Washington, DC 2016: Charting the future of North American airports

  • December 1, 2016
By Tyler Duvall and Rob Palter
To meet modern customers’ expectations, airports need to evolve with growing demand, new technologies, updated security requirements and funding pressures.

As we look ahead, these forces will grow stronger, as will the complexity of projects and the public’s desire for transparency into the performance of airports. Led by executives from some of North America’s busiest and largest airports, this roundtable of eighteen airport and infrastructure leaders discussed major issues facing the sector today.

Select key themes included:

Capital project delivery

  • Well-managed capital projects present an opportunity to differentiate an airport and attract airline capital. US airline operators typically view airports as cost centers and don’t find great value in non-core services. Airports that distinguish themselves as more than just cost centers will get a bigger slice of airline investment capital. Because airlines have “portable capital” and can continually shift network capacity across stations, airports get airline investment, commitment, and partnership when they can demonstrate good management, on-time delivery and control over capital expenditures.
  • Design and execution applied through an integrated business case ensures airport capital projects are scalable, flexible, and future-proof. Airports are a continuous construction zone and they must constantly adapt with shifting project needs, timelines, and stakeholder/partner input. Traditional projecting planning and delivery has not kept pace with these trends, and thus many projects are late or over budget. To remedy this, airports should assert an integrated view of the project and its “business case” throughout planning and execution process. This requires a clear view on project objectives and stakeholder priorities up front to ensure scope is fit for purpose. As the project progresses into execution, it is incumbent that the airport and its partners continually revisit the initial business case to weigh trade-offs and deliver the project without major cost or timing escalations.

Customer experience

  • Airport operators are uniquely positioned to integrate airport stakeholders to deliver customer experience. The airport authority/operator is in a unique and challenging role integrating diverse stakeholders across airlines, service providers and concessionaires. Facilitating this collaboration across these employers’ teams to deliver a unified, quality customer experience requires airports to prioritize the trainable and improvable customer and employee touchpoints and to work across stakeholder groups to ensure the passenger is cared for. Getting this right can yield increased non-aeronautical revenue, happier passengers and staff, and improved airport rankings.
  • Getting the “basics” right separates excellent airports from those that flyers avoid. As airports provide a wider variety of services and manage more complex operations, it remains critical for the “basics,” such as cleanliness, uptime of facilities and enjoyable employee interactions, to function seamlessly. Customers will find delight in the flourishes only when their experience is built on a strong foundation of well-delivered basics.
  • A great customer experience starts with a great employee experience. Despite service automation, the nature of airport operations will always create above average instances of customer-employee interaction. Research has demonstrated that the same systemic problems (e.g. wait times) are felt very differently depending on the personal interactions and treatment received. The customer experience improves dramatically when employees feel empowered, motivated, and part of the solution.

Public-Private Partnerships

  • P3s enable airport managers and government officials to advance projects that are complex and benefit from private sector innovation. Because the risk aversion of the public sector is higher, the private sector needs to make it easier to understand when P3s are appropriate and effective.
  • Airports can explore broader innovation opportunities together. Currently all P3s have a separate operating model—nothing is standardized across actors and must be created unique to each deal. This slows procurement, consortium team formation, and ultimately increases project risk and cost. There is an opportunity for airport operators to host a centralized conversation between local governments, airlines, and concessionaires that results in a standard approach to P3s.