Digital disruption is hot topic in the aviation industry today. Airlines are facing a rapidly changing landscape, from increasing on-demand customer services to streamlined operations with new technology. Today's industry leaders see digital disruption as a way to improve their capabilities and the experiences they deliver. At a recent industry conference, Aviation Festival Europe, there were featured presentations by executives from three leading airlines: Emirates, JetBlue, and Qantas. In this post, we explore their perspectives on digital disruption.
During the opening keynote, Emirates President, Sir Tim Clark, discussed the importance of digital transformation for airlines on both the consumer-facing and back-end side of their businesses. He particularly stressed the need for airlines to update their legacy systems, many of which are outdated and inefficient.
Already Emirates has spearheaded some new initiatives and products to improve the customer experience and internal operations. This year, for example, the airline announced the introduction of facial recognition scanners with the goal of decreasing wait times at security points and customs.
Sir Clark put it simply when he said, “Our business has to move…at the pace of customer expectations. If your businesses can’t keep up…you will perish.”
JetBlue CIO, Eash Sundaram, focused on the role digital transformation plays in the customer experience. Sundaram also spoke about JetBlue Technology Ventures, Silicon Valley’s first venture capital subsidiary backed by an American airline. JetBlue aims to support companies that are building technical capabilities that can later help JetBlue simplify the customer experience. The goal is for JetBlue to bring these companies in-house when they’re ready.
As Sundaram explained, “if you make the customer experience incredibly simple, customers will be significantly more loyal than just throwing points at them.”
Qantas CEO, Gareth Evans, focused on the “how” of digital transformation. What steps to airlines need to take to embrace digital transformation? Evans discussed what he calls the Three Pillars of Transformation:
Cultural Transformation: Employees are the lifeblood of any organization. Airlines should do what they can to improve their skills and enhance their engagement with their employers.
Customer Transformation: Airlines aren’t exactly known for providing the best customer service. They should work to improve customer satisfaction and the customer experience, both of which would garner improved loyalty.
Network and Fleet Transformation: Airlines are plagued with outdated processes and technology. Airlines should revamp their operations and financials across their entire organizations to improve efficiency while cutting costs.
Qantas has taken the need for change to heart. Earlier this year, the airline announced the launch of its AVRO Accelerator. This incubator gives startups the opportunity to present ideas to Qantas members related to improving the traveling experience, solving complex business problems, and using new technologies.
The AVRO Accelerator involves 10 teams over a 12-week program. Participants will work with Qantas and other industry mentors while having access to selected Qantas customer insights, operational data, and technology platforms.
The Opportunity of Digital Disruption
Airlines face a variety of challenges in today’s competitive environment. It’s easy to see why leadership is overwhelmed with the seemingly endless list of emerging technologies and solutions. Yet, as Evans puts it, digital disruption should be seen as an opportunity, not as a negative influence. “Why should we wait to be disrupted? Why not leverage our brands, our customers and our data to go and disrupt other industries?”
His way of thinking could put airlines in the right frame of mind to embrace change. Not only will airlines overcome their fear of digital disruption, but also play a role in shaping their industry for the future. Those who don’t will only get left behind.