Ai Editorial: 5 areas that can propel airlines’ digital transformation journey

First Published on 14th May, 2018

Ai Editorial: Avoiding quick wins, adopting fail-fast attitude, opting for growth culture, a governance team and setting up a “best of breed” platform for optimizing digital experiences can help in a big way in gearing up for the digital API economy, writes Ai’s Ritesh Gupta

 

Airlines need to gear up for the digital world, which brings significantly different complexity and speed, something the likes of network carriers weren’t used to in the classical economy.

It is time to do away with slow, incumbent development processes, technologies and applications to deliver change.

Airlines have to be ready - digitally enabled end-to-end, by working out new digital front-end experiences, and seamlessly connecting these to the back-end systems.

At the same time, the journey of digital transformation needs to be understood because transforming a business involves an element of risk, too.

Failure to demonstrate value as desired can be a major concern. Here we explore 5 aspects that can help airlines in getting closer to the goal of being agile and delivering a superlative passenger experience as an organization:

·          Avoid quick wins: Do away with the mindset of “incrementalism”. It is being pointed out that if organizations end up settling for commodity-level task for incremental enhancements then it won’t serve the purpose. Don’t incentivize the team to progress only for quick gains. In one of his recent posts, Dave Thomson, Head of Product at Skyscanner, wrote that with this approach, one can avoid “big scary problems”. Thomson referred to a couple of possibilities where such mistakes happen –relatively larger businesses tend to be susceptible and the lack of precise and linked goals letting executives/ teams to work on an idea and deliver it. He says “think of quick wins as handing a lifeline to your competitors” and letting them “entirely leapfrog everything you are doing”. Thomson’s recommendation: think of “the network effects that exist within marketplaces, it’s better to swing for the fence and miss than not swing at all”.

·          Adopt fail fast attitude: Make learning as transparent as possible. For those keen on sharing learning, they go for reasonable prototypes, test them with users, and constantly refine them until they reach a minimum viable product. User experience professionals point out that focus must not be on the functional attributes of your product or service, but instead on the context for how customers purchases and use them.

“A great user experience isn’t enough. Airlines need to be connecting user experience with conversion rate optimization, but this isn’t happening today because most airlines don’t understand the relationship between the two.  We are constantly seeing airlines spend 6 months to 1-year designing a new digital experience, then they spend another year building this new digital experience, but by the time they have the new experience live it is 1-2 years old.  This process can’t continue for airlines to be successful,” says Mike Slone, Chief Experience Officer, Travelaer.

“(Airlines) They need to develop a “fail fast” attitude. One that allows them to quickly produce new innovative digital experiences, launch them, observe successes and failures, revise the user experience, observe and measure, and then optimize and redesign again- this should be a constant process, not one that is started every few years after you realize that your user experience is old and outdated.  Airlines are not agile enough and most are not willing to fail fast, thus they will always be behind until they change their internal processes to stay ahead of their customers,” shared Slone.

·          Go for growth culture: Specialists point out that digital transformation is certainly not about assets, it’s not even about processes and methodologies. It’s about culture.

As a digital organization, Air New Zealand encourages a culture of curiosity, learning and problem solving, while providing clear direction and support.

Companies like Skyscanner are very particular about agile developments cycles and speed associated with it. Focus on setting up small, cross-functional, dedicated teams. They work on a small set of tasks together as a unit, and get feedback and clarification from each other continuously. In these companies engineering, growth, data science, and product operate together as much as possible. They deliver very fast, ensure teams are never afraid of trying new things and offer them ownership and independence in their functioning. Failure is part of their daily routine, as there is a culture of forgiveness and experimentation.

·          Governance team: Datalex recommends putting in place an agile governance team. Blair Koch, Datalex CTO and President USA asserts that this team should feature senior leader representation from all the functional leaders involved in the scope of the digital transformation.

“The roadmap developed should show how the transformation will take you from the current state to the future state and include a dimension of time, preferably at least quarterly “releases” of capabilities. The roadmap should be 24-36 months in duration,” wrote Koch in his posting.

·          Role of travel technology: The future of an airline’s digital success is building their own “best of breed” platform that can incorporate seamlessly the best travel tech products or modules into one experience.

“Relying on one Internet Booking Engine or one travel tech partner is often a mistake because the airline is held back by the abilities of one provider, when they could be advancing by working with multiple providers. Some airlines will always want the “easy button,” but the innovative airlines will push beyond the spoon feeding that happens from the large travel tech providers,” said Slone.

Airlines are starting to use sophisticated tools not produced by travel tech companies to improve their ability to personalize and adapt the content to their customer’s needs.  

 

Hear from experts and assess the journey of travel companies at the upcoming Mega Event Asia-Pacific (Ancillary, Loyalty and Co-Brand Conferences) to be held in Bangkok, Thailand (28-30 August, 2018).

Follow Ai on Twitter: @Ai_Connects_Us

 

 

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