Alteryx chief data & analytic officer Alan Jacobson says aviation firms must embrace insights in order to remain competitive
Appetite for travel is fast approaching its pre-Covid peak as years of delayed or cancelled holidays, family reunions, and business meetings drop off the wish list and finally enter official travel calendars.
Highlighting this demand, Iata has now noted an 82.3% increase in global travel demand year on year for January 2022, with demand for international travel rising by a huge 165.6% in the same period.
Despite this sizable increase in demand in a very short space of time, however, many organisations in the aviation industry are struggling to react in time to take advantage and recoup any losses endured in recent years. With significant layoffs during the pandemic, and with many airline employees having now secured employment in alternate sectors, the industry is operating with both greatly reduced resource and a greatly reduced ability to increase that resource due to process backlogs.
Iata reported that approval times for new staff security clearances had “more than tripled”, leading to a post job offer quiet period of around three months where potential employees were left waiting for a decision. Highlighting the scale of this challenge, along with the reduced ability to meet customer demand in the short-term, Heathrow Airport introduced its temporary passenger cap at around 50% of its standard capacity, where just 100,000 passengers can travel per day.
In response, British Airways also temporarily suspended short haul ticket sales at the airport in order to help clear the backlog and build back better. This was, according to the airline, the “responsible action”, and designed to “help maximise rebooking options for existing customers given the restrictions imposed”. Emirates, however, responded with a now-viral press release highlighting the wide-reaching impact these cuts would pose to customer experience, and the need for these decisions to be made far sooner. The airline confirmed that “70% of [our] customers from LHR are headed beyond Dubai to see loved ones in far flung destinations, and it will be impossible to find them new onward connections at short notice”.
An industry wide challenge: responding quickly to macro disruption
The challenge facing the aviation industry – while far reaching and impactful – is also a contextually simple one to identify. Micro changes are no longer sufficient to mitigate macro disruption.
Without the resources to assess macro demand or identify interruptions in advance, organisations have not been able to make fast data-informed decisions, nor secure staffing at the volume required, to mitigate that disruption. While, on a micro-scale, roadblocks and delays are known challenges, mass disruption has a disproportionate and cascading long-term impact on each interdependent segment in the aviation space – from baggage handlers and duty-free staff to air stewards and pilots.
Breaking down legacy strategies and reacting to unexpected disruption
The challenge the industry faces is evident. Disruption due to insufficient resource forecasting and broken processes breaks down the customer experience credentials that the aviation industry relies on to thrive.
Considering the business requirement for fast decisions, combined with a global industry environment defined by disruption, timely and high-quality insights will not appear as if by magic. Bringing knowledge workers on the journey to more advanced analytic capabilities is key to driving this transformation.
While many organisations in the aviation industry are integrating advanced analytics solutions for passenger flow analysis, fuel demand, or scheduling, many more still endure the legacy challenges endemic to businesses today. Fewer still adopt an end-to-end analytics approach to generate insights applicable to the sector as a whole.
Once identified, gathered, processed, and analysed, data can then be used to streamline day-to-day operations and automate manual processes while improving the customer experience. One major North American airline, for example, used data-driven insights to enhance on-time performance, assist with flight demand forecasting, manage flight crew available time and scheduling, and plan ahead for fuel demand.
It used this data to avoid hundreds of thousands of dollars in extra costs from failure to anticipate daily changes while reducing costs by increasing fuel forecasting accuracy by 70%. Combining those insights with data from other departments – such as staffing pipelines from HR, vehicle maintenance information, or simple inventory management could then deliver a benefit far greater than the sum of its parts.
It’s clear that the travel industry leaders that have fully integrated data analytics are the ones best mitigating and adapting to rapidly changing market conditions. The sector now has an opportunity to reassess its relationship with data – collaborating on already held information, collating it, and using it to generate whole-business data insights.
Once the siloed data necessary to deliver a customer-centric travel experience is unlocked, the potential for the sector to respond quickly to macro disruption at scale will be hugely improved. Embracing more robust data science to make the best possible use of big data for fast insights is no longer optional – it’s the price of entry to compete in an increasingly globalised and disrupted landscape.