphol is trying to solve? Discuss the business impact of this problem.

The problem they are trying to solve is the mishandling of baggage in Schiphol’s baggage conveyors network. Schiphol is trying to increase the revenue stream by optimizing customer experience while redusing costs-per-baggage. Achieving this goal has a deep impact on Schiphol’s revenue stream for two reasons:

·         Schiphol is an international hub – flight transfers are more likely to take place at Schiphol if its efficiency and customer experience increase

·         Schiphol serves a large user basin – increasing direct  customer experience increases traffic of people

Increase efficiency in baggage handling in the Schiphol International airport, in Amsterdam, the Netherlands. Mishandled baggage is a $2.5 billion problem for industry every year and this problem may manually affect about 51 million passengers travelling through Schiphol airport alone. With the new system, the manager of Schiphol estimated this system operate 99.9% of times while being able to minimize loss and damage in that 0.01%. This system is extremely expensive but if implemented successfully it can save 0.1% of $2.5 billion.

Think of the data that the network uses. What kinds of management reports can be generated from the data?

Data items of circulating across Schiphol Conveyor Network comprise of four items are scheduling data, hit or failure reports, delays and usage information. All of this data was designed to allow plotting of cost-per-baggage reduction progressions. Schiphol constantly uses the reports to steer the completion of the project described.

DATA NETWORK	REPORTS
Number of baggage	Total number of business handling every year
Total loss	Profit and loss report
Defect system-minimum loss and damage	Risk management report and improvement system
Capacity of the baggage	Actual capacity for the baggage
Automatic data scanner	Efficiency of the data scanner

The above mentioned reports can be done through Enterprise systems. Enterprise systems is the need to coordinate activities, decisions and knowledge across the firm’s different levels, functions and business units. Enterprise systems use a single central data repository in order to supply all users with a consolidated view of employees, customers, suppliers and vendors. The key to effectively using enterprise systems is to eliminate redundancy and duplication, not just in the information systems but also in business processes.