Winning in the B to C world
Emirates Airline president Sir Tim Clark is a man rarely given to stating the obvious yet, as Barbara Saunders reports, he believed it opportune when addressing the recent International Air Transport Association (IATA) World Passenger Symposium in Dubai.
Nobody needs reminding that it’s a B to C world we’re in now and the days of legacy intermediaries are rapidly coming to an end.
Those were the words of Emirates Airline president, Sir Tim Clark, as he called into focus the industry’s mounting preoccupation with ensuring it lives up to ever-growing customer demands – one which has given rise to supersonic-speed innovation with technology in the cockpit.
IATA CEO, Alexandre de Juniac, in his opening remarks, sounded a warning for all in the industry to fasten their safety belts for a startling speed of change.
“Keeping up is a major challenge for an industry whose first priority always must be safety. Safety is not measured by speed. And our excellent record on safety is the result of a mind-set focused on global standards and years of experience. Passenger needs, however, evolve much more quickly. And it is a real race to meet their expectations,” he said.
It’s also a race to meet growing passenger numbers. IATA’s latest 20-year passenger forecast says 7.2 billion people will by flying in 2035 – about twice as many as now. The forecast holds out huge growth opportunities, and enormous challenges.
Clark knows that only too well. Dubai has the world’s busiest international airport, handling 82 million passengers by September of this year – with Emirates carrying more than 51 million.
“Here in Dubai, we have high passenger numbers combined with the pressures of limited real estate at the airport… plus, we have strong competition from regional airports, and an economic imperative to develop air connectivity,” he explained. This led to his airline’s “unrelenting impetus to continually innovate, and find solutions to deliver the best possible travel experience”.
Emirates read the writing on the wall ages ago. It now has an active pipeline of innovation projects, ranging from operational efficiency enhancements, to product development and service delivery, and the in-house capability to design and develop the technology solutions to support them, but that, said Sir Tim, is no longer enough.
“With the speed and scale at which technology is developing, we also increasingly tap on external partnerships to help us with our innovation agenda.”
For the industry, he said, it meant a whole rethink. “We’ve got to throw away fatalistic legacy thinking and ask ourselves: ‘If we could redesign the airline passenger experience from scratch, what might that look like? And then, what does our business have to look like, to deliver on that passenger experience’?
“For starters, I can picture a passenger journey – from home to airport to boarding gate – without any stops.”
That picture is shared by de Juniac. It includes: online check-in with personal data uploaded before the passenger leaves home with ‘approval to fly’ from all authorities and the flight data being automatically transmitted to smart luggage tags. Passenger bags are dropped off in automated sorting bins and the passenger goes straight through a much smaller check-in hall. Biometrics or other smart technology continually tracks the passenger through the airport, with customised messages being sent to screens, smart watches or personal mobile devices, directing passengers to their departure gates or other checkpoints.
“There would be no gate lounges and minimal staff to complete the biometric-controlled boarding process,” Clark envisioned. “Central search could be hugely simplified and the process accelerated by using artificial intelligence-assisted, high-tech screening machines, which screen passengers and hand baggage at the same time, eliminating the need for multiple clothing and accessory removal and the resultant queues.”
The result, he said, could be a passenger with more time to spend in airport duty-free, fast food and merchandising offerings.
Clark believed the industry has things all about face. “When airports are being built, the tendency is to look at how things are done today rather than what could be done for the future. Buildings are built, and the passenger experience is then force-fitted into the structure, rather than the other way around. And… by the time approvals are received to start building anything, we’ll be looking at facilities that are outdated by another 10 years.”
De Juniac concurred and pointed to IATA’s new distribution capability (NDC) as helping change models by evolving the customer experience while the ‘one order’ initiative promised itineraries with a single reference number connecting to budget carrier networks, adding customer value and opening up business opportunities.
Its success, he said, depended upon a completely overhauled approach. “We must be prepared for fundamental change in the back-office – replacing not just legacy systems, but also legacy mind-set.”
Next up, said de Juniac, would be the ‘one identity’ vision, which could be achieved “through close collaboration between airlines, airports and governments”.
IATA joined forces with global IT provider, SITA, to ram the message home with a study that said worldwide deployment of radio frequency identification (RFI) technology, which can accurately track passengers’ baggage in real time, could save the industry a fortune over the next seven years by reducing the number of mishandled bags by up to 25%.
The study claims RFID capabilities could be deployed for as little $0.1 per passenger on average, while generating expected savings of more than $0.2 per passenger.
The innovators, however, aren’t waiting for the new mind-set, forcing the agenda with ever-smarter technologies.
SAP and Dubai Technology Partners (DTP) are working together on a suite of products to optimise airport and airline efficiency. Version one of the, as yet, unbranded suite will launch imminently.
Abdul Razzak Mikati, managing director, DTP, explained: “Using SAP systems integration we are providing a platform that will process data in real time, enabling airport and airline decision-makers to make more-informed decisions.”
He claims the ‘made-in-the UAE’ solution is unique. “It takes up to 20 individual sub-systems and collates the data in real time using a high technology platform like SAP HANA to get one view. Take turnaround times – we can decrease them. We can also manage specific processes with a fast, in-memory platform, which can forecast scenarios based on historic data going back up to four years,” he said.
He doesn’t say when other suite versions will go to market; just that the partners “have a road map”. He does, though, explain that it has multiple functions in forecasting, using historical data and SAP’s model to predict what any flight’s behaviour will be.
“This is important for the airport to plan and equally important for the customer experience,” he added.
Tayfun Topkoc, managing director, SAP UAE, says the partners are already talking to various airports about the solution, which can enhance passenger experience and make the throughput of millions of travellers so much easier.
“The platform can be enriched with data to deliver management processes, to manage historic-based forecasts, to manage flight delays and queues,” he said. “Data-analytics allows the operators to make more informed decisions and provide some machine-learning technology – the latest trend for which the algorithms can predict and forecast the extent of crowds, loads, baggage handling and delays. Operators can then optimise resources and meet demand efficiently.
“We can deliver up to a 64% reduction in down time for airlines, which equates to operational savings for airlines and airports of up to 76%. It also allows the more efficient management of incidents at airports.”
Version one of the suite is a test bed. “Once launched we will get feedback and make any required changes, which is proof of our agility to adapt to customer requirements,” said Abdul Razzak.
DTP and SAP see massive potential for the suite. “The market is huge,” said Abdul Razzak. “We’re looking at the UAE yes, but also to the region and then global. Saudi Arabia, for example, has 25 local airports to be remodelled, then there’s redevelopment in Kuwait, Bahrain and Oman. Travel demand everywhere is increasing the need for optimisation.”
Of course, to deliver the streamlined travel experience passengers are now demanding requires a synchronised agenda across the entire aviation ecosystem – a prerequisite not lost on Clark.
“That includes getting our suppliers, airport operators and security providers, immigration and customs, to buy into our vision of air travel experience and to provide the quality systems, infrastructure and support that airlines need to deliver on that vision,” he said.