Back to Air Transport IT Review - Issue 2, September 2009

Doing even more with technology: Simplifying the Business

Industry Insight: Simplifying the Business

The last time the airlines faced a major downturn was in 2002/03. It triggered a concerted effort to tackle a high industry cost base, giving rise to the Simplifying the Business (StB) programme. Five years on it is saving the industry US$4 billion a year by eliminating paper tickets and substituting check-in counters with common-use kiosks. So what's next?

Francesco Violante, Idris Jala, Tan Sri Bashir Ahmad Abdul Majid, Giovanni Bisignani

With the industry now in the midst of another severe downturn there is a greater need for technology to do even more. A second stage of IATA's Simplifying the Business has been launched with additional savings of US$10 billion per year identified.

Two of the original initiatives - 2D bar coded boarding passes and e-freight - are ongoing (see below). They have been joined by the Baggage Improvement Programme (BIP), which incorporates the RFID bag tag initiative, and Fast Travel, a series of four projects designed to expand self-service choices for a wider set of passengers.

Baggage improvement

Perception and reality can often be at odds: it really is unusual for bags to go missing. In fact, on average airlines lose just over one bag in a hundred. So they get it right nearly 99% of the time. Nevertheless, it is a US$3 billion dollar problem for the industry - each year, affecting the owners of 33 million bags.

> See the 2009 Baggage Report

The BIP aims to cut baggage mishandling in half by the end of 2012, by targeting the 200 worst airports around the world, which typically account for 85% of mishandled baggage.

To identify problem airports, IATA uses data extracted from SITA's mishandled baggage tracing database, WorldTracer, and its BagMessage system. Used globally across the industry, these are part of an integrated set of solutions that facilitate the tracking and tracing of baggage, from origin to destination.

Mishandling 'toolkit'

But there is no single solution to the issue, so IATA has developed a 'toolkit' that can address 90% of mishandling issues.

IATA has identified the most common issues causing mishandled baggage as:

Passengers using online services to buy separate tickets. This is a problem if there is no through check-in agreement between the different airlines
Customer service agents accepting bags with old bag tags still on them, causing confusion over the routing
Having no baggage transfer message agreements, which is still the case with some airlines. Such arrangements allow airlines to talk to each other when transferring baggage from one carrier to another

Once fully implemented, the initiative should save the industry US$1.9 billion every year.

Fast Travel

Fast Travel builds on the cornerstones of the original StB programme - e-ticketing, kiosks, and 2D BCBPs - to provide a more cohesive self-service experience within the airport environment. Made up of four projects - Bags ready-to-go, Document scanning, Self-boarding, and Bag recovery - the initiative will realize an additional US$1.6 billion a year in savings. At the same time, it will close-in on the vision of paperless travel.

Bags ready-to-go

Travelling with check-in baggage often involves joining the back of a long queue at the airport. That is changing. The Bags ready-to-go project brings the same self-services that have allowed light travellers to breeze through the airport to those who want to check-in luggage. That counts for most of us - around seven out of ten passengers check-in luggage.

The key is to make the bag drop process fast and efficient, and to avoid replacing the traditional check-in queue with a queue by another name. That means effective use of technology.

Two enhancements are in the pipeline.

First, Common Use Self-Service (CUSS) kiosks are now being deployed with 2D BCBP readers and bag tag printers. These enable passengers to use off-airport check-in, using the web or a mobile phone. Next, the passenger can scan their 2D BCBP at the nearest airport kiosk to print bag tags. Self-tagged bags can then be handed to an airline agent at the bag drop point. Research indicates that nearly 50% of airlines will offer this kiosk functionality by the end of 2010¹.

Second, common-use bag technology allows a single bag drop counter to service passengers from multiple airlines. This speeds up throughput and makes it easier for airports to locate the counter close to the kiosks.

That spells good news for passengers who can relinquish the burden of hold luggage faster. Tests carried out with Swissport on SITA's own PassengerBagdrop application indicate that the bag drop process can be completed in as little as 20 seconds for a passenger with one self-tagged bag, though 30 seconds is a more normal average, if the agent needs to do the tagging.

That makes the bag drop transaction rate up to 30% faster than using traditional counter check-in procedures.

Document scanning

In addition to printing bag tags for self-tagging, Fast Travel is promoting the adoption of document scanning capabilities at CUSS kiosks. This will speed up the provision of the Advanced Passenger Information (API) required to complete kiosk check-ins.

Up to now, those wanting to use kiosk check-in for international travel would often find they also needed to queue at a traditional counter desk to ensure their passport details were captured correctly for the API record. This severely diminishes the value provided by self-service kiosks.

By using the self-scanning capabilities of kiosks, international passengers can now scan their travel document to quickly and accurately populate the API fields required by the destination government. This can then be automatically combined with the details of the passenger's itinerary and completed with manually entered information using the kiosk touchscreen.

Adding a document scanning capability makes kiosks a much more valuable alternative to the traditional check-in desk for international passengers: not just in saved queuing time, but also by opening up other self-service options. For airlines, the benefit is higher kiosk usage, which brings both passenger processing cost savings and up-selling opportunities.

Self boarding

Another part of the journey through the airport due for a facelift is at the gate. Boarding today demands the processing of a mixture of boarding cards - magnetic strip, 1D bar codes, 2D bar codes, some printed on paper, others on mobile devices.

Boarding card reader technology at gates needs to be duplicated to handle the variants used by different airlines. This is both expensive and inefficient. The result is a slow, staff-intensive process, leading to long boarding times and frustration among passengers.

Change is on the way

By the end of 2010 the industry will use a single industry-wide 2D boarding pass standard, reducing the amount and complexity of equipment required at airport gates. Automated entry barriers opened by scanning valid 2D BCBPs - either on paper or a mobile phone - will allow passengers faster entry to the aircraft.

SITA has made its common-use gate infrastructure and equipment 2D compliant to read and validate each boarding pass in an automated manner. It provides an efficient way forward, with costs shared by the different users, making self-boarding a practical proposition for the wider industry and a smoother, quicker experience for passengers.

Bag recovery

A process as complex as baggage handling will never be 100% full-proof. Airlines recognize this, and they know that minimizing frustration when mishandling does happen can make a valuable difference to passengers.

One part of the answer is to speed up the process for passengers to file a mishandled baggage claim. Check-in kiosks have already shown that a well-designed kiosk interface can be much quicker and more convenient for passengers than dealing with a human.

The initiative, known as Bag recovery, allows passengers to use a kiosk placed in the baggage hall to scan their bag tags and enter contact details. Passengers are then able to immediately generate claims and continue their journey without the need to queue at a baggage service counter.

In parallel, the information is communicated automatically to SITA's WorldTracer application. It successfully matches 99.9% of all mishandled baggage logged from the more than 2,200 airport locations connected to the system. Most baggage is re-united with passengers within 48 hours.

A unique claims ID number enables passengers to stay informed of the status of their baggage, either through a dedicated website or a call centre.

Know-how and technology

Extracting the full benefits of Fast Travel will require the underlying technologies to be embedded efficiently into existing processes. SITA's know-how and technology connects the dots, helping passengers avoid wait times and airlines and airports improve their service levels and bottom line.

Web-to-mobile (W2M) technology enables passengers to check-in online and receive their 2D boarding passes by text or picture message to their mobile phones.

Self-service kiosks are being:

Configured to read 2D bar codes and print out baggage tags to enable self-tagging and speed up bag drop processing
Fitted with documents scanners to speed up collection of Advanced Passenger Information
And deployed with bag tag readers in arrival baggage halls to speed up logging of missing bag claims

Common use equipment at bag drops enables passengers from any airline to deposit hold luggage at a single airport location.

Gate readers that scan 2D bar codes, whether on paper or a mobile device, will activate access gates to allow self-boarding.

The result will drive higher usage of self-service infrastructure for airlines and airports, providing new opportunities to save costs and generate revenue streams. At the same time, passengers will experience more choice, control and convenience throughout their journey.

_{1. 2009 Airline IT Trends Survey conducted by Airline Business and SITA}

Facts about 2D Bar Coded Boarding Passes (BCBP)

2D BCBPs are fast becoming a central component of air travel from check-in to boarding.
Their ability to act as an electronic itinerary for each passenger makes them an invaluable tool for airlines to use technology rather than paper to correctly 'guide' passengers through each step of the journey.
That brings automation and efficiency savings. And it provides a platform to offer new passenger services, such as access to lounge areas.
Q3 2009 should also see the arrival of a 2D BCBP standard that includes a digital signature, allowing airport security officials to verify the authenticity of the boarding pass. Eventually that should trim queues at outbound border controls bringing further time savings to passengers.
IATA measures current BCBP usage at 59%. When full compliance of this StB initiative is completed at the end of 2010, savings for the industry should add up to around US$1.5 billion every year.

Facts about E-freight

IATA e-freight's mission 'to take the paper out of air cargo' is proving to be its most challenging.
Much of the supply chain is outside the airline industry's direct control. It means a complex group of stakeholders, including shippers, freight forwarders, and a multitude of government and inter-government agencies, needs to be engaged to make significant progress.
Inevitably, progress has been painstakingly slow, but not without successes. The original identified saving of US$1.2 billion has now been significantly upped to US$4.9 billion. At the same time, 13 of the possible 30 paper documents accompanying each shipment have now been replaced with electronic messages.
The electronic documents are a cheaper, more accurate and a more reliable form of communication that should cut shipment times by 24 hours. They also carry clear environmental benefits. IATA estimates e-freight can eliminate 7,800 tonnes of paper documents - 80 Boeing 747 freighters worth of paper documents - every year.
SITA subsidiary CHAMP Cargosystems is an e-freight strategic partner providing automated cargo solutions that eliminate paper.