Digital Transformation & Maturity

Digitalize or die: Ryanair’s story is a warning to telcos

As day one of the Mobile World Congress got into gear, 5G dwarfed all other conversation, the big challenge to digital emerged as people rather than technology, and Ryanair’s digital story resonated with industries beyond just the airlines.

5G the price is right (or is it?)

My overall experience of day one saw the expected hype around 5G dominate the keynote sessions. Vittorio Colao, Chief Executive Officer (CEO), Vodafone, made the case, as did all the major service providers, that the cost of spectrum needs to be lower and it shouldn’t be about paying the highest price.

We have of course seen many issues around the globe with high spectrum costs which has ultimately made the sector and deployment of new technologies a lot less profitable – if at all.

Getting there with digital

The 5G hype aside, it has been great to see how many service providers are talking about being “digital operators” and talking openly about their digital transformation programs. This was particularly apparent in the digital transformation conference session which saw people like John Hurley, Ryanair’s Chief Technology Officer (CTO) take to the stage alongside Sandra De Zoysa, Group Chief Customer Officer (GCCO), Dialog Axia; Chema Alonso, Chief Data Officer, Telefonica; and Bjorn Ivar Moen, CMO Mobile, Telenor Norway.

A common thread was that the main barrier to successful transformation continues to be around internal culture. Digital transformation is fundamentally about three things: people, processes and technology. If you do not get the people part right first, then your transformation project won’t be successful.

Telenor’s Moen clearly made this case by asserting that to digitally transform successfully, companies need to retrain as well as hire new digital professionals.

Ryanair’s story: Telcos can learn where others have gone wrong

As the man behind the curtain of Ryanair’s digital progression in recent years, CTO Hurley was surprisingly forthright in admitting that the company thought that people would “walk over broken glass” to get the best fares, no matter how poor their digital experience. Ryanair was in for a shock.

Hurley gave an honest, refreshing account of the battles Ryanair faced in embracing its digital transformation program. He explained that Ryanair thought it enough to simply have a great product and low fares, and that they didn’t need to transform. As IT is expensive and the Ryanair model is based on low cost – soups to nuts, they thought their difficult website and poor app wouldn’t matter.

In 2014, they had a rude awakening when sales started to fall, they began to lose market share and Ryanair was branded “unlikable”. It took this massive change in fortune for the company to invest in their transformation program and as Hurley stated, it was far from easy and certainly expensive and against the “low cost, budget” ethos embedded across the company.

So what did Hurley, and Ryanair, learn from their unexpected misfortune? They discovered the importance of being agile and giving the customer a good digital experience. They invested in IT and launched a new mobile app and website which was much more based around personalization. They had to put the customer first and reinforce that Ryanair was there to serve its customers and that they shouldn’t be hated.

Success starts in the mind

For Ryanair’s transformation to be successful they had to learn to be agile and work in a new DevOps way – DevOps is a software engineering culture promoting a more agile approach to development and operations.

This certainly wasn’t easy according to Hurley; it required a huge cultural shift, not only in terms of skillset but also (and most importantly) in mindset.

Agility means multiple releases (sometimes on the same day) and it also means that things might not be perfect. One of the biggest internal battles they faced was aligning the working methodologies of IT and marketing. IT was focused on making real-time updates and improvements which may happen over multiple releases. Marketing meanwhile preferred fewer, perfect releases.

The operations department also put up a battle. They feared something would break. Their main job is to ensure that customers can book flights, and as long as that part of the website was working, they were less concerned with the user experience.

Hurley quickly learnt that for this transformation to be successful, everybody had to be on board, and that included the CEO himself Mike O’Leary. He knew that without the backing of O’Leary, the project was doomed to failure. Even with the CEO on board it was still a battle to get everyone aligned. Hurley stated that to be successful “You must fight, you must battle. Operations don’t want the risk and to change,” but he battled and fought with them nevertheless, and made sure they did!

So was the battle worth it? Absolutely – their large IT transformation had immediate success, the mobile app works, the website is more customer focused and user-friendly, they are less hated and moreover Ryanair.com is the world’s busiest airline website. It handles over twice the amount of daily traffic compared to its nearest rivals, servicing two and a half million customers a day, while the app has been downloaded 29 million times.

Hurley’s closing remarks were particularly poignant. “Digital transformation is about speed, agility, feedback on products and most importantly customer first. Embrace digital – if you don’t you will die.”



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    About The Author

    Vice President, Content, Research and Media - TM Forum

    Aaron Boasman-Patel is responsible for content across TM Forum’s research portfolio, the digital content platform, Inform, as well as leading content and research across the events and Digital Leadership Summits portfolio, including TM Forum Live! This is fed back to the Collaboration team to help drive the Forum’s strategic direction and collaborative program. He has chaired many international conferences and delivered presentations on smart cities, customer centricity, Internet of Everything, industry developments, market trends and strategy. Aaron has worked in the telecoms and associated industries for over ten years. He graduated with an M.A. (Oxon) from the University of Oxford. Aaron specializes in digital transformation, customer centricity, analytics and AI, and digital platforms and ecosystems.

    1 Comment

    1. Good story and insight … may we know what exactly was done to change the mind set/People aspect and how long it took to reach where they wanted to be at. What were the key challenges and how those were addressed

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