IT enables airlines and airports to create a connected supply chain

1. Business white paper
Time for co-operation
IT enables airlines and airports to create a connected supply chain

2. Page 2Business white paper
Table of contents
3 Challenges of a changing market
4 New technology is a driving force
4 Mobility and real-time information management exchange are key
5 New industry vision
5 Why Hewlett Packard Enterprise
6 The HPE solution
8 Operational and financial benefits
9 Looking to the future
11 Concept to reality

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They need to review the way they use operational data for events, touch points and check
points from kerbside to gate, ramp, apron and in flight. They also need to reposition their
approach to retail and entertainment services, replacing traditional paper-based transactions
and physical contact with self-service and automation and move from fixed installations
to mobile.
Technology aligned to business and operational processes is the key enabler and
Hewlett Parkard Enterprise Travel and Transportation is at the forefront of this
revolution with initiatives that aim to create the HPE Connected Traveler and
the HPE Connected Airport.
Challenges of a changing market
Air travel is a boom industry. International Air Transport Association (IATA) figures show
that 5,700 passengers board an aircraft every minute and 3.3 billion passengers flew in 2014.
If latest industry forecasts are correct, the positive trend is set to continue.
Not only are passenger numbers increasing but travellers are also becoming more
discerning with challenging expectations. For its 2014 Global Passenger Survey, IATA
contacted 5,500 respondents in over 140 countries through social media, email and
word-of-mouth.
The survey reveals that airline websites remain the predominant booking channel,
accounting for more than 50 per cent of flight bookings, while just 25 per cent of passengers
now use travel agencies. A quarter of travellers visit at least three websites before buying
their ticket and one in ten people buy travel through social media (in Asia Pacific this figure
rises to one in five).
Self-help has been a key turning point and the survey reveals that modern travellers have an
appetite for joined-up and automated services.
Thirty-eight per cent expressed a preference for automatic check-in, receiving their
boarding pass from the airline direct by text message or email. Seventy-five per cent
said they would use self-tag bags with printed or electronic labels and 80 per cent would
welcome being able to track their bags throughout the journey.
When booking, more than 50 per cent of travellers in North America also bought ancillary
products and services such as excess baggage, seat upgrades, travel insurance, hotel
bookings, car rental, priority check-in and boarding, duty free shopping and lounge access.
The survey also shows that passengers are now more demanding, with 50 per cent
considering a queue time of more than ten minutes to be unacceptable. Just one per cent
would accept a 20 minute queue.
The need to reduce cost, boost productivity and improve
service levels has plunged the air services industry into an
era of critical transformation. Airlines and airports are
re-evaluating how they operate and are recognising the
need to create a connected supply chain by working
together as one cohesive business service unit.

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Airports need to gain more understanding of crowd movement to control and improve
passenger flow. They need to collect data on passenger footfall in critical areas so they
can reduce bottlenecks and identify the most visited areas. They also require better
interaction with passengers to improve guidance on boarding notifications, gate changes
and irregular operation handling. On the retail front they need improved footfall and the
browse-to-purchase rate to increase sales.
New technology is a driving force
Airlines and airports are finding that traditional routes to market are no longer sustainable
in an environment that’s in constant change. The emphasis is swinging from operational to
retail and entertainment. As the industry becomes more customer centric and the customer
more educated and informed they are more demanding and more discerning as to quality of
service delivery. These changes in the dynamics of their business are putting the industry at
the forefront of technical change.
The ability to align business strategy and vision with IT means that the airport chief
information officer (CIO) is taking on a new role. No longer purely a supplier of IT services,
the future CIO will be a director of transformation, bringing IT closer to the airport business.
Next generation IT platforms will take advantage of advances in virtualisation, open source
frameworks and operating systems. They will also embrace cloud technologies to provide
Software-as-a-Service, Platform-as-a-Service and Infrastructure-as-a-Service. Mature service
oriented architectures, rules engines, messaging, search functionality, business intelligence
and data warehousing technologies will all have a part to play and will be integrated into
environments that are built from the ground up, to meet the specific needs of the air
service industry.
Mobility and real-time information management
exchange are key
This is the age of mobility and that is the main foundation for change in air travel.
It’s predicted that 5.13 billion people, or 69.4 per cent of the world population, will be
using mobile phones by 2017 and that 49 per cent of them will have smartphones.
It’s also anticipated that 91 per cent of all people accessing the Internet will do so
from their phones by 2017.
1
“Our concept is based on Hewlett Packard Enterprise’s
ability to manage and analyse data and on the New Style
of Business with social networking and unstructured data.
Our analytical tools enable us to use customer data to
influence and profile customer behaviour.”
— Chris Owens, director and strategist, Global Travel & Transportation Industry,
Hewlett Packard Enterprise
1
Source: marketer: Smartphone Users
Worldwide 2012-2017 Report

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In its latest Mobility Report, telecommunications specialist Ericsson underlines the rapid
growth of this market. It says that total mobile subscriptions are expected to grow from
6.8 billion in Q1 of 2014 to 9.2 billion by the end of 2019. The report predicts a tenfold growth
in mobile data traffic between 2013 and 2019 with the fastest growing segment, video,
expected to increase by 13 times. Social networking is expected to grow tenfold by 2019;
audio traffic eightfold and Web browsing sixfold. The airport model will be far less fixed
installations and more mobile device management. The need to manage the use of mobile
devices will also put pressure on airport operators to improve customer movement through
the airport and enable on-time departures.
New industry vision
Average travellers find using an airport to be a tedious combination of waiting and
queueing but that could become a thing of the past. IATA has a vision that aims to transform
the experience, allowing passengers ‘to seamlessly walk through the airport without
breaking stride’.
Its Simplifying the Business (StB) programme is an industry initiative that has already
resulted in the automation of many existing processes, including the handover of more
control to passengers, and these have enhanced some areas of the passenger experience.
However, their value has been limited because they operate in the domains of
each individual stakeholder – the airline, the airport and in some instances the
government authority.
The landlord and tenant relationship between airports and airlines is now out of date.
To achieve their common goals, airlines and airports need to collaborate on operational
data, looking at how they can use real-time information. Real progress will be made when
airports and airlines re-evaluate how they operate, aligning their business needs into one
cohesive unit and performing as one connected supply chain. Technology is the catalyst that
will make this a reality and HPE is playing a leading role to bring about the required change.
Why HPE?
HPE has supported the airline industry for over 30 years. Employing 3,500 travel and
transportation professionals, it runs six transportation industry Global Centres of Expertise
and nine similar centres for information management and analytics. HPE has carried out
over 50 airline system migrations in the last 15 years and its solutions are now found in more
than 500 airports where they support over 500 million+ passenger boardings annually.
The company’s technology powers a number of industry suppliers and it also supports
over 100 airlines with outsourcing, applications development, Passenger Service Systems
(PSS) and flight operations. It has several strategic reservations clients and more than
70 departure control clients. HPE PSS and DCS is one of the world’s largest communities
with one billion passenger transactions taking place annually.
9.2billion.Total mobile
subcriptions are expected
to grow from 6.8 billion
in Q1 of 2014 to 9.2
billion by the end
of 2019

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HPE also has all the know-how and technology that the air travel business needs.
Virtualisation and cloud computing are two growing domains, with 93 per cent of airlines
intending to implement these platforms over the next five years. HPE has expertise in these
two disciplines as well as data security.
In addition HPE can bring servers and desktops, unified communications, remote support
and the consumerisation of IT to the table, with particular reference to Bring Your Own
Device (BYOD) and its impact on the airline business model.
As with all new and more open systems, agility is the key and that is delivered by the HPE
New Style of Business which integrates business strategy with IT solutions, such as cloud,
big data and mobility and digitised customer experience capabilities. With its analytics
software it can also collect and manage data on topics such as passenger behaviour, make
sense of it, draw conclusions then pass that information back to the airport operator through
business intelligence dashboards.
The HPE Solution
Creating the HPE Connected Customer is the goal. The initiative puts into context how
innovation can help improve the customer-centric, commercial and operational activities at
an airport. The overall aim is to draw on HPE technology and industry knowledge to build
innovative, managed solutions that are scalable and that can be repeated at a number of
airports on a global basis.
The HPE Connected Customer initiative sets the agenda by which the air services industry
will be managed and measured as it moves to a customer enabled management focus with
a heavy emphasis on retail and entertainment offerings. It recognises that IT will have the
greatest impact over the next seven years as the operational models of airlines and airports
converge to deliver integrated services through a connected supply chain.
“We have a lot of existing customer agreements where we
are supplying the hardware to airports around the world.
Over 500 airports are already using some form of HPE
hardware and we are trying to make that relationship more
collaborative and smarter, creating strategic partnerships
as opposed to a manufacturer and supplier relationship.”
— Chris Owens, director and strategist, Global Travel Transportation Industry,
Hewlett Packard Enterprise

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Technology links the airport and airline with the traveller from online check-in to kerb
and gate, covering all land and airside activities including security processing, retail and
entertainment. Developing this framework will provide an end-to-end vision of airport
customers and focus on their various touch points. It will review the retail requirements of
concessionaires and customers and the operational requirements from kerb to landside,
airside and gate.
The HPE Connected Airport is designed to link the airport and airlines’ operational activities
and business processes across front and back offices, ramp and apron operations. There is a
heavy focus on real-time airport collaboration working models to use data more effectively
across the airport in terms of operational metrics such as on-time departures and minimum
base turnaround times at both hub and route network airport locations. It will also review
ramp and apron operations and security requirements.
Director and strategist with Global Travel Transportation Industry, Hewlett Packard
Enterprise, Chris Owens, explains: “The HPE Connected Customer is the main theme in the
airport environment and we break it down into different elements.
“If you go through a customer’s journey there are various events and touch points they
experience from the time they buy their ticket to arriving at the airport, whether by taxi,
underground, overland train or using a car that is then left at an airport car park.
“We can monitor the customer or passenger’s movement through the airport and all the
interfaces they come across or go through as part of that process – check-in desks, baggage
drop, security, land to airside, duty free, retail, entertainment, lounge, boarding gate and
actually boarding the aircraft.
“All these touch points are managed in turn to offer better services to the passenger, with
concierge class assistance through the airport straight into the lounge and the benefits of a
dedicated personal shopper if you require that type of service during an airport visit.
“The whole idea is to look at data that we can use to profile customers and offer incremental
sales and product opportunities that they can experience during their journey through the
airport environment.”
Specific solutions such as geolocation and big data technologies will be used to provide
analysis of customer foot patterns, dwell times and repeated behaviour.
To increase retail sales, the airport system can be alerted to a customer’s location and will
generate their preferences, based on loyalty, user data and travel schedule.
150kA rolling delay can
cost over £150,000 to
an airline because of
knock-on effects

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The HPE Connected Customer can then generate automatic real-time couponing or
promotions which are sent to the passenger’s mobile device and will direct them to the
appropriate retail outlet. The advertiser and merchant then pays the airport for every
coupon redeemed or forwarded.
HPE Aurasma software can also provide Augmented Reality on mobile devices to
enhance the passenger experience with real-world environments overlaid by
computer-generated input.
“Our concept is based on HPE’s ability to manage and analyse data and on the New Style of
Business with social networking and unstructured data,” says Chris Owens. “Our analytical
tools enable us to use customer data to influence and profile customer behaviour.
“We bring in the whole concept behind what we are doing in communications and media,
again using smart devices where you can communicate messages to a customer in a
particular environment. We can also offer services with airport operators where we
provide the devices and they load on the applications that they use for operational ground
handling purposes.”
Operational and financial benefits
An aircraft is only earning money when it’s in the air so it’s a major advantage if an
airport can work more efficiently with an airline to guarantee that they get the aircraft
away on time.
The HPE Connected Customer and the HPE Connected Airport will enable airlines to better
manage the customer flow through the airport. This will support their main objective which
is to get passengers through security and to the gate as quickly as possible so the aircraft
can push back within its time slot.
“If you look at the return on investment (ROI), based on building an airport operational
dashboard, a rolling delay can cost over £150,000 to an airline because of the knock-on
effects. If you can maintain a very high push back punctuality figure then it’s going to lessen
exposure to incremental costs that haven’t been budgeted for but which would affect the
bottom line,” adds Chris Owens.
As well as eliminating the knock-on impact of late flights it will also avoid the financial
burden of delayed passengers claiming compensation – a serious situation for all airlines
working on tight margins.
Speeding up security also has an effect on retail sales because industry surveys reveal that
ten minutes extra in security cuts the average passenger’s retail spend by 30 per cent.
28%of airports are
increasing investment
in mobile devices
and via social networks

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Sales can also be boosted by leveraging behaviour data to drive real-time targeted offers
and by promoting new and relevant products. Increased retail income benefits both the
concessionaires and the airport. The adage about an airport being a shopping mall with
a runway at the side of it is going to be truer than ever before.
The airport can benefit from better security and can improve the travel experience by
maybe suggesting alternative paths to avoid congestion. It will also generate additional
revenue by supplying data on customer behaviour to merchants.
Passengers will benefit by receiving continuous assistance and guidance while in the airport,
by being informed of retail discounts and special offers and by receiving real-time alerts on
unexpected events such as flight delays or queue bottlenecks.
More work is being done at the airport through the use of an integrated approach to airport
collaborative decision making and the benefits it can bring to the airport operator and
ground handling agency, providing real-time operational data throughout the airport and
displaying it through a combination of fixed installation and mobile devices.
The ability to manage and process both operational and security data through the
appropriate airport control centres and the need to inform the business with regards to
real-time operational metrics is creating a more open environment for data exchange.
Many areas require a more open and informed data exchange. These include asset and
resource management, improved operational capabilities in the event of aircraft delays or
substitutions as part of an irregular operations plan, improved overt and covert security
including access control and the ability to use information in terms of predictive analysis.
To perform and exceed both the service level and operational level agreements in place
between the airport operator, its suppliers and stakeholders and to deliver the required
business metrics and KPIs, airports need access to core and support operational, business
and commercial data.
The HPE Connected Airport model is very much part of the requirement by airports
and airlines to improve overall customer satisfaction across each part of the connected
passenger journey, using the ability to manage and analyse data to improve both front and
back office services and to manage all aspects of the connected airport supply chain from
kerbside to gate and from ramp and apron to perimeter fencing.
Looking to the future
Transformation will bring far more automation to airports with much fewer staff and
passengers becoming masters of their own destiny. They will check themselves in,
produce their own boarding pass and check their own baggage in. The can have their own
personalised smart label that they can carry everywhere around the world no matter what
airline they use. They will scan this then just drop the bag off into a self-service baggage
drop container.

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As aircraft are fitted with more sophisticated avionics, limitation on network
communications will disappear and life in the air will be an extension of life on the ground,
with passengers carrying their own mobile devices and using them in flight as they would
on the ground.
Airlines are looking to add new sales channels with more adaptable kiosks for selling
ancillary products and services located across the airport environment, with social network
sites being the latest addition to a growing channel mix. Early adopters are already
integrating social media sites in the sales process and airlines continue to reduce
agent-led passenger operations in favour of more self-service options.
Passenger self-service continues to grow and is still expanding. Some airports are planning
to increase the number of check-in kiosks, while others plan to introduce more kiosks for
alternative usage such as self-scanning of documents, flight transfer, transit and baggage
labelling. Other airports are looking at reducing the number of kiosks where the use of
mobile and smart devices is on the increase and where the passenger profile is more geared
to using new technology.
Airports also plan to extend the self-service concept to other customer touch points to help
improve the performance and speed of passenger handling throughout the airport. Mobility
and mobile devices are therefore becoming a top agenda item for them to invest in over the
next three to five years.
Also, airports continue to show interest in introducing e-gates to reduce queues and speed
up passenger processing and common bag-drop locations are beginning to feature on
the airport self-service wish list. Over the next three years, 47 per cent of airports plan to
implement common bag-drop locations.
Twenty-four per cent of airports are reported to be increasing spend and investment in
customer services with 28 per cent increasing investment in mobile devices and via social
networks. These increased investment levels during 2015/16 are set to support the airport’s
customer service vision and are directly in line with airline plans on improved information
and automation.
Providing notification of flight status and delays on customer mobile phones remains at
the top of the airports’ mobile investments and using mobile phones to direct customers
around the airport in terms of providing way finder information is beginning to attract
airport IT investment.
Airports will increasingly offer retail services through customers’ mobile phones and, like
the airlines, are starting to consider positioning themselves as providers of Fast Moving
Consumer Goods (FMCG) and entertainment services.
Although the provision of passenger services via social networks remains experimental for
many airports, the majority of airport operators are open to using these channels to provide
enhanced customer services. Most airports expect social networks to make a contribution
as an additional communication channel as well as an important ancillary revenue stream.

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Concept to reality
The HPE Connected Customer and the HPE Connected Airport initiatives have been
undergoing proof of concept (POC) tests at the company’s applications factory in
Galway, Ireland, where a dedicated product manager, chief technical officer (CTO) and
a team of developers are bringing together all the component parts that go to make up
the HPE Connected Airport supply chain.
“We are looking at the whole intelligent hub airport operation that sits under the umbrella of
the HPE Connected Customer,” concludes Chris Owens. “We have a lot of existing customer
agreements where we are supplying the hardware to airports around the world.
“Over 500 airports are already using some form of HPE hardware and we are trying to make
that relationship more collaborative and smarter, creating strategic partnerships as opposed
to a manufacturer and supplier relationship.
“By doing this, we can embrace what airports and airlines are actually trying to do which is
improve the whole customer experience.”
Learn more at
hpe.com/go/consumer-travel

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© Copyright 2015 Hewlett Packard Enterprise Development LP. The information contained herein is subject to change without
notice. The only warranties for Hewlett Packard Enterprise products and services are set forth in the express warranty statements
accompanying such products and services. Nothing herein should be construed as constituting an additional warranty.
Hewlett Packard Enterprise shall not be liable for technical or editorial errors or omissions contained herein.
4AA5-7762EEW, November 2015
Case study
KPN Werkplek
Industry
IT services
Business white paper