August 17, 2023

The Power of Data and Analytics in Travel Disruption

We’re in the peak summer travel period, and airlines are reporting robust demand, despite economic volatility. Passenger volumes are heading back towards 2019 numbers, reaching 90.8% of international pre-pandemic numbers in May, according to data from the International Air Transport Association (IATA). Our recent Consumer Pulse Survey found that 8 in 10 (78%) consumers are planning leisure travel in the next year, with half of them planning two or more trips.

However, as the travel industry continues its journey back to growth, it is facing significant headwinds as a result of disruption from industrial action, air traffic control shortages, inclement weather and other irregular operations. So how can airports and airlines navigate this complex environment, be proactive in their response to customer expectations and adapt to rapidly evolving aviation guidelines?

We believe the answer lies in technology, data, artificial intelligence and automation. While technology used to be considered a disrupter, it’s now seen as an enabler, the primary source of competitive advantage that will allow companies to build enhanced experiences and breakthrough innovations.

When we surveyed senior travel industry leaders to find out how they manage delays and cancellations, we found that although most (98%) travel industry leaders recognize the critical nature of these irregular operations, half of those surveyed do not have a concrete technology strategy to prevent them. Let’s explore this further.

Predicting disruption through data

Companies are currently unable to unlock the full value of the data at their disposition owing to a legacy technology infrastructure characterized by rigid business silos and vast untapped data sets. Our research found that 70% are unable to predict disruptions in advance using predictive data capabilities.

To prepare for disruption, airlines and airports can put innovative data and “applied intelligence” assets to use at the core of their business, unlocking significant value and driving the next level of performance across the enterprise.

In the last few years travel organizations have been migrating to the cloud for scalability and flexibility, however our research points to a significant gap in data analytics capabilities, which when combined with AI and automation can help airlines and airports predict and respond to disruptive events, reducing delays, optimizing cancellations, controlling costs, as well as enhancing customer care.

We have seen some early innovators however, including airline Saudia, which is tapping into the combined power of digital, cloud and data to transform the guest experience and improve operational efficiencies. Additionally, Melbourne Airport in Australia is using data analytics to gain end-to-end visibility of airport operations.

Addressing disparate data sets

The disparate nature of data sources across the broader travel ecosystem (for example, between airlines, airports, air traffic control, air navigation service providers and border agencies) is also an issue. It’s undoubtedly a complex environment, with multiple stakeholders coming together to facilitate the safe movement of people and freight.

Siloes and untapped data sets from across the travel ecosystem are hindering the industry’s ability to gain predictive recommendations, perform root-cause diagnosis of external disruptions and gain a unified view of their operations. We found that nearly 40% of firms reported that they are not yet adequately prepared to predict climatic or external disruptions in advance at an ecosystem level.

By working together, airports, airlines and the broader industry players can bring a fragmented system into a coherent whole – helping the interdependent ecosystem operate more efficiently and effectively to find opportunities for growth and new value.

Where to start

Transforming data into a differentiated asset for the long term requires a focus on three interrelated actions across business, technology and people:

1. Build a strong data foundation - Create an effective data management program, which includes data governance, data quality and master data management; technology platforms and data architectures; and data supply chain management.
2. Mobilize advanced technologies - Use AI, machine learning and analytics to glean critical insights from data.
3. Create a data-led culture - Manage the people and cultural dimensions of advanced data management.

Reinventing travel

These technologies will play a crucial role for how airports and airlines tackle disruption and reinvent themselves for future success.

For example, data and advanced analytics can be used to improve crew scheduling and productivity; optimize fleet and operational planning with better aircraft and gate utilization; and drive efficiencies in aircraft maintenance with real time updates. Additionally, they can increase customer satisfaction with more unified communications as well as helping to reduce delays and cancellations – and control costs. Abu Dhabi’s Etihad Airways announced that it is using AI-driven analytics tools to optimize staffing, passenger handling and assist with customer inquiries. American Airlines is also embracing data-driven decision-making, announcing an analytics transformation to minimize disruptions and streamline operations.

At its core, it’s about connecting people and processes and embracing the power of data across the enterprise and beyond, creating a boundaryless organization. This interconnection is critical in an era where passengers expect their travel journeys to be disruption-free and seamless.

Copyright 2023 Northstar Travel Media LLC. All rights reserved. From By Emily Weiss.

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