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Opening address:Digital transformation in the Cognitive Era

Dee Waddell, Global Managing Director, Travel & Transportation, IBM

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2016 was the airline industry’s

most profitable year ever

There will be 7 billion airline

passengers by 2034 (double that of

2015)

Cheap oil pricesare keeping operating costs low

$29 billion industry net profit forecast for 2017,

representing

8 years in the black

Industry ancillary revenue for 2016 grew to

$67.4 billion

In 2017, passenger airlines expect a

31% rise in demand

Record high load factors for the industry,

hitting 80.5% in 2016

Airlines are experiencing historically-strong fundamentals

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However, are airlines under-estimating disruptive threats?

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The worlds largesttaxi company…

Owns no vehicles

The worlds largestaccommodation company…

Owns no real estate

The worlds largestretailer…

Carries no inventory

The worlds largestmedia company…

Creates no content

Disruption is real and airlines must accelerate pace of digital transformation—particularly around customer and operations

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Cognitive can accelerate digital transformation objectives

More Personalized Services

e.g., custom loyalty incentives,

Individualized pricing, etc.

Higher Revenue per Traveler

e.g., increased direct distribution,

targeted marketing of ancillaries, etc.

Increased Customer Intimacy

e.g., partner-informed 360 degree

view, psychological profiling, etc.

Data

Transaction

Intelligent Operations

e.g., automatic stock replenishment,

dynamic staff allocation, predictive

maintenance, etc.

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How will you transform and thrive in the cognitive era?

Deliver actionable insights Drive program excellenceDelight in data complexity

Data Apps

Execute cognitive programs, not projects

Prioritize business solutions, not technology

Emphasize projects that improve customer travel

Projects

Empower end users with insights, not data

Leverage continuous improvement for apps

Use cloud to innovate around legacy systems

Partner to acquire and improve data

Focus on improving context around data

Standardize formats for consumption of insights