In a risk-averse industry, one company designed a digital transformation that turned their multi-million-dollar losses into profit. Find out what they did to improve quality and drive growth.
Malta is a tiny island nation in the Mediterranean with nearly half a million residents, located between Sicily, Tunisia, and Libya. The country relies on the air industry for trade and transport, and nearly 1 in 10 people are employed by the airlines that serve Malta’s lone international airport and support infrastructure.
Two years ago the only Maltese flag carrier, Air Malta, was experiencing severe financial difficulties. Competitively challenged by European airlines with regular flights, Air Malta was serving as a mail carrier and providing medical transport to stay alive. Chief Information Officer (CIO) Alan Talbot was aware that without a drastic pivot, the demise of the 45-year old company was imminent. He proposed moving all business systems onto the cloud to make existing partnerships smoother, and new partnerships more attractive.
“Digital transformation may seem like a buzzword, some distant world trend, but in reality it is already happening right here in Malta… Air Malta has embarked on a digital transformation journey, starting with the modernisation of IT systems and processes. Legacy modernisation is required to provide end-to-end visibility and seamless transactions between key airport, flight operations and commercial systems.” -- Times of Malta, 11/25/2017
Setting the goals of growth and profitability, the company invested in one major strategic initiative: build Application Programming Interfaces (API) to make it possible for all suppliers and partners to interact in real time with Air Malta. To make this happen, the company brought much of its outsourced software in-house, and built a development team that manages some on-site software and some cloud-based services. Bringing software development in-house, and building an agile team around it, amplified the company’s awareness of -- and willingness to leverage -- digital systems.
This case study shows that implementing new and emerging digital technologies to improve quality and performance -- Quality 4.0 -- does not have to be complicated. By focusing on one clearly defined technology implementation, Air Malta was able to turn a €10.8m loss into a €1.2m profit between 2016 and 2018. At the same time, they built an agile technology-driven culture, with people who are ready and excited to innovate.
International Airline Transport Association (IATA). (2017). The importance of air transport to Malta. Prepared by Oxford Economics. Available from https://www.iata.org/policy/Documents/benefits-of-aviation-malta-2017.pdf
Samuels, M. (2018, December 14). CIO interview: Alan Talbot, CIO, Air Malta: Air Malta’s CIO is working to turn the IT department from a cost centre into a profit centre, introducing APIs and using emerging technologies. Computer Weekly. Available from https://www.computerweekly.com/news/252454201/CIO-interview-Alan-Talbot-CIO-Air-Malta
Times of Malta. (2017, November 25). Embarking on a digital transformation journey. Available from https://timesofmalta.com/articles/view/embarking-on-a-digital-transformation-journey.664159
About the Author: Nicole Radziwill is the Vice President, Global Practice Leader, Quality & Supply Chain at Intelex Technologies. Before Intelex, she was an Associate Professor of Data Science and Production Systems, Assistant Director (VP) End-to-End Operations at the National Radio Astronomy Observatory (NRAO), and manager and consultant for several other organizations since the late 1990's bringing quality management to technologically-oriented operations. She is a Fellow of the American Society for Quality (ASQ) with a Ph.D. in Quality Systems from Indiana State University. Nicole serves as Editor of Software Quality Professional (SQP) journal and is a former Chair of the ASQ Software Division. She is an ASQ Certified Manager of Quality and Organizational Excellence (CMQ/OE) and Certified Six Sigma Black Belt (CSSBB).
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