Podcast
A new normal or business as usual?
From plummeting demand to massive route cancellations, COVID-19 is having a significant impact on airline scheduling. As airlines plan for recovery and start flying again, managing airline schedules has never been more dynamic. Today, network planners need to rebuild and adapt schedules to optimize evolving market trends. Those airlines that get it right, will come out stronger from the current crisis.
At the core of an airline’s operations and offer is network planning and scheduling – its ability to develop flight schedules maximizing both profitability and reliability. And in the current environment, even stimulating willingness to fly by balancing load factors and number of aircraft.
How has COVID-19 changed the world for network planners?
Typically, airlines would use a previous schedule to prepare for the next period. This familiar and simple approach just doesn’t work anymore, because last season’s, or even last month’s, schedule isn’t relevant today. Airlines will have to create their schedules from scratch. This is a very complex and time-consuming process, especially given the volume of capacity changes we are seeing today. The second challenge is to determine demand. It’s difficult to predict where passengers are willing and able to fly to because historical data is not representative of current demand and governmental restrictions. Airlines will have to keep adapting their schedules continuously as their assumptions of demand are updated almost in real-time.
Is there a successful way for network planners to emerge from COVID-19?
Absolutely! The good news is that scheduling parameters still apply today. For example, aircraft turnaround times may increase due to the extra time needed to sanitize the plane, but the concept of turnaround times is not new. The same can be said for the best practice of clean-sheet scheduling – the capability and technology around rebuilding schedules from scratch – instead of just making incremental changes to previous schedules. This helps to better match capacity with demand and allows for easy adaptation of schedules after they are published. Progressive airlines,like Southwest,were already using advanced capabilities and technology like this before COVID-19.It is time for a breakthrough in airline schedulingand we can provide these same capabilities to any airline that wants them.
What is the solution?
Airlines have access to a tremendous amount of data, so let’s start with finding out where passengers want to fly. Traditional sources of historical data do not apply anymore, but there are new, creative ways of finding relevant information. For example, some airlines are looking at traveler search and shopping patterns to determine demand. Another critical source of demand data will be short-term booking data from an airline’s revenue management system.
Next, it’s time to get the core schedule right – creating a schedule proposal that balances load factors and frequency. There is technology today to optimize frequency planning. Now, it’s time to turn this proposed frequency plan into a real schedule by optimizing departure times, aircraft routings, and fleet assignments from scratch. Again, there is optimization technology today for clean-sheet scheduling, making it easier, especially when facing a situation of limited resources.
In these times, it is necessary to use theright revenue optimization technology,combined with the right people, with an analytical mindset, to handle the complexity of the current environment.
How can integration with other areas of an airline’s ecosystem help?
Integration with other areas across the airline’s ecosystem, such as operations, crew, and revenue management systems, has always been important, but now it is critical.Network planning should provideinitial forecasts of demand to revenue managementfor the new schedules. Additionally, when accounting for the ability to generate revenue per flight, network planning should also reflect the latest revenue management strategies, not historical averages.
COVID-19 has created a “new normal”, and expert airline leaders need to find new ways to continue to optimize their networks. With the help of new generation optimization and decision support tools, driven by the right people, airlines can do this.
I recently discussed these capabilities in detail with Jim Barlow, Vice President of Strategic Consulting, Airlines, at Amadeus and Jeremy Million, Director of Sales, Sky suite, Amadeus in an episode of the Amadeus Airline Podcast entitled, “Network planning: a new normal or business as usual?” I invite you to listen and get in touch if you have any questions that we can help you with.
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