National carrier, Kenya Airways targets savings of up to Sh1billion as it switches to digitised passenger management systems.
Fredrick Gitunga, the chief information and data officer at Kenya Airways, revealed that the airline saved Sh300 million in 2023, by deploying technology solutions in key areas such as travel bookings and anticipates further savings as more functions go digital.
“We have been able to deploy in-house developed systems that are able to serve our customers right, pick at the earliest opportunities any customer concerns, and improve turnaround time at a very modest cost,” he said in an interview.
“That has helped us save. Last year alone we were able to save Sh0.3 billion in terms of using capacity in house, this year we are projecting to surpass that to close to Sh0.5billion to a billion savings,” Mr Gitunga.
KQ last year revamped its online booking systems, eliminating costly human –interfaces which added to its overall expenditures.
“We have revamped our digital channels, especially our website to make it more customer-focused and friendly. We made it to a simple concept of book, pay and fly. It has enhanced our value proposition driving our sales upwards of 30 percent,” the official said.
“We have reduced the number of calls coming to our customer care centre, that by itself has reduced the requirement for physical agents to about 50 percent. Since we simplified the customer journey on the website, customers do not have what we call a dropped cut, they don’t find difficulties trying to get access to us,” Mr Gitunga said.
The revamped direct channel of booking also saw KQ reduce costly middle business agents.
“For the customers, since you can finish every journey you need within the website, then you find the cost of doing business with us reduced, it gives you flexibility to choose fares and travel itinerary,” the KQ official said.
“The direct channel of booking, these costly middle business agents have been reduced as well. You can generate your ticket online as well and check in online” Mr Gitunga said.
KQ posted a Sh513 million profit in the first half of the year—the first in over a decade since 2013—buoyed by higher revenues, a stronger Kenya shilling, and the restructuring of a loan facility owed to the National Treasury.
This saw the airline reverse a loss of Sh21.7 billion at the same time last year as it continues to show potential for profitability.
The carrier’s non-operating costs which include spending on key items such as interest and foreign exchange revaluations fell to Sh687 million in the half-year, from Sh22.8 billion previously.
At the same time, KQ posted an improved operating profit of Sh1.2 billion from Sh998 million in June 2023.
The higher operating profit was supported by a faster growth in revenues which hit Sh91.4 billion from Sh75 billion previously.
