big data what is in it for me ? big data @ airlines

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

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All mission critical business processes of an airline rely on IT

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Airline Industry: State & Imperatives – A Reminder

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More Loss than Profit in the Long Run World Airline Financial Results, 1978-2006

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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

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Customer Centricity, Ancillary Revenues and Mobility Solutions are on

the Airline CIO‘s Agenda

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New Players Challenging our Value Chain

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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

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Selling Travel Experience of a Premium Provider vs.

Selecting the Cheapest Ticket at Expedia or Google Flights …

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Big Data Architecture

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Challenges Facing the Travel & Transportation Industry

Adressed by Big Data Technology - Sample Use Cases

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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