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Thu, Apr 01, 2004

Outsourcing Key to Tartan Lines Profitability

Tartan Air Lines announced this week its 1Q 04 results, reporting profits up steeply and declaring a dividend of 43 cents a share, for the first time in the history of the no-frills airline. "Outsourcing is the key," CEO Edmund McBargan told analysts during a conference call. Tartan has always outsourced indirect cost centers such as ticketing, customer service, information technology, and baggage claim, mostly with long-time outsourcing partner Pilotless Technology of Mumbai and Delhi, India.

The change that brought the airline new levels of profit is the actual outsourcing of piloting tasks. "It happens at the point where the UAV technology vector intersects the cost of labour vector," University of Minnesota economist Andy Borowitz explained. "At that point, you are dumb to hire pilots."

Pranipwal Ramadacharvaryan, a former Indian Air Force MiG-21 pilot, said he liked his job, which pays $3,000 a year. "Firstly, this plane is much less likely to crash than one of those old, ill-kept Fishbeds," he told us in perfect English, for which he credits Pilotless Technology's intensive language and accent classes. "Secondly, if it does, it's not my problem."

In a nearby classroom, lit by sunlight and caressed by the fragrances and subtle sounds of the metropolis outside, instructors taught new hires about the equipment they would soon be operating. "This is the Futaba digital proportional radio-control transmitter," intoned instructor Ranjit Singh. "Digital proportional radio-control transmitter," the students happily repeat. They will get some hands-on with the unit before joining Mr Ramadacharvaryan and others on the "production floor."

Union activists have attacked the outsourcing program. "Och aye," said McBargan. "They 'would' do that. But actually, we employ just as many Americans and other nationalities as we did. What's more, instead of in-demand pilots, we source these new hires from among the hard-core unemployed."

Hard-core unemployed? Of course. McBargan is referring to the 650 actors and actresses who have replaced the flight deck crews on his airliners. On long, tapered fingers, Tartan's CFO Jake Marley enumerates the advantages of hiring actors:

"One, it frees up dozens of restaurant positions for people who can actually pay attention to waiting tables. Two, it's cost-effective. We're talking will work for food here -- not that the pilots were that much different. Three, by using actors from Central Casting we always get pilots that look like pilots. When our pilots had to be pilots they didn't look anywhere near as pilot-like as these guys and gals do. How do you feel when you see a line pilot with a weak chin, or a beer belly, or three chins? What about some gal who looks like she can't reach the pedals? So, four, it increases passenger confidence."

http://www.scroogeandmarley.com

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