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Lufthansa Systems implements RFID technology to track and trace aircraft parts
Logistics processes in the field of maintenance, repair and overhaul (MRO) are extremely complex and time critical. Radio frequency identification (RFID) technology can simplify these processes, improve documentation and ultimately lower costs. With its extensive MRO process expertise and technological competence, Lufthansa Systems helps airlines and MRO service providers implement RFID technology. The IT service provider recently introduced RFID for Lufthansa Technik Logistik (LTL), which is using the technology to identify aircraft parts.
During the MRO process, aircraft parts — everything from the landing gear and avionics devices to the emergency equipment — pass through various stations. Up until now, paper versions of all the necessary documentation (such as certificates, repair orders and maintenance charts) have accompanied these parts on their way to the workshop and back to the plane. But it is difficult to avoid errors when processing so much information, and the associated logistics processes (such as those for incoming parts) require a great deal of manual effort.
This is where RFID technology can help. Using small transponders (RFID tags), the information contained in the paper documents can one day be stored on the aircraft parts themselves and then read by special handheld reading devices or gates and transmitted directly to the data processing system. The entire route of every part is fully documented and each employee involved in the process can now see every important item of information relating to the part. RFID technology prevents manual input errors and improves data quality. Furthermore, by automating logistics processes and providing prompt electronic access to data, RFID considerably shortens the turnaround time for parts sent to the workshop. At the current stage of development, the tag is stored on a document attached to the spare part. The tag contains a reference number which refers to the comprehensive data stored in the backend data base. The final stage with a fully-integrated ("permanent") tag that is affixed to the spare part and contains all information in itself is planned for around 2010.
Lufthansa Systems has already successfully introduced RFID technology for Lufthansa Technik Logistik. The IT service provider supported its customer through each phase of implementation, from development to the roll-out and operation of the systems. Prior to implementation, Lufthansa Systems helped LTL evaluate the technology, redesign its processes and develop a suitable IT architecture. During the roll-out, Lufthansa Systems integrated the IT architecture into the back-end systems and was responsible for procuring, configuring and installing the RFID end devices.
New forecasting module from Lufthansa Systems
More reliable passenger planning for better revenue management.
In commercial environments sometimes the prediction of the seemingly unpredictable is of major importance for a company’s success. This is certainly true for airlines looking to adjust seating capacity to the number of passenger bookings in order to optimize the overall revenue of a flight. The question here is: how many people will board a given flight in a couple of weeks’ time, and how much are they willing to pay? The profitability of an airline’s operation is directly impacted by such forecasts.
The ProfitLine/Yield O&D Forecaster developed by Lufthansa Systems has been setting new standards in this field. Going one step further, the company developed the ProfitLine/Yield O&D Market-sensitive Forecast Module, a brand-new component that significantly enhances the O&D Forecaster. It combines product- and price-related forecasting methods. This approach addresses the fact that both quality-oriented and price-conscious passengers book flights with network airlines. The former group of passengers places priority on product quality, which includes aspects such as departure time, connection times, service and comfort. The latter group makes booking decisions based primarily on the ticket price and how it compares to the prices offered by competitors.
Both price- and product-oriented forecasts are based on so-called price elasticity models, which make it possible to predict how many passengers would accept any given price for a flight. All other factors influencing the customer’s decision are taken into account as well, such as total travel time, number of stops, connecting times, alternative routes and minimum stays. Airline professionals talk about the so-called sell-up potential and buy-down effects which arise from customer behavior. Selling-up refers to the fact that customers will buy a higher-value product at a higher price if the more attractively-priced product they originally wanted is no longer available and there are no cheaper options. Buying-down occurs when the customer chooses a lower-value option than expected when purchasing a ticket. This is the case when a business class customer buys an economy class ticket, for example, or when a vacationer accepts restrictions, such as a non-refundable ticket, in order to take advantage of a cheaper offer.
The Market-sensitive Forecast module has another important feature as well: it lets airlines define their main competitor for every combination of origin & destination traffic and route planning. If an airline can determine its competitor’s market prices - using automated web searches, for instance - it can use this data to improve its own forecasts.
Such a detailed analysis offers obvious advantages for airlines. It gives them exact forecasts not only for their traditional products, but also for low-fare offers, enabling them to precisely predict passenger demand in their network. The developing team has been working to implement the new forecaster for launching customer Lufthansa since February 2008.
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