Global air travel is ready to soar.
The International Air Transport Association, a trade group for airlines, expects more than 4 billion business and leisure travelers to take to the skies in 2023. While that’s good news for the aviation industry, it could put pressure on IT systems and airline personnel.
As a result, some experts suggest it’s important for airlines to invest in their IT estates to meet fluctuations in customer demand.
When airlines are not investing in their IT operations, they are sure to run into inevitable flight disruptions and system breakdowns. Not only do these incidents cost companies millions of dollars in losses, but they can tarnish brand reputation in the long term.
“When airlines are not investing in their IT operations, they are sure to run into inevitable flight disruptions and system breakdowns,” said Brian E. O’Rourke, Vice President, Senior Partner at Kyndryl, which extended a longstanding collaboration with Delta Air Lines to manage and modernize its mainframe infrastructure. “Not only do these incidents cost companies millions of dollars in losses, but they can tarnish brand reputation in the long term.”
Here, O’Rourke, who spent over 20 years working at Delta, talks about the need for airlines to digitally transform and how tech can help create a more personalized experience.
Recent computer outages led to flight delays and cancelations in the U.S.
How can technology help airlines be more resilient?
Unprecedented surges in air travel often expose the hidden operational challenges and limitations of overburdened technology, especially flight crew systems that include crew scheduling and rostering. While a headache for travelers, the recent outages are prompting airlines to take technology refreshes and modernization more seriously — many systems are at the end of service and support. It is also crucial to have a hardware and software roadmap to ensure system reliability and resiliency. All this points to the importance of constant modernization — and why our customers at Delta are truly paving the way. They’ve been prioritizing the improvement of their systems for years, enabling them to withstand these spikes in travel.
How have Kyndryl and Delta been working together?
As with many industries with large-scale, legacy footprints, the airline industry has a lot of complex, critical infrastructure, such as the mainframe. But the reality is we can’t just flip a switch and transfer it over to the latest, next-gen technologies like cloud. The collaboration we announced with Delta today is a perfect example of how we can support a company undergoing the long-term journey of digital transformation and modernization, while maintaining resiliency. For us, this starts with a trusted partnership founded on the deep expertise of running these mission-critical systems for many years. With Delta, we’re continuing to run and manage these systems — while also adding more automation and flexibility to their core enterprise data that runs on mainframe — to accelerate the innovation they can deliver in the years to come. This is an essential step as more airlines embrace cloud and other advanced technologies aimed at improving the customer experience. Additionally, this sort of intentional approach, with an eye to the long-term advancements it will yield, helps to lay a solid foundation, and can deliver the ROI the airline industry demands from such high-stakes investments.
Why should companies make these big investments in IT operations when expenses are generally rising?
Let’s look at the flip side. When a passenger purchases a ticket on a given airline, it is a contract and commitment to transport them from origin to destination. If airlines don’t consistently deliver on that promise, customers will naturally migrate to other more dependable brands. Historically, IT spend across global airlines range from 4% to 6.5% of gross revenues. One of the areas where we’re seeing airlines continue to invest is in cloud. For example, Etihad Airways is transitioning critical workloads to a new multi-cloud environments to increase efficiencies in their operations and speed how they deliver new innovations to market. This is the sort of investment that has real impact — it’s enabling Etihad to become more agile and sustainable, and enhance its guest experience. The bottom line is with strategic and thoughtful planning, these investments can go a long way in ultimately ensuring a smooth and hassle-free travel experience as well as brand loyalty — both of which impact their bottom lines.
So where should airlines focus their IT investments right now?
We are seeing airlines focus their IT spends on Internet of Things (IoT) and cloud technology, AI and machine learning, sustainability, advanced self-service and biometrics, personalization for both In-flight connectivity and on the ground, and on touchless technology — all of which support an improved passenger experience. In contrast, it’s equally important to look internally and make investments that will improve workflows and the employee experience. A great example of this is Singapore Airlines, where we’ve collaborated to transform the airline’s digital workplace experience for employees worldwide. Finally, in this age of increased threats, airlines must make cybersecurity business strategies a priority to ensure their technology systems and data are protected.
How can airlines make better use of data and AI?
Operational challenges are commonplace today. At any given time, airlines must be prepared to manage surges in demand, unexpected cancelations and delays, and staff shortages — to ensure a seamless travel experience from booking to destination. IT modernization is an important part of that. At Delta Air Lines, we manage and run their CRM loyalty platform that has over 23 million SkyMiles members. We also support the systems of engagement that keep Delta compliant with FAA regulations on historical maintenance records for every aircraft in their fleet. Additionally, our platform for their re-accommodation engine automatically rebooks customers within minutes when they experience canceled or delayed flights. All these systems provide scale for an airline that serves over 200 million passengers a year.
Speaking of travelers, in what ways can technology improve personalization and loyalty?
Airline personalization has been around for years. But this year we are at a tipping point with more sophisticated passenger-experience technologies, including facial biometrics for check-ins, bag drops, security and boarding. In-flight content personalization is also taking off in a big way. In January, Delta introduced fast, free Wi-Fi for everyone across its fleet. This is expected to drive the company’s Delta Sync streaming platform, which allows passengers to stream personalized content from the in-flight entertainment systems. We’ve also seen other industry players step up and embrace new technologies as they work to improve passenger loyalty. For example, Bangalore International Airport Limited — one of the fastest-growing airports in the world — is currently on a 10-year project to transform BLR Airport into a digitalized and seamlessly connected Smart airport. Innovations that push the boundaries on personalization could drive higher premium yields and customer loyalty in the long run.
How else are airlines accelerating growth?
Digital IDs — such as Delta’s Digital ID verified by facial recognition — are going to be instrumental in accelerating growth in the airline industry. Elite members can now opt in on their mobile apps — and when they reach the airport, they can flow through an expedited lane from baggage drops to security. Once passengers experience this service, they are hooked. Investing in Digital IDs will be beneficial for business travelers that are driving premium margins for airlines. Ultimately, it’s another innovative way to drive brand loyalty.
What are some other highlights about working with Delta?
We are honored to be Delta Air Line’s strategic IT partner and support its ongoing digital transformation as the leader in customer experience and employee care. We share values of empathy, devotion and a restless need to innovate during difficult and challenging times for the industry. Kyndryl’s deep understanding of the complex environment Delta operates in, along with the variability we offer, are game changers for their business.
