A Long Road Ahead on Digital Transformation
Aviation is perhaps 20% down the road toward digitalization and digital transformation, Lufthansa Chief Commercial Officer Network Airlines Harry Hohmeister told attendees yesterday during the Airlines of the Future panel. He also noted that the transformation is not happening at the same pace across the airline structure.
The digitalization revolution is taking place on the customer front-end and not on the production side, he said, citing Google’s activity as well as C-trip in China. Change is more “evolutionary” on the production side. “How do you digitize flight?” he asked.
Hohmeister and best-selling author Paolo Fallo also discussed whether the industry is vulnerable to the so-called “Amazonafication” of the industry. Responding to CNN’s Richard Quest’s question, Hohmeister said Lufthansa would not agree to sell its capacity to Amazon because it does not want to lose the direct customer relationship and all that this entails. “If you don’t have customer loyalty, you have to fight every day—in our case for 140 million passengers a year.”
One hurdle facing the airline industry on the road to digital transformation is that the industry has allowed access to core data to get into the hands of suppliers—GDSs in the case of distribution, and OEMs on such things as engine performance data.