Finnair Cargo, playing it cool
27 / 02 / 2018
Finnair Cargo managing director Janne Tarvainen’s 24 years at the airline have seen him occupy a wide variety of roles.
He began his career at Finnair in 1994 employed — via GE Aircraft Engines — in a technical role.
Initially, he had plans to become a pilot after completing his military service in the air force, but in the end decided to continue his career on the ground and in 1998 became employed directly by Finnair in its powerplant department.
He continued in this department, taking on a management role and extra responsibilities for more engine types over the years, until 2006 when he was asked to head up the component division.
After a year or so in components, Tarvainen moved across to the line maintenance business. About two years later he took on responsibility for heavy maintenance.
Around this time, the airline industry began to face turbulence caused by the global financial crisis and in 2011 Finnair took the decision to close its heavy maintenance division.
Most western airlines had already outsourced this aspect of their business to lower cost countries, Tarvainen explains.
This led to him becoming head of the operations control centre in 2012 before eventually taking over as managing director of Finnair Cargo in November 2015.
Tarvainen could not have joined the airline’s cargo business at a time of bigger change. The airline had just started taking delivery of 19 A350 XWB aircraft that will increase cargo capacity by 45% by 2020.
So far 11 of the aircraft have been delivered, with the twelfth set to arrive later this year.
The effect of the arrival of the new aircraft can already be seen in the carrier’s cargo figures; last year it handled 970m revenue tonne kms, up 11% year on year.
The airline also operates eight A330s, 16 A321s, 10 A320s and eight A319s, while subsidiary Nordic Regional Airlines operates a fleet of Embraer E190 and ATR-72 aircraft.
Finnair is also due to take delivery of three more A321s. Services offered by Finnair cover 18 destinations in Asia, seven in the Americas and 70 in Europe.
As well as the new fleet, work on a state-of-the-art cargo centre had just got underway when Tarvainen joined the cargo business.
He says that his varied roles at the airline had prepared him well for cargo, but admits there were still things to learn.
“Since I was previously in charge of the operations, I knew a little bit about the cargo operations, but I wanted to develop a deeper understanding of the cargo business itself,” he says.
“When I accepted the position, I wanted to build a team and fill positions with people that had a deeper understanding and experience of cargo.”
Change for the better
One of the things he has most enjoyed about his current position is managing the change the business is going through.
“Change management and change in general is something I like and find inspiring. With this project we are talking about transformation, not just an incremental improvement, but a transformation.”
Tarvainen says that when building the new terminal, Finnair decided to “look at things a little bit differently”.
“We hoped to find excellence and it is a difficult question — what does excellence look like? What does it look in five years, or 10 years or more?
“We tried to build a terminal that is smarter and better. We tried to look at things a bit with fresh eyes.
“That doesn’t mean we have to be naive or anything like that but we tried to really question certain things and find a way of doing things that supports the Finnair Cargo operations and allows us to conduct our business in the best possible manner.”
Tarvainen says that the main reason for building the new cargo centre, named Cool Nordic Hub, was that the existing facility was reaching capacity.
With the airline adding extra cargo space, it was imperative that its cargo team had the right tools to be able to process traffic as efficiently as possible.
Tarvainen says that cargo is important to the airline — representing around 15% of revenues generated on its widebody long-haul operations — and therefore Finnair was prepared to invest time and money in building a market-leading facility.
Another reason to ensure that the centre is as efficient as possible is the fact that 80% of cargo handled in Helsinki is transhipment traffic, meaning it needs to be quickly processed.
A further selling point for the airline, Tarvainen points out, is that flying through Helsinki is geographically the shortest route to Asia. Plus, the airport does not suffer with congestion, unlike some of its larger European rivals.
He describes the terminal as a sophisticated tool, using data and automation to create efficiency, improved processes and visibility, rather than simply a warehouse.
This is achieved through its cargo and warehouse management systems, automation and Cargo Eye monitoring software.
These elements are brought together at its sophisticated cargo control centre, which looks like something you would expect to see at a NASA space shuttle launch, or at least an integrator hub.
Cargo Eye collects live data from across all of Finnair Cargo’s information and tracking systems — the global position of aircraft, flight information, the geographic location of all cargo ground traffic and key data from SkyChain [Finnair’s cargo management system] — and renders it onto a large screen in Google Maps format at the control centre.
The viewer gets an instant top-level, panoramic view of what is happening and where everything is.
A navigational sidebar is included, allowing the user to filter onto the screen the data which is most relevant and contextually meaningful to them.
This means the control centre can look at one screen and see where every truck and plane is carrying seafood or pharmaceuticals, get updates on its arrival and connecting transport, monitor its contents and temperature, and be prepared to shift ground resources to where they are needed most in anticipation of delivery.
All of this helps Finnair Cargo to manage operations from a network perspective, rather than each individual part of the transport chain.
“This means, for example, whenever we have delicate perishables that need to be delivered in a speedy manner, we can pass that information into the system,” says Tarvainen.
“It goes to airline operations control so they know and can prioritise those things. The information can even be passed by notification to the captain so they then know there is that kind of cargo in the aircraft and can adjust the temperature of the cargo compartment.”
However, the development of these systems was not without its challenges, says Tarvainen, with the quality of data being one of them.
“The biggest issue, and this is a bottleneck for the whole industry, is the data quality. When we went live with SkyChain we knew there was an issue with the data quality, but we didn’t know how bad the situation was.
“Roughly 50% of the waybills were correct, the rest had to be amended. They were using old formats or a combination of different formats, or the content was not right.
“That is an issue. We are spending quite a bit of effort [correcting this] because the systems require excellent data quality and to actually utilise that asset well, you have to put in quite a lot of effort to rectify the data.”
While the terminal is clearly sophisticated, it does also do the things you would expect of a terminal.
In total, the airside facility measures 31,000 sq m, has a capacity of 350,000 tonnes per year — roughly double the existing terminal — and has 3,000 sq m dedicated areas for both pharma and perishables shipments.
The centre also boasts 550 10 ft ULD positions, 29 truck doors for loose shipments, five truck doors for ULDs and an automated storage and retrieval system.
The terminal began handling perishables shipments in November but the full cutover from the old hub took place in January.
Tarvainen says that the initial start-up was hard work — as you would expect when opening a sophisticated new terminal — with staff needing training on new procedures and systems, but overall he says it was an enjoyable process and went better than expected.
“So far I have been very pleased with the situation because typically with a new terminal it scales between being really, really difficult and horrendous,” he says.
“We closed the old terminal a little bit in advance of what we thought as well so it is good.
“According to some of the consultants we have utilised, this is the most tested air cargo terminal they have seen.”
The terminal is also going through the CEIV Pharma certification process, with an initial audit already carried out.
So what is next for Finnair? Is it time to relax and enjoy the fruits of its labour? Tarvainen says there is no time to rest because of the highly competitive nature of air cargo.
Next, the airline will focus on how to utilise all the data and visibility that its new cargo systems generate to build new products and services for customers.
“I am really excited about the go-live of the cool terminal. After that we can build products that really add value for our customers — efficiency, speed and operational quality.
“We will be able to launch some interesting new products that will hopefully support customers’ operations and the services that they require.
“There are a couple of things that we are thinking about. A good example of that is the Cargo Eye [system] that combines information from various sources, from our cargo management system, from the warehouse management system and from operations control and external providers, even tractors that measure temperatures and so on.
“The idea is to monitor, control and steer the operations. The complete vision is that we are able to serve the very same view to customers.
“For example, if a certain customer has a shipment between Narita and Helsinki and there is a two-hour delay at departure due to the weather, they will know where the shipment is, that the temperature is okay and once it is in the air they could also start the e-customs process.
“When we talk to customers, they use words like consistency and transparency. They say they could reduce the number of warehouses they have all over the world if they have the real status of shipments. That is exactly what we try to provide.”
Other innovations the airline could implement in the future include packing robots, automated guided vehicles at landside acceptance, the integration of the ramp operation into the data exchange and the introduction of cloud-based services.
It seems that while Finnair Cargo has spent much of the last couple of years pushing innovation in its air cargo operations, it has no plans to rest on its laurels and there will be lots of ‘cool’ new developments to keep an eye out for in the future.