Saudi Arabian Airlines vice president of information technology, Muhammed Ali Albakri, profiles the carrier’s 2007-2011 IT masterplan, valued at 2.5 billion Saudi riyals.
When did Saudi Arabian Airlines launch its five-year IT masterplan?
The masterplan was initially prepared in 2006, with execution commencing the following year. Before this period, the airline suffered from a major lack of technology investment and for several years the infrastructure and applications were not upgraded. It was difficult to serve passengers in a timely or efficient manner due to outdated legacy systems, so technology investment was essential to address these issues, become more efficient, and compete better on both a regional and international basis. Aside from that, the masterplan was launched as a support vehicle for the airline’s privatisation programme, which started 15 years ago and was progressing at a slow pace, so we needed to assist in expediting that process.
What aspects were involved as part of this technology overhaul? First, we upgraded our legacy networks infrastructure on a domestic and international level, while also upgrading the airline’s main data centre. Second, all legacy application systems were replaced. Third, the IT division was reorganised and transformed into a shared services provider for the holding company and all subsidiaries, including the airline and sister entities such as cargo and ground services. And finally, a new governance model was introduced to streamline the IT division’s relationship with Saudia’s different business units.
How has the initiative progressed over the years? We’ve just concluded the timeframe of this masterplan, which was 2007-2011, with around 98 percent of the outline now completed. This is a major achievement considering the investment of 2.5 billion Saudi riyals, marking the largest ever airline technology investment. Of course, there have been changes in the aviation industry since the initiative was launched, with emerging business demands, and some adjustments were needed. Therefore, certain aspects are being extended into 2012. The next stage is opening these services to external companies, such as other airlines and tourism firms on a commercial basis.
How successful has the project been for Saudi Arabian Airlines? It’s been a huge success and the results have started to show. With our ecommerce capabilities, build on the Amadeus reservation platform, almost 1 billion Saudi riyals worth of tickets were sold in 2011 through improved direct channels, such as the internet. Eventually we target 100% of domestic flights to be booked through direct channels, as this improves seat inventory and lowers operating costs, while offering passengers the ease of self-service. We also implemented the SAP Enterprise Resource Planning (ERP) platform to streamline our back-office processes across the group and provide support/integration to front-line solutions such as Amadeus for passenger services and the Sabre platform for airline operations. We then built a unique fuel management system, enabling us to reduce fuel-related operating costs.
Will this masterplan also assist the airline’s membership of SkyTeam? Yes. Saudia has wanted to join a global airline alliance for some time, but this would not have been possible without a major investment in technology. We needed a fully-integrated system with other alliance members in terms of reservations, ticketing, departure control and frequent flyer. Now, however, that process will be much easier than ever before and we have signed an agreement to become SkyTeam’s first Middle East member, starting in June 2012.
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