How the right strategic partner can maximise an airline’s digital investments
The space sector traditionally faces some of the most versatile problems that need innovative solutions. The mission statement of NASA makes it clear that it relies on diverse sets of people to face the dynamic challenges in space programs. When NASA forms a team, each member possesses a different set of capabilities and as a team, collectively, the members could think differently and come up with multiple viewpoints. When such teams work together on problems, they get innovative ideas that enable them to derive new solutions; in other words, they become self-sustainable units. This paradigm of solution development is applicable even for modern-day business sectors like the airline industry, which involves rapid evolution that necessitates frequent innovations.
One of the most striking observations from the airline sector is how low cost carriers (LCC) are now transforming themselves to move into previously uncharted territories like loyalty programs and code sharing/interlining with other airlines for more connection trips, including partnerships with full service carriers (FSC) for long haul flights. Besides, a lot of these airlines are now offering full service package sales through their websites as well as on GDSs thereby improving their reach. On the other hand, full service carriers now offer unbundled fares and rely more on ancillary sales to improve their revenue. Some even have their own LCC subsidiaries to compete with other LCCs and are driving NDC initiatives to have alternatives over GDS. The challenge discussed for space sector is equally applicable for the airline industry with regards to its technology development initiatives.
However, considering cost pressure, can an airline form self-sustainable teams with diverse skill sets to achieve its technology aspirations? Will partnering a technology company help satisfy its digital ambitions? The high levels of domain and technology competency required in software development pose a need for airlines to engage a strategic partner to build their digital ecosystem. Such a partner would be equally competent in technology and domain knowledge and can bring in diverse perspectives to connect business problems with technical solutions.
Here are some of the top advantages an airline stands to enjoy by engaging a strategic partner to drive its digital transformation initiatives:
A strategic partner specialised in the airline domain can serve not just as a technology implementation partner but also offer high-level advisory on how an airline can innovate its business offerings through a host of digital technologies. For example, the right partner can help an airline identify data streams within the technology infrastructure that can be subjected to machine learning and big data analytics to uncover hidden insights that have the potential to reform the business. The same partner can recommend and oversee high-level processes, standards, and re-engineering initiatives necessary to help airlines become early adopters of the industry's digital trends like artificial intelligence, blockchain, and Internet of Things.
Assured delivery success
If you opt for a service provider that offers just technical excellence at lower costs then there are high chances of failure in delivering a working solution or in delivering a solution aligned to business needs. It could be because the solution had high-level technology deployed but failed to capture the nuances and unique workflows particular to the airline industry. A typical example would be an airline selecting an IT powerhouse serving multiple industries, to build a vendor portal solution for its cargo management system, over a specialist air cargo technology service provider, due to lower costs. The selected partner would deliver a technically competent portal but has a high chance of missing out on testing the solution over typical air cargo scenarios. The solution when deployed may cause more harm than good for the airline and ultimately prompt the airline to build the portal again from scratch, thereby scaling up costs. Had a strategic partner specialising in air cargo technology been selected, all possible operational scenarios would have been developed right at the first time and tested on the solution before it went live. The airline could reap the benefits fully from day one of deployment.
Faster time to market with efficient development practices
While airlines could go overboard with requirements for their enterprise applications, there would be several instances where components could be reused or removed from development scenarios due to outdated technology. Having a partner well versed with the business aspects of the airline industry can be beneficial during the initial requirement validation phase. Such a partner with strong techno-functional expertise can analyse requirements and ask questions that would help the customer reuse elements and eliminate unwanted development of components, thereby lowering costs and enabling them to bring the innovative solution to the market faster. For example, an airline enterprise application may require several connectors that bind it with other third-party systems in its technology ecosystem. A techno-functional partner can ask the right questions to identify such connectors which can be reused or shared for multiple integrations and hence prevent duplicate efforts in development. Besides, their experience in developing similar connectors for other customers would enable them to promote reusability for cost effectiveness.
The airline industry is known to have several unique operational constraints and challenges. A technology partner with limited domain knowledge would need to negotiate a significantly large learning curve to get acquainted with the kind of scenarios that a solution would need to encounter. This knowledge acquiring phase could stretch from anywhere between a month to over six months depending on the influence the application has on the customer's business ecosystem. This would lead to the airline's business management team spending valuable time on providing business training for the partner. The effort would have to be replicated every time a new engagement with the partner is to be initiated. However, a strategic partner with techno-functional expertise on the other hand can start delivering value from day one of the engagement as the partner would be very familiar with high-end solution building exercises that address the nuances and challenges of the airline sector.
The key to deriving value from an airline's digital investments lies in efficiently bringing on-board customer facing innovations better and faster than the competition. For this to happen, an airline needs to have a strategic partner that can bring both technical excellence and domain acumen to the drawing board. The solutions and initiatives stemming from such partnerships should be capable of empowering airlines to build deep relationships with their customers by offering them innovative and integrated experiences across a broad spectrum of areas such as pricing, destinations, loyalty programs, convenience, logistical support, on-boarding and much more. These partnerships help lay the foundation for scalable solutions that can easily accommodate trending market propositions in future and enable the airlines to innovate faster at lowered costs.
About the author
Mohamed Jaffer Ali A, is a Senior Service Delivery Manager who has worked with global customers in the airline, rail, and cruises industries. He is an expert in handling the development and implementation of business-critical applications and digital transformation projects, creating significant business value for the customers. He is a PMP, CSM, and AWS Solution Architect certified professional.