Back to Air Transport IT Review - Issue 2, September 2010
Changing systems, changing mindsets: Skyways
How Skyways maintained yields despite recession
By Soren Roos*
Vice President Revenue Management & Distribution
Skyways
Sweden was hit hard by the global recession and Skyways lost 20% of its domestic passengers. Despite this drop in load, the airline was able to maintain the same yields - due largely to the implementation of a new revenue optimization and passenger management system.
At Skyways, we made four key changes that contributed to our successful weathering of the worst economic downturn in recent history.
- We got senior management buy-in
We started by getting buy-in from the most important stakeholder: the CEO. If we were going to successfully implement major changes, he had to be onboard 100%. That meant backing the project with resources, time and money. - We made organizational changes
We realigned our Traffic, Pricing, and Yield Control departments, placing them beneath the Vice President of Revenue. This allowed easy access for weekly meetings and other forms of communication that greatly facilitated the project. - We upgraded and educated our staff
We turned our Yield Controllers into Revenue Managers, then brought in outside consultants to provide them with the training and education they needed to be successful. - We changed our revenue and distribution systems
We took control of our pricing by hosting our own module. When we were hosted by another airline's system, it took seven days to get a fare to market. In today's dynamic environment, that was unacceptable.
The changes and upgrades allowed us to go from a "go for anything that makes money" approach to one that facilitates efficiency and improves revenue.
Lessons learned
During the upheaval of changing systems and making organisational adjustments, we learned several valuable lessons.
- Yields will always be important. Due to recessions, or ash clouds, you may lose passengers - but you need to keep yields up.
- Change is constant. As airlines, we are continually living in chaos, every day brings new challenges to meet and overcome.
- IT development is necessary - and ongoing. Small airlines need help. It's important for IT providers such as SITA to commit to us for the long haul, not just implementing a new system and going home. Training is needed, as is help in changing people's way of working.
The most important lesson was not to do with the technology. To change the system is not easy, but it is not mission impossible. The real challenge is changing minds - the way people work and think.
*Based on a presentation to the "Driving up yields" Industry Insight Session, Air Transport IT Summit 2010.
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