It was almost a year ago that British Airways announced plans to invest £7 billion in a two-year transformation program.
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While much of the investment was earmarked for the fleet and enhancing the customer experience in the air and on the ground, the carrier said there would be a £750 million investment in IT infrastructure, including the migration of some 700 systems to the cloud.
In addition, the company earmarked £100 million for automation, artificial intelligence and machine learning across operations from "booking to baggage handling," it said at the time.
Colm Lacy, chief commercial officer, provided an update on the investment, particularly some of the technology elements, last week at the Amadeus Altitude event in Lisbon, Portugal.
Lacy said there are five pillars to BA's strategy since the pandemic, including growing and strengthening its existing presence in London, improving the customer experience and driving a more efficient operation, and that the transformation is being "driven around" those pillars.
"We have got to look after our customers," Lacy said. "However, no matter what we do for our customer experience, we have to focus on the basics. Our investment in our operation and engineering are key, it doesn't really matter what we give people on board if we continue to operate late and not deliver the basics of getting you from A to B. It doesn't really matter if we give you champagne and caviar on board, you're not going to be happy. We're investing in systems, in people and in a new business model."
He said the airline's move to the cloud is well underway, and it will be out of its data centers in the first half of this year.
Digital touchpoints
Lacy also talked about the digital experience and said it is testing a new BA.com website and mobile application.
"It's now so important that we give our customers what they want. Our existing platform doesn't meet customer requirements. Everybody demands an experience that they get in modern retailing, and we weren't able to deliver that with our existing system. For me, a huge part of our investment is all about giving the customer control of their journey. We have to have 100% serviceability online to meet our customers needs, that's what they expect, that's what they demand."
We have a mess of an ecosystem that we have added to over 20 years. This is an opportunity to simplify it moving forward.
Colm Lacy - British Airways
He went on to say that they are A/B testing the new BA.com platform with a goal of all having all "commercial transactions" go through it by the end of the first half of this year.
Lacy also said BA's current ecosystem has made bringing new products to market challenging for the carrier. The airline announced its partnership with Amadeus Nevio last year as it looks to drive a more modern selling approach.
The carrier has also changed how it works from a waterfall methodology to a more agile approach, according to Lacy, enabling it to move more quickly, to bring new systems on stream and to rid itself of some technical debt.
"We have a mess of an ecosystem that we have added to over 20 years. This is an opportunity to simplify it moving forward," he said.
The idea of a world free of technical debt is probably some years off. Airlines, and their technology partners, will have to operate two platforms as they transition from the legacy distribution to more modern systems.
"We have to be pragmatic. We still have to operate in today's world which is why we're bridging between the new world, like the offer and order and Nevio developments and the Altea world which is based on Edifact," said Cyril Tetaz, executive vice president of airline solutions for Amadeus.
"We need that to ensure continuity and to ensure we can pace our progress. So, you're going to have a very long transition period where you're going have to accept that you interoperate two platforms with different standards. Shifting 100% to a legacy free world is going to take time."
Bringing in AI and data analytics
BA is also deploying a new payment platform and new revenue management system, enabling it to optimize pricing and retire its existing 20-year old technology. Lacy said a more modern revenue management system, which is currently being tested with a full migration planned for later this year, will enable the airline to implement advanced data analytics and use AI.
He also gave a nod to the importance of the indirect channel and said the only way intermediaries would have access to products and pricing would be through NDC-driven distribution. BA's target is for between 85% to 90% of its volume to come through modern retailing platforms, including its digital channels and NDC, by 2027.
"We have to make sure we have it fit for purpose and make sure we understand that this is about working with them and finding a carrot in terms of why they need to move with us on this journey," he said.
Lacy also spoke about the wider need for the air travel industry to "modernize our foundations."
"We recognize the ecosystem we have at the moment as an industry is out of date. We need to group together to make sure all of us have an infrastructure and ecosystem that meets our joint customer needs. We need to be able to retail across carriers. We need an ecosystem that is modern, based on today's world and more importantly meets the needs of all of our customers."
*The reporter's attendance at the event was supported by Amadeus.