airline consulting case study

When the COVID-19 pandemic began, air travel came to a halt. For Delta Air Lines, one of the world’s oldest airlines in operation, two things became clear. One, the airline needed to respond to the economic realities of the time. And two, once the pandemic came to an end it would need to quickly get new, premium customer experiences off the ground.

Both directions needed the support of more than 90,000 front line employees. And all of them needed different tools and insights to be able to go the extra mile for Delta’s valued customers. Accomplishing that meant that a transformation was required to enable technology solutions to be delivered faster, and in a more secure, reliable and scalable way.

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To co-pilot this journey, Delta turned to IBM. Using the IBM Garage™ Methodology , IBM Consulting™ experts worked side-by-side with Delta to plan out the migration that would move most of the airline’s distributed workloads to the hybrid cloud. With that, Delta’s cloud migration initiative was airborne.

Moving hundreds of workloads to the cloud is just the beginning. By modernizing operations with the open hybrid cloud architecture built on Red Hat® OpenShift® Service on AWS (ROSA), Delta can now deploy anywhere and take a consistent, standards-based approach to development, security and operations across clouds. This will be the key to clearing the runway to greater scale and more personalized customer experiences.

Delta’s cloud migration is still ongoing - hundreds of applications have been migrated to the cloud and many team members are adopting new agile ways of working with IBM’s help. Delta and its customers are already reaping some of the rewards. For instance, building on the cloud foundation with ROSA allowed Delta to quickly launch free in-flight Wi-Fi on more than 680 planes and start to provide more personalized services on-board.

Looking ahead, Delta’s cloud transformation initiative aims to increase employee engagement, productivity, speed to market and cost efficiencies by between 25%–30%. And with the IBM team, Delta’s laying the groundwork that will help it be ready to weather the ups and downs of a turbulent industry while continuing to deliver the first-class customer experience and operational excellence for which it is known.

Headquartered in Atlanta, Georgia, Delta (link resides outside of ibm.com) is a leading global airline. More than 90,000 people at Delta lead the way in delivering a world-class customer experience on over 4,000 daily flights to more than 280 destinations on six continents.

Your hybrid cloud advantage awaits. See how our hybrid cloud approach can offer up to 2.5x more value than a public cloud-only approach.

Produced in the United States of America. January 2024.

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All client examples cited or described are presented as illustrations of the manner in which some clients have used IBM products and the results they may have achieved. Actual environmental costs and performance characteristics will vary depending on individual client configurations and conditions. Generally expected results cannot be provided as each client's results will depend entirely on the client's systems and services ordered. THE INFORMATION IN THIS DOCUMENT IS PROVIDED "AS IS" WITHOUT ANY WARRANTY, EXPRESS OR IMPLIED, INCLUDING WITHOUT ANY WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE AND ANY WARRANTY OR CONDITION OF NON-INFRINGEMENT. IBM products are warranted according to the terms and conditions of the agreements under which they are provided.

Airline Industry

The coronavirus pandemic upended the airline industry. BCG’s airline consulting experts help companies take a data-driven and action-oriented approach to their business so they come back stronger than before.

Coping with the demand shock in the wake of COVID-19 has posed one of the greatest challenges in the airline industry’s history. Our airline clients are asking: how do we ensure survival in the face of a global pandemic? And how can we prepare to ramp up and create value in the new reality? The eventual winners will make bold moves now—with only a small window of opportunity to act.

For many airlines, this will require a clean-sheet redesign of strategy, networks, and operations. Companies have an opportunity to rethink their networks, schedules, staffing, organizational design, digital setup, revenue management, and much more. Whether applied company-wide or to specific divisions, this approach can unlock meaningful value and deliver transformative change.

How We Help Airline Industry Clients

We serve seven of the ten largest network carriers and six of the top 20 low-cost carriers, in addition to airports, OEMs, cargo carriers, and other key players in the aviation ecosystem. Our airline consulting teams combine expertise in all aspects of the airline industry, including strategy, network planning, airline operations, pricing and revenue management , sales and distribution, personalization and airline loyalty, MRO, people and organization , digital and travel technologies, and sustainability . By working in cross-functional teams, we view each airline holistically to ensure that every move delivers cascading benefits for the business overall.

Our work has achieved groundbreaking impact. One airline client’s transformation has been described as “the largest corporate turnaround in the country’s history.” Another client became the most punctual airline in the world. And another achieved a three-point improvement in on-time departures.

Our Client Success in the Airline Industry

Improving Pricing and Revenue Management By combining our pricing expertise across multiple industries with our work in revenue management, our airline consulting teams developed a methodology for revenue enhancement in the travel and tourism industry that has helped individual airlines increase revenue per available seat mile (or kilometer) by 1% to 2% on average, and up to 20% on certain routes.

Improving On-Time Performance Using BCG’s proven methodology, a South American low-cost carrier improved on-time performance by 9%, crew satisfaction by 50%, crew productivity by 10%, and airport FTE productivity by 11%; it also reduced lost baggage by 20%.

Reducing Operational Costs A large US airline built a more-efficient operating platform that optimized crew staffing, preventive maintenance, airport utilization and turn time, and system operations, reducing operational costs by 20% to 25%.

Launching an Agile Transformation A major Asian airline, facing intense competition from full-service and low-cost carriers, embarked on a two-phase transformation that engaged 10,000 employees in an agile transformation and reduced costs by more than $500 million.

BCG’s Airline Industry Tools, Centers, and Solutions

Our work is always 100% customized to a client’s unique needs, and BCG’s airline consulting teams have a strong suite of proprietary tools to support our analysis and strategic approach.

BCG created advanced revenue management solutions to overcome to challenges posed by Covid-19. The first, Machine Learing2 demand forecast, with more than 90% forecast accuracy, significantly improves pricing effectiveness and revenues. The second, an AI-driven bionic elasticity model, builds reliable demand curves that inform customers’ willingness to pay and optimal positioning for every pricing decision.
BCG’s zero-based scaling tool uses proprietary BCG data and public sources to forecast market demand, predict airline industry trends, calculate profitability per route, and optimize for overall network profitability. The tool enables airlines to address network design at a time when historical models are unreliable for making the right big decisions on short notice.
BCG and KLM , as part of BCG’s digital operations and transformation center, developed a state-of-the-art solution using artificial intelligence , machine learning, and advanced optimization to support global leaders in airline operations. This cooperation marks the first time a leading aviation company has joined forces with a top-tier consultancy to bring to market a new service.
BCG cofounded Journera , in partnership with Jeff Katz, the founding CEO of Orbitz Worldwide. This industry-wide platform provides secure, real-time data exchange to help companies create more-seamless travel journeys.
BCG’s pricing and revenue management competence center offers a suite of solutions to drive strategy, advance methodology, sharpen tools, and build a stronger, more capable organization.

Follow BCG on Consumer on LinkedIn

Companies operating in today's airline industry must optimize performance, tap into new opportunities and transform to meet consumers demands. Follow BCG on Consumer on LinkedIn for the latest industry insights and news.

Our Insights on the Airline Industry

Can Airlines Accelerate the Transition to Modern Retailing?

The industry has made progress in streamlining the process of booking tickets and tracking information to offer passengers a more seamless experience. But there is more work to do.

To Uncertainty and Beyond in the Travel Industry

In this episode of The So What from BCG, Jason Guggenheim, BCG’s global leader of travel and tourism, explains how companies can sharpen their ability to sense shifts in demand.

Building a Brighter Future for Airports

Hard-hit airports can rebound from the crisis by adapting their economic models, promoting industry sustainability, and fully realizing their digital potential.

Executive Perspectives: What the Evolution of Travel Means for Business

Consumers are ready to hit the road and take to the skies. Organizations within and beyond the travel industry should be ready for the demand spike—but prepare for uncertainty, volatility, and new patterns to emerge.

Meet Our Airline Consultants

Managing Director & Partner

Managing Director & Senior Partner

Raleigh-Durham

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BCG’s Zero-Based Scaling (ZBS)

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Case Studies

Engaged to launch Oman’s first low cost carrier from concept to first commercial flight in under 1 year.

Business plan for Civil Aviation Authority
Operating licence for LCC in Oman
Leadership in strategy, brand, team, network, operations, maintenance, systems
Sourced most economically efficient aircraft fleet in the market
Achieved AOC Certification
Launched commercial flights in 2017 in under 1 year
SalamAir now operates fleet of 7 A320 aircraft to 28 destinations

Launching Oman’s first low cost carrier from concept to AOC and first commercial flight in under 1 year.

Achieving EC approved turnaround and rebranding of destination airline Air Malta.

Negotiating European Commission’s rules to enable state aid
Turnaround plan, rebranding, repositioning and culture change
12 A319/A320 aircraft
500 redundancies, from 1,400 to 900 staff
$250m revenue
From €70m pa deficit to €6.25m operating profit (50% from new revenue, 50% from savings)
Becoming one of Europe’s most punctual airlines

Achieving EC approved turnaround and rebranding of destination airline Air Malta critical to the economy of the island state.

Caribbean Airlines

Turnaround and launching a brand new airline saving a strategic asset for Trinidad & Tobago.

BWIA was losing $40m pa on a $270m turnover
Persuaded Government of Trinidad and Tobago to close BWIA & launch new airline Caribbean Airlines in 3 months
Winning the US FAA’s support
Code-share with British Airways
Integration of local airline Tobago Express
From 1,900 to 1,100 staff
Achieved financial break-even in 3 months
Profit of $4m in 7 months, with increasingly positive cash flow

Turnaround and launching a brand new airline saving a strategic asset for Trinidad & Tobago.

South African Airways

Turnaround of an established international government-owned carrier

Full network review and redesign at domestic, regional and international long-haul level, slots negotiation and assignment
New commercial strategy, sales & distribution strategy, customer journey, rebalance of capacity with sister LCC, new ancillary and loyalty strategy, new airline partnership strategy including franchise, codeshare, and alliances, and achieved regulatory approval for commercial JV agreement
Managed fleet renewal programme, including economical and operational assessment, financial modelling, coordination of engagement with OEMs and preparation for engagement and assessment
Achieved the following measurable financial outcomes: – 10% reduction in CASK (excluding fuel), – 50% reduction in operating losses, and – 22% improvement at EBIT level

Turnaround of an established international government-owned network carrier

Etihad Airways

Business plan review, turnaround and carve out of subsidiaries for one of the largest holding companies in the region, in partnership with AlixPartners.

Business plan review post Covid, including network design and route profitability
Commercial strategy review including LCC collaboration options for short haul feed
Fleet restructure and rationalisation assessment and evaluation of options including captive leasing company
Subsidiaries carve out program including MRO, catering, ground handling, travel, with full business plan and financial valuation

Business plan review, and turnaround for major hub carrier.

In-depth diagnostic assessment of the airlines’ operations and performance, delivering:

Full quantitative and qualitative assessment of the airline using AMG’s proprietary Lodestar Dynamics diagnostic tool and methodology
Full report with benchmarks of comparable operators and action plan for operational improvement and alignment to best-in-class
Assessment of operations and operational teams fit for purpose
Identification and prioritisation of strategic and operational projects to improve airline’s performance and growth
Prioritised actions to achieve strategic objectives
Financial assessment of turnkey projects

Operational performance improvement assessment for a leading regional airline.

Nigeria Air

Business case and implementation plan for the start-up of a new national carrier.

Full business plan preparation and evaluation
Demand forecasting and scenario analysis
Financing options evaluation
Network design and fleet selection, coordination of OEM negotiation process
Financial modelling for fleet selection and assessment
Market research, brand development, industry brand launch event

Business case, brand launch and implementation plan for the start-up of a new national carrier.

MRO spend and cost saving review for legacy carrier.

Review of all external spend in the maintenance area aimed at reduction of cost of maintenance, including airframes heavy checks, engines and components
Conducted market testing, internal benchmarking and should cost analysis, identifying areas of potential savings
Identified up to 20% savings on addressable spend

MRO spend review, identifying up to 20% savings on addressable spend.

MRO Business Improvement

One of largest Low Cost Carriers in the EU
100 + aircraft
4 operational bases & 6 different MROs
Reviewed organisational structure, assessed fleet maintenance task application, developing tools to integrate and retain the most efficient check cycle.
Established common maintenance philosophy, procurement, engineering and maintenance task applications uniformly applied
Achieved €18m cost saving pa

Achieved €18m pa saving through maintenance review for one of the largest Low Cost Carriers in Europe.

Fleet Optimisation & Renewal

Asian operator
Optimising fleet of 25 narrow body aircraft
Assessed aircraft taking into account age, maintenance, lease conditions for return and future costs
Reviewed future requirements for network, operating costs, maintenance capabilities and market rates
Provided optimised solution ensuring the best cost model and long term operational fit was delivered

Optimised a fleet of 25 narrow body aircraft providing a solution that ensured the best cost model and long term operational fit for a significant Asian Low Cost Carrier.

Airlines & Aviation bodies

The AMG team have advised and held C-Level, Strategic and Operational Senior Management positions with the following Airlines and Aviation bodies:

Air Atlantic
Air Liberté
Air Southwest
British Airways
bmi – British Midland
Brussels Airlines
Cirrus Aviation
Eastern Airways
Gatwick Airport
Qatar Airways
Olympic Airways
Uganda Airlines
Virgin Atlantic Airways

We are airline people, our focus is airline management.

Aviation trends & analysis, ecojet airlines initiates growth equity financing. the purpose led regional airline, is initiating a £20 million growth financing which will…, amg’s ben leon was invited join the royal aeronautical society’s sustainability workshop held in london at the raes headquarters together…, it was an honour for amg chairman prof rigas doganis (one of the esteemed judges) and amg cco ben leon….

Aviation Consulting Case Studies

At air52, we pride ourselves on delivering tangible results for our clients across the aviation industry. our case studies showcase how our strategic approach and industry expertise drive success for airlines, airports, and aviation partners. explore our success stories to see how we can help elevate your organization's performance in the dynamic aviation landscape., propelling network growth.

ATR turboprop aircraft banking on approach with landing gear extended

We collaborated with a regional carrier to develop a comprehensive partnership strategy, expanding their network and enhancing market reach.

Key Outcomes:

Significant network growth potential

Improved competitive positioning

Catalyzing Tourism Growth

Aerial view of tropical islands and coral reefs through airplane window

Air52 partnered with a tourism board to revolutionize their air service development strategy, bridging the gap between destination marketing and airline network planning.

Engaged five potential new airlines

Enhanced destination accessibility

Elevating a Startup's Prospects

Low-angle view of passenger jet taking off against clear sky

Air52 assisted a low-cost carrier (LCC) startup in optimizing their business plan and financial model, enhancing their value proposition to potential investors.

Robust, market-driven business plan

Increased investor interest