A lot of the consulting work I do behind the scenes is for organizations within traditional industries that enjoy huge revenues and scale, but are starting to see disruptive forces impact what they do – perfect examples are banking (see here and here) and telecommunications where new technologies threaten the very core of their business. Start-ups face various barriers to entry, but their challenges are more about differentiating what they do from the competition and offering more value to their customers.
Airlines are perhaps one of the best examples of organizations in a traditional, highly competitive industry that have a massive imperative to change.
Significant volatility in costs and income means that airlines stand on a burning platform – they must find ways to keep their customers loyal, to increase aggregate revenues, and to cut costs without cutting perceived service levels.
As such I have been contemplating what “Airline Customer Service 2.0” – as I call it – would look like.
Part of my drive for thinking about this is the issues I’ve discovered as I fly a quarter of a million miles or so every year. Post 9/11, the glamor of business travel dissipated rapidly; how can we replace some of the service and excitement of business travel, within the construct of heightened security requirements?
For me, much of it comes down to integration. As it stands, the relationship between myself as a frequent traveler and my airline of choice is completely siloed – I exist in literally dozens of disparate systems within airlines, and with almost no integration between these systems, my experience as a customer is fragmented.
Here are some examples of recent experiences I’ve had that, I believe, have been sub-optimal:
- I was flying from EWR via LAX home to New Zealand with my wife on my 40th birthday. Wanting to surprise her I requested an upgrade to business class. When we boarded there was no record of our upgrade request (nor the fact that it was a special occasion). Imagine a system whereby flight staff had live access to a passenger’s upgrade requests, important biographical information and communications history. Sure they would not be able to guarantee every request could be met, but they’d at least be aware of what was going on.
- As a high value airline customer, I’m generally specially greeted by the flight service manager at the start of long-haul flights on my primary airline. Almost without fail however, the FSM has to ask me how to pronounce my last name. While this isn’t a big deal, imagine if the FSM was toting a mobile device which gave them some info about me (like how to pronounce my last name or that, though my passport says Benjamin I much prefer being called Ben). It’s the little things, right?
- I’m something of a control freak and ring the airline contact center on a semi-regular basis to check on small details regarding my travel. Every time I do so, I have to enter my frequent traveller code to obtain priority service (and yes, I’m eternally grateful for the priority service). Imagine a situation where my mobile number (the phone I call from 90% of the time) was known by the contact center and hence I could bypass all the identification steps.
- In the past few years I’ve flown on the day of – or the day before depending on time zones – my birthday. That’s not a biggie and I don’t expect any attention, but a smart mobile device in the hands of flight staff would give them access to that sort of information (even better, I’ve flown home from the US a few years running the day before my son’s birthday – imagine a cheery “Hope your kid has a great day” while in flight!)
- Airlines run regular promotional campaigns giving customers the chance to win unique experiences. I always enter these competitions. Every time I do, however, I have to enter the same details (name, phone number, membership number) into yet another system of record. Imagine if I had one global login to an airline that crossed all of my needs (booking, support, marketing campaigns etc). Or, by extension, imagine allowing me to use my Facebook credentials to sign into these services.
So what do all of these examples raise in terms of an opportunity for IT organizations in commercial aviation?
Let’s look at multi-national company SITA, which is already in the business of offering IT services and infrastructure to airlines. For example, SITA’s community baggage systems offer baggage tracking services that process more than 2.5 billion messages annually, helping airlines to ensure passengers and their baggage end up in the same place. The challenge for SITA, then, is to move beyond core airline operational systems and start to deliver “softer” functionality. While baggage handling and related operational services can help drive airline efficiencies, it is through customer connection systems that airlines can really attract and retain high value customers.
We’ve already seen SITA make some forays into this area – recently it developed some trial technology for Virgin Atlantic to enable airline concierges to use Google Glass to give travelers relevant information. While I wasn’t overly impressed with this initiative (it felt a little bit like jumping on the “next big thing” in technology rather than delivering something of real value today) it was good to see SITA start working in this area. Its newly branded SITA OnAir unit, which provides onboard technology is also looking at how to strengthen the connection between airline and customer in the air.
The real opportunity, and one which I would love to see SITA discuss at its upcoming Air Transport IT Summit in Brussels, is to help airlines better deliver their core customer-facing solutions. The core operating systems that airlines use (passenger manifests, frequent flyer information, promotional campaigns etc) all sit in siloed locations within an airline’s IT footprint. If SITA were to help the airlines expose all that data and roll a connecting fabric over the top of it, they could build massive value for airlines and, by extension, themselves. While a SITA development, integration and customer relationship management platform may be less sexy than a press release proclaiming the launch of a new virtual reality headset application, arguably it is more impactful on the industry.
That’s what I’m hoping to hear about from SITA at its summit, let’s see if I’m pleasantly surprised or not…
[Disclosure: I have, in the past, consulted to some of the organizations mentioned in this article. SITA is covering my expenses to attend its summit in Brussels this year. I’m a grumpy traveler who knows exactly what he wants.]