Use the power of digital and win

On a recent Wednesday, I board a flight and call my rental car company to book a vehicle. I land at the major airport where my reservation was confirmed but encounter one small detail: all the cars had been rented. The manager apologizes, smiles and hands me a coupon for a free day. When changing cities in midweek and trying to be productive, it is pointless for me to argue that I have a reservation. Instead, I find the supervisor and start chatting about whether IBM could help the company fix its planning and scheduling system challenges. Before long, my car arrives and I dial into my next work call.

Photo by Bambi Corro on Unsplash

You don’t automatically change business models just by going digital. What brings the competitive advantage is how digital capabilities can enable disruptive new business models. The transformation of planning and scheduling processes with the implementation of state-of-the-art digital technology can probably make a rental car agency more efficient and productive — and even reduce “sold out” situations for those with confirmed reservations. But is that a true disruption? Is that really going to save it from tomorrow’s new business models?

Be customer-centric first

Consider frequent business travelers who make up most of the rental car segment at major airports. Most of us update last-minute travel plans but still expect the best cars available at the cheapest rate. We want the most flexibility in terms of approved car type, pick-up time and drop-off location. At many airports, a shuttle takes us to the lot to pick up the car. This can easily add 30 minutes to getting the product (a car) to the customer (me).

Disrupt by going digital

Now imagine if we devise a digital technology that allows me to book my rental car in real-time as soon as I touch ground. This gives me not just real-time inventory but also how long it will take me to get into the car, depending on its location. So as soon as I land, I see all options for rentals. I could book a car that will be delivered by a driver to the arrival gate as soon as I walk out. This gives me solid availability, flexibility and time savings. Once driver-less cars overtake the road, I can visualize an even smoother ride as soon as I leave the terminal.

Let’s take it a step further. Imagine a digital technology company that does not even invest in fixed assets but has solid algorithms and subcontracts at all the premier rental car companies. As a consumer, I have a variety of vendors at a click of a button.

Talking digital versus doing digital

In simple terms, we see either an existing company with the right culture tackle this challenge, or we see another start-up create an idea and diligently launch it to disrupt the industry.

It takes hard work on all fronts for any company to accomplish an innovative model, because it is not just about building algorithms to pull the insights and show real-time inventory. Robust and security-rich architecture supported by a solid cloud strategy are the way to go. Structured and unstructured data is needed — not only about cars but also about flight delays, weather patterns and relevant tweets. All that data needs to be organized. Companies need to take methodical steps to define and establish a cloud, data and AI platform strategy and road map.

Whether for rental car companies or retailers, this exciting era is led by technology. You need strong and visionary leaders who know where to focus. You need leaders who are bold enough to disrupt your industry and find new revenue-generating avenues. Then your customers really can win by being digital.


Kedar Mahadeshwar

About the Author: Kedar Mahadeshwar is Vice President & Partner, IBM GBS. He enjoys his learning journey while transforming businesses globally for Fortune 50 customers in Distribution and Consumer products markets by using digital and AI technologies.


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