big data what is in it for me ? big data @ airlines
TRANSCRIPT
Big Data – What is in it for me ?
Big Data @ Airlines
RSM Leadership Summit 2014
Roland Schütz, Deutsche Lufthansa AG
Global Megatrends affect the Aviations Sector, too
Page 1
All mission critical business processes of an airline rely on IT
Page 2
Airline Industry: State & Imperatives – A Reminder
Page 3
More Loss than Profit in the Long Run World Airline Financial Results, 1978-2006
Page 4
Source: Boston Consulting Group, 2007
The worst sort of business is one that grows rapidly, requires significant capital to engender the growth, and
then earns little or no money. Think airlines. Here a durable competitive advantage has proven elusive
ever since the days of the Wright Brothers. Indeed, if a farsighted capitalist had been present at Kitty
Hawk, he would have done his successors a huge favor by shooting Orville down.
— Warren Buffett, annual letter to Berkshire Hathaway shareholders, February 2008.
Market transformation, consumer trends & global travel transportation
model impose substantial change in the airline industry
Page 5
Customer Centricity, Ancillary Revenues and Mobility Solutions are on
the Airline CIO‘s Agenda
Page 6
New Players Challenging our Value Chain
Page 7
Ancillary Opportunities
Cost burden is disproportionate to customer
engagement
Distribution needs to be viewed as more than shopping
for and selling a ticket
2
Shopping Ticket
Purchase Manage Booking
Flight Post Flight
Customer Engagement Cycle
Entity Agency/GDS Agency/GDS
Airline
Airline Agency/Airline
Cost €€ € €€€€ €€€
Margin €€€€
€€€
€ €€
Time
Spent 1 – 7 Days 30 Days 1 Day 5 Days
Airlines Transformation into OTA‘s and Department Stores
Page 8
Selling Travel Experience of a Premium Provider vs.
Selecting the Cheapest Ticket at Expedia or Google Flights …
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Big Data Architecture
Page 10
Challenges Facing the Travel & Transportation Industry
Adressed by Big Data Technology - Sample Use Cases
Page 11
Use Case: Outstanding Personalised Experience
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Business Input
Data by delivering millions of individual treatments in real-time
User Experience by ensuring content is presented at the right
time, in the right channel, in the most digestible & actionable
format
Use Case: Handling IRREG Situations
Exampe: LAX Airport Shooting, Nov 1st, 2013
Immidiate response to activities on facebook and
twitter …
The impact that a ten minute event can cause is
shocking:
•1 casuality (TSA agent)
•Over 118 flights en route to LAX were canceled or rerouted
•135 flights scheduled to depart from LAX were canceled
•127 flights were delayed at least fifteen minutes
Information was propagated slowly. If social media
content would have been evaluated, appropriate irreg
handling could have started earlier and mitigated
business impact.
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Use Case: Predict Departure Delays, Optimize Fuel Consumption
Approach:
Predict network behaviour and departure delays of aircraft
throughout day, taking into account
• Reactionary delays, rotation oriented
• Weather and congestion at airports
Learn delays from historical patterns and today’s real-time info
Learn optimized flight routes from past flight data
Benefits:
Proactive handling of IRREG situations
Maximize aircraft usage, minimize working capital
Protect the environment
Save fuel
Comply with Crew Duty Times
Passengers: Shorten flight times and minimize waiting times
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Use Case: Predictive and Preventive Aircraft Maintenance
Approach:
•Aircraft technical status information is collected and
evaluated to predict failures of aircraft parts:
•Aircraft are connected to the ground permanently.
•Data is made available in real time and searched for
patterns indicating failures, esp. of engines (most
expensive)
•Scheduling of predictive maintenance events, avoiding
flights to destinations short of spare parts, etc
Benefits:
•Downtime prevention, reduced schedule interruptions
•Safer, long-lasting planes
•Savings by adapting maintenance to wear
•Improved spare part handling and logistics
•Passenger: Less unplanned delays.
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Discussion