Airline finance is being transformed by new technologies and the business dynamics of a fiercely competitive industry. Though the traditional skillset will remain important, there is a growing need for value-adding activities, turning finance from number crunching into a strategic necessity.
Finance professionals will be expected to understand and leverage technology to improve efficiency, reduce cost, increase revenue, and enhance the customer experience.
Data analysts, tech-savvy accountants, and value stream managers will be at the heart of future finance
In future, repetitive tasks and manual processes will be automated, forcing finance professionals to learn new skills and approaches.
In the age of the digital customer, the aviation industry isn’t spared from disruptions by digital players and tech giants. As customer expectations are evolving, airlines' future performance will depend on how quickly they can adapt by transforming their existing processes into digital ones, dedicated to fulfilling a seamless travel experience. Data shows that there is a strong correlation between organizational health—the ability to align and achieve strategic goals—and sustained financial performance. To optimize finances, therefore, airlines must transform transactional finance management into value management. Only then a company will become a high performing organization (HIPO).
Having value managers in airline finance is a key enabler for greater efficiency in the delivery of industry projects.
Digitization covers a wealth of new technologies, including the all-important blockchain—a decentralized digital ledger in which transactions are recorded chronologically and publicly. The aim is to put accurate and comprehensive real-time data at the fingertips of finance professionals, enabling them to respond instantly to management, partners, governments, and tax authorities.
Comprehensive and expensive IT systems will be left behind in favor of open source, user-friendly apps and technologies that enhance speed, flexibility, and the potential for collaboration.
Digitization will leverage new technologies to automate traditional transactional processes and streamline financial planning, budgeting, and forecasting.
Advanced analyses and insights will be the order of the day in future finance. This will involve partnering internally and externally to connect different types of data from various sources for a greater perspective on the business. This centers on having one version of the truth, a record agreed upon by all systems, partners, and departments.
Using predictive analytics and financial modelling will not only forecast performance but also help to manage risks. This critical business intelligence function supports senior management decision making and guides strategy.
Correctly analyzing data will include such technical skills as statistical modeling. Interpreting data, meanwhile, necessitates business skills to understand industry trends and potential financial impact.
Process management can uncover and address several key inefficiency issues. There has to be constant improvement in techniques and methodologies while maintaining relevance to the finance function.
The high-volume, low-margin nature of the airline business means tightening financial processes is strategically important. Even small improvements can produce noteworthy increases.
Streamlining financial processes starts with knowledge of the end-to-end chain and ends with greater efficiency and harmonization.
Future finance will necessarily incorporate all aspects of the airline business. Only when partnering successfully with internal stakeholders can finance departments become high performing organizations.
Trust and confidence will be built by ensuring that accurate, timely, and relevant financial data is communicated effectively.
Business partnering will help build a data-driven culture and increase the willingness to use data for decision making.
General financial and accounting skills will remain relevant. But the need to complement these abilities with airline-specific knowledge, such as aircraft financing and cost management, will significantly increase. Areas such as payment, liquidity planning, and risk management are consistently evolving and require up-to-date skills.
For instance, finance professionals will need to understand the cost, risk, benefits, and profitability of new payment methods while understanding the customer trends that could affect the convenience, compliance, and complexity of payment acceptance.
Traditional accounting skills will remain important but the need for aviation-related understanding will continue to increase.
Finance’s success will depend on its flexibility and its capacity to drive that agility throughout the organization. Appropriate communication and transparency will be vital.
A key to success is a mindset that seeks to continually re-evaluate the systems and processes used and ensure they meet business needs. There is a human dimension to change management and it must be acknowledged that change will not always be easy though it will always be necessary.
Aviation is an industry that can never stand still.
The IATA Finance Academy prepares the aviation finance professionals for tomorrow’s aviation industry, converting number crunching ability into financial analytics and forecasting skills, strategic risk and resilience knowledge, and compliance and control understanding.
The emphasis on technical and managerial skills results in a complete future finance professional, confident in data-driven financial management.
Be a driver of this transformation and digitalization of the airline business, and help your airline become a high performing finance organization.