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The Potential of Collaboration: James Hogan, President and Chief Executive Officer, Etihad Airways

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Air Transport IT Summit 2013 - www.sitasummit.aero - @sitasummit

Air Transport IT Summit 2013 - www.sitasummit.aero - @sitasummit

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  • 1. JAMES HOGANPRESIDENT & CHIEF EXECUTIVE OFFICERTHE POTENTIAL OFCOLLABORATIONCreating the ideal journeySITA Air Transport SummitLa Hulpe, Belgium - 20 June, 2013
  • 2. AIR TRAVEL TAKES OFFIn 1910, commercial airtravel became a reality.The German Airship Travel Corporationlaunched flights from Frankfurt to BadenBaden and Dusseldorf.Services were operated by Zeppelin airships.
  • 3. FROM HOT AIR TO WINGED FLIGHT1914.The St Petersburg –TampaAirboat Line operated thefirst commercial flight with awinged aircraft.A two-person floatplane flew35 kilometres across TampaBay, Florida.The journey took 22 minutes.
  • 4. WE’VE COME A LONG WAYAircraft: Benoist X-IV Airbus A380Capacity: 2 people 525 passengers + crew (X 262)Length: 7.9 metres 72.7 metres (x 9)Wingspan: 13.4 metres 79.7 metres (x 6)Range: 200 kilometres 15,700 kilometres (x 78)Speed: 103 km/h 900 km/h (x 9)
  • 5. Source: IATA / Air Transport Action GroupTHE AIRLINE INDUSTRY TODAY• Over 1700 airlines, 23,000 aircraft, 3750 airports• 3.6 billion passengers expected worldwide in 2016• 3.13 billion passengers expected worldwide in 2013Image source: Artist Ryu, Ho-Yeol
  • 6. CUSTOMERS ALSO HAVE EVOLVED• Sophisticated buyers• Highly mobile• Confident with technology• Constantly connected• Informed and value-focused• Expect 24/7 service
  • 7. AIRLINE CUSTOMERS WANT CONTROL OF THEIR TRAVEL• Loss of time biggest cause of passenger stress (SITA)• 70 per cent of air travellers carry smartphones or tablets (SITA)• 75 per cent want more self service (IATA)• After 2015, 90 per cent interaction with airlines via smartphones (IATA)• Up to 8.5 billion mobile devices by 2016 (Ericsson)China and India amonggreatest users of smartphones
  • 8. TODAY’S TECHNOLOGY ENABLES …• Online price comparison and purchase• Online check-in and seat selection• Boarding passes – printed or electronic• Ancillary service purchases• 24/7 online communication with customers• Self-service baggage check-in kiosks• Electronic “self boarding”• “Personalisation” of information or offers• Crowd-sourcing of information aboutproblems or delays• Fast dissemination of opinion – good or bad
  • 9. ETIHAD - SITA COLLABORATION• 10 year strategic partnership• Evolving global IT infrastructure toaccommodate Etihad growth• Cloud network for timely data access,globally• Etihad Airways CrewTab for inflight,online guest support• Ongoing innovation, research andsupport
  • 10. BUT DOES THIS CREATE THE IDEAL JOURNEY?It all helps.But it still can’t replace the human touch
  • 11. ETIHAD AIRWAYS• National carrier of the United Arab Emirates• Established 2003• Based in Abu Dhabi• Full service, international• Key partner in Abu Dhabi 2030 Plan• No legacy airline constraintsFastest-growing networkcarrier in airline history
  • 12. OUR MANDATE
  • 13. OUR GUIDING PRINCIPLESWe are a people business• We have guests not passengers• Full service international airline• Service based on Arabian hospitality• We benchmark against world’s besthotels and restaurants• Business model based on partnering• Growth through collaboration
  • 14. IN OUR FIRST DECADE …• Focus on building scale• Over 15,500 employees from138 nationalities• 78 aircraft, more than 80 on order• 94 direct passenger + cargo destinations• 10.3 million passengers in 2012• 45 codeshare partners, virtual networkover 350 destinations• ProfitableWe have big plans for the future
  • 15. OUR THREE-PILLAR STRATEGYBuild scale through• Organic growth• Codeshare partnerships• Minority equity investments in other carriersA new, collaborative businessmodel for the airline industry
  • 16. THE WORLD’S FIRST ‘AIRLINE EQUITY ALLIANCE’• Equity ensures commitment and obligation• Streamlines entry into new markets within foreign investment limits• Avoids drawn-out process for mergers, larger investments• Enables rapid expansion via established brands• Delivers revenue and cost savings• Stronger customer proposition*Jet Airways subject to regulatory approval29% 40% 10% 3% 24%*
  • 17. COLLABORATION BRINGS …• 475 destinations• 500+ aircraft• Over 95 million passengers• Revenue US$20 billion• Lower cost, higher productivity• More choice for guests*Jet Airways subject to regulatory approval*
  • 18. VERTICAL INTEGRATION• Travel and tour operations• Event planning• Dubai Travel Mall• Airport ground handling• Flight catering• Loyalty program “House ofBrands”Further investments to help deliver the ideal journey
  • 19. WHAT WE WANT FROM TECHNOLOGY• Scalable to accommodate growth• Tailored solutions for Etihad Airways and partners• Multi-market capabilities and support• New revenue opportunities• Lower costs, higher productivity• Improved reliability• Ability to customise guest experience• Flexible to adapt to circumstances
  • 20. PASSENGER SERVICES TECHNOLOGY OVERHAULOur biggest single investment for the next decade• Single platform for reservations, inventory, e-commerce,check-in and dispatch• Significant enhancement of mobile communicationsaccess• Commitment to development and continuousimprovement• Enables guests to take greater control of their journey• Compatible with key partner airlines
  • 21. OUR LATEST TECHNOLOGY COLLABORATIONA first for the airline industry• Predictive maintenance partnership with Taleris• Assesses performance data in aircraft computers• Predicts likely failures of components and systems• Recommends preventive action• Reduces aircraft downtime• Guest benefit: Fewer flight delays, greater reliabilityAnother step towards the ideal journey…
  • 22. IT’S ALL ABOUT THE GUESTOur strategy requires…• Product and service to surpasscompetitors• Maintaining the human touch – noteliminating it• Technology which strengthensairline – guest relationships• Partners who can help deliver ourvision
  • 23. OUR GREATEST CHALLENGE: AIRPORTS• Need to differentiate full service from “commodity” carriers• Guest experience crucial to Etihad Airways product• Airports a key touch point in our guest relationship• Security and immigration experience beyond our control• Both functions crucial …• But both can “dehumanise” guest experienceOUR IDEAL JOURNEY CANNOT BE DELIVERED UNDERTODAY’S CONDITIONS
  • 24. COLLABORATION ON INDUSTRY ISSUES• Lost time, too much process are biggestconcerns for travellers• Security must be faster, more sophisticatedand less intrusive• Immigration documentation: electronic,inflight lodgement?• Faster, more intelligent processing usingexisting customer data• Need for global consistencyTECHNOLOGY PARTNERS MUST WORK WITH INDUSTRY ON FRESH SOLUTIONS
  • 25. TECHNOLOGY MUST SUPPORT OUR VISION• Current airport technology designedfor legacy requirements• Etihad Airways is not a legacy airline• We need all-new technology tailoredto our guests’ requirements• Our vision cannot be constrained bylimits of existing technology• We need to deliver the ideal journeyfor the whole of the trip
  • 26. WHERE FROM HERE?• Etihad Airways will be a prominent andpositive participant in the ideal journey.• Next-generation technology must bedeveloped to deliver the ideal journey• Proliferation of new technology andproviders – where will SITA fit?• What is the next step in creating theideal journey?
  • 27. JAMES HOGANPRESIDENT & CHIEF EXECUTIVE OFFICERTHANK YOU
  • 28. DISCLAIMERAny use, republication or redistribution of this content isexpressly prohibited without the prior written consent ofthe Author. Permission to copy and reproduce contentmay be granted by the author, at their discretion, andby request only.Source: presentation of James Hogan, Eitihad Airwaysat the 2013 SITA Air Transport IT Summit, Brussels.2013 Air Transport IT Summit