"Airline Industry Gets Smarter With Bags"
The problem of lost baggage has been irritating customers and costing the airline industry billions of dollars annually. To combat this annoying dilemma, airlines have been creating and implementing new ideas. Instead of just increasing “manpower,” the airlines have been becoming “smarter.” This implies that the airlines are using new technology. In several airports around the world, some companies are beginning to institute new tracking technologies, which include scanners and luggage tags. Personally, I believe this is a brilliant idea, considering airlines are facing the some of the worst debt in their history. Moreover, by introducing new technologies to prevent lost luggage, the airlines may alleviate this problem, which has lost the industry an insane amount of money. Also, this new process may encourage more people fly because the airlines won’t have to charge customers to check each additional bag. As I mentioned before, one way to track the luggage is to use scanners and barcodes. This was introduced almost twenty years ago, however, not all airports found around the world obtained the necessary technology to ensure compatibility. Although it seemed like a great idea, it never proved to realistic. Some airlines, including Lufthansa, have used this program and shown that it could indeed help this problem. As the bag is unloaded off the tarmac, it is scanned and an automating system sends it according to where it needs be next, whether that is another plane’s cargo hold or a baggage terminal. It has proved to work the majority of the time, however it is purported that the bags are scanned improperly about 15% of the time. This increases the likelihood that a bad will be lost. Again, this solution seemed to be imperfect.
Currently, however, companies including IBM, Motorola, Vanderlande Industries BV are teaming up to create a new resolution, which most notably includes the implementation of an Information Technology known as radio frequency identification tags, or RFID tags. These devices are attached onto items, in this case luggage, to be tracked using the emission of radio waves. According to Brian O’Rourke who is responsible for aviation services at IBM, the RFIDs are “99% accurate.” The tags are easily tracked because the sensor gives off a unique signal, thus making the item’s location known. The installation at terminals, which may cost up to a few million dollars, is largely paid for by the airline itself. Some of them are seemingly reluctant to make investment of this size. However, I believe that the investment will clearly be worth it, because airlines (on average) spend over three billion dollars annually on lost baggage. If the usage of RFID tags are near flawless, it would be baffling that the airlines would not make the investment.
In conclusion, I feel that the implementation of RFID tags is not only a great idea, but also necessary to airlines. Because some airlines are battling the largest debts of their history, the usage of this system can save them billions of dollars and possibly save them from filing for bankruptcy and ultimately prevent them from shutting down.
Article Found: http://online.wsj.com/article/SB125426756348250917.html
I agree that airline companies need to continue to find ways to reduce costs. In this article, the airline industry seems to have found a potential cost saver in baggage sorting/tracking. At the same time this new technology can increase efficiency. My only concern is whether these strapped for cash airline carriers can afford investing in such expensive technology. There must be unreasonable doubt that the aforementioned RFID technology will work. When a company uses new technology, bumps along the way are expected. However, when a mistake can mean loss luggage, the airlines must be extremely careful. As they continue to build back customer relations, airliners can not afford another setback. Lastly, I see great opportunity for IBM who is at the forefront of the RFID technology. If the Airlines decide to invest in this technology, IBM could be handsomely rewarded.
ReplyDeleteThis idea seems like a great way to help pull airlines out of debt. As Brian stated, airline companies are facing some of the worst debt in history. These new technologies can improve customer relations by improving the trust between customers and airlines, as it will be decreasing the risk of problems for customers. This can lead to more customers joining loyalty programs with airline companies that are using this new innovative technology. Therefore, I believe airline companies should invest in this new technology soon in order to gain a more competitive advantage over the market.
ReplyDeleteI think this development is an enormous benefit for airlines in two big ways. One, it helps them solve the neverending problem of lost luggage. Lost luggage can give an airline a really bad rep, so solving that problems can improve how people view them. Second, it will save them millions of dollars in manpower if this system can be perfected. It will allow them to be more efficient with less manpower, which is every company's goal.
ReplyDeleteI'm sure in the beginning there will be problems and setbacks with the technology, and it may seem faulty. But as stated, if it can be perfected- it would be an enormous asset for airline companies.
The first thing that comes to my mind after reading this article is the article we read in class regarding the steps that Continental Airlines took in order to be the leading airline in its industry after having so many problems and a terrible airline system before the new CEO came. The new ideas that air companies are coming up with to lower and prevent problems with losing luggage, etc. will improve customer relations tremendously, like Alexandra says; the customer will have more trust in the airline company. It's essential that these airline companies put these new tracking technologies into use because it will not only give that company an advantage, but it will help the industry in general.
ReplyDeleteThe luggage tags that airline companies are putting on bags are an excellent system to track the luggage. I have personally dealt with lost luggage and it is not fun. I went to Italy and my luggage was lost in transit, but I gave them my tag I received at check in and by scanning it into the system, they were able to see exactly where my luggage was last. The new RFID system can be very helpful though as well because it gives off a unique signal so the location of the bag can be known. The airline industry needs something like this because with the amount they charge for flights and to check baggage these days, people will not be happy about lost luggage.
ReplyDeleteThis use of IT is certainly a long-awaited development for many travelers. My dad frequently travels for business and is constantly on and off of planes, sometimes 3 or more in a week. He as well as many other travelers that I know would definitely support the development of anything that would alleviate the worry of lost luggage. There's nothing worse than the feeling of arriving at your destination only to find that your belongings have not.
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