Friday June 21, 2024

PIA shifting from one service system to another

By Kiran Butt & Moayyed Jafri
September 02, 2018

LAHORE: Pakistan International Airlines (PIA) will have a new Passenger Service System by September 5, a Turkish web-based product by the title of HITIT. The management has entered into a new partnership with a computer services giant and solution provider HITIT after a competitive bidding process.

While the pretext for this decision is explained to be financial and operational, experts believe that this shift is also a significant move in the geo-strategic paradigm.

According to the sources, the current agreement with SABRE, an American product is expiring on Sep 18, 2018, after almost two decades and the management decided to select a new system through the PPRA Rules. However, the Global Distribution System’s (GDS) agreement is still going on with the SABRE.

Because PIA would have risked making its agents unhappy had it chosen to opt out GDS that abruptly. The GDS offers extra monetary benefits to sales agents which had more or less created a lobby amongst agents in favour of GDS. In order to avoid a backlash from its sales agents PIA as for the time being continued with GDS however, it plans to opt out of it eventually, sources told.

The PIA entered into an agreement with SABRE with a vision of expanding its flight operation as the system was designed for such use. However, the national carrier could not materialize its policy of expanding its flight operation which resulted in SABRE becoming more and more expensive for the corporation for its contracting flight operations.

In addition to this, the PIA purchased additional components of SABRE for financial and inventory management like AIRMAX. However, did not use those components due to lack of capacity. Meanwhile, continued paying for these components.

Some major flaws of the SABRE were: there was no audit trail after 72 hours of the activity and if someone had reset their password after the activity, it could not be traced. Some of the employees were misusing it and the authority could not have done anything. The ancillary sale was also not available in the system.

Around the world, direct and indirect sale of ticketing has the ratio of 50 percent each. But in Pakistan due to the monopoly of travel agents the sale of direct ticketing is just 2 percent. With this web based new system, people will be able to book tickets by themselves and will get all the options on the website.

If the PIA has continued this agreement with SABRE, it would have been cost the legacy carrier 50 million dollars in the next five years. On the other hand, the HITIT is costing half of the amount. With this change, the PIA will save up to 5 million dollars annually.

The new project is expected to be completed by end of this year. There are some conditions binding on both parties as per disclosure laws protecting the rights of companies.

The change will bring new Core Reservation System, Departure Control System, Frequent Flyer Program, Internet Booking Engine, Mobile Apps, Revenue Management, Schedule Management, Revenue Integrity, and Disruption Management.

While HITIT appears to be a more viable solution for PIA as compare to SABRE, it too has certain operational compatibility issues. Point to point flight operation is not considered HITIT’s prime forte, however, PIA officials argue that the vendor will provide a customized solution in this regard. The effectiveness and success of that solution would only be measured over time. Another factor is that HITIT requires extensive hardware up gradation which PIA officials claim had already been achieved. When contacted, PIA Spokesperson Mashhood Tajwar said that the organisation was moving towards betterment and improvement in its passenger management system keeping in view the best operational and financial interests of the national carrier. He, however, did not confirm the date of implementation being the first week of September as such.