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IT formula to relieve Aero loss
By siliconindia
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Tuesday, 15 July 2008, 16:36 IST
Mumbai: The air transport technology firm SITA,a specialist in air transport communications and IT solutions, and other software firms like Kale Consultants, have suggested proper use of technology to cut on costs of airlines.SITA has recommended mobile phones to be used as tracking devices, to cut down on costs, relating to flight delays, which amounts to $600 milion collectively.
The various software firms like Kale Consultants have offered solutions through technology, helping the ailing aero industry to cut on 30 percent of their revenue accounting costs. The fixed 80 percent operational costs are making them seek other methods to relieve themselves from the burden. Kale Software is an independent software company, established in 1994. The company is specifically focused on official software services in public sector such as development, application and maintenance of large scale application software systems. "We are willing to experiment with IT (information technology) if it helps us," said Partha Sarathi Basu, chief financial officer of low-fare carrier SpiceJet, to Livemint, The Wall Street Journal. "IT is the backbone of any airline, and can help minimize costs to a decent level," he added. SpiceJet is in the lookout for cargo management software, as they have already made use of software to arrest credit-card fraud and cutting down on staffing. The software formula has been of great help to even others like the British Midland Airways, who have managed to cut down on revenue accounting cost to 30 percent, through outsourcing to Kale. Thus, it leads to the saving of personnel cost to a great extent.
The loss incurred by the airlines has made everyone in the line to seek this cost-effective, convinient method; with $85 being the estimated fuel cost per passenger carried, while average yield per passenger is only $150.
"According to our old revenue accounting system, we had to have at least 150 people to manage our airline�s revenue management system and revenue leakage monitoring. Now we save all that personnel cost by outsourcing,� said Palmer,the Chief Financial Officer of British Midland Airways who was in India to meet Kale executives. Moreover, airlines have also resorted to e-ticketing from those booklet sized tickets, which alone can save around $3 billion.
The mobile technology have surely been of great importance as signalled by SITA as it can be used for various processings like to hold boarding passes, baggage tracking information and even payment data. "These'digital travellers'", referring to the common travellers, "will have on-demand access to a range of mobile-enabled services such as real-time flight updates, self-service booking, check-in and boarding, as well as mobile payments," said Jim Peters, Chief Technology Officer at SITA.
