IATA - Process Transformation Study
IATA commissioned Nyras to evaluate how new distribution capabilities (NDC), modern technology and retailing best practice could help the industry to continue advancing, free from the constraints of legacy processes and procedures.
The project was developed to address the major concern that many airline practices remain substantially driven by complex legacy fares and ticketing processes that were defined before the computing age. Their automation is criticised for mapping paper-based processes into an electronic format and therefore failing to simplify the business.
The most important objectives of the project were to:
- Identify key challenges facing the industry today, including the management of more complex products.
- Assess whether today’s processes are fit for purpose, what value they bring and to develop learning from other industries that have overcome similar issues.
- Analyse the extent to which the industry can transform the customer order processes.
To help ensure Nyras interviewed numerous executives from some of the world’s most progressive carriers around the world, gaining their insights on developments taking place in the industry and incorporating them into the IATA study.
IATA turned to Nyras because our experts bring capabilities from both legacy and low-cost airline backgrounds and have specific skills within technical, commercial, retailing, passenger service system and global distribution system functions. We also offer additional knowledge of business process improvement and have extensive experience of managing airline industry benchmarking for both airline sales and distribution processes. With this unique combination, we were perfectly positioned to deliver a balanced view and optimum solutions.
Following thorough analysis of market practices, we discovered that:
- PNR (Passenger Name Record) processing should be redesigned, order records consolidated and e-tickets and electronic miscellaneous documents (ET/EMDs)
- Order management processes should be remodelled as a single customer order to supplant the PNR transactions and accounting ET/EMD documents.
- Operational messaging and ancillary sales processing should be restructured for XML and the ET/EMD servers eliminated.
- Payment and remittance policies should be more flexible and reflect offer rules and airline preferences.
Our study proposed some very clear, attainable solutions that would drive simplification and enable the airlines to operate more efficiently within an increasingly digital market. The outcomes are very achievable with all the technologies proposed in place and backed by real-life case studies.
Our outline for future airline distribution includes a shopping process with real-time access to current prices in a PSS, XML messaging throughout the order to cash process, an elimination of e-tickets and EMDs in favour of a single customer order with a simple booking process for flights and ancillaries that retains the status and stored value of entitlements. All products will be described by airlines in an industry taxonomy using their own unique product codes that can be exposed and stored on the internet and decoded by standard software and readers.
IATA have committed to facilitate industry evolution towards this concept by encouraging an industry-wide change in mindset regarding systems and business processes.