News & Events

We live in challenging times for every industry. From the continuous threat of Covid-measures to the global political tensions (linked to the war in Ukraine) all the way to the energy crisis and the increased cost of living (due to historically high inflation rates). The airline industry is no exception to this and is probably even more impacted than most other industries, due to its direct link with all those challenges.

As a result, the airline industry needs to be highly resilient and needs to react aggressively to a number of universal trends (i.e. trends applicable to any industry), i.e.

• Increased pressure on margins due to the increased competition (linked to further globalisation) and increasing costs, due to increasing customer expectations (on quality, service, sustainability…​), increasing regulatory needs (like e.g. GDPR, safety and ecological standards…​​) and obviously the increasing energy (fuel) costs. At the same time due to tele-work and videoconferencing (which will even further evolve with VR/AR and the Metaverse), the need for airline travelling (especially for business flights, which is a very profitable segment) is decreasing.
  This means a further growth for the low-cost carriers, focusing on the price-conscious leisure travelers. Especially the trend of “Workcations” (i.e. trips abroad which combine “work” and “vacation”) can give an interesting boost to the sector.
• Trustworthiness: with companies becoming more and more international and virtual, trust becomes harder to earn. This means any airline company needs to take measures to gain and retain this trust via
  • Transparency and traceability, e.g. by a clear communication in case of disruptions and by a clear and transparent pricing (e.g. by eliminating certain costs like change and cancellation costs)
  • Security and privacy, e.g. by ensuring that all personal data is stored and processed in a secure and privacy-conscious way or by maximum ensuring passenger safety (e.g. via predictive maintenance technologies to catch problems pre-emptively)
  • Timeliness, i.e. ensuring that all flights are departing and arriving on time as much as possible. This can be achieved by good coordination and data exchange with all involved partners, via predictive maintenance technologies, via robust flight scheduling…​
• Frictionless customer experience: the end-to-end journey of a customer from searching a flight, over the booking of the flight, all the way to the check-in and check-out and the flight itself should happen as smooth as possible. This can be achieved via (hyper) automation (e.g. automated check-in or digitized bag-tracking), embedded user journeys (in channels of partners) and a multi-channel experience (e.g. via biometric fingerprint and facial recognition for check-in, security, lounge access and boarding).
• (Hyper-) Personalization: customers expect more and more an experience which is personalized to their specific needs and desires (‘It’s all about me and I want it here and I want it now’). In the airline industry this is reflected in personalized communication (e.g. personalized promotional campaigns to improve upsell and cross-sell opportunities), airline companies offering more and more customer-facing apps, which allows to accompany the traveler in every step of his journey, an increase in last-minute bookings…​

• Democratization: due to the increase competition and automation (via digitalization and standardization), it becomes more and more possible to make services (flights, but also specific value-added services), which were till now exclusively reserved for the happy few, also accessible to a much larger audience. Obviously this changes the airline industry from a luxury good (with low volumes and high margins) to a commodity good (with high volumes and lower margins), which requires a big shift in business model and business processes.
• ESG (Environment, Social and Corporate Governance): customers nowadays are more and more conscious about the ESG behavior of each company. With the airline industry having a very big carbon footprint, this becomes are important competitive differentiator. As a result, airline companies look more and more to become (near) carbon-neutral, by offsetting carbon emissions, increasing the share of narrow-body aircrafts (to ensure maximum seat occupation rates), more efficient flight capacity (seat more passengers in the same amount of space via more efficient cabin designs), sustainable aviation fuel (e.g. hydrogen-powered planes), employing carbon capture technologies…​
• Partnerships in the form Ecosystems: with embedded user journeys becoming more and more crucial, increasing competition and increasing speed of innovation, it is no longer possible for any company to offer all products and services itself. Instead companies need to partner and form ecosystems, in which innovation can thrive and a Win-Win-Win situation (for both partners and for the customer) can be achieved. In the airline industry this is manifested by:
  • Continuous exchange of data to anticipate and identify potential disruptions and shifting flight schedules. E.g. airline companies should receive real-time data from all airports, from sensors on aircraft (identifying anomalies as soon as possible), from weather forecast agencies…​ All this data should be aggregated and fed to machine learning algorithm to predict and anticipate on future disruptions.
  • Partnerships with other airline and transportation companies in order to offer attractive frequent-flying programs, maximize seat occupation, reducing carbon-footprint by offering parts of journey via other modes of transportation (like train)…​

Central in all these trends in the airline industry is to have a scheduling system, which is

• Highly resilient by robust scheduling (i.e. by scheduling flights and personnel in such a way that a potential disruption has minimum ripple effect on other flights, especially for the flights with highest probability of disruption, based on AI/ML models predicting future disruptions) and an ability to reschedule real-time based on new evolutions.
• Support more complex optimizations, i.e. where a scheduling system only took a few parameters into account to calculate the schedule, the model scheduling systems should take much more constraints into account, like minimizing carbon-footprint, maximizing employee happiness/motivation…​
• Multi-modal and cross-partner scheduling, i.e. the scheduling system should allow to take into account the scheduling results of partners (like train schedules or partner airline companies), so that value for all partners and for the customer can be increased.

Most scheduling systems currently used by airline companies are not able to cope with these new requirements, so investment in new more modern systems is advisable.

If you’d like to learn more about how Motulus can help you solve your optimization issues then please contact us at info@motulus.com