Not All GoPNG’s Decisions On SOEs Are Based On ‘Economic Rationalisation’

Our country (and all countries) is conceived with a ‘going concern’, i.e. it will continue on into the foreseeable future long after we all are gone from our mother Earth. Into that foreseeable future, decisions on progressing the country will continue to be made based on economic rationalisation and national rationalisation. Economic rationalisation decisions are often based on the NPV (net profit value) trade-offs. National rationalisation decisions on the other hand are those reached with the country’s ‘going concern’ in mind where economic value takes less precedence. These are decisions made in the present to sustain the existence and the national identity of a country going forward and cannot be easily or readily quantified with an economic value. We pay now the economic price or we will pay later but many times over the loss of nationhood price.

When it comes to making decisions, especially in running a country and in particular in managing GoPNG SOEs, many of us are probably scratching our heads on why poor performing SOEs are not yet sold off. Often we will based our views on economic rationalisation. However, there is the ‘National Rationalisation’ side of the coin to contend with that appears to be at play in these sagas where endeavouring retention of our poor performing SOEs appear to create conflicting views.

Conflict arises when we are confronted by choices and are unable to make a decision. When we are deciding between economic and nationalism choices, there is bound to be conflict. But with our hearts in the right place and our minds vision clear, we can’t go wrong on our mission in making national rationalisation decisions that will ensure the continuity of our country into the foreseeable future (more on ‘hierarchy of loyalty’ in serving our country in the link below).

In the two articles below (and the links within these articles where I delved deeper) I covered the ‘National Rationalisation’ dilemma of maintaining a ‘National Identity’ and ‘Energy Security’ that are confronting GoPNG decision makers on our Air Niugini and our PNG Power Limited which many of us will tend to see mostly from an ‘Economic Rationalisation’ perspective.

1. Why Would GoPNG Not Rush Into Putting Down ANG As A ‘Panting Dog’?

2. Has Potential To Be GoPNG’s Strategic ‘Milking Cow’ SOE

Air Nuigini

Establish Air Niugini’s Present Technical Limit Capacity To Optimise Demand & Capacity

Recently our Air Niugini has had increase frequencies of technical issues that have ground and weigh down our ‘Bird Of Paradise’ from soaring up and higher. View the LinkedIn Article ——->

Our ANG is a physical asset intensive GoPNG SOE which productivity and profitability rests on the reliability and the eventual availability of its fleet of aircrafts. Reliability (and Availability) is a probability that a process/system/equipment/component will perform a specific function over a specific time period and under specific support conditions.

The specific support conditions are the critical success factors or the support conditions that prop up or improve and sustain aircraft fleet reliability and maintainability to meet the demand for ANG’s services. Click link below for more on the specific support conditions.

The demand for ANG’s services is the driving force for productivity of its airplane fleets. This demand is established by the sales and marketing function which will have its budget called the ‘Sales Budget’. This ‘Sales Budget’ projects the revenues from sales of ANG’s services. The ‘Sales Budget’ is usually the starting point in preparing the ‘Master Budget’ which is comprised of other budgets. A budget, therefore and if you like, is in essence a promise that is made to the clients, the stakeholders and the shareholders and that promise must be endeavoured to be kept.

It is important that the ‘Sales Budget’ must be as accurate as possible. ‘Sales Budget’ accuracy depends on a number of factors and what should be primary among them is understanding the true ‘inherent production capacity’ and making accurate the ‘Production Budget’ as much as possible to deliver on its promise. Having inaccuracies can end up in two cases: the best case scenario is to under promise then meet or exceed budget expectations; the worst case is overpromising our clients in the market as well as the stakeholders and shareholders as we struggle to deliver on the budget promises over the specific budget period.

Accurately measuring ANG’s airplanes fleet’s availability and production capacity plays a big part in the accuracy of the ‘Production Budget’ promise. ANG’s airline fleet’s availability is the output of the efforts, primarily in maintenance and reliability functions that feeds into establishment of the ‘Production Budget’.

The technical limit capacity of ANG’s aircraft fleets can be established from the maintenance and reliability perspectives using ‘optimisation’ by graphical solution via ‘Linear Programming’ and ‘Availability Block Diagramming’ in order to make accurate production forecast.

See the link below for a STAR (situation target action result) story of a mine mobile fleet and how this approach could be considered for possible application to the airline fleet if not done yet to established its current technical production limit capacity with the present aircrafts fleets.

Only when we know ANG’s true inherent technical limit capacity, then we can take decisive actions to restore it to a reputable airline in our region. One of such actions will be to introduce a redundancy configuration or standby aircrafts per airline fleet to improve reliability and eventually availability.

A suggested possible approach: treat each of Air Niugini’s aircraft fleet as a ‘system’ with a ‘MISSION FUNCTION’.

Our ANG needs a bold vision, strategic thinking and pragmatic mission going into the future. To mitigate the risk of fleet unreliability impacting on operations and cash flow and to improve and sustain its vital service as it serves the nation, a bold decision is needed to build redundancy (i.e. a standby aircraft per fleet) into its aircraft fleets so it can reliably soar into new heights. Yes it will cost more, but we pay now or we will pay later but many times over in effects cost (in increasing frequency of flight delays; frustrated customers and esp overseas tourists; and loss of reputation which puts a dent in our country’s pride). It should not be a question of ‘Economic Rationalisation’ but rather based on ‘National Rationalisation’.

Air Nuigini GoPNG

Why Would GoPNG Not Rush Into ‘Putting Down’ ANG As A ‘Panting Dog’?

In our country where many places are still not linked by road and air access is still vital, Air Niugini is more than just our national airline, it is a symbol of our country’s astonishing progress from independence and with the background of this physical accessibility challenges, ANG has helped to bring diverse local communities together in creating a more unified nation.

Air Niugini has been a reliable air service provider for many years since its formation almost incidentally with the birth of our country. However, in the recent past years ANG’s services appears to have deteriorated which was brought on by an onset of many technical issues which threaten to ground the airline.

View LinkedIn Article —->

The technical issues can also be attributed to ANG being operated as a SOE with community service obligations and profits not retained to carry out vital maintenance or upgrade its aircraft fleet which were becoming obsolete. These contributes to high cost of ownership. From an economic rationalisation perspective, ANG appears more as a cost burden and a liability: it was making losses and the unit cost was high. Many times it was the subject of debates to sell it off as a non-performing GoPNG SOE and this consideration is still on the table as the GoPNG appears not in a hurry to put down ANG as a ‘panting dog’.

GoPNG recently came to the rescue of ANG with a K2 billion funding but PMJM issued an ultimatum that ANG must make the most of this financial life-line or GoPNG will change its protectionist policy by ‘opening up the skies’ and allow more competition into ANG’s air coverage market. GoPNG’s decision to persist with and patronaging ANG is understandable given our airlines symbolism and status it projected for our nationhood. Hence, pursuits in maintaining a ‘National Airline’ is an endeavour that should be pursuit more on National Rationalisation than Economic Rationalisation.

As another prominent senior citizen Alois Jerewai is noted stating in one of his recent Facebook post, while our country still lacks total connectivity by road, the continued operation of Air Niugini is a public service and not necessarily a business concern while the. For National Security reasons also, this Airline’s survival is the survival of this Country.

Responding to many commentators on his post who viewed the situation with our National Airline from the Economic Rationalisation perspective, Mr. Jerewai said “the Airline is still the biggest mobiliser of our travelling public, business-people, and in case of immediate national state of emergency, the transportation of our security forces. While I agree with your various observations, the fact remains that the airline is not strictly a business concern. It is currently a public necessity.”

I agree with Mr. Jerewai and from a technocratic perspective our Airlines is salvageable from its current situation.

My suggestion for salvaging our National Airline is given in this article below.


PNGn Formal Sector Workers Are The ‘Kings And Queens’ Of ‘Charity’

Below is an extract from the writings of the late Bernard Narokobi in his seminal work ‘The Melanesian Way’.

Extract from Bernard Narokobi’s seminal work ‘The Melanesian Way’.

“We are often preached at by missionaries to be charitable and to give and not to count the cost. We are often urged by service organisations to engage in community work as if we have never known community service in our villages. In saying this I do not deny that the village ‘closeness’ is no longer true for towns and cities. Wantoks don’t live close to each other any more or have the time and resources to help each other. There is definitely a need for organisations like St. Vincent de Paul, Red Cross, the Port Moresby Development Group and Apex. I cast no aspersions on the sincerity of their members and am a member myself of some of these. I often wonder, however, whether some of these organisations exist as elite clubs to propagate themselves and to justify many smart business deals and activities that cannot measure up to either Christian or Melanesian standards of care and concern for one’s fellow.

“We must be careful not to destroy the Melanesian values of self sacrifice for the benefit or others, or make beggars and dependents out of our people by good works and deeds. Let me emphasis this point. I am not against charity organisations. There is certainly a place for charity organisations like St. Vincent de Paul in Port Moresby where for whatever reasons tribal and “wantok” links have broken down, and a need for government or publicly financed institutions for the aged, the blind, the deaf, the dumb, the lame and the disabled throughout Melanesia. Relatives and “wantoks” can no longer look after their physically handicapped without help, and need the support of all of us.

“Too often we join charity organisations for wrong reasons. Our foreign brothers and sisters seem to undertake charity or welfare work to justify their financially advantageous positions. Papua New Guineans are often made to feel that volunteer service is something imported to our shore sand planted in our hearts. How wrong this attitude is. It is nothing more than “Euroegocentricity”. Many Papua New Guineans support their aged parents, infant school relatives, widowed parents, and divorced sisters without ever asking for financial support from the Government, the Church, private enterprises or charity organisations. They do this because tradition dictates it.”

In a collectivist society such as ours, PNGn workers are ‘Kings And Queens’ of ‘Charity’. Even the pay we get does not stay only with us but is spread thin across our extended families and relatives. These people, our extended families and relatives, happen to be the very people our government is set up and we pay taxes to so they can be served.

But our GoPNG policy has not been kind and very disheartening to our PNGn workers. It was even heartless as it dip its fingers into the PNGn workers retirement savings.

View LinkedIn Article —>

There were many instances where it even refuses to pay the PNGn workers their rightful dues and here is such an example.

But the PNGn workers are steadfast in our duty to our fellow citizens and still hold out hope that our GoPNG will be proactive in encouraging our charitable hearts. These are the four actions that I think will encourage the heart of our ‘Kings And Queens’ of ‘Charity’:

1. Allow personal income tax payers a discretionary component of our taxes.

2. The other three are: reduce PIT if a discretionary component of tax is too difficult; remove dual pay salary so there is more money staying in the country and flowing within the circular flow of cash; and regulate the real estate industry so PNGn workers can have large disposable income to spend into the economy in other sectors and not just the real estate sector.

These above four actions I think will result in a win-win situation that will empower, enable and encourage the ‘Kings And Queens’ of ‘Charity’ which are the PNGn workers.

Internet Service Provider

Starlink Availability In PNG Will Have Suspicious Legal Regulatory Hurdles To Overcome First

The below Facebook post gives a contextual background to this article on the paradox of service provision by GoPNG in the ISP market.

The Facebook post giving context to this article.

The thought of Starlink as a new entrant into the Internet Service Provider (ISP) market in PNG is perceived as long overdue justice and a welcome relief by users of the present slow and expensive local ISPs. However, as reported, the National Information and Communications Technology Authority (NICTA) has decided that for the interest of existing ISPs in the country, Starlink Satellite Direct to Home Internet will not be legitimised in PNG. This legal regulatory hurdle is now viewed suspiciously as it contradicts the two main aims of government in providing goods and services to the citizens.

The two key objectives of government in serving the people are:

1. Social Efficiency (benefits of producing something must be greater than its cost to society); and

2. Equity Considerations (society’s resources are fairly distributed and shared by all).

Differentiating between equality and equity.

In a free market economy and to ensure its objectives are met, the government participates in the market to meet its social obligations by providing public goods and services. But when free market is not distributing equitably and fail to achieve social efficiency, the government intervenes to correct it. Where government is not involved directly it will intervene using various government policies and legal instruments to correct the market. Policy instruments may include taxes and subsidies to correct a monopoly market situation. Legal instruments are executed via regulatory bodies such as NICTA for market share in the ISP market as in this case and ICCC (Independent Consumer and Competition Commission) for price control so monopoly and oligopoly firms as well as State Own Enterprises (SOE’s) do not charge high prices.

SOEs are set up as semi-government businesses to deliver on the two key government objectives of social efficiency and equitable distribution while at the same time strive to become the government’s ‘milking cows’.

View LinkedIn Article –>

From a National Rationalisation perspective, GoPNG would want to protect the ISP market for its SOEs that are participating in that market. Unfortunately from an Economic Rationalisation point of view, the SOEs in the ISP market appear to have contributed to this comparatively slower internet services at higher prices in PNG and defeating the equitable aim of government in providing affordable and efficient services to the people. The intervention by GoPNG into the ISP market by allowing the entry of Starlink into PNG is much anticipated and would be most welcome.

View LinkedIn Link — >

Additionally, since 2013 GoPNG has had consecutive annual National Budget deficits which means revenue was less than expenses. To cover for the shortfall in the budget expenditure, the government had to borrow. Supporting those ‘panting dog’ SOEs in the ICT market would constitute a sizeable part of government expenditure. GoPNG need to have some fiscal discipline to reduce budget deficits and Starlink’s entrant into the ISP market in PNG now provides this opportunity to cut expenditure on continuing to support low performing and high cost SOEs in the ICT market which had failed and continue to not meet government’s aims in providing services in the ISP market segment.

View LinkedIn Article —>

Despite these opportunities to intervene and correct the market as well as to reduce wasteful expenditure and reduce budget deficits, GoPNG is highly unlikely to respond favourably and soundly. One of the dominant reasons for this is that GoPNG had earlier in 2022 already announced plans to launch a satellite and was reported to have projected a cost of K1.4 billion which it would now have probably appropriated in its budget. The current players in this market in PNG are most probably contracted and lined up already for this costly ambitious K1.4 billion project and expected windfall. It is committing to such irrelevant nice-to-have projects in such times that is propping up unnecessary our National Budget into deficits. Starlink’s entrant as a new ISP will nullify this wasteful and unnecessary cost to put a satellite into orbit by GoPNG and not suprisingly this will be rightfully seen as ‘disruptive internet connectivity’ and this is welcome so we can focus on other more needful stuff.

The Facebook post reporting GoPNG’s plan to have own satellite.

However, given the present position and commitment of GoPNG, do not expect GoPNG to budge easily on the position NICTA will take in pretense to protect the existing ISPs and the market in PNG.

Air Nuigini

Lack Of Standardisation With Onset Of Obsolescence Can Lead To High Cost Of Ownership For Air Niugini

Air Niugini’s (ANG’s) fleet consists of three Boeing 767, two Boeing 737, two Bombardier Dash 8-100*, four Bombardier Dash 8-200*, three Bombardier Dash 8-300* and six Fokker 100 aircraft. ANG has one Boeing 787 on order.

This article below is from a post by Exepreneur on 25th June 2023 on Air Niugini when unforeseen technical difficulties with two of the airline’s Boeing 767 aircraft were both temporarily rendered unserviceable in Brisbane, Australia. This had led to major adjustments in Air Niugini’s flight schedules, disrupting travel plans for passengers both domestically and internationally but incurring the high cost of ownership and one among them is reputational loss.

View LinkedIn Article —>


“๐˜ˆ๐˜ช๐˜ณ ๐˜ต๐˜ณ๐˜ข๐˜ฏ๐˜ด๐˜ฑ๐˜ฐ๐˜ณ๐˜ต ๐˜ง๐˜ข๐˜ค๐˜ช๐˜ญ๐˜ช๐˜ต๐˜ข๐˜ต๐˜ฆ๐˜ด ๐˜ช๐˜ฏ๐˜ต๐˜ฆ๐˜จ๐˜ณ๐˜ข๐˜ต๐˜ช๐˜ฐ๐˜ฏ ๐˜ช๐˜ฏ๐˜ต๐˜ฐ ๐˜ต๐˜ฉ๐˜ฆ ๐˜จ๐˜ญ๐˜ฐ๐˜ฃ๐˜ข๐˜ญ ๐˜ฆ๐˜ค๐˜ฐ๐˜ฏ๐˜ฐ๐˜ฎ๐˜บ ๐˜ข๐˜ฏ๐˜ฅ ๐˜ฑ๐˜ณ๐˜ฐ๐˜ท๐˜ช๐˜ฅ๐˜ฆ๐˜ด ๐˜ท๐˜ช๐˜ต๐˜ข๐˜ญ ๐˜ค๐˜ฐ๐˜ฏ๐˜ฏ๐˜ฆ๐˜ค๐˜ต๐˜ช๐˜ท๐˜ช๐˜ต๐˜บ ๐˜ฐ๐˜ฏ ๐˜ข ๐˜ฏ๐˜ข๐˜ต๐˜ช๐˜ฐ๐˜ฏ๐˜ข๐˜ญ, ๐˜ณ๐˜ฆ๐˜จ๐˜ช๐˜ฐ๐˜ฏ๐˜ข๐˜ญ, ๐˜ข๐˜ฏ๐˜ฅ ๐˜ช๐˜ฏ๐˜ต๐˜ฆ๐˜ณ๐˜ฏ๐˜ข๐˜ต๐˜ช๐˜ฐ๐˜ฏ๐˜ข๐˜ญ ๐˜ด๐˜ค๐˜ข๐˜ญ๐˜ฆ. ๐˜๐˜ต ๐˜ฉ๐˜ฆ๐˜ญ๐˜ฑ๐˜ด ๐˜จ๐˜ฆ๐˜ฏ๐˜ฆ๐˜ณ๐˜ข๐˜ต๐˜ฆ ๐˜ต๐˜ณ๐˜ข๐˜ฅ๐˜ฆ, ๐˜ฑ๐˜ณ๐˜ฐ๐˜ฎ๐˜ฐ๐˜ต๐˜ฆ ๐˜ต๐˜ฐ๐˜ถ๐˜ณ๐˜ช๐˜ด๐˜ฎ, ๐˜ข๐˜ฏ๐˜ฅ ๐˜ค๐˜ณ๐˜ฆ๐˜ข๐˜ต๐˜ฆ ๐˜ฆ๐˜ฎ๐˜ฑ๐˜ญ๐˜ฐ๐˜บ๐˜ฎ๐˜ฆ๐˜ฏ๐˜ต ๐˜ฐ๐˜ฑ๐˜ฑ๐˜ฐ๐˜ณ๐˜ต๐˜ถ๐˜ฏ๐˜ช๐˜ต๐˜ช๐˜ฆ๐˜ด” says World Bank.

However, when unexpected technical difficulties arise, airlines face the daunting task of maintaining their operations while ensuring passenger safety.

Air Niugini, the national airline of Papua New Guinea (PNG), is facing a difficult situation as it deals with a longer-than-expected repair time for its Boeing 767 planes.

The Acting Chief Executive Officer, Gary Seddon states that unforeseen technical difficulties with two of the airline’s Boeing 767 aircraft have rendered them both temporarily unserviceable in Brisbane, Australia leading to major adjustments in Air Niugini’s flight schedules, disrupting travel plans for passengers both domestically and internationally.

Beyond the inconvenience to travelers, flight disruptions also have economic consequences. PNG heavily relies on air transport for both domestic connectivity and international trade. Business travelers, who depend on consistent flight schedules, face challenges in conducting their operations smoothly. The country’s tourism sector which has started to recover from the  Covid19 impact suffers setbacks due to the disruptions, impacting revenue and employment in related industries.

“๐˜‹๐˜ถ๐˜ฆ ๐˜ต๐˜ฐ ๐˜ต๐˜ฉ๐˜ฆ ๐˜ค๐˜ฐ๐˜ฎ๐˜ฑ๐˜ญ๐˜ฆ๐˜น๐˜ช๐˜ต๐˜บ ๐˜ฐ๐˜ง ๐˜ต๐˜ฉ๐˜ฆ ๐˜ณ๐˜ฆ๐˜ฒ๐˜ถ๐˜ช๐˜ณ๐˜ฆ๐˜ฅ ๐˜ณ๐˜ฆ๐˜ฑ๐˜ข๐˜ช๐˜ณ๐˜ด ๐˜ข๐˜ฏ๐˜ฅ ๐˜ต๐˜ฉ๐˜ฆ ๐˜ข๐˜ท๐˜ข๐˜ช๐˜ญ๐˜ข๐˜ฃ๐˜ช๐˜ญ๐˜ช๐˜ต๐˜บ ๐˜ฐ๐˜ง ๐˜ด๐˜ฑ๐˜ข๐˜ณ๐˜ฆ ๐˜ฑ๐˜ข๐˜ณ๐˜ต๐˜ด, ๐˜ธ๐˜ฆ ๐˜ข๐˜ฏ๐˜ต๐˜ช๐˜ค๐˜ช๐˜ฑ๐˜ข๐˜ต๐˜ฆ ๐˜ต๐˜ฉ๐˜ข๐˜ต ๐˜ต๐˜ฉ๐˜ฆ ๐˜ณ๐˜ฆ๐˜ด๐˜ต๐˜ฐ๐˜ณ๐˜ข๐˜ต๐˜ช๐˜ฐ๐˜ฏ ๐˜ฑ๐˜ณ๐˜ฐ๐˜ค๐˜ฆ๐˜ด๐˜ด ๐˜ฎ๐˜ข๐˜บ ๐˜ต๐˜ข๐˜ฌ๐˜ฆ ๐˜ญ๐˜ฐ๐˜ฏ๐˜จ๐˜ฆ๐˜ณ ๐˜ต๐˜ฉ๐˜ข๐˜ฏ ๐˜ช๐˜ฏ๐˜ช๐˜ต๐˜ช๐˜ข๐˜ญ๐˜ญ๐˜บ ๐˜ฆ๐˜น๐˜ฑ๐˜ฆ๐˜ค๐˜ต๐˜ฆ๐˜ฅ. ๐˜ž๐˜ฆ ๐˜ข๐˜ณ๐˜ฆ ๐˜ฉ๐˜ฐ๐˜ฑ๐˜ฆ๐˜ง๐˜ถ๐˜ญ ๐˜ต๐˜ฐ ๐˜ฉ๐˜ข๐˜ท๐˜ฆ ๐˜ฐ๐˜ฏ๐˜ฆ ๐˜ฐ๐˜ง ๐˜ต๐˜ฉ๐˜ฆ ๐˜ธ๐˜ช๐˜ฅ๐˜ฆ๐˜ฃ๐˜ฐ๐˜ฅ๐˜บ ๐˜ข๐˜ช๐˜ณ๐˜ค๐˜ณ๐˜ข๐˜ง๐˜ต ๐˜ฐ๐˜ฑ๐˜ฆ๐˜ณ๐˜ข๐˜ต๐˜ช๐˜ฐ๐˜ฏ๐˜ข๐˜ญ ๐˜ฃ๐˜บ ๐˜ต๐˜ฉ๐˜ฆ ๐˜ฆ๐˜ฏ๐˜ฅ ๐˜ฐ๐˜ง ๐˜š๐˜ถ๐˜ฏ๐˜ฅ๐˜ข๐˜บ 25 ๐˜‘๐˜ถ๐˜ฏ๐˜ฆ. ๐˜›๐˜ฉ๐˜ฆ ๐˜ฑ๐˜ข๐˜ณ๐˜ต๐˜ด ๐˜ธ๐˜ฆ๐˜ณ๐˜ฆ ๐˜ด๐˜ฆ๐˜ค๐˜ถ๐˜ณ๐˜ฆ๐˜ฅ ๐˜ง๐˜ณ๐˜ฐ๐˜ฎ ๐˜ต๐˜ฉ๐˜ฆ ๐˜œ๐˜š ๐˜ข๐˜ฏ๐˜ฅ ๐˜ด๐˜ฉ๐˜ช๐˜ฑ๐˜ฑ๐˜ฆ๐˜ฅ ๐˜ฐ๐˜ท๐˜ฆ๐˜ณ๐˜ฏ๐˜ช๐˜จ๐˜ฉ๐˜ต

โ€œ๐˜›๐˜ฉ๐˜ฆ ๐˜ฐ๐˜ต๐˜ฉ๐˜ฆ๐˜ณ ๐˜ข๐˜ช๐˜ณ๐˜ค๐˜ณ๐˜ข๐˜ง๐˜ต ๐˜ธ๐˜ช๐˜ญ๐˜ญ ๐˜ฃ๐˜ฆ ๐˜ถ๐˜ฏ๐˜ข๐˜ท๐˜ข๐˜ช๐˜ญ๐˜ข๐˜ฃ๐˜ญ๐˜ฆ ๐˜ง๐˜ฐ๐˜ณ ๐˜ญ๐˜ฐ๐˜ฏ๐˜จ๐˜ฆ๐˜ณ ๐˜ต๐˜ฉ๐˜ข๐˜ฏ ๐˜ฆ๐˜น๐˜ฑ๐˜ฆ๐˜ค๐˜ต๐˜ฆ๐˜ฅ, ๐˜ข๐˜ด ๐˜ธ๐˜ฆ ๐˜ข๐˜ณ๐˜ฆ ๐˜ฑ๐˜ฆ๐˜ณ๐˜ง๐˜ฐ๐˜ณ๐˜ฎ๐˜ช๐˜ฏ๐˜จ ๐˜ข๐˜ฏ ๐˜ฆ๐˜ฏ๐˜จ๐˜ช๐˜ฏ๐˜ฆ ๐˜ค๐˜ฉ๐˜ข๐˜ฏ๐˜จ๐˜ฆ, ๐˜ฐ๐˜ฏ๐˜ค๐˜ฆ ๐˜ข ๐˜ด๐˜ฑ๐˜ข๐˜ณ๐˜ฆ ๐˜ฆ๐˜ฏ๐˜จ๐˜ช๐˜ฏ๐˜ฆ ๐˜ฉ๐˜ข๐˜ด ๐˜ฃ๐˜ฆ๐˜ฆ๐˜ฏ ๐˜ฎ๐˜ฐ๐˜ท๐˜ฆ๐˜ฅ ๐˜ต๐˜ฐ ๐˜‰๐˜ณ๐˜ช๐˜ด๐˜ฃ๐˜ข๐˜ฏ๐˜ฆ,” the CEO says

The Airline adds that it is working closely with its industry partners and evaluating the possibility of โ€˜wet leasingโ€™ additional aircraft to supplement its fleet and minimize service disruptions.


Reading through this press release you could sense this underlying challenge of a prevalent lack of standisation as well as a lack of strategic foresightedness (i.e. the complexities of the challenges increases with longer time horizons as this brings increase uncertainties and more variables and requires strategic foresightedness to mitigate the risks associated with obsolescence).

Standardisation in physical asset intensive industries, according to “R.A.I” Chatbot, is a continuous improvement endeavour that aims to lower operational cost, optimise performance as well as improve safety in industries such as in the airlines where safety of people is of the utmost paramount. Standardisation in maintenance refers to the process of establishing and implementing consistent practices and procedures for maintenance activities. This can include standardising equipment maintenance procedures, work instructions and job plans. Standardisation helps to ensure that maintenance activities are performed consistently and efficiently, which can improve equipment reliability, reduce downtime and increase safety. Standardisation can also help to streamline maintenance processes and reduce cost by eliminating unnecessary steps and reducing the need for rework.

The challenge with Standardisation is made harder with obsolescence and unstable BOD and Exec. Mgmnt not providing the strategic foresight to mitigate this risk of obsolescence.

Not many airlines operate B767 anymore and hence parts supply would be an issue. Boeing began developing the B767 nearly half a century ago. The model sold well during the 1980s and 1990s but demand plunged after 9/11 attacks. By 2030 it is expected that Boeing will cease manufacturing of B767. ANG need to move forward faster with the B787 deals to ease up the international routes and free up the 737 for major domestic routes like Lae and Hagen. But this lack of strategic foresight in mitigating the risk of obsolescence can be attributed to instability at the BOD and Exec. Mgmnt levels.

The quicker things change and the suppliers of aircraft fleet parts go out of business then the parts become obsolete. The risk associated with obsolescence includes safety, reputational loss and the economic cost of: re-fleeting the production assets (in this instance the aircrafts); restocking of new inventory of parts to support the new fleet; reviewing of maintenance systems (policies, standards and procedures); and upskilling/licensing of maintenance personnel as well as pilots to maintain and operate the new fleet.