Smarter Airport Systems Transform Travel - IBM

Creating smarter airports An opportunity to transform travel and trade

1 Creating smarter airports

Executive summaryAirports face multiple challenges, including meeting capacity demands, providing enhanced public service and increasing revenue—all while battling rising costs, increasingly dissatis-fied customers and rigid information infrastructures. These challenges and pressures are evidence that their current business processes need revitalization.

Even with their challenges, airports have the potential to become multi-modal transporta-tion hubs and centers of economic vitality. To do so requires greater collaboration between airport stakeholders and a more integrated approach to managing and sharing information.

Society has presented airport executives with a mandate to create airports that are smarter, just as airport infrastructures, systems and processes are becoming digitally aware, inter-connected and infused with intelligence. By embracing new and existing technologies to ac-quire, associate and analyze information in the airport infrastructure and using that informa-tion to become more efficient and effective, airport operators can create a more responsive and agile operating and commercial environment. In addition, they can be recognized as leaders who harness shared information to:

• Provide enhanced service to passengers, airlines and other customers.

• Achieve real-time operational awareness, adaptability and readiness.

• Decrease the cost of delivering services.

• Generate business insights that benefit the airport, airlines and business partners.

The smarter airport is a dynamic hub that connects a multi-modal transport network with people, information and trade; it serves the needs of the larger community and generates economic value for the region. It is a new frame of reference with enormous potential for growth and progress and for opportunities to think and act in new ways.


IntroductionThe demands being placed on all modes of transportation are growing, driven by expand-ing populations, rapid urbanization, business globalization and the rapid adoption of new technologies. These and other factors have created four imperatives for all operators in the transportation ecosystem:

• Predict demand and optimize capacity and assets accordingly.

• Improve the end-to-end customer experience.

• Improve operational efficiency while reducing environmental impact.

• Continue to assure safety and security, with less cost and impact on customers.

Airports play an increasingly important role in addressing these imperatives because they are a nexus for multi-modal transportation.

Airport operators are responsible for planning, designing, building and operating their capital-intensive infrastructure assets over long plan-ning horizons to meet commitments to the local communities and metropolitan areas they serve. They have a long-term financial obligation to de-liver sustainable return on these assets. Current airport business models are often not yielding the desired financial results, however.

Based on the Global Airport Revenue statistics of the Airports Council International (ACI), aero-nautical revenue does not cover all airport op-erations costs. Instead, net airport profit growth is now derived from non-aeronautical revenue because of higher margins and lower operating costs.1 Both airport revenue streams (aeronauti-cal and non-aeronautical) are under pressure caused by reduced passenger numbers, cargo volumes and aircraft movements in the current economic environment.

The reason that current business models are no longer as effective as they once were is that the air travel environment is changing faster than organizations can adapt. Periods of economic growth and decline, airline traffic volatility, short-term route network changes, evolving security rules and other governmental regulations all characterize the current air travel environment. In this changing environment, airports and their business partners are struggling. It is clear that a business model transformation is necessary.

Airport-initiated stakeholder collaboration and information technology are key enablers in the transformation of the airport business model to one that uses airport infrastructures better and supports new commercially attractive offerings. This transformation requires big ideas from all participants in the global airport industry—from small operators to large airport authori-ties in both high-growth and mature markets. Global multi-modal transportation needs more dynamic, economically viable airports that serve as central hubs in networks of passenger, cargo and information movements. Now that so many technology avenues are open, it’s time to make the change.

This paper provides a brief overview of the challenges that have mandated a change in the airport business model and then explains how airports can use new strategies, current and emerging technology and paradigm shifts to become smarter airports.


Mandate for changeGlobally, airport authorities, owners and their business partners face a number of business challenges:

• Capacity shortfallsDemand for air travel worldwide continues to expand, stretching capacity beyond the breaking point. Currently about 2.2 billion passengers per year are using commercial aviation services. It is possible that, as the world population increases and air travel becomes even more available, by 2020, there will be demand for 7 billion passenger trips. If current conditions persist, airline and airport passenger capacity will only be able to handle 6 billion travelers, creating a shortfall of critical infrastructure of 15 percent.2

• Dissatisfied passengersA 2008 IBM survey of 1,000 passengers across the U.S. revealed a growing lack of tolerance for poor agent interactions, bag-gage fees, lost luggage and flight delays. Customers have good reason to be dissatis-fied. In 2008, almost one-quarter of sched-uled U.S. flights were delayed. Frustrated U.S. air travelers avoided 41 million flights over a period of 12 months ending in 2008, which cost the U.S. economy over $26 bil-lion.3

• Declining revenueThe International Air Transport Association (IATA) estimates that airlines will lose $11 billion in 2009, after shedding $16.8 billion in 2008.4 These airline revenue losses have a significant impact on the airport industry. In total, the fees that airports charge the global airlines to use their facilities account for 21 percent of overall airport income; the other 79 percent is from commercial airport activities and passenger service charges.5 With fewer passengers and the commercial sales per passenger down between 10 and 20 per-cent,6 airports face a dramatic decline in both aviation and non-aviation income.

• Increased regulationsNew requirements from a large variety of regulatory bodies, including aviation authori-ties and national and local governments, put pressures on airport operations. For example, new security requirements for the passenger and cargo handling processes are caus-ing disruptions and are increasing airport costs. Safety and security costs have risen to almost 60 to 70 percent of airport operating costs.7 In addition, environmental regulations affect all airports, regardless of size or loca-tion. Some new regulations are likely to cause significant changes to airport operations, such as those applicable to oil spill preven-tion planning and directives to monitor and control noise pollution, toxic air pollutants and carbon emissions.

• Increased competitionStrong airline alliances dominate the market. As a result, airports compete with each other for airline and passenger traffic, while their local communities expect all attractive routes to be available. However, the larger share of competition is from other forms of transpor-tation. High speed rail has had a significant impact on air travel in continental Europe.8 Airport operators and their infrastructure as-sets cannot easily move to a better market, so they must make their market more attrac-tive to airlines, passengers and the larger air travel stakeholder community.

These challenges have created an almost overwhelming mandate for change. Airports must transform themselves and their business models to overcome the current challenges they face and thrive in the 21st century. They must become smarter airports. To do so requires a different mindset and a new level of collabora-tion between all the major stakeholders in the air travel chain.

For airport operators, the top

industry challenges are: capacity

shortfalls, dissatisfied passengers,

declining revenue, increased regu-

lations and increased competition.


Smarter airports are connected networks that make it easy for passengers, cargo, informa-tion and services to get where they need to be. Such connectivity creates a new, positive experience for travelers from pre-flight to post-flight. The seamless integration of information from various processes—from check-in, to security, to flight information displays, to bag-gage, to boarding—streamlines airport opera-tions. A single instrumented, interconnected and intelligent information architecture provides the flexibility to adapt to the changing needs of airlines, airports and their customers. The result is a positive effect on airport revenue and growth. For example:

• Technology connects the objects, people, processes and systems in the air travel process and helps operators and service providers track their movements. With this information, airport operators and other avia-tion service providers can allocate support resources just when they’re needed through-out the process.

• Air and multi-modal network alignment en-ables efficiencies, incentives and multi-brand-ing opportunities. Competitive pricing and schedules enhance door to door connectivity for passengers and cargo.

• New travel services can create consumer revenue growth because passengers can move through the airport with few hassles and enjoy their experiences at the airport.

• Regional logistics and trade based on related business activities in the airport’s region or country stimulate growth of the air travel network and land side connectivity.

Technology can enable airports to transform the entire air travel process. However, technology is only an enabler. For airports to truly make the leap to new, sustainable and profitable busi-ness models, airport operators, airlines, ground handlers, security operators, customs, retailers, concession owners and public transport opera-tors all must alter their mindsets from propri-etary to collaborative. Collaboration is the key to planning and managing multi-modal operations and commercial services effectively in every aspect of the airport ecosystem.

Smarter airport enablersOperationally, an airport supports a complex process that spans multiple organizations, cat-egorized into three major components: passen-ger, cargo and aircraft departure, transfer and arrival. Each component consists of operational processes that different organizations share, in-cluding air navigation services providers, ground handling, catering, airlines, various supporting units and the airport operator itself.

Decades of adding layer-upon-layer of informa-tion technology have increased complexity, resulting in cumbersome airport systems that are expensive and inflexible. Is it any wonder then—as more people, equipment and systems have been added to the logistics of sustaining these complex and specialized systems—that current models have lost a great deal of the flexibility necessary to lower costs?

Smarter airports are connected

networks that make it easy for

passengers, cargo, information and

services to get where they need to

be. A single instrumented, intercon-

nected and intelligent information

architecture adapts to the chang-

ing needs of airlines, airports and

their customers.


Now, however, there is an opportunity for airports to think and act in new ways. The world is becoming:

InstrumentedRFID tags, mobile phones and other connected devices are creating the ability to sense, measure and track locations and conditions of objects, people and processes over door –to-door multi-modal transport networks.

InterconnectedTechnology has evolved to the point that there are now large networks that connect all types of objects, creating multitudes of interactions between people, places and things.

IntelligentInstrumented and interconnected information infrastructures and other assets can now communicate with sophisticated business systems so that we can mine more data, analyze relationships, identify new patterns and make informed decisions in real time.

This instrumented, interconnected and intelligent world presents airport authorities, owners and other stakeholders with tools and strategies they can use to create smarter airports that better serve pas-sengers and customers, connect with multi-modal transportation centers and smooth the air travel process. The sections that follow define how instrumentation, interconnectivity and intelligence are being applied to airports.

Instrumented Interconnected Intelligent

An opportunity to think and act in new ways


InstrumentedConsider these predictions for 2010:

• 1 billion transistors per human on the planet

• 4 billion subscriptions to mobile telephones and personal digital assistants

• 2 billion people with Web access

• 1 trillion connected objects such as cars, ap-pliances, cameras, roadways, pipelines

Using these technologies and others, such as wireless airport sensors, RFID tags and person-alized cards based on biometrics, you can track objects, people and airport processes through-out the airport infrastructure and broader air travel chain. In fact, instrumented objects, peo-ple and processes are already providing masses of new transportation data around the world. For example, instrumented devices aid passen-ger navigation at self-service check-in kiosks, immigration, retail areas, security and gates in combination with wireless sensors in the airport area. Expect the presence of common-use self-service technologies to become more widespread as airports recognize their potential for further empowering passengers.

The airports in Las Vegas, Amsterdam and Hong Kong use RFID to sort and track baggage. Better read rates over the bar coded tags have improved baggage sorting and reduced mishandled baggage, while increasing the capacity of the existing bag-gage system. The airports then can defer costly and disruptive expansion work.

Instrumentation also supports obtaining more airport operations information, such as utiliza-tion of terminal processes, passenger flows and maintenance of critical airport assets such as runways, terminals and equipment. Exist-ing airport hubs in Europe, Asia and North America and new airports in emerging markets are applying increased levels of instrumentation to the travel process. With information about passenger flows from mobile devices with GPS and RFID tags, airport operators can locate passengers, cargo and bags while interacting with individual passengers at each step in their travel process, reducing costs and helping meet new security mandates. Airport staff can also be better deployed in the airport to accommodate these flows, which in turn improves capacity.

Using transistors, mobile phones,

personal digital assistants, GPS.

wireless airport sensors, RFID tags

and personalized cards based on

biometrics, it is possible to track ob-

jects, people and airport processes

throughout an airport.


InterconnectedAn airport operation has, on average, at least 30 disparate systems running concurrently. For many years, airport operators focused their technology purchases on separate solutions that responded to a single or unique opera-tional need. For example, they invested in one solution for baggage handling, another for flight information display systems and yet another for check-in. The result is an infrastructure with original and older applications that are highly in-flexible, complex and difficult to integrate. Each system holds information that could improve airport service if shared with other systems; however, most are simply silos that provide information only to a select group or enterprise.

Connecting the different airport systems, with-out replacing the original infrastructure, makes it possible for airport operators and their business partners to share important information, such as that provided by instrumentation. They can develop business models for a consistent travel experience and optimal airport processes. Inter-connectivity can be accomplished in a number of ways, such as with:

• Standardized, global airport connectivityIndustry associations such as ICAO, IATA, ACI and the American Association of Airport Executives (AAAE) have begun working on a framework that promotes global airport interconnectivity with global information standards. The goal is a more transparent air travel chain, one that can better match supply and demand for terminal capacity and other airport process bottlenecks. The framework would support the technologies that can transform processes in areas such as aircraft handling, security, baggage and check-in. Examples include new tools such as airport-wide performance dashboards that make it easy to view real-time information to improve travel flows.

• Shared servicesShared services can include reusing data, networks, software and computing resources to create interconnected information pro-cesses between departments and partners. Using information technology, airports and airlines can work together to develop a shared services model that meets the in-creasing demand for streamlined operations. A shared services model supports growth and organizational collaboration to meet evolving challenges while reducing the effect of information silos that result in redundant costs and inefficiency.

• Airport Operations Control CentersThe purpose of an Airport Operations Control Center (AOCC) is to oversee and align all air-port processes from a single, trusted source, creating a common focus on punctuality, process quality and continuous improve-ment. AOCCs feature modular, flexible airport operating systems and an information architecture that can receive information from anywhere in the airport and route it to where it needs to be to support all airport opera-tions processes. For example, airport staff and enterprise resource planning systems can receive predicted passenger departure traffic volume so they can match resource levels with demand. Such alignment can help reduce the high cost of overstaffing and cor-rect poor service levels. The AOCC can also use communication channels such as secure Web portals to share information that can help integrate financial processes by creating a unified situational and analytical view for airport management.

Airports can accomplish intercon-

nectivity with global informa-

tion and connectivity standards,

shared services, airport operations

control centers, shared services

and IT optimization.


• Optimization of IT infrastructureThe cost and complexity of IT systems can be reduced using a technique known as “virtualization.” Shared servers and storage, which can be in-house or offsite, can run multiple applications so that a server for each application is no longer necessary. The result is the flexibility to adapt system capacity to changing needs and streamline IT operations. Virtualization also yields lower costs for en-ergy and space, while helping convert capital expense to operational expense.

Frankfurt Airport Fraport and Hong Kong Chek Lap Kok International Airport have achieved improved safety, security and operations efficiency by integrating the real-time management of multiple airport systems and operations into a new AOCC. These systems automate and remotely capture performance measurement, which in turn facilitates improvements in operational planning for the airports.


IntelligentWhen the systems of airports, airlines and service providers are instrumented and inter-connected, operators acquire a wealth of new passenger-based information. Intelligent busi-ness applications help airport operators deci-pher this information to answer questions such as: “Are we managing our airport operations ef-ficiently based on actual traffic patterns?” Also, with such intelligence, airport operators, airlines and service providers can develop new areas of air travel process integration that change the dynamics of passenger flows and facilitate bet-ter airport and aircraft capacity utilization. For example, intelligent systems can monitor gate usage to determine the availability of space for aircraft. Boarding and baggage procedures that use technology to help locate travelers and their baggage for quicker boarding can also improve turnaround time.

In addition to more efficient airport operations and better utilization of the airport facilities, intelligent information infrastructures make it possible to introduce new services for passen-gers. Such services include virtualized passen-ger procedures that provide service beyond the boundaries of the physical airport, spreading peak congestion over locations and broader time intervals. For example, smart phone appli-cations and kiosks located outside of the airport can enable remote check-in and deliver person-alized information about schedule changes to travelers, streamlining the time and resources needed to support passenger peak demand periods while improving customer service.

Instrumented, interconnected and intelligent airport systems are the backbones of a smarter airport and are key enablers of smarter airport strategies.

The Manchester and Copenhagen airports are capturing real-time passenger flow data by pas-sively tracking the Bluetooth phones carried by passengers. This information ultimately helps the airports eliminate bottlenecks, improve operations and optimize staffing levels.

Intelligent business applications

help airport operators answer ques-

tions such as: “Are we managing our

airport operations efficiently based

on actual traffic patterns?”


Experiencing a smarter airportPicture this: You’ve finally chosen your destination for your next vacation: Peru. You use a secure airport Web portal to book your flight and get a tour of what to expect at the new airport terminal in your city, along with hints and tips related to the Peruvian culture and history. Forty-eight hours before your flight, you get a message on your phone with your flight details along with a 2D bar-coded boarding pass. On the way to the airport, you receive a scheduled departure confirmation and learn that there are no delays. When you get to the airport, a text message greets you with your gate numbers and boarding time. You tag your luggage yourself and drop it off at a check-in kiosk.

There’s a line to check in, so a roving check-in agent uses a mobile device to check your passport and completes the check-in process, so that you can proceed directly to your gate. On your way to the gate, you decide that a Spanish-English dictionary would be helpful. You pick one out and pay for it using Near Field Communication on your mobile phone. Your personalized shopper profile has sent you locations of items of interest available at shops in the airport and you remember to buy motion sickness medication for your ferry ride from Callao to see sea lions on the Isle of Palominos. You receive an alert that your flight is boarding, find your gate using the interactive airport PDA map and use the 2D bar-coded boarding pass to get on the plane. When you arrive in Lima, you already know what carousel your bags are on, thanks to another text message on your mobile phone. Because you had the foresight to register with the relevant authorities, you proceed through immigration quickly using a biometric scanner. After you retrieve your bags and go through customs, you will be able to pick up the guidebooks that you pre-ordered during the reservation. You also receive information about train schedules and other modes of transport on your mobile phone based on the postal code of your final destination.

Throughout all these activities, airport security at each airport can identify selected travelers or suspicious objects with video surveillance throughout the terminal in the central airport operations control center. Meanwhile, airport staff receives real-time information about arriving and departing flights and irregular operations messages on their mobile devices. Your impression is of a well-run airport with all operations functioning properly without delays.

This is not a scene from the latest science fiction film or video game. This is a picture of an integrated travel process in an airport that uses the latest technology and collaboration to:

• Add real-time information to the pre- and post-flight air travel process.

• Collect more information for analysis and airport optimizations.

• Eliminate unnecessary costs in air travel operations and improve decision making.

• Improve baggage handling speed and accuracy

• Facilitate core airport processes and minimize the hassle factor.


Strategies for a smarter airportSmarter airports connect air transportation with sea and land travel, people, information and trade to serve the needs of the larger commu-nity and drive economic growth. To anticipate existing and future challenges, they collaborate to benefit from intelligent airport optimization and to provide more value for the connected traveler, shippers and the full stakeholder ecosystem. The strategies necessary for this connection and collaboration include:

• Connect multi-modal transport networks to improve competitive position.

• Innovate to upgrade operations and commer-cial services for a consistent travel experience.

• Promote sustainable development of the larger logistics and trade area community.

Connect multi-modal transport networks To meet the increasing demand for transpor-tation, government officials are working with airport planners and embracing new concepts for mixed-use transportation facilities as part of a larger economic model for growth. Global airports have a unique position in these projects because they are concentration points for multi-modal connectivity that facilitates movement between a city or region and the surrounding world. Currently, however, there is little coordi-nation between the different types of transpor-tation found at airports and their environs. In fact, different transportation systems compete with one another, often causing delays, confu-sion and passenger dissatisfaction.

To realize their full potential as multi-modal hubs, airports must lead the creation of a “transportation system of systems.” They must move beyond physical infrastructure to help integrate operational processes and supporting technologies between transportation operators, the community and their customers. The reason for this is that smarter airports do not recognize traditional boundaries between air and other forms of transportation. Instead of competing with rail, road and water, a smarter airport is a multi-modal hub with a large catchment area that offers regional and global air route connec-tions and helps reduce overall transportation times and costs. At these hubs, more passen-gers and cargo can move more efficiently, serv-ing more destinations, with increased on-time performance.

To improve the traveler and customer experi-ence, airports can start by aligning air route networks and schedules with those of other kinds of land transportation. Passengers and cargo shippers can then make informed plan-ning and purchasing decisions about each type of transportation they use. Airports should also adopt the actions of current world-class airports by expanding land and sea travel networks to offer new destinations. Frankfurt and Paris are examples of airports that are connected with high speed train networks. Amsterdam and Hong Kong benefit from the existence of large seaports that strengthen the airports and vice versa with additional traffic volumes and devel-opment of logistics and trade areas.

The strategies for a smarter

airport include connecting trans-

portation networks to improve

competitive position, innovating

for a consistent travel experience

and promoting sustainable devel-

opment of the larger logistics and

trade area community.


Innovate to upgrade operations and commercial services A smarter airport dramatically improves the travel experience by optimizing the role of airports in the surrounding world. Using existing information to recognize opportunities, innova-tive partnerships with investors can create new aviation and non-aviation services and facilities. Examples of the new services include:

• Web portals that provide greater levels of interaction with customer target groups

• New airport loyalty concepts, such as airport member cards for fast tracking and customer intimacy

• New retail, food and beverage services, ho-tels and parking

• New media, entertainment, personal services and information services at the airport

This broad consumer business portfolio creates a city-like airport that caters to the needs of all passenger segments—from the budget leisure passenger to the premium first-class business traveler—by channeling stagnant travel time into positive experiences.

Airports that provide innovative services outside those related to aviation benefit because they develop new revenue sources. For example, think of the benefits of retail brands advertis-ing in active displays that change their ads in real time based on the demographics of the passengers at the airport. Passengers feel catered to and retailers see increased sales. Also, consider the possibilities of having items passengers have ordered waiting for them at a pick-up center at their arrival destination so that they don’t have to stop on their way to their ho-tels or homes. Retailers, passengers, customer service and delivery agencies all benefit from the strength of the airport brand in the com-mercial area.

Promote sustainable development of the logistics and trade area communityAirports today are multifunctional trade areas. Arterial spines and trade clusters of aviation-linked businesses radiate outward for up to approximately 12 miles (or 20 kilometers) from the airport. Such “aerotropolises” can include corporate headquarters, aircraft maintenance facilities, business parks, logistics centers, industrial parks, hospitality and entertainment establishments, large retail centers and mixed-use residential developments.9

Operators of smarter airports recognize the power of these aerotropolises and work to ensure their sustainability. Using the intelligence created by greater visibility of transportation flows and direct access to travel and trade information, they work with all the parties in these communities to create new avenues for economic growth. They also connect with other infrastructures in their trade zones, such as security, energy and communication, to obtain more information for analysis with the aim of further optimizing business.

In addition, airport operators are seeking col-laboration initiatives with other international airports to extend their global economic reach. These are like the alliance developments in the airline industry over the past 20 years and even include collaboration with them. For example, in late 2008, Amsterdam Airport Schiphol and Aeroports de Paris signed a 12-year alliance agreement of for a dual-hub concept. Two of the objectives of the alliance are to strengthen the relationship and collaboration with their largest airline clients, Air France-KLM and the SkyTeam Alliance, and to grow commercial and trade services together. Alliances between airports and airlines are also likely to increase, creating healthy competition for new travel volumes and trade activities.


Promoting sustainable development of the larg-er trade community, improving competitive posi-tion with multi-modal transport networks and in-novating to upgrade operations and commercial services all represent the process of creating a smarter airport from a strategic perspective. There are also tactical considerations—these form the route to a smarter airport.

Routes to the smarter airportThe appropriate route to a smarter airport depends on the airport ownership model, cur-rent and projected capacity and the ability to accommodate future passenger growth, cargo traffic and customer requirements. However, there are certain actions that are recommended regardless of the airport ownership model or configuration.

Create strategic clarityWithout a clear understanding of an airport’s strategic position and growth objectives, stakeholders can operate at cross purposes. Therefore, it is critical that all airport stakehold-ers understand the airport business model and the future strategic direction for growth based on the major themes on the airport business agenda. Some of the major considerations include:

• The competitive position of the airport in relation to other airports and forms of travel and transportation and how well the airport can attract new airlines, travelers and related business activities

• Investment priorities and trade-offs between core business dimensions such as aviation operations, commercial services and logistics and trade

• Airport branding from low-cost leadership to more customer intimacy

• How and where to position new entrants in the airport market such as banking and investment groups and large engineering and construction corporations

• The role of the airport in the economic re-gion—as a public runway and terminal utility service only—or an engine for growing multi-modal transport, travel and trade interactions

Collaborate responsivelyIf they are to thrive, airports and their business partners must collaborate to plan, manage and operate the movement of passengers and cargo in the entire travel process. They need to develop a shared vision to resolve congestion, customer dissatisfaction and other pressures such as national security and the environment. The key enablers of airport collaboration are:

• The willingness of airport operators, their business partners and service providers, motivated by a better economic model, to achieve process integration for improved air travel services and lower overall airport costs

• The alignment of modern airport procure-ment, contracting and management pro-cedures to recognize the value of a new outsourcing business model with external providers handling non-core processes.

• The implementation of technology that pro-motes information-sharing between all airport entities

Mitigate business risksOn the route to a smarter airport, operators, airlines and other aviation stakeholders must mitigate safety, security and financial risks while making sure that they are good corporate citizens. For security and safety, airport stake-holders should take advantage of emerging technologies, including fingerprint recognition systems, automated document identification systems, iris scanning systems, facial-recogni-tion technologies and data analysis systems for pre-screening passengers.

Creating strategic clarity, collabo-

rating responsively and mitigating

risks are part of the route to a

smarter airport.


In the financial arena, there should be an emphasis on transforming fixed capital expen-ditures into variable operating expenditures. Variable operating expenditures are created by focusing on core aviation activities and out-sourcing non-core activities to specialty services providers, such as handling, information, facility management, security and so forth, based on pay-for-use models. At the same time, airport operators must continue to maintain strong relationships with the local community as part of their corporate social responsibility policies, which should include noise and CO2

emission reductions.

Plan your routeA smarter airport is not built overnight. It requires bold steps, investment and the will to create real transformation. Take a moment to score your organizational actions (- or +) against this checklist of questions:

• How are you driving strategic collaboration with all airport business partners and opera-tors of connecting modes of transportation? Do you have senior level meetings with your stakeholders to align shared vision, strategy and business operating models, including joint business planning and actions?

• Have you considered enlisting a third party with industry expertise, business transfor-mation experience and technology insight to help facilitate collaboration and process improvement? This approach has been used by some airports to help align all stakeholders with a common purpose.

• What are you currently doing to provide your passengers with a consistent and predictable airport experience along all the links of the air travel chain? What do you plan to do in the future? How do you measure your progress?

• To what degree are you benefiting from the full value of multi-modal transportation net-works, travel and trade services concepts in combination with an overall airport-wide strat-egy for total revenue and cost management?

• Do you have a map of your enterprise infor-mation infrastructure and applications that shows which systems are integrated with those of the airlines, ground handlers, secu-rity operators, customs, retailers, concession owners, public transportation operators and so on to take advantage of your combined assets, capacity and services? Is effective governance in place?

• Which airport processes do you consider core competencies performed by airport per-sonnel versus business functions that could be executed by specialist service providers?

• What are you currently doing to measure and sense the health of your airport operations? What are your plans for incorporating such information into near real-time collaborative decision making to answer these questions: How are we doing? Why? How can we improve?

• What are you currently using your best talent for? What could be accomplished if they were focused on helping the airport ecosystem become instrumented, interconnected and intelligent?

How did your organization score in the preced-ing checklist? How many of those + signs are your airport acting on right now? Would the per-son in the office next to yours score the airport the same way? There might be an opportunity to transform travel and trade further. Let this checklist be your impetus to get started.


ConclusionThe time for airports around the world to change is now. Current business models are not yielding the desired results. Today, airport authorities, owners and their major business partners are facing rising costs, declines in revenue, growth constraints and an increasingly dissatisfied customer base. To prevent these problems from worsening, airport operators must move away from “business as usual” models and transform their business processes. They must become smarter airports.

Smarter airports are connected networks that make it easy for passengers, cargo, informa-tion and services to get where they need to be. The seamless integration of information from all airport processes streamlines airline operations. A single instrumented, interconnected and intel-ligent information architecture helps the airport adapt to the changing needs of airlines, aviation service providers and customers. The result is a positive effect on airport revenue and growth.

Technology can help transform the entire air travel process, but it is only an enabler. For air-ports to truly make the leap to new, sustainable and profitable business models, all stakehold-ers involved must become collaborators rather than competitors. With collaboration comes the effective planning and management of multi-modal operations and commercial services in every aspect of the airport ecosystem.

Innovation partner for the changing airports industryAt IBM Global Business Services, we collaborate with our clients, bringing together business insights, advanced research and technology to give them a distinct advantage in today’s rapidly changing environment. With our integrated approach to busi-ness design and execution, we help turn strategies into action. And with expertise in 17 industries and global capabilities that span 170 countries, we can help clients anticipate change and profit from new opportunities.

The time for airports around the

world to change is now. To thrive in

the years to come, airport operators

must transform their business pro-

cesses to create smarter airports.


About the authorsFrank Binnekade is currently Travel and Trans-port Industry Solutions Leader for IBM India and South Asia. In this capacity, he supports airports, airlines and logistics clients with high value business services, software and systems. Frank has more than 15 years of experience in the global travel and transport domain, holding various commercial management, supply chain and business consulting positions that include completing a wide range of commercial, op-erational and route development engagements for international airport clients. Frank holds a Master’s Degree in Business and Transport Economics from VU University Amsterdam. His e-mail address is [email protected].

Robert Biciocchi is the Solutions Leader, Americas, for the Customs, Ports and Border Management global solutions group in IBM, re-sponsible for the U.S. Airports Program and has also been involved with border management and commerce issues with the U.S. Transporta-tion Security Agency, U.S. Coast Guard and U.S. Customs and Border Protection. An active member in the ACI and IATA industry working groups, he has helped to lead several large airport modernization projects. He has also served as an executive officer in a successful international trade and logistics company and held other senior management positions in firms providing enterprise application solutions. His e-mail address is [email protected].

Brian E. O’Rourke is the Global Airline Offering Leader and Business Development Executive in the IBM Global Travel and Transportation unit and has been actively involved in numer-ous consulting engagements and value added initiatives for airlines and other clients. Using his professional training and 23 years of airline in-dustry experience, he helps airlines and airports use process optimization and technology to become more efficient. He has worked directly with the IATA to drive industry-leading solutions and he has co-authored and published several aviation industry articles, including “The Innova-tive Airline, “Creating sustainable advantages in competitive times,” “Service Oriented Archi-tecture for the Airline Industry” and more. His e-mail address is [email protected].

Charles Vincent is a Partner who leads the Dis-tribution and Travel and Transportation practice in IBM Global Business Services in Southwest Europe. His e-mail address is [email protected].

References1 IATA Economic Briefing, July 2009. http://www.iata.org/NR/rdonlyres/4929507D-5B4B-430B-

A52C-A201BBE1A434/0/Infrastructure_Costs_Jul09.pdf

2 ACI Passenger and Freight Forecasts, 2005-2020: Flag shortage of airport capacity, Airports Council International, 23 August 2005, http://www.docstoc.com/docs/9887809/ACI-Passenger-and-Freight-Forecasts-2005-2020-Flag-Shortage-of-Airport

3 RITA, Bureau of Transportation Statistics, 2009. http://www.transtats.bts.gov/HomeDrillChart.asp

Press releases from Transportation Industry Association, May 29 and June 26, 2008: http://www.ustravel.org/pressmedia/pressrec.asp?Item=900; http://www.ustravel.org/pressmedia/pressrec.asp?Item=905

4 Statements made by CEO Giovanni Bisignani at the 65th IATA Annual General Meeting in Kuala Lumpur June 2009 and updated at press briefing in Washington September 15th 2009, http://www.iata.org/pressroom/speeches/2009-09-15-01.htm

5 Angela Gittens, “Airport Strategies and Stakeholder Partnerships in Challenging Times,” ACI 3rd World Civil Aviation Chief Executives Forum, 2009. http://www.airports.org/aci/aci/file/Speeches/AGI/2009/WCAEF_060809_website.pdf

6 Airports Council International speeches, http://www.aci.aero/cda/aci_common/display/main/aci_content07_c.jsp?zn=aci&cp=1-7-3475^31035_666_2__

7 Angela Gittens, Director General ACI, “Airport Strategies.”

8 Peter Jorritsma, Substitution Opportunities of High Speed Train for Air Transport, Aerlines e-zine, 2009. http://www.aerlines.nl/index.php/2009/substitution-opportunities-of-high-speed-train-for-air-transport/

9 Dr. Stephen Appold and Dr John Kasarda, “Governing the aerotropolis,” Global Airport Cities. Spring 2009. http://www.aerotropolis.com/files/2009_04_GoverningTheAerotropolis.pdf

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