The Missing Puzzle Piece
Real-time cost data across commercial planning increases profitability!
The number of challenges airlines face is at an all-time high. Therefore, structure and speed are key. Streamlined and well-integrated automated backoffice processes, as well as getting new insights by connecting the right data quickly enough, lead to greater visibility and accelerated decision-making. This is the formula to stay ahead of the competition.
Customer expectations are rising constantly, and shopping behavior is becoming more complex. This could explain why many airlines tend to concentrate heavily on improving customer-facing applications while other areas may be lagging. However, when it comes to the airline industry, balance across the entire enterprise is vital.
Airlines must focus on customers, technology and innovation simultaneously to make strategic commercial decisions that satisfy the needs of an airline and its customers. However, a growing amount of data and lack of access to the right information at the right time has led to slow processes and an unclear understanding of an airline’s position.
Even worse, siloed information across airline databases prevents the use of an integrated system with visibility into real-time data for precise decision-making. Therefore, airlines need consistent data flow with real-time, accurate information.
Given the right tools and processes, airlines can break down silos in cost management and commercial planning. It starts with managing all direct operating costs such as fuel, handling, airport, passenger taxes, navigation, catering and crew travel … in a single solution.
Sabre AirVision Airpas: Integrated Direct-Operating Cost Management
There are four pillars of integrated direct-operating cost management, including seamless integration across all direct-operating costs; a reduction of overspending emanating from invoice errors; automated financial processes; and advanced decision-support and accelerated route profitability.
Sabre AirVision Airpas, the leading solution in route profitability and cost-management technology for the commercial-airline industry, integrates operational and contractual data. Bringing both together results in immediate access to accurate cost data following a flight event.
The solution enables airlines to:
- Increase transparency by centralizing costs and contract management across all direct operating costs;
- Significantly reduce the threat of overspending by checking invoices more effectively, which can save up to 2 percent of direct operating costs per year;
- Automate invoice checking by processing electronic invoices using industry-standard formats, such as IATA’s IS-XML;
- Speed up month-end closure and financial-planning processes, such as budgeting and forecasting;
- Accelerate route-profitability response times, making them available shortly after the flight event;
- Reach a much higher level of automated financial processes, saving time and resources by up to 35 percent;
- Gain powerful business intelligence and central visibility for all parties and departments involved.
Airpas sits in the heart of an airline’s application landscape, representing the missing puzzle piece that ensures data consistency across the entire airline. Enterprise-source-planning, accounting, workflow-management, flight-scheduling/operations and digital archives systems, as well as corporate data warehouses, are all linked by providing and receiving data.
IATA, as well as more and more airlines, are driving initiatives that help establish what is called a “High Performance Finance Organization.” As such, chief financial officers, finance directors and heads of controlling clearly see a strong need and urgency to transform the finance department from an accounting department to a value manager. This will eliminate redundant, manual tasks; improve employee productivity; empower staff by using the time saved to run deeper analyses from new angles; and create broader management information. Airpas provides all the tools to facilitate this change and run optimized finance processes successfully.
In addition fuel managers, ground operations managers, airport managers and procurement leaders will undoubtedly benefit from seeing their key performance indicators (KPIs), both operational and cost related, reported given the access they will have to historic data and being able to compare KPIs on granular or aggregated level.
With all this being said, how can this central cost database and expertise now be leveraged across commercial planning to create the most value for airlines? There are numerous possible integration opportunities.
For example, planning and scheduling solutions are heavily dependent on relevant, accurate, up-to-date cost data. Without a structured approach, airlines might run their planning processes on out-dated, incomplete cost data, leading to inaccurate conclusions and decisions. Moreover, it can be difficult and cumbersome to regularly receive data from the finance department due to confidentiality concerns.
Airpas, which links solutions between these areas, could easily solve this problem with six key capabilities including:
- Access control — Compliance with confidentiality and data granularity levels required by finance;
- User interface — Targets non-finance users supporting planning and scheduling business flows;
- Dynamic loading — Automated transfer of selected data;
- Data management — Data extrapolation for different periods, aircraft types and airports;
- Integration — Population of solution-specific cost drivers;
- Reporting — User-defined reporting with varying levels of granularity.
The outcome of this approach could result in optimized profitability forecasting based on more accurate cost data, with a potential increase of several million dollars a year. In addition, it would enable airlines to make smarter, faster decisions by understanding the true cost implications of choices. Moreover, it would increase visibility, alignment and confidence with a unified view of data across all departments.
In addition, an airline could achieve optimal flight profitability by linking Airpas with Sabre Revenue Optimizer to access profitability information on the flight-leg level immediately following a flight.
These, and numerous other examples of how Airpas can integrate an airline’s commercial-planning solutions and processes, are currently in the concept stage.
Continuous improvements across the entire commercial-planning process helps enable airlines to achieve enterprise-wide objects and revenue maximization. An end-to-end commercial-planning suite aggregates disparate data from multiple sources to remove business-process limitations and enable faster, smarter and optimal decision-making that capitalizes on simple technology, solving large, complex airline-industry problems.