The airline industry value chain

The value curve is a tool for strategic managers to see visually how their strategy works in relation to close competitors.

The airline industry value chain

This section provides an overview of key trends shaping the future of the industry: These factors, combined with the growth of disposable income, the rise of the middle class in many emerging markets and changing attitudes of people towards travel, have enabled the industry to flourish.

While travel is still not accessible to everyone, more people than ever before are travelling today—with 1. In previous decades, North America and Europe have dominated the travel markets, but this may not be the case for much longer.

While markets in Europe and the Americas will continue to grow, the rate is incomparable to other regions. Emerging markets will not only become larger source markets but also they will become more attractive destinations.

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Between andthe top 10 fastest growing destinations for leisure travel spending are expected to be India, followed by Angola, Uganda, Brunei, Thailand, China, Myanmar, Oman, Mozambique and Vietnam.

Similar trends are apparent in other emerging markets. What is clear, is that new consumers like the millennials, as well as older baby boomers are not only demanding, but looking for experiences, albeit very distinct ones. Studies show that millennials are more tech-savvy and connected than any previous generation and are changing the way travel is consumed.

In effect, millennials might take low-cost flights and go all out on activities and restaurants. Travellers today often look for experiences, whether it be an authentic local experience, an adventure or even and the opportunity to make a difference at the destination.

Creating a strong value proposition for this group will be key to attracting them in the next decade. New Travellers, Old System The 21st century traveller has high expectations for efficiency and a low tolerance for barriers to global mobility.

Unfortunately, the infrastructure and bureaucracy that travellers must navigate are decidedly 20th century. Barriers to mobility and inefficiencies are particularly notable when obtaining visas and at the airport.

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Travel barriers operate just like any other trade barriers, impeding growth and depressing job creation. Removing travel visas at the bilateral level would more than triple travel flows between countries. A comprehensive model for Smart Travel, one that includes Smart Visas, Smart Borders, Smart Security processes and Smart Infrastructure, will revolutionize the travel and tourism sector the way the smartphone has transformed the telecommunications and media industries, bringing job creation and growth along with it.

To achieve a Smart Travel approach, the travel industry must increasingly rely on technology and digitization to create a safe and seamless experience for passengers.

With the available technology, passengers today are able to book their flights and check in online, have their boarding passes on their smartphones, go through automated clearance gates and even validate their boarding passes electronically to board planes.

Such technologies should be applied to continue to enhance border security and travel facilitation. The private sector is taking a proactive role in engaging with national governments to highlight the economic case of travel facilitation and the security benefits of the implementation of technologically enabled solutions, while at the same time urging collaborative efforts among all relevant public and private stakeholders to achieve a fully integrated model to facilitate Smart Travel.

Geopolitical Insecurity is the New Normal Technology has, and will, continue to revolutionize the way we live, work and connect with one another as new technologies blur the lines between the physical and digital spheres.

At the same time, however, we are faced with a complex geopolitical landscape marked by a rise in physical and e-terrorism and a surge in populism and xenophobia. Together, they have the potential to reverse the growing freedoms acquired in previous decades by citizens to travel the world.

This new global landscape has significant implications for the movement of people across borders, and, specifically, the travel and tourism industry, which takes responsibility for safe travel through the skies of over 8 million people daily. Despite air travel being one of the safest modes of transportation, with incredibly stringent security standards, measures following security shocks have often been implemented to soothe the public rather than to contribute to a more effective and secure environment.

A survey undertaken by Google in shows that contrary to traditional thinking, most travellers accept that their personal data will be shared in exchange for enhanced security and efficiency.

To support the expected growth in international travel in the next 14 years, there is a need to fundamentally rethink the policy framework and innovate the way people move across international borders.

The airline industry value chain

And while enabling more people to discover the world, it is imperative to ensure the safety of national borders and citizens. The importance of designing an inclusive new global framework is highlighted by the fact that the top 10 fastest growing destinations for leisure travel spending are all emerging markets.

In this digital age, technological solutions can and should be created and implemented to move the global system from one of physical to digital borders. To move from bilateral programmes to a global one, a number of areas need to be addressed, namely, the harmonization of intelligence and data-sharing, the global implementation of common standards set by the International Civil Aviation Organization ICAO and the shift to a secure digital process.

The airline industry value chain

In parallel, countries should expand their multilateral agreements and move towards a single application system for visas. These policy shifts require additional cooperation and collaboration among various government agencies, international organizations and travellers.

Moreover, national administrations should reconsider the role of the traveller in the process and create an opportunity for travellers to be part of the solution. The prototype proposal entails the development of a data platform or virtual hub to be populated by multiple sources and allow customers to share data with other entities that require the information.

By bringing together all necessary stakeholders to design, agree, test and implement a new framework and prototype, the goal is for the global community to not only understand but also witness the benefits of such an approach.

The Fourth Industrial Revolution is Here to Stay The aviation, travel and tourism industry has been at the forefront of digital disruption, changing the way people travel.

But the revolution is not over. The industry needs to be ready for the new technological transformation ahead. The way people experience, consume and share information has changed drastically from previous decades. Shifts in customer expectations, new technologies and industry trends are compelling the industry to adapt their business and operating models in their quest for enhanced customer preferences and operational performance.The U.S.

airline industry operates the safest form of intercity transportation, thanks to the ongoing and strong collaboration between the airlines, labor, manufacturers and government.

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Airline industry value chain Inbound logistics Primary activites Stock control airlines must store and handle fuel, food, and drinks. Stock is managed to ensure reductions in stock turnover, thus reducing costs and wastage. Route selection airlines must choose their flight routes.

These will be selected upon desired routes, and deals negotiated with the airports. Consumer Electronics.

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Seizing Opportunities in China’s Cold Chain Logistics. Cold chain logistics form the foundation to supply perishable products—fresh fruits and vegetables, meat, dairy, aquaculture products, fresh flowers—and medical products—drugs, reagents, vaccines, biological products—that have strict temperature, humidity, and other environmental requirements.

airline industry. Industry Affairs Committee. problems in the value chain, but additional causes included inefficiently designed regulation, poor industry structure and the commoditization of the airline product.

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