Consistent profitability in the past few years suggests these are good times for the industry. But a wide-ranging panel discussion noted the various challenges looming on the horizon that could seriously erode margins, if not destroy them entirely.
Infrastructure—or rather the lack of it—is a key issue. As traffic demand grows, passengers and aircraft will need somewhere to go. But many airports simply won’t have enough room. High airport charges threaten to further dampen demand and curtail aviation’s many benefits.
Airlines must also engage with big data to retain control of their businesses and customers. In effect, airlines must come full circle to be leaders in information technology (IT) once again.
Once, airlines led the way in IT and implemented cutting-edge reservation systems at a time when banks were still doing manual ledgers. But that leadership position has been lost, partly because airlines have far fewer interactions with individual customers than banks or retailers and partly because of a lack of investment. The incentive to invest what little money was available in new systems hasn’t been there.
That has changed. But airlines cannot simply build digital veneers. A process-driven business has to completely change its way of working to put those processes on digital platforms.
The industry is clawing its way back. Compare airport processes today with those of five years’ ago and the changes brought about by new technologies are obvious. In five years’ time, airport processes will be different again, given the various initiatives underway.
Gender equality was also discussed. To be sustainable in staffing terms, aviation needs to attract more women to the industry. The building blocks must be put in place to ensure that there are more women at all levels and in all aspects of the industry. But these programs must move quickly and be transparent.