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[av_heading heading='Transformation' tag='h1' style='blockquote modern-quote modern-centered' size='' custom_class='' subheading_active='' subheading_size='15' padding='10' color='' custom_font=''][/av_heading]
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[av_heading heading='The Evolution of Airports and Key Drivers for Transformation' tag='h3' style='blockquote modern-quote modern-centered' size='' custom_class='' subheading_active='subheading_below' subheading_size='15' padding='10' color='' custom_font='']
Edward Wilson-Smythe
Principal
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The Evolution of Airports and Key Drivers for Transformation

Five Forces Driving the Evolution of Airports

Major airports have evolved from being merely the beginning and end of journeys, to being an integral part of the socioeconomic engine which drives regional growth. This shift has been driven by the emergence of four forces which have changed the role of airports for each of their stakeholder groups:airport-technology

  • Externalization of airport profiles, driven by:
    • Airports becoming the primary point of entry into a given region for international visitors and visitors from outside the immediate region.
    • The expectation of passengers for an integrated experience which starts and ends beyond the boundaries of the airport.
  • Internal focus on airport operations, driven by:
    • Global and regional hubs focusing activities on connections and driving critical needs for flexible operations and an improved passenger experience within the airport, rather than on simpler origin-destination operations.
    • Airports becoming civil ecosystems which serve the social and economic needs of the large population of workers which are associated with airports on a daily basis.
  • Changes in strategic and financial drivers, driven by:
    • Airports increasingly operating as autonomous agencies or corporations, and not extensions of municipal or regional government, leading to less focus on tax and appropriations burdens and more focus on financial viability as stand-alone entities.
    • Increasing pressure by airlines on aeronautical fees, with these fees driving airline decisions on preferred airports especially in regions with multiple airport choices and strong alternative inter-city transportation options.
    • The growth in ancillary (non-aeronautical) revenues driving a greater proportion of airport financial viability, which help offset the downward pressure on aeronautical fees.
  • Increasing constraints by regulatory and law enforcement requirements, driven by:
    • Increasingly stringent controls and standards related to security and movement of aircraft, passengers and baggage, impacting the ability to drive flexible airport operations.
    • These constraints having an increasingly negative impact on passenger experience which reflects directly on passenger satisfaction and airport choice, especially for global and regional hub operations.

These four forces not only drive fundamental changes to the role of airports, but also pose often conflicting priorities which are difficult to reconcile.  Key among these conflicts are the need for greater flexibility offset by more stringent controls and constraints, the need to externalize the airport profile hampered by the need to focus on internal airport operations, and the need to reconcile expectations of key stakeholders – airlines, passengers, workers, government and regulatory agencies, taxpayers, shareholders/bondholders – which are often at cross purposes.

The solution to these challenges is the emergence of the fifth force, which enables airports to address the key drivers in an integrated manner, and reconcile conflicting objectives to drive benefits across the entire ecosystem:

  • Integrated technology leverage, consisting of:
    • Innovations driven by the growth of low-cost, scalable, flexible and secure technologies which enable integration of informational, operational and customer integration in a way which was unthinkable even a decade ago.
    • The structured, judicious and purposeful application of emerging technology capabilities to solve strategic and operational challenges.

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