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Take off to digital horizons

Accenture's Robert Zippel discusses the implications of digital technologies for airlines.

Tell us about your role at Accenture?

I lead the Technology Practice for the Travel Industry globally for Accenture. This includes the industry segments of Airline, and Hospitality—Hotel Corporations, Travel Services, Car Rentals and Cruise Lines. It also covers the work we do from technology strategy to implementation and operations.

What drives your passion for the airline industry?

I like industries that serve clients with a physical service or a product, in addition to setting sail to go digital. The people in these industries are usually very passionate about what they are doing, and really want to make a difference when it comes to the service they provide to their customers. The airlines I worked with in the past were very concerned about serving passengers the best they could, even amidst disruptive situations. The top concern always was safety of the passengers.

Airline executives are highly aware digital will transform their industry. So why have airlines been slow to adopt digital technologies?

Airlines are in a very difficult place. They are low-margin businesses with significant regulatory requirements, and outside factors like fuel price that they can’t control. They also can’t play around much with their systems without risking at minimum the seamless journey of their clients, worst case their lives. Imagine an excess baggage system linked to weight and balance making mistakes, and a plane summersaulting at take-off. There are also very complex challenges (admitted, sometimes self-inflicted and not business-case driven) in striving to accommodate all passenger wishes safely. A look at the special service request catalogue in a network airline reveals a lot. Airlines struggle with multi-speed IT because of the legacy landscape, lack of liquidity of the workforce, regulatory issues and safety. And, not least, the investments needed in a low-margin business required to change.

Do you see any shifts in workforce dynamics as airlines increasingly adopt digital technologies?

People will need to be moved from handling processes to creating the client experience. This requires change management and skilling. And adopting a more liquid workforce. Airlines struggle to demonstrate that this is not necessarily a threat to the workforce in some countries. But there is no alternative. Airlines will need to use intelligent automation to increase speed and quality of standard processes, while driving cost down and freeing up people for what really creates the customer experience.

Intelligent automation is already transforming the aircraft manufacturing industry; do you see any implications for airlines?

Absolutely. There is no real customer experience benefit from having three agents at the gate reading to you from the computer system and handling your boarding pass while the quick boarding gates are closed and not in use. Many things in disruption handling, like re-bookings, etc., are complex and need automated handling, so that airline employees can focus on improving the customer experience. Automation can also improve the information that is made available to passengers. People appreciate being kept in the loop about what’s going on, especially if there is something difficult to handle like delays, strikes, etc. This can be supported by automation, and through use of personalized data about passenger needs there can be additional offers to increase revenue, client satisfaction and loyalty.

How can airlines transform the air travel experience with digital technology?

Passengers are used to managing a lot of their life in a mobile enabled, virtual, socially connected way. They expect no less when travelling. Personalized approaches, increasingly tailored to their wants and needs, are becoming the new normal. Airlines need to at the very least keep up, better still take the lead. They have the advantage of virtual and physical touchpoints— venues people move through, etc., but are not making much use of if now. Airlines will need to go digital to not interrupt the life people are used to living. This includes seamless use of media and online services, “social travel” and an optimized level of personalization of service and auxiliary offers.

With digital disrupting every industry, how can airlines innovate from the "outside in"?

Airlines can benefit a lot from platforms giving them a basic set of digital services and innovation. Adopting these industry platforms for passenger service, commerce, operations, etc., can close the innovation gap and provide a good basis for multi-speed IT and really differentiated innovation offerings. However, sometimes airlines think they need to innovate where already the functionality is commodity, and they fall behind because of low implementation speed.

What is the role of the broader ecosystem―business partners, customers and competitors―in the technology journey of airlines?

Airlines need to select partners, platforms and products to enable their digital journey, at speed. The ecosystem needs to provide commodity services and what I would call the “commodity innovation," while still enabling airlines to develop differentiated services within their own control. Airlines should steer away from partners wanting to lock them into a closed environment and insist on open APIs and the ability to expand and extend at their leisure. If “the one platform” does not exist, multiple platforms need to be connectable, interoperable and expandable while providing anything as a service (XaaS).

How can airlines balance commercial opportunities that customer data offers with customer concern for data privacy and security?

Users will accept use of their data by airlines, if they are aware of how it is being used and they gain added value to their experience. They will not expect to be sold auxiliary services, based on data they thought was provided to the airline for security reasons. They would certainly not want to be approached by a third-party business partner, with data they never expected to be used outside the context of air travel and security. Transparency and focus on what passengers actually perceive as added value will be the key to not losing the digital trust advantage that airlines have today. And most importantly, the data needs to be protected by the airlines against hacking and making the passengers targets for any kind of digital attacks.

Does the airline organizational and corporate culture have any implication on digital technology investments?

Digital and “the New” is perceived as a threat to established processes, organizational structures and job descriptions as well as skill profiles. Airlines will need to introduce much stronger change management to handle the digital transformation. Bottom-up decision making will usually be a threat to transformation speed if it is not accompanied by guiding airline employees to adopt and embrace change.

What disruptive technology trends are you watching for in the airline industry?

As industry agnostic players like Google and Amazon expand their services, airlines might lose many touch points to their clients and risk being reduced to operating planes. The reduction of business travel due to an increase in virtual meetings has never really materialized in the past. But, with virtual reality becoming mainstream, the increasing proliferation of consumer devices and the rising ecological conscience might have an impact on business travel. So business travelers who are increasingly facing reduced travel budgets, and long lost business class permission, will potentially need special attention or be tempted to adopt virtual meeting tools much more quickly than in the past.

What kind of a traveler are you?

I avoid business-related travel where I can, to save valuable time. That being said, my role does involve travel, and relying only on virtual solutions insufficient, at times, to address the business need. So I am a frequent but not enthusiastic traveler. I could be, if the loss of time would be less. When I travel, I select based on saving time, maximized ability to continue working and communicating. As a leisure traveler, I care less about time loss then about comfort.

What are the three things you prefer in your airline while traveling?

The flight product itself (seats, service), efficient process that reduce my loss of time on day of travel, and safety (equipment, pilot and crew training)

How can airlines professional stay relevant in this highly competitive and rapidly evolving industry?

Adopt change as good. Investigate where you can play a part in “the New," instead of trying to resist it. Think about and propose ways to upgrade the customer experience, and look for ways to speed up the digital journey of your airline. Know the platforms and dynamics out there, and combine services with customer experience in mind and you will become more relevant than today. If that involves doing/learning a completely different job than what you are doing today, start today. Resistance is futile.

About Robert Zippel

Robert Zippel is the Global Travel Industry Technology lead. Robert has worked at Accenture for the past 15 years leading large scale programs in enterprise networks and network security and data center infrastructure, along with operations and infrastructure outsourcing projects for some of the world's largest travel companies and airlines.

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