Title

Outsourcing the management of major airports of Pakistan: challenges and opportunities

Degree

Master of Business Administration Executive

Faculty / School

Faculty of Business Administration (FBA)

Year of Award

Spring 2019

Project Type

MBA Executive Research Project

Access Type

Restricted Access

Keywords

Airports -- Pakistan | Management | challenges

Executive Summary

The aviation industry of any country is. a major contributor to its socio-economic development. Airports around the world were traditionally managed by states either through direct control or through a civil aviation department or authority. During the last two-three decades the trend of privatizing or outsourcing the operation, maintenance, and development of airports to the private sector has become an international trend. The purpose to involve private sector is mainly to increase efficiency, quality of service, revenue streams through increased traffic and through commercial activities other than the pure aeronautical activities, to encourage the private sector to invest in the development of new airports which requires huge capital expenditures, etc. Many airports around the world are already using different models of Public Private Partnerships (PPP) for airport management without compromising standards and recommended practices by the International Civil Aviation Organization (ICAO). In Pakistan, all commercial airports other than Sialkot International Airport are owned and managed by Pakistan Civil Aviation Authority (PCAA) which is an autonomous body under the Ministry of Aviation. Currently, airports owned and managed by PCAA are facing issues like reduced efficiency, slow commercial activities, future development challenges, capacity building of human resource and customer dissatisfaction, etc. To overcome such problems, PCAA plans to outsource the management of major airports of Pakistan to renowned international airport operators following the international trends to introduce PPP model in aviation sector which is also in-line with the National Aviation Policy-2015. This study will highlight the challenges and opportunities associated with outsourcing management. The study will also look into outsourcing models adopted by other countries and what Pakistan can learn from such endeavors. Moreover, inputs from the experts and stakeholders will give more insights into local hurdles and opportunities and how PCAA should proceed with this process. The research will also look into outsourcing models taking in consideration of the local framework of the aviation industry in Pakistan and will try to evaluate whether this step will introduce positive trends in the airports and the overall industry or whether some other strategies can also be evaluated for that purpose.

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