The airline CFO function is no longer a back-end job producing and sharing data. It has become a front-end decision-making job. CFO’s, you are already in the cockpit of organizations! Let's take a look of how to redefine the role of Airline finance in a data-driven world.
What does this mean for the modern airline finance leaders? What is changing? What are the trends that will influence and re-define what your role is likely to be? Let’s talk about you and how your role has undoubtedly evolved because among other things, you are already on the co-pilot seats of your organizations.
The travel market is changing:
We are seeing many changes in the market, and many more on the horizon.
- Digital Transformation is the top business priority of 2019. The World Economic Forum estimates that the overall economic value of digital transformation to business and society will top USD 100 trillion by 2025.
- Airlines, being a service industry, will use this transformation to enhance the customer journey, to elevate the customer experience and incorporate technology because that is what the new digitally savvy generations (Millennials or Gen Z) expect.
- Airlines are aspiring to become online retailers, more like Amazon. The New Distribution Capability (NDC) & One Order are great facilitators for business model changes.
- Bitcoin, digital wallets and alternative forms of payments will mushroom.
Companies are appointing ‘Chief Digital Officers’. CIO’s are creating exhaustive plans on how to go down this path. There is a strong element of change management within organizations requiring education and, with all these changes comes the need for regulation in the ecosystem. All this rests on a solid data foundation! (https://www.zdnet.com/article/the-biggest-lessons-learned-in-digital-transformation/)
DATA is the key:
Between the data that goes in and what finally comes out, there is a whole new complex layer of data management. Completeness, timeliness, accuracy, whilst converting data into transformation is key. Major decisions are made depending on this data. CEO’s and CFO’s sign on their P&L and balance sheets!
The Finance Departments generate a huge amount of data which sits at the base of all the analysis, it is crucial that this is done right. It’s the foundation of the digital transformation building, which could crumble like a pack of cards if not done correctly.
In summary, earlier you used to focus on compliance and audit, data security, operational objectives, budgeting and forecasting. Now you are also asked to provide quality data and analytics that can point the organization in the right direction, again, to become a bonafide co-pilot to the CFO and the CEO.
You have in your grasp the single version of truth in terms of data that can be used for decision making, and performance monitoring across the organization. It´s all about the data, the data you have, the data that matches real financial performance, and what you can do with that data.
So, it isn’t just about producing or having data available, it is about leveraging it to gain business intelligence, to provide compliance, quality, and guidance.
The whole nature of data is changing:
How do you preserve it´s sanctity? How do you become ready for the future of your airline and what will your role be in it?
- Understand how the data you generate is used by your stakeholders today. Do they understand it? Are they using it correctly?
- Understand how you can bring value to stakeholders beyond the Finance function.
- Ensure you are helping by providing quality data through your financial systems.
- Go beyond providing the data…. how can you use analytics and automation to get real tangible value from the data available? Be proactive!
- Understand how different business elements can integrate and work better together.
The need of the hour is to leverage data and automation, and to have the right tools to harness the power of data in your own airline to be the co–pilot in its true sense.
If you are interested in learning more about the definition of CFO role in airlines, you would like to read Redefining Performance Insights as an Airline CFO