Digitising the skies

No industry has changed more than airlines in response to the relentless march of technology. Dave O’Donovan tells Jason Walsh more disruption is already on the runway

1st October, 2017
Dave O’Donovan, director of digital and mobile technologies at Aer Lingus

Today’s technology jobs tend to be divided between the hard and the soft — many, in fact, are in reality more marketing than technology. Dave O’Donovan, director of digital and mobile technologies at Aer Lingus, however, has bridged the gap, with a grounding in deep technology but a career on the business side of the industry.

O’Donovan studied electrical engineering at UCD, driven by a lifelong interest in how things worked.

“As a kid growing up, I was always interested in figuring how things worked. I was interested in getting a phone into the bedroom, or a TV into the bedroom, running wires up carpets and stats, much to the chagrin of my parents,” he said.

“Computers were really just blooming in Irish homes when I was in my secondary school years, so engineering was a natural step. Then, after university, I was doing the milk rounds and realised I had to make a decision: do you double down and go into deep design, say chip design, or step back to the business side?”

O’Donovan chose the latter, taking a job with Accenture.

This wasn’t his first interaction with the world of high-tech business — or with its notorious boom and bust cycles.

“I spent a summer in San Francisco in 2000 at the height of the dotcom boom and saw the wealth creation around that boom — and then the subsequent bust,” he said.

After a year in China, O’Donovan took up his post with Accenture, developing online projects for large companies which were grappling with the internet. This also led to an early run-in with ‘data’.

“A lot of it really started with working on projects, helping big companies develop online projects, [and] after a couple of years I moved more into the data space. Companies at that time were really focused on consolidating backward-looking reporting, trying to ensure they had a clear view of things. There was a little bit of forward reporting, but this ‘small data’ revolution developed the rules that [later] triggered the big data revolution,” he said.

After a decade in Ireland, O’Donovan wanted to spread his wings, moving to New York to work for an e-commerce start-up called Archetypes.

“The vision was great, but we were probably a couple of years too late. After that I moved to Accenture in New York, where I set up an innovation lab in a university, the Stevens Institute. In parallel, I also ran a fintech innovation lab, trying to connect big companies to fintech innovators,” he said.

Flying high

Fintech was perhaps a fortuitous move, as it was an early example of the kind of disruption that would come to define the coming ‘digital’ revolution.

“There are industries we thought could never be dispirited, like hotels — the entry costs are too high. Now the biggest accommodation provider in the world [Airbnb] has no property at all.”

O’Donovan moved briefly to a global payments provider that was seeking to get on board with digital, before the lure of coming home moved him to pack his bags once more, this time to Aer Lingus.

“I was really excited about the possibility of working for Aer Lingus,” he said.

The airline was, he said, typical of the kind experiencing change at breakneck speed: in 2002, only 3 per cent of revenues were direct. In 2003, it was 50 per cent. Today it’s over 90 per cent.

This change is not yet over, said O’Donovan.

“I think there’s another inflection point [coming] in the travel industry. There’s a very dominant group of legacy airlines and Aer Lingus’s strategy is to double down on digital. There’s so much opportunity along that customer journey to improve the customer experience.

“We’ve been around for a long time and we’ve figured out how to connect to all of the big legacy airlines. However, we’ve also been able to live in Ryanair’s backyard for 30 years,” he said.

This openness to change is, he said, what defines Aer Lingus’s digital strategy.

“In some ways we need to shift the mindset of an airline being fairly unexciting. We’re really an e-commerce company; we want people to be able to browse our offerings on any device at any time, and offer them things along the way that will add value to their journey.

“Can we show them how long the security line is in the airport? If they’re travelling alone might they be interested in lounge access, things like that,” he said.

O’Donovan accepts that travel has become a painful experience in recent years, its glamorous sheen worn down by security lines and passport controls. In order to offset this, he said, airlines need to make use of technology to provide customers with a better, smoother experience.

“The alternative is to be a bus with wings. We don’t want to be a bus with wings, so the more we can identify the different types of traveller the more we can guide them,” he said.

In practice, this means using apps, social media and the web to communicate with customers, including via social media. Social media was never intended as a replacement for call centres, however, and this does present challenges.

“We’re present on those channels, and we use them as a two-way channel. The question there is how can you scale up to the volume of queries people make. That’s where things like chatbots come in. We don’t have any in use at the moment, but it’s one of the kind of things we’re prototyping.

O’Donovan said that all businesses now have to reckon with social media, and to do it well.

“We’ve about 400,000 interactions per year on social media channels. Generally, companies have cottoned on to the fact that people who look up your brand see questions being asked, so seeing responses helps with building your brands,” he said.

The race to mobile is next, but airlines with Aer Lingus are forced to face something smooth mobile companies like Amazon can ignore: interacting with other people’s technology.

It’s a big question for airlines, especially if they interact, as does Aer Lingus, with legacy airlines: how do you take a mainframe that was fit for purpose in the 1970s and make it fit for purpose today?

“The big challenge is how can you change airline technology so that you’re selling the seat and allow people to pick and choose the ancillaries they want,” he said.

There are hints to be found in other sectors.

“Financial services companies have done a good job of wrapping a digital layer on top of their mainframe,” he said.

“We have to be aggressive around how we’re going into the future.”

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