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article imageAirlines are embracing digital transformation

By Tim Sandle     Aug 23, 2017 in Technology
The airline sector is highly competitive with different carriers seeking new ways to control costs and gain passenger access. This environment makes the sector ripe for digital transformation. We assess some initiatives.
Digital transformation takes different forms for airlines. Some applications relate to backroom functions, seeking better financial clarity whereas other initiative involve improving the customer experience.
With the latter, the airline JetBlue has focused on being attractive to the customer, which has consisted of putting live high definition televisions in seat backs and with being the first airline to introduce satellite based, onboard Wi-Fi. The airline has also introduced NFC (near field communications) to eliminate the tedious nature of the check-in process. This has been improved by allowing a kiosk to identify a customer and profile the minute he or she walks up to it.
One example of an airline embracing the digital transformation process is Cathay Pacific Airways. The airline has a fleet of 140 planes, and it covers some 190 countries. Despite its large market share the airline faces intense competition. To address threats and opportunities the airline recently launched a review of its finance and procurement operations, under the title of the ‘Horizon8’ initiative. The aim here was to utilize digital technology to introduce greater transparency of the company’s expenditure; to assess route profitability and to generate more accurate financial reporting. This involved the use of a Systems, Applications & Products (SAP) system. Such systems provide users with a soft real-time business application. The system contains a user interface and is considered very flexible.
To achieve these goals the airline embraced a digital procurement system called SAP S/4HANA. Through the capture of data and use of big data analytics, the airline was able to improve on planning and budgeting, financial consolidation, profitability analysis, and garner better business intelligence. The system allowed the airline to collect information in real-time. Quoted by the website Consultancy.UK, Sumit Nurpuri who was involved with the implementation of the system through SAP experts Capgemini said: “This transformational project at Cathay Pacific Airways is a testament to Capgemini’s significant aviation and SAP software experience across the world. We are delighted that the program will (once live) enable one of the world’s top airlines to benefit from cost efficiencies and new digital capabilities in the years to come.”
A third example comes from Malaysia Airlines which has launched its first in-house Innovation Lab, dubbed the iSpace. The focus is on building an agile and modern workspace for employees. The workspace is equipped with the airline’s physical Solution Cafe which provides helpdesk support, a reading corner, gaming, recreational and meeting rooms.
These examples show how digital technology can be used by an established industry, where individual airlines can put in place initiatives in order to stay ahead of others.
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