David Brett, president of Amadeus Asia Pacific, sheds light on the changing travel landscape and how technology is helping airlines to keep customers happy. When selecting an airline to fly with, what factors do you consider?
Price is probably a major consideration, and of course you will select the airline that offers flights at times that are most convenient. Maybe you are willing to compromise on price for a flight at the right time, or vice versa. You might have a preferred airline because of its reliability for fast check-in and on-time departures. You may be more concerned about the in-flight experience—do they offer good entertainment, an enjoyable meal, polite service, and ‘creature comforts’ such as blankets and pillows. But I bet you have never considered which airline has a superior IT system, and in the past it probably wouldn’t have mattered, with most airlines operating on a similar IT infrastructure.
But today, IT is something that you should be aware of. Why? Because today’s modern airline IT systems have the ability to alter the travel experience quite dramatically, from booking through to check-in and baggage handling.
Do you have a story of travel gone wrong?
Almost everyone has one. A story to tell about the time they flew with a particular airline and things went horribly wrong. Perhaps when booking the flight the wrong passenger details were recorded or the website crashed at the crucial moment. Or when checking in, the airline had no record of the booking. Lost baggage, frequent flyer points that never materialise…the list of horror stories goes on. What most passengers don’t realise is that many of these issues can be avoided if the airline is using ‘intelligent’ IT systems.
Right now, many airlines are still using what are known as ‘legacy’ IT systems— in other words, dinosaur software that is no longer capable of handling the demands that are placed on a modern-day airline. They sometimes cannot cope with the vast number of bookings that an airline processes today, and there is a lot of room for error if information is entered incorrectly. These older systems are also unique to each airline. If a carrier decides to merge with another airline or join an alliance such as Star Alliance, OneWorld or SkyTeam, their systems will not be compatible and the partnership won’t operate seamlessly if a passenger wants to book flights between partners.
Amadeus has seen increasing demand for e-commerce technologies that help airlines to increase revenues and improve the online shopping experience via their websites. However, in order for these Internet technologies to be most effective, they must be linked to an efficient internal IT system to deliver what the website promises.
Time for an upgrade
However, many airlines are moving towards a change that will enhance your travel experience. Despite the fact that the global recession has hit the airline industry hard, in an unprecedented drop in travel, worse than 9/11 or SARS, many carriers have signed up to shift their technology to a new platform that will help them to survive and prosper. Why now? Perhaps because crises force airlines to analyse their systems and processes, to trim back on costs and to ensure that customers remain loyal. It is in periods of heavy economic pressure that airlines need to build and maintain customer loyalty, and only the best IT can help them improve the flight experience and thus customer relations. Operational stress can also help airlines evaluate what parts of their internal and external processes are not working well, and then set those parts right.
Despite financial gurus saying that the current downturn may have reached its lowest point, the potential escalation of the H1N1 flu outbreak and political unrest in Asia Pacific have clearly shown that volatility is the only constant factor in the travel industry. There will always be some threat, but some airlines will be able to manage the risk better than others.
When airlines operating on legacy systems consider the capabilities of their IT, it is clear that there is a huge gap, and only a change to a more modern system can help. More than 70 airlines globally have come to this realisation, and are outsourcing their IT to travel technology experts such as Amadeus.
For example, the Star Alliance selected Amadeus’ IT platform as the recommended common system for its members. This will help member airlines to significantly reduce both the ongoing costs of IT development and maintenance, improve their operational capabilities and offer an enhanced and consistent level of customer service across their partnership. In the future, a Singapore Airlines passenger travelling on a code-share flight with a Star Alliance member will find his or her passenger data such as seat or meal preferences recorded and duly noted by partner airlines as well.
In Asia Pacific, many of the leading players are also on their way to an IT transformation. Last year, Qantas became the first airline globally to complete migration to Amadeus’ Altéa customer management system (CMS). Singapore Airlines, Cathay Pacific and V Australia are among the others who are in the process of revolutionising their IT with Amadeus. Technology is becoming the key differentiator between those airlines which are prepared for the future and those that aren’t.
Speaking at the Malaysian Association of Professional Speakers seminar in Kuala Lumpur, Tony Fernandes, chief executive officer of AirAsia, said three factors are crucial in running a business and navigating turbulent times — creativity, brand innovation and technology. The secret to staying in the black even through dips in the travel cycle is to create a streamlined, flexible company model that can easily adapt to changing circumstances and new opportunities. To do that, one needs to be a more advanced, more cunning user of IT than one’s competitors.
In this time of transition, the gap between the ‘haves’ and ‘have-nots’ is becoming more visible. Those on legacy systems will find them expensive, difficult to maintain and to adapt to the new travel environment. If an airline needs to scale back operations, change its distribution strategy or wants to implement automated check-in, for example, it will find the legacy system network virtually impossible to manipulate.
On the other hand, those on open systems will find that their maintenance costs are lowered, sales are increased, and customer service improved. Open systems technology such as the Altéa CMS has an intuitive check-in agent interface, helps to maximise loading on the aircraft, and automates functions at all steps in the journey—from check-in to seat planning and boarding gate configuration. And while they may not realise it, passengers experience smoother flights with fewer delays, faster check-ins, more efficient baggage handling, and overall, a more pleasant travelling experience.
So the next time you fly, consider all the steps in the journey that can be vastly improved with the help of first-class IT. You will soon see that the future of the airline industry lies in a decision that almost all airlines are facing right now. Will they fight to make their existing technology bend and stretch in ways that it is not designed to, and continue to experience the problems that make a passenger, such as yourself, less satisfied? Or will they choose to future-proof their business by choosing cutting-edge IT that is intuitive to passenger needs, and improves not only the travel experience, but also the carrier’s bottom line? The Asia Pacific aviation industry is certainly beginning to see the light and show the way forward, as more carriers move towards first-class IT systems that will help them to navigate the future and come out on top.
Join the CIO New Zealand group on LinkedIn. The group is open to CIOs, IT Directors, COOs, CTOs and senior IT managers.