Airline Cargo eBay – Fact or Fiction

Distressed Merchandise – Airline Belly Hold

The Airline Cargo Manager today has the responsibility to maximise the Aircraft belly hold and ensure maximum ULD Load and Profitability of Cargo per flight.

Without sophisticated Knowledge Management and Business Intelligence Systems how does he ensure his Cargo shipments are Optimised and Profitable. Despite all the experience and knowledge of the Cargo Manager there is always inventory left on the table and unsold capacity.

Thinking aloud, what if there was a Web Site similar to eBay that is purely focused on Airline Cargo?

  • Distressed Merchandise i.e. unsold Air Freight space could be sold by carrier to the highest bidder i.e. Shippers and Freight Forwarders community.
  • The benefits for the individual Shippers & Freight Air Freight, the Community Web Site would offer  at a discounted last minute at auction rates.
  • The benefits for the Airlines participating in the scheme they would be to maximise belly hold and increase profitability every time .

Fact or Fiction?

What price Airline Intelligence – Airlines can achieve an ROI of over 1,000% with $500 million in cost savings and revenue generation over typically over a five – six year period.

Airline Business Intelligence Trends

Business Intelligence and data analytics are becoming a buzzword in the Airline Industry board with the emphasis on Business Intelligence.

For us to understand the importance of this trend we need to be aware of the key trends driving the industry.

  • 56% of airlines will make R&D investments in passenger services via social media
  • 52% of airline companies will consider business intelligence as their major investment programmme in the next three years
  • 57% of airlines believe social media provides the greatest value as a marketing channel
  • 78% of airlines personalise service offers to their passengers though direct channels

But then we all understand this trending it is in every trade journal we read and every IT vendor collateral portfolio.

What is different though is the age old question of what do I do with all this data and how do I turn data into intelligence to enhance my business and in what BU areas will benefit most.

Here are a selected number of Business areas where BI and real-time analytics play a vital role within airlines;

Airline Cabin

  • Ancillary sales
  • Duty Free /On Board

Management of the seat factor and cabin shift

  • Overbooking capacity to ensure maximum seat factors with minimal off-loads and downgrades
  • Revenue mix/ Cabin mix via market segmentation 
  • Seat access and group acceptance
  • Pricing optimization
  • Partner code share/interline
  • Managing traffic flows (O&D) ƒ

Loyalty management

  • Identify the different clusters of customers/travellers by type /propensity
  • Target clusters with real time relevant messaging
  • Targeted promotions to ensure repeat revenue and reduced churn
  • Maximise Partner & Third Parties

Cargo management 
ƒ

  • Cargo capacity / demand planning ƒ
  • Cargo rate optimization
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  • Cargo load optimization
pallet management

Passenger business

  • Disruptive elements/Missed connections
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  • Lost or Misplaced baggage
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  • Premium Travellers upsell additional sell vacations/ancillary
  • Corporate Channel/customers
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  • Up sell, cross sell during the booking process ƒ
  • Self Service
  • Ancillary sales
  • Distribution Cost to Serve/Channel of Service

Flight operations

  • IROPS Aircraft re-routing
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  • Gate management
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  • Baggage management
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  • MRO Parts management
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  • Flight Planning/Forecasting
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  • Flight catering management ƒ
  • Ground handling services
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  • Rostering/Crewing Manpower planning
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  • Staffing levels /self certifcation

Others

  • Digital Channels
  • Corpoarte Sales
  • Web Channel LTB Ratio’s and Stickyness
  • Brand buzz analysis
ƒ
  • Sentiment analysis

Interesting History On 100 years of Aviation – Free ebook

Well worth a look for all the Aviation Geeks amongst us  http://www.atn.aero/analysis.pl?acateg=reports
There is a free elink to the book which features;

A timeline of key milestones in commercial air transport history. It gives an understanding of the path air transport has followed to become a major contributor to modern society by bringing together people from around the world, allowing for the exploration of the wonders of our planet, and by playing an important humanitarian role, for example through emergency assistance and through opportunities for family reunification. The air transport industry remains a fascinating sector. Its future will undoubtedly will bring new adventures -flights in orbit – and wondrous new technologies- flying with solar energy.

Average of £73 per minute in UK Rail passenger delays caused by incidents – http://wp.me/p3aCAV-27

On average their are in excess of .8million incidents per annum leading to 14million minutes of delay to franchised passenger Rail services in the UK.

Infrastructure faults come high on the list but equally so do Weather and Signalling- Communication to Passengers of incidents is highlighted as a key concern. Planning and re-plan is crucial to ensure minimal risk and delay.

A formidable challenge that can impact the Rail Franchise Operators profit at every point of the Journey. Rail operational factors are not always attributable or within the Rail Franchise Operator’s control.
Factors that cause major disruption and impact both from a customer experience perspective and a financial perspective are;

Weather Impact of Rail delays due to unavoidable weather changes
Mechanical issues Aging rolling stock lead to increased mechanical issues
Train Utilisation Operational delays can impact network utilisation
Station/network Congestion Re routing of trains, station delays impact efficiency
Union obligations Staffing overun on crew hours, compensation payments affect operational productivity and efficiency
Rail regulations Increased penalties and impositions on Rail operational delays

All of these factors can and do impact and disrupt operational core functions such as, Finance & Revenue Management, Call Centers, Freight Operations, In- train catering & cleaning services, Ground Ops, Engineering, Crew Planning & Scheduling, Network Planning, Customer Service.

The compounded effect of this is a direct impact both in terms of the customer experience and operational efficiency & financial/risk imposed on the Rail Operator.

I believe there is a need for a single INCIDENT MANAGEMENT SYSTEM in ‘real time’ based on a common integrated IT platform.

If we take a different view of individual business impacts and classify them as ‘events’ that can and do re occur over a timeline we can take a very different perspective on the risk and financial impact to the Rail Operator.

The reclassification or construct of business impacts as EVENTS would enable by use of an event processing engine to group and categorise the core events by severity of impact and construct a model dynamically that turns data into information and presents this via a ‘holistic real time view’.

This information would the be presented via a series of dashboards back to the Rail Management/operators in real time for action.

In addition if we couple the ability to ‘analyse’ the customer experience and financial impact of these events, we could pre rank and scenario re plan alternative business solutions to ‘minimise future disruption, ring fence operational costs,  and improve the customer service proposition – this must in my opinion be a major benefit to any Rail Franchise Operator.

(Source: National Audit Office)

Inside the ‘Big Data’ Tornado – The Holy Grail. http://wp.me/p3aCAV-1p

Big Data and Digital revival in search of (The Holy Grail)

As we are all aware Airlines, Hotels, Financial Services organisations and Retail businesses today are undergoing a Big Data revival and Digital revolution – It is in the pursuit of the ultimate Customer Experience and the potential incremental profits that spur on the enterprise –  The speed and pace of progess is alarming and somewhat likened or akin to rushing head on in over a chasm!

The anology of a Chasm brings me to a book I read many years ago on the growth and development of organisations within the Hi Tech Industries authored by Geoffrey Moore. The book was titled ‘Crossing the Chasm’ and the anology and principles it is grounded on still hold true today, this was followed by another book called ‘Inside the Tornado’ which builds on the former book.  Both books a recommended read.

Below is a recent quote from the Author Geoffrey Moore in respect of Big Data and The Digital experience;

Geoffrey states;

We are putting the entire world on the Web and have digitized the consumer experience,” Moore said. “We are now digitizing the business experience including government and healthcare. The tool set you need to digitize requires Big Data because it’s not just about handling data before and after, it’s about handling data during transactions. Without Big Data, you are blind and deaf and in the middle of a freeway.”

Crossing the Chasm

In Mr Moore’s analogy organisations go through phases of maturity and evolve. It would be true to say they re -invent themselves and develop strategies and tactics to succeed and ‘Cross the Chasm’ or they fall off into the precipice to be forgotten.

Once on the other side they position their Brand, Products & Services to meet the needs of the customer and enter ‘The Tornado’ the place to be – where it is all happening, eventually emerging as a successful organisation into Main Street.

Inside the Tornado

Inside the Tornado

However I have an issue – My Issue with Big Data and playing inside a Tornado!

My issue is…

Most organisations have been advised, understood and embraced the idea of Big Data and indeed spent many $M in the process. They are now in a rush wholeheartedly towards the chasm to get inside the Tornado without fully understanding what is inside or what is required to gain entry!

Now in anticipation at the precipice they stand and reflect – they are indeed wondering what to do with all this data they have amassed and how they can use it to get them across the Chasm to ‘Inside the Tornado’ and the Holy Grail!   

What is needed now- Customer Insight, Segmentation and understanding of Customer Value -Perhaps?

More will follow on this topic – your views please welcome as always?