As the aviation sector grows, digitalization will enable the sector by streamlining procedures, lowering manual labor requirements, and fostering collaboration to provide a seamless experience for all stakeholders by creating and delivering custom digital applications quickly and at scale.
By Sri Srinivasan, Chief Revenue Officer, Zvolv
Recent developments in the aviation sector – including the proposed Air India and IndiGo investments with their fleet renewals to revamping of the airports signal a marked shift within the Indian Aviation industry, fast-tracking aviation sector growth and reiterating its criticality to keep India moving.Airlines are evolving their business operating models and focusing on driving a “better” travel experience for consumers.
As airlines evolve, the airports are becoming “destinations” by themselves, rather than a channel facilitating travel. Slowly and steadily, the leading airports of the country such as Mumbai, Delhi and Bengaluru are being revamped keeping the “destination” approach in mind.
Airports Authority of India (AAI) is actively looking to upgrade and enhance more than 70 additional airports across tier 2 & tier 3 cities, an effort directly linked to the growing preference for air travel by Indian consumers and passengers. The Indian government expects to invest $1.83 Bn in the development of airport infrastructure by 2026. The sector will have a huge impact with an economic multiplier of 3.1 and an employment multiplier of 6x in this phase.
The private airlines’ expansion is seeing an uptick in the Maintenance Repair and Overhaul (MRO) investments, with leading plane builders Boeing and Airbus, and international carriers, dramatically increasing their investments in MRO set up in-country.
To achieve the Indian government’s stated goal of a unified transportation policy, the aviation sector is key. Air cargo and associated logistics cost efficiencies will be fundamental to driving the government’s ambition to improve national logistics cost efficiencies from 13% to 10% of the country’s GDP.
Challenges & Opportunities -“Doing More with Less”
Whilst investments in the aviation industry are certainly seeing an uptick, there are still some real challenges the industry is facing for it to fulfill the promise of keeping India moving.
A majority of operations within the airport, airlines, and logistics segments are still run by legacy core systems and a multitude of manual and paper-driven processes. These legacy technologies continue to increase safety risks and drive costs upwards.
The Indian aviation industry as a low-margin industry continues to face pressure from all sides to reduce costs by optimizing operational efficiency. Cut-throat competition leading to an airline price war, rising fuel bills for the airlines, and the overall macroeconomic conditions add to the current uncertainty for aviation players looking to invest for growth, all of which represent significant challenges to the industry.
As the e-commerce market continues to explode, managing supply chain risks is becoming a priority risk for many corporations. Logistics-focused investments are key to mitigating this risk and improving supply chain resilience.
The still-developing MRO ecosystem (with airlines fleet refreshing underway) creates a challenging narrative for an industry segment having the ambition to make a difference to a few hundred million citizens.
In addition, sustainability is a continued concern for the industry, with growing recognition that transformation is required to achieve the stated emission reduction goals of tomorrow. The aviation sector has a key role to play here and the industry titans whilst acknowledging this challenge, do not necessarily have an easy way to finding a path that balances environmental concerns, vis-a-vis short-term commercial needs. How citizens look at sustainability will also determine the pressure on the industry to transform on this key topic.
However, the good news is there is a tremendous opportunity for aviation players to invest in digital technologies to modernise and operationalise their legacy processes within and around the airports and their ecosystems.
From leveraging Generative AI for improved customer service and delivering enhanced forecasting capabilities to managing passenger and cargo demand accurately, to metaverse technologies (incl VR/AR) getting deployed within airports to transform the customer experience e.g. virtual check-ins, to driving airport development leveraging digital twins capability, technology has been playing a key role in transforming this sector globally.
The Indian aviation sector has an opportunity to leapfrog with such technology-led advancements.The recent example of the DigiYatra project, with almost a million+ downloads of the DigiYatra app in less than a few months, provides a glimpse of what the future holds. The DigiYatra initiative has the potential to extend passenger experience beyond the physical precincts of an airport – think seamless passenger check-ins at airport hotels beyond the airport with the DigiYatra ID. The use case of leveraging this digital infrastructure is still in its nascency and is only expected to greatly enhance as the ecosystem develops around this program.
Likewise, we are seeing increasing adoption of modern low code technology platforms by leading airlines and airports across the country – from digitising taxi booking process outside the airports to airport retailing and commerce, safety inspection checklists and fuel price management, to contract and supplier management process automation, low code platforms are fast-tracking the airports and airlines efforts to find the efficiencies without compromising on experience. This is only a good sign for an industry looking to find ways to “Do more with less” and scrap to find more avenues for higher margin realisation.
Conclusion
An aspirational population willing to spend on air travel, and demanding consumers used to sophisticated mobile technologies and implicitly expecting higher levels of personalisation, will drive the aviation industry forward.
The government of India’s transformation program around enabling better services for its citizens, and focusing on improving underlying supply chain resilience with targeted investments in logistics and MRO, with an overarching travel and transportation framework augurs well.
Smart technology, automation, and digitalisation are key for the aviation industry to thread the needle between safety, profitability, and sustainability. The aviation players understand this and are starting to take the right steps to make the aviation sector key to keeping India moving.
The writer is the Board Director and Chief Revenue Officer for Zvolv. He is an experienced C-suite executive and board member with working in the technology sector for 30 years across Asia, Europe, and Australia, with some of the largest silicon valley companies, global and Australian enterprises across diverse industries (government, private, and non-profits).
