Time to evolve?
Honeywell’s growth sales leader for airports, Gert Taeymans, explains how adopting an operating expenditure (OPEX) business model and new technology can help airports optimise operational efficiency.
Today’s airports face a number of new business dilemmas, one of which is to improve the airport experience for passengers at the same time as handling more traffic than ever before.
It is quite a challenge and the risks of getting it wrong are high, as failing to efficiently handle the continued upward trajectory in traffic will inevitably lead to delays and customer dissatisfaction.
And with many airports already at capacity, and major infrastructural upgrades not always an option, often the only solution is finding new ways to improve operational efficiency.
Creating more capacity
To address the capacity issues within existing physical constraints, airports need to conduct a complete reappraisal of the operational models they already have in place.
Unfortunately, many airports today tend to take a siloed approach to operations, addressing specific problems on a case by case basis without looking at the big picture.
Developing a holistic view of the operations is essential and requires an audit of all existing processes and systems.
Finding opportunities for optimisation
Typically, the biggest inefficiencies exist at the intersections between different processes and systems. Many airports, for example, could do a lot more to improve the integration of airside and terminal operations.
By breaking down those silos, and enhancing integration, it is possible to create the kind of seamless operation that promotes operational efficiency.
While optimising structure and processes should be the priority, emerging technologies are increasingly at the heart of efforts to drive performance.
Greater use of Internet of Things (IoT) enabled tracking has provided visibility of the overall passenger journey. The insights generated by this visibility are helping to improve flow and the overall experience, so much so that queues are shortened despite introduction of more stringent security requirements.
Numerous airlines have begun trials of automated boarding gates in the last couple of years. Crucially, organisations are finding that when automation technology is utilised, customer satisfaction tends to be higher.
The OPEX model evolution
With sophisticated digital technologies becoming more prevalent, airports are increasingly looking to external experts for help overseeing their modernisation initiatives, partnering with external managed service providers to both assess existing processes and stay in front of the latest innovations.
Traditionally, it’s been the norm for organisations to manage this in-house, but faster technology lifecycles are driving up capital expenditure (CAPEX), making this approach unsustainable.
Shifting to the operational expenditure (OPEX) model that managed service providers offer helps ensure airports are at the optimal point of the evolution cycle, while also drawing on the expertise of technology specialists.
Moreover, this support helps ensure effective integration with legacy infrastructure. This is important as new technologies are central to driving greater capacity, but optimal return on investment depends on an implementation strategy that maximises the value of systems already in place.
While a root and branch review of processes and systems might not be required for every airport today, doing so makes good business sense.
Most smaller airports, for instance, will not be operating anywhere near maximum capacity, but would still derive significant benefits, including greater profit margins, by increasing the integration of their operations.
Technology is central to achieving this, and by adopting a service agreement approach, airports of all sizes can stay at the forefront of innovation.