The impact of digital transformation on airport processes, business models and passenger experience
Widely accepted as a disruptive force which changes management mind sets, business processes and business models, digital transformation has been evolving for decades – ever since the first automated baggage sorting systems appeared in the 1990s and the first e-ticket was issued in 1994.
Today, terms like connected traveller; smart airport; self-service airport; in-terminal location-based services; and management process visualisation are now in common usage, but what do we mean by digital transformation? The concept is defined by three separate, but intertwined, drivers: Digitisation, Connectivity and Data.
Part 1 of this series covers Digitisation of Airport Processes with Part 2 focusing on Connectivity; and this third part looks at Big Data applications and the overall benefits to airport managers.
Big Data applications
Big Data is the end result of the digitisation process and the evolution of connectivity. Trends in digitisation and connectivity define the airport of today, but Big Data will define the airport of the future.
The sheer volume of data handled by businesses necessitates Big Data Analytics (BDA). Airports are now recognising this need as they focus on optimising processes, improving productivity and minimising costs; while evolving from B2B to B2C organisations.
Many of the analytics solutions currently used by airports relate to Business Intelligence (i.e. management dashboards and reporting) to support performance management and traffic flow forecasting for short and long term planning.
In future, however, airport managers will use analytics to help them visualise airport operations in 3D and based on real-time data inputs. It is also conceivable that airport systems will be taking automated actions on behalf of managers to remove bottlenecks and improve efficiency. This will be the first manifestation of Artificial Intelligence (AI) in the airport environment.
Benefits to airport managers
The benefits to airport managers can be summarised as follows:
- Process Optimisation
- Enabling an airport’s Business Process Improvement (BPI) team to identify problem areas, measure performance and take necessary actions
- Allowing both short term and long term planning
- Improving employee productivity
- Delivering synergies amongst stakeholders
- Reducing costs
- Business Model innovation
- Allowing the development of new non-aeronautical revenue streams, thereby enhancing the creative campaign process
- Enables, for the first time, airports to know and segment airline passengers in order to offer new services to the right people at the right time and at the right price
- Customer Experience improvement
- Improvement will come through process optimisation and business model innovation, but could be targeted specifically through digital transformation
- Allows airports to develop unique services to facilitate the passenger journey through each and every airport touchpoint
As with any industry, airports can be classified as innovation leaders, innovation laggards, or somewhere in between.
Some airports, such as Geneva, Doha International and Dubai International, have defined clear objectives on using digital technologies to build brand equity and be seen as industry innovators. Düsseldorf went a step further by deciding fund innovation.
Others, such as London Gatwick may prefer to take smaller steps and focus on improving processes in smaller areas with a multitude of measurable benefits. There is no right or wrong approach in the speed of innovation, nor in the project size, as long as there is a clear vision (call it the “End State”). After all, the digital roadmap should be linked to the strategy map, whether the airport is building a digital terminal or a smartphone application.
Digital transformation of airports is intensifying and manifested by digitisation, connectivity and big data trends – covered individually in the three parts of this series:
Part Three: Big Data applications