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Blog

Airlines can achieve better customer-centricity with order management retailing transformation

October 11, 2021

Last updated: January 10, 2022

3 min read

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Laurent Chauvin

Head of Strategy, Transversal Services, Research, & Innovation, Amadeus

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The paper explains why this significant area of airline business needs an overhaul and how transitioning to an order-first world can contribute to increased revenues, a more efficient back-office, and a better traveler experience.

Amadeus is launching its latest white paper about the order management transformation: Future-proofing the move to order management for airlines .

The retailing transformation of the airline industry is underway, driven by the industry's commitment to standardization through NDC. But for the retailing transformation to positively impact business models, operating processes, and brand positioning, airlines need to start thinking about, if not acting upon, the next phase: order management transformation.

Travel is restarting. Airlines are looking for a way to reduce operating costs and improve business efficiency while solidifying current revenue streams and finding new ones. These objectives are being achieved by hyper-optimizing existing processes and through theninitial benefits of NDC , such as new differentiated product bundles and price points, based on richer contextual information about the traveler.

One thing the industry needs is simplicity, and the NDC standard is a start. But many airline processes are still based on the standards which shaped the classic passenger service and departure control systems, and there is an inbuilt complexity in place as airlines and experts have found workarounds so that the classic systems can serve the needs of today's travelers.

But what if the systems don’t need the workarounds?With its ONE Order initiative, IATA wants to simplify the industry and this move is an integral part of the NDC journey. The organization has been crystal clear in the messaging: ONE Order will result in the gradual disappearance of multiple reservation records, as well as e-ticket/EMD concepts. It will be replaced by a single reference order which will become the single access point for customer orders by third parties such as interline partners, distribution channels, ground handling agents and airport staff, among others.

An order management system, which does away with multiple documents to create a single record, will support airlines' cost efficiencies and revenue-increasing strategies. For the former many time-consuming, manual, non-value-adding processes will be removed; for the latter existing partnerships will be easier to manage and new ones easier to onboard.

Travelers will also benefit from the industry's shift towards a single record, which will support a better end-to-end experience. Customer-centricity is something the industry talks a lot about, and order transformation can make that happen.

Any future airline-native order management system will need to be compliant not only with all relevant, existing IATA standards but also developed to accommodate future standards, including ONE Order. And the system must be able to connect to and integrate with all and any airline system and with other travel suppliers and partners outside the industry. Interoperable, agnostic, and modular systems are needed to nurture potential collaborations and partnerships.

Transitioning from the classic and familiar systems to the retail-oriented next generation is a sophisticated process, and specific airline expertise is needed. This expertise needs to cover the tech specifics of managing a transition and delivering business value. Airlines will decide on their transformation and transition timelines and need an IT partner which will allow them to execute on their path, in their own time, and in synch with their overall business aims.

Future-proofing the move to order management for airlines is a comprehensive deep dive into the theory and practice of order management transformation.

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