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Beyond bots and Robots: Exploring the unrealized potential of cognitive

computing in the travel industry

Steve Peterson, Global Travel & Transportation, Industry Research Leader,

IBM Institute for Business Value

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� Why are airlines interested in

cognitive computing?

� What progress has been made

on cognitive transformations?

� How can airlines get the most

from cognitive computing?

Cognitive

Transformation

Actions

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Advanced analytics and cognitive are two very different animals

Advanced analytics:

• Traditional rules-driven

systems

• Organize and evaluate

structured information

• Apply mathematical rules

to the amassed data

• Typically produce

forward-looking

projections, or predicted

trends, on the basis of

prior period results

Cognitive computing:

• Next-generation

information systems

designed to accelerate,

enhance, and scale human

expertise

• Systems that continually

build knowledge and

learning

• Typically understanding

natural language and are

designed to interact more

naturally with humans

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To look beyond headlines, we spoke to leaders with real cognitive experience

Survey respondents by region

Europe Americas

Asia Rest of World

302responses

Survey respondents by role

CEO / Board CDO

CHRO CIO / CTO

CMO SVP / VP / Director

302responses

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Leaders apply the insights they derive from real cognitive analysis

Level of sophistication applied to analytic analysis

De

gre

e t

o w

hic

h in

sig

hts

are

ap

pli

ed

to

b

usi

ne

ss d

eci

sio

ns

5%38%

7%

1%8%17%

5%

14%

6% Leaders – have developed and applied robust cognitive capabilities

Learners – have expertise in advanced analytics, but not cognitive computing

Laggards – have some exposure to analytics, but only nascent capabilities

Survey respondents by degree or analytic sophistication and level of

application of analytic insights

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� Why are airlines interested in

cognitive computing?

� What progress has been made

on cognitive transformations?

� How can airlines get the most

from cognitive computing?

Cognitive

Transformation

Actions

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3

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For most, the transformational journey to a cognitive future is just beginning

6%

56%

33%

3%

24%

58%

17%

1%

0%

10%

20%

30%

40%

50%

60%

70%

None 1-3 projects 4-9 projects 10 or more

Leaders Everyone but Leaders

Number of data analytics projects that will have truly cognitive

elements in the next two years

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So far, the travel industry has focused its cognitive investments on bots and robots

Bots

� Seen by many as a low risk opportunity to test cognitive technologies

� Supporting select customer service interactions across all travel segments

� Leveraging a mix of machine learning, artificial intelligence and natural language processing systems

Robots

� Although less common that chat bots,

robots are emerging to interact with

travelers in service settings

� Initial efforts have focused on informing and

entertaining travelers, robots will soon be

equipped with sensors to collect data on

travelers and their environment

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Alterra’s Marina helps travelers book flights

and hotels using messaging bots via

Facebook Messenger, Skype, Slack,

Telegram, Kik, WhatsApp, WeChat, etc.

• Recommends trip destinations

• Recommends trip activities

SnapTravel helps travelers book hotels using

messaging bots via Facebook Messenger,

Slack and SMS; if an user stumps the bot

with a unique request, a human agent will

intervene and assist the bot

• Provides specially negotiated hotel rates

Bots were a good place to start, and have been well received by customers

Many cognitive travel startups are using bots to provide concierge type services

An artificially intelligent service now

available at twelve Edwardian Hotels-owned

Radisson Blu locations that is able to report

on hotel amenities, give directions and tips,

and receive guest complaints in a matter of

seconds via SMS

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Indeed, the travel industry is increasingly dependent on bots for customer service

Kayak’s Slack bot helps

travelers with flight, hotel,

and rental car searches via

queries (i.e. “/kayak flights

from newark to paris france

April 4 to April 11.”)

• Tracks flight status

Cheapflights’ Facebook

Messenger bot helps travelers

book flights and hotels

• Provides travelers with the

average cheapest round-trip

flight in the future

• Recommends trip

destinations

Expedia’s Facebook

Messenger bot helps

travelers book hotels

• Provides top 5 hotels and

prices for selected dates

• Confirms booking

• Provides itinerary

information

Skyscanner Facebook

Messenger bot helps

travelers book flights

• Yields the cheapest

flights

• Recommends trip

destinations

Most travel bots have adopted only mild cognitive capabilities, but future iterations

of these systems have the potential to further improve travel experiences

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Cognitive enabled interactive robots are also finding a role in service delivery

Robot created by BlueBotics that scans

passengers’ boarding passes, guides them

to their gates, and lets them know how

long until they reach their gate

Robotic kiosk created by VGo in collaboration with

the Verizon Innovation Program that answers

passengers’ questions (i.e. where to pick up tickets,

boarding times) and assist customers with any

incidentsRobot created by SoftBank that answers

passengers’ questions in Japanese, English, and

Chinese about airport facilities, important flight

information, and weather forecasts

JAL’s “NAO” at Tokyo’s

Haneda AirportKLM’s “Spencer” at

Amsterdam’s Schiphol

Airport

JetBlue’s “Crewbot” at

New York’s JFK Airport

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The hotel industry has been particularly eager to deploy cognitive robots

IBM Watson’s robot that is powered by

WayBlazer assists with visitor requests,

personalizes the guest experience and

empowers travelers with more information to

help them plan their trip

Savioke’s robot that autonomously relays

items (i.e. extra towels) between hotel staff

and guests via SMS or phone call request.

Four robots are currently deployed in

California

MFG Automation’s robot that helps guests with

their luggage storage, carrying up to 500 pounds

“Yobot” at Yotel Hotel in

Midtown Manhattan

“Connie” at Hilton

McLean in Virginia

“Relay” at numerous

hotels in California

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But bots and robots under-represent the true potential of cognitive computing

Bots and Robots

What they don’t yet do

� Leverage multiple complex systems to meaningfully engage travelers

� Take advantage of the power of cognitive computing to identify relationships between multiple datasets

� Meaningfully impact the core travel business

What they do well

� Frees up resources to focus on other, more difficult customer service issues

� Helps get the traveling public comfortable with natural language processing

� Harvest the information within a few discrete domains

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Two types of transformations will emerge as cognitive reaches its full potential

Customer Personalization ProgramsOperational Improvement Programs

� Prior industry efforts to optimize

operations have focused on single silos

� Large operational improvements depend

on connections between silos, which is

where cognitive can excel

� Personalization has long been on the travel

agenda, but progress has been slow

� Cognitive will be used to scale understanding

of traveler patterns and preferences

� Cognitive puts real personalization within

reach

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Travel companies expect cognitive to improve operational efficiency

Operational Improvement Programs

53% of leaders, and 52%

of everyone else said they

were planning to use cognitive

computing to improve operational

performance

Types of Projects

� Comprehensive cognitive

maintenance programs

� Flight planning assistance

using cognitive tools

� Dynamic employee and

asset re-scheduling during

operational disruptions

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Cognitive data discovery gives MRO a tool for diagnostics and decision support

Leading Asian airline innovates

around legacy maintenance

challenges with a cognitive-enabled

app

Cognitive computing amplifies human expertise to uncover important diagnostic clues in unstructured data.

Business challenge

Aircraft maintenance is a complex puzzle involving hundreds of subassemblies and thousands of parts. Technicians face immense pressure to solve the puzzle quickly to avoid flight delays and cancellations. Human

intuition only goes so far in synthesizing years of unstructured data. The airline needed a way to unlock vast amounts of information in its maintenance records, enabling aircraft technicians to diagnose and solve problems quickly.

Cognitive transformation

The airline uses a cognitive discovery system to analyze structured and unstructured data from its ERP environment, detecting patterns in how and why equipment fails to diagnose and fix problems. The solution uses natural

language processing and advanced content analytics to interpret and cross-reference text, finding connections that humans may miss, such as the effect of changing seasons on tire replacements or wear and tear on seats.

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Two types of transformations will emerge as cognitive reaches its full potential

Customer Personalization Programs

Types of Projects

� Traveler recognition

programs across

touchpoints

� Personalized pricing and

offers

� Loyalty personalization

(e.g., customized incentives)

17% of leaders, and 29%

of everyone else said they

were planning to use cognitive

computing to improve travel

personalization

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Hotels illustrate the potential of cognitive by delivering personalized insights

“Cognitive search will not only find you the perfect hotel but present it in the perfect manner.”

—Scott Goldberg, Vice President, WayBlazer

Business challenge

Many business-to-business (B2B) companies in travel are focused on driving traffic to a hotel’s website but are not as focused on closing the deal. To improve the number of bookings from site users, websites must make it easier

for users to find the options they want. The founders of WayBlazer wanted a way to understand all the unstructured social, review, image and other data that travelers were seeking.

Cognitive transformation

WayBlazer developed an online travel application and application programming interfaces (APIs) that do more than just return a list of travel options for basic parameters. They use cognitive computing to interpret

unstructured social sentiment, images and reviews across thousands of sites, then maximize conversion and revenue by delivering specific answers and recommendations for each traveler.

Answering natural-language

questions with unprecedented

personalized insight and advice

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� Why are airlines interested in

cognitive computing?

� What progress has been made

on cognitive transformations?

� How can airlines get the most

from cognitive computing?

Cognitive

Transformation

Actions

1

3

1

2

3

2

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Airline executives must set the right cognitive course and execute effectively

Cognitive Plan Cognitive Actions

• Where is my cognitive strategy?

• What are my top cognitive priorities?

• What are the milestones in my

cognitive roadmap?

• How can my enterprise maximize

return on data?

• How can our apps support our cognitive ambitions?

• How can we facilitate continuous cognitive enterprise learning?

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Deciding where to invest is not as easy as it was when cost was the clear priority

Historical Language

� Fleet efficiency

� Asset utilization

� Customer retention

� Customer Self-service

� Process standardization

� Scale

Consistent Differentiated

Operations Experiences

Co

nta

inG

row

Co

sts

Re

ve

nu

e

Dominant Strategy 2003-2013

Dominant Strategy 2013-2023

Future Language

� Personalized

experiences

� Journey management

� Value to customer

� Empowered employees

� Lifetime loyalty

� Scope

Differentiation strategies demand innovation

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Cognitive transformation demands clear alignment of objectives and investments

implement cognitive

solutions as quickly as

possible to drive

competitive advantage

ADAPT

EXPLORE

PIONEER

ADOPT

adopt cognitive solutions

only after they have been

proven to limit risk

acquire and integrate

available solutions to well

defined business challenges

develop and customize

cognitive solutions to

satisfy unique needs and

objectives

Cognitive

adoption

Investment

approach

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Cognitive transformation requires strong execution with data, apps and projects

Deliver actionable insights Drive program excellenceDelight in data complexity

Data Apps

Execute cognitive programs,

not projects

Prioritize business solutions,

not technology

Emphasize projects that

improve customer travel

Projects

Empower end users with

insights, not data

Leverage continuous

improvement for apps

Use cloud to innovate

around legacy systems

Partner to acquire and

improve data

Focus on improving context

around data

Standardize formats for

consumption of insights

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Questions

1. Does your enterprise have a comprehensive

cognitive program in place today?

2. When will your cognitive investment go beyond

the chat-bots and robots?

3. Are your cognitive investments more likely to

bring about a transformation in travel

personalization or operations?

4. How well is your company guiding the projects

that comprise its cognitive transformation

program?