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Lufthansa CIO Dr Roland Schütz describes the airline's digital transformation

Thomas Macaulay | April 4, 2017
The CIO of the largest aviation group in the world explains how he uses technology to unlocked new revenue streams.

The airline works with IBM on its global IT infrastructure and smaller firms such as PROS for revenue management and has integrated its booking and ticketing service into the Amadeus Altea platform.

"We perceive ourselves as an end-user company. Our core purpose is flying and maintaining aircraft and the kind of technical engineering, but our core purpose is not developing software or running an IT shop, that's only a necessary part of the whole.

"We really believe we need a smartly composed ecosystem of innovative partners which can carry us forward. We apply technology but we cannot afford developing technology. We are not building our aircraft by ourselves, it's done by Boeing and Airbus, and IT is a complex masterpiece of engineering as well.

"We need strong partners that can help us pushing in some technologically important field forward. So we do need the right ecosystem of partners which help us to innovate in fields which are of strategic importance to us. I deeply believe we cannot do it completely by ourselves."

Schütz draws on the practices of the retail industry for inspiration when personalising email marketing by sending passengers relevant flight offers and advice without swamping them with information that could cause them to be blocked.

Another area in which technology has benefitted Lufthansa is in handling its exponential growth in pricing enquiries that has resulted from the specific data requirements of real-time offers. Using bots to automate responses has cut the costs of answering in half.

"We increased the conversion rate in our marketing measures by 30% only by starting to filter emails by simple rules," says Schütz.

"We are building up profiles of our customers and their preferences when they are flying with us. Of course, we are always strictly to the law when it comes to data privacy, but this kind of data is extremely beneficial for us better meeting the needs of the customer. Simply by introducing this filter, we increased our conversion rate by 30%.

"Knowing the customer and having an artificial intelligence-assisted relationship with the customer is most important, and I think that the retail industry is ahead of us there, but I think we can catch up."



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