Common IT Platform Delivers Star Performance

28 February 2006 (Last Updated February 28th, 2006 18:30)

The implementation of a common IT platform can dramatically improve airlines' competitiveness. Aman Khan and Lee Hock Lye of Star Alliance explain the benefits of working together in a strategic alliance.

Common IT Platform Delivers Star Performance

For an airline, it is just as important to have robust computer systems as it is to have a modern fleet – and it is equally important for the airline's passengers. Creating flight schedules, providing fare information, making reservations, electronic ticketing, check-in, changing a booking or giving credit for frequent flyer miles would all be impossible without sophisticated IT systems.

SEEKING HARMONY

"Developing and operating a common IT platform for an alliance that spans the globe is a mammoth task."

Today, most airlines have their own IT systems that are unique to them, even though the tasks they perform are broadly similar. However, when they act in concert – in an alliance, for example – the use of different hardware and software by the individual member airlines of an alliance poses major problems, making it time-consuming, expensive and complex for them to achieve their shared goals.

Experts representing Star Alliance members carried out a feasibility study to examine the possibility of harmonising the different IT infrastructures of the member airlines. "It started as a technology refresh project, but people quickly realised it was a great business enabler," is how Aman Khan, vice-president IT of Star Alliance describes the feasibility study.

The study results indicated that, by implementing a common IT platform, Star Alliance could reduce its costs, improve its products and dramatically improve time to market for joint IT projects, enabling it to offer its customers a better service and travel experience than its competitors.

COMMON IT PLATFORM

Expressed in simple terms, the common IT platform consists of three elements: the central hardware, the software for the various applications and – critically – the common database that is accessed in real time by all members of the common IT platform. The common IT platform extends across a total of nine areas, enabling seamless service across the service chain, especially in the areas of:

  • Reservations
  • Ticketing (electronic or paper)
  • Fares and pricing
  • Airport services
  • Schedules and availability
  • Codesharing
  • Inventory

The common IT platform utilises proven elements such as the transaction processing facility, a high-performance real-time operating system that is almost standard for aviation applications requiring high data throughput and availability coupled with state-of-the-art, Unix-based solutions for applications such as departure control, inventory and ticketing. Sophisticated middleware ensures smooth communication between airports, call centres and ticket offices.

NEW LEVEL OF CUSTOMER SERVICE

Compared with the legacy systems used by many airlines today, the common IT platform architecture is less complex and more flexible, and it is easier to integrate new services. In addition, it will allow Star Alliance members to simplify their business processes more quickly and at much lower cost.

"Today, most airlines have their own IT systems that are unique to them."

Individual passengers will quickly discover the benefits of this technological innovation, and all Star Alliance members that use the common IT platform will have access to more customer information than they have today. This means that their staff always know the identity of the customers they are dealing with, they will know how important these customers are to the other alliance members and what their preferences and special wishes are, and they will be able to provide passengers with a personal service that up to now has only been possible for their frequent flyers.

"We are taking customer service to a whole new level, because we always show the same face to the customer," says Lee Hock Lye, vice-president products and services at Star Alliance. "The Star Alliance travel experience will be even more seamless, making it harder for other alliances to offer their passengers a similar level of service."

COMPETITIVE EDGE

This competitive edge is likely to become even greater in the future. With the common IT platform, it will be easier, faster and cheaper to develop new services than has been the case up to now. Instead, of many different business processes and IT environments, there will now be just the one.

All users of the common IT platform will have the same starting point for discussing the process and their requirements. There will be a common IT development process on one system. Eventually this will enable all Star Alliance carriers to offer a seamless and consistent service to customers.

"Individual passengers will quickly discover the benefits of this technological innovation."

The common IT platform will not only reduce ongoing IT costs, it will also lead to a significant revenue advantage through channel shift. The common IT platform allows travel agencies and corporate customers direct access to airline inventory, bypassing traditional global distribution systems (GDS).

Horst Findeisen, vice-president commercial at Star Alliance, says that common IT platform carriers could "save at least 70% of today's GDS fees" paid via the traditional GDS distribution channel.

CAREFUL SELECTION PROCESS

Developing and operating a common IT platform for an alliance that spans the globe is a mammoth task. Star Alliance member airlines carry more than 380 million passengers per year, operating 15,000 flights per day to 795 airports in 139 countries, so great care had to be taken in the IT selection process.

Requests for information were sent out to nine well-known providers. On the basis of their replies, four companies were asked to submit detailed proposals. After an in-depth evaluation of these proposals and several weeks on site to perform detailed "scoping", a system from Amadeus was finally selected. "It was a tough choice," explains Aman Khan, "but Amadeus was able to offer us excellent technology and extensive experience in serving the travel industry."

During the partner selection process, a team analysed the business case for the common IT platform to establish the likely impact of the implementation of the platform on IT and distribution costs, and on service improvements.

Another team developed the future governance model of the common IT platform, and yet another focused on implementation planning and on how alliance carriers could migrate from their legacy systems to the common IT platform.

COMPLETE FLEXIBILITY

The framework agreement that Star Alliance has negotiated ensures that all its members enjoy the same attractive terms coupled with maximum flexibility. Especially for smaller airlines within the alliance, it is important that, instead of being forced to accept the entire package, they should be able to put together from individual elements the solution that best satisfies their requirements.

"This solution is far superior to anything else in the airline industry and gives a strategic advantage."

The process by which the participating Star Alliance members migrate to the common IT platform will be a gradual one. Lufthansa will lead the way with a gradual migration beginning in 2006 that will be completed by the end of 2008, with United set to follow suit. Other members of the Star Alliance are already negotiating with Amadeus.

In view of the enormous benefits to the airlines and their customers of a common IT platform, Aman Khan, is certain that in a few years' time the overwhelming majority of Star Alliance passenger traffic will be processed via such a platform: "This solution is far superior to anything else in the industry and gives us a strategic advantage.